TIDMXTR
RNS Number : 2677H
Xtract Resources plc
23 November 2022
For immediate release
23 November 2022
Xtract Resources Plc
("Xtract" or the "Company")
Racecourse Prospect Updated Mineral Resource Estimate
The Board of Xtract Resources Plc ("Xtract" or the "Company") is
pleased to announce an updated Mineral Resource Estimate for the
Racecourse Prospect, on the Bushranger Copper-Gold Project in
central New South Wales, Australia. Utilising all the data from the
recently completed Phase 2 diamond drilling programme, independent
consultants, Measured Group Pty Limited ("Measured Group"), have
prepared an updated Mineral Resource Estimate for the Racecourse
deposit.
Highlights
-- Following the completion of a substantial drilling programme
by Xtract, independent consultants, Measured Group, updated the
historic Inferred Mineral Resource Estimate for the Racecourse
Prospect, which is now reported as 512Mt @ 0.22% CuEq*, at a
cut-off of 0.1% CuEq, containing 1.1Mt of copper equivalent metal
and classified as Indicated and Inferred in accordance with JORC
(2012)
-- The Racecourse Mineral Resource contains 50Mt @ 0.25% CuEq
which has been classified as Indicated in accordance with JORC
(2012)
-- A higher-grade core of the Racecourse mineralisation extends
from near surface to relatively shallow depths and contains 191Mt @
0.33% CuEq, reported at a cut-off of 0.2% CuEq
-- The majority of the updated 512Mt Racecourse Mineral Resource
is expected to occur within depths amenable to open pit mining
methods, given an open pit mining study completed by independent
consultants Optimal Mining in July 2021 concluded that the
Racecourse copper-gold mineralisation could potentially be
economically extracted via open pit mining to a depth of 600m (see
RNS dated 26 July 2021)
-- The Measured Group report also concluded that, as the
mineralisation increases in grade and width down plunge, the area
north and down plunge of the currently defined mineralisation is a
clear exploration target and represents an opportunity to
significantly increase tonnage
-- Xtract is now proceeding with defining a maiden Mineral
Resource Estimate for the Ascot Prospect, located to the south of
the Racecourse prospect, which is expected to add to the overall
mineral inventory on the Bushranger Project
-- Following completion of the Ascot Prospect Mineral Resource,
the open pit mining study for the Bushranger Project will be
updated to determine the economics of a 25Mtpa open pit mining
operation, utilising the Mineral Resources at both the Racecourse
and Ascot prospects
*CuEq % = (Cu%) + (Au g/t * 0.6577) + (Ag g/t * 0.008769)
Cu Price = US$8800/t, Au Price = US$1800/Oz, Ag Price =
US$24/Oz
Colin Bird, Executive Chairman said: "With over a million tonnes
of contained copper equivalent metal, the Racecourse Mineral
Resource represents a substantial undeveloped copper-gold porphyry
deposit within the Lachlan Fold Belt in central New South Wales and
on a grade basis is equivalent to Alkane's recently announced Boda
Mineral Resource. A positive for Racecourse is that the
highest-grade part of the deposit extends from the surface to
relatively shallow depth. Also, we know from the open pit study
completed in July 2021, that open pit mining could potentially be
profitably undertaken to a depth of 600m. If an updated open pit
mining study indicates similar depths are mineable, this means that
the majority of the updated Racecourse Mineral Resource could
potentially be mined and we can maximise the early cash flows by
mining the higher grade 191Mt core to the deposit at rates up to
25Mpta. Now that the updated Racecourse Mineral Resource estimate
has been completed, we are working on the maiden Mineral Resource
for the Ascot Prospect, which we expect will significantly increase
the overall mineral inventory on the Bushranger Project. Once, the
maiden Mineral Resource has been defined for Ascot, we will update
the open pit mining study, which will detail the economics of a
25Mtpa mining operation, based upon extracting both the Racecourse
and Ascot Mineral Resources. We expect that the open pit mining
study will be completed early in 2023."
Racecourse Prospect Updated Mineral Resource Outline
http://www.rns-pdf.londonstockexchange.com/rns/2677H_1-2022-11-22.pdf
Representative Geological Cross Section Through the Racecourse
Prospect (No. 1)
http://www.rns-pdf.londonstockexchange.com/rns/2677H_2-2022-11-22.pdf
Representative Geological Cross Section Through the Racecourse
Prospect (No. 2)
http://www.rns-pdf.londonstockexchange.com/rns/2677H_3-2022-11-22.pdf
Representative Geological Long Section Through the Racecourse
Prospect
http://www.rns-pdf.londonstockexchange.com/rns/2677H_4-2022-11-22.pdf
Racecourse Prospect Updated Mineral Resource Estimate
From July 2021 until July 2022, Xtract completed a Phase 2
diamond drilling programme at the Racecourse and Ascot prospects on
the Bushranger Project in central New South Wales, Australia. A
total of 49 drill holes were completed for 32,695m of drilling. The
objectives of the Phase 2 diamond drilling programme were as
follows:
1. Extend to the northwest and southeast of the 2018 initial
Racecourse Inferred Mineral Resource of 71Mt @ 0.44% Cu and
0.064g/t Au, at a 0.3% Cu cut-off (see RNS dated 27 October
2020)
2. Test a series of IP resistivity anomalies to determine if the
resistivity anomalies relate to areas of increased intensity of
copper mineralisation at the top of the Racecourse porphyry
intrusion
3. Test the continuity of copper mineralisation on the eastern
side of the Central Porphyry Intrusion at the Racecourse
prospect
4. Determine the extent and grade of the newly discovered copper
mineralisation at the Ascot Prospect
Following the completion of the Phase 2 drilling programme on
the Bushranger Project, a new 3-dimensional geological model was
defined for the Racecourse Prospect. Geochemical assay data from
the historical drilling, Phase 1 and Phase 2 Xtract drilling
programmes, along with the new Racecourse Prospect geological
model, were used to prepare an updated Mineral Resource estimate
for the Racecourse Prospect.
The updated Mineral Resource estimate, which has been prepared
at different cut-off grades by independent consultants, Measured
Group, based in Brisbane, Australia, is set out in Tables 1 and 2
below and is prepared in accordance with JORC (2012) and in
compliance with Appendix 3 of the AIM Note for Mining and Oil &
Gas Companies - June 2009.
Measured Group have reported a Mineral Resource estimate of
512Mt @ 0.22% CuEq, reported at a cut-off of 0.1% CuEq and
classified as Indicated and Inferred in accordance with JORC
(2012). Within the overall Racecourse Mineral Resource, 50Mt @
0.25% CuEq has been classified as Indicated and 462Mt @ 0.21% CuEq
is classified as Inferred in accordance with JORC (2012).
Table 1 - Racecourse Prospect Mineral Resource Estimate
Average Values Contained Metal
-------- ------------------------------ -----------------------------------------------
Resource Mass Cu Au Ag CuEq Au CuEq
Classification (kt) (%) (g/t) (g/t) (%) Cu (tonnes) (t.oz) Ag (t.oz) (tonnes)
----------------- -------- ----- ------- ------- ----- ------------ -------- ----------- ----------
Indicated 50,150 0.22 0.04 0.87 0.25 108,700 59,600 1,397,500 124,500
----------------- -------- ----- ------- ------- ----- ------------ -------- ----------- ----------
Inferred 461,950 0.17 0.05 0.71 0.21 797,300 757,200 10,566,500 980,100
----------------- -------- ----- ------- ------- ----- ------------ -------- ----------- ----------
Total 512,100 0.18 0.05 0.73 0.22 906,000 816,800 11,964,000 1,104,600
----------------- -------- ----- ------- ------- ----- ------------ -------- ----------- ----------
Notes:
1. Xtract owns 100 per cent. of ProspectOre Ltd, the operator of
the Bushranger Project and gross and net attributable resources are
therefore the same.
2. Mineral Resources are reported in accordance with JORC
guidelines. Mineral Resources are not Mineral Reserves and do not
have demonstrated economic viability.
3. All figures are rounded to reflect appropriate levels of confidence.
4. Apparent differences in totals may occur due to rounding.
5. A cut-off grade of 0.1% CuEq has been used applying a copper
price of US$8,800/t, a gold price of US$1,800/Oz and a silver price
of US$24/Oz
6. The Mineral Resource estimate is based on information
reviewed by Measured Group, with an effective date of 31 October
2022.
7. CuEq Formula : CuEq % = (Cu%) + (Au g/t * 0.6577) + (Ag g/t * 0.008769)
Table 2 - Racecourse Grade vs Tonnage estimates using CuEq
cut-offs
CuEq** Cu (%) Au (g/t) Ag (g/t) CuEq** Tonnage CuEq
Cut (%) (Kt) (Contained
Off (%) Tonnes)
------- --------- --------- ------- --------
0.00 0.16 0.05 0.66 0.20 592,300 1,164,921
--------- ------- --------- --------- ------- -------- ------------
0.05 0.16 0.05 0.66 0.20 582,910 1,161,456
--------- ------- --------- --------- ------- -------- ------------
0.10 0.18 0.05 0.72 0.22 512,091 1,104,631
--------- ------- --------- --------- ------- -------- ------------
0.15 0.21 0.06 0.89 0.26 335,837 881,798
--------- ------- --------- --------- ------- -------- ------------
0.20 0.27 0.08 1.15 0.33 191,010 632,217
--------- ------- --------- --------- ------- -------- ------------
0.25 0.31 0.09 1.34 0.38 143,735 508,475
--------- ------- --------- --------- ------- -------- ------------
Notes:
1. Xtract owns 100 per cent. of ProspectOre Ltd, the operator of
the Bushranger Project and gross and net attributable resources are
therefore the same.
2. Mineral Resources are reported in accordance with JORC
guidelines. Mineral Resources are not Mineral Reserves and do not
have demonstrated economic viability.
3. The Mineral Resource estimate is based on information
reviewed by Measured Group, with an effective date of 31 October
2022.
4. CuEq Formula: CuEq % = (Cu%) + (Au g/t * 0.6577) + (Ag g/t * 0.008769)
A higher-grade core of the Racecourse mineralisation extends
from surface to relatively shallow depth and contains 191Mt @ 0.33%
CuEq, reported at a cut-off of 0.2% CuEq, which is equivalent to
the cut-off used by Alkane Resources Limited for the maiden Mineral
Resource for the Boda Prospect. This shallow higher-grade section
of the Racecourse prospect is expected to positively impact the
economics of an open pit mining operation, by allowing cash flows
to be maximised in the first 8 years of a mining operation,
assuming a mining rate of circa 25Mtpa. The majority of the updated
512Mt Racecourse Mineral Resource is expected to occur within
depths amenable to open pit mining methods, given that an open pit
mining study completed by independent consultants, Optimal Mining,
in July 2021, concluded that the Racecourse copper-gold
mineralisation could potentially be economically extracted via open
pit mining to a depth of 600m (see RNS dated 26 July 2021).
The updated Racecourse Indicated and Inferred Mineral Resource
compares to the previous April 2018 Inferred Mineral Resource of
71Mt @ 0.44% Cu and 0.064g/t Au at a cut-off grade of 0.3% Cu,
which was based on a much smaller set of drill intercepts. The
updated Mineral Resource uses a cut-off grade of 0.1% Cu, based on
analysis of the Grade vs Tonnage curve, higher prevailing commodity
prices, a large moderate grade deposit envelope based on the
additional drilling by Xtract and the 2021 Optimal Mining report
which suggested that mining to 0.15% Cu cut-off could produce a
positive economic return - this report was prepared before the new
drill data was available.
Next Steps
Xtract is currently completing a geological model for the Ascot
Prospect, located approximately 1.5km south of the Racecourse
Prospect. Upon completion of the Ascot Prospect geological model,
the Company will engage Measured Group to complete a Mineral
Resource estimate for the copper-gold mineralisation at Ascot. This
will be the first Mineral Resource defined for the Ascot Prospect,
following the new discovery in December 2021 (see RNS dated 9
December 2021). The Company anticipates that the Ascot Mineral
Resource estimate will be completed before the end of 2022.
In July 2021, Xtract contracted Optimal Mining to complete an
open pit mining study which examined the economics of mining the
Racecourse Mineral Resource based on the historic April 2018
Inferred Mineral Resource and the deposit outline as it was defined
in July 2021 (see RNS dated 26 July 2021). Once the Ascot Prospect
Mineral Resource Estimate has been defined, Xtract will again
contract Optimal Mining and Measured Group to update the open pit
mining study based upon the newly updated Racecourse Mineral
Resource and to also utilise the maiden Mineral Resource for the
Ascot Prospect. This open pit mining study will examine the
economics of a 25Mtpa open pit mining operation. Xtract estimates
that the update to the open pit mining study will be completed
early in 2023.
Further information is available from the Company's website
which details the company's project portfolio as well as a copy of
this announcement: www.xtractresources.com
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014 as it forms part of
UK Domestic Law by virtue of the European Union (Withdrawal) Act
2018 ("UK MAR").
The person who arranged for the release of this announcement on
behalf of the Company was Colin Bird, Executive Chairman and
Director.
Enquiries :
Xtract Resources Plc Colin Bird, +44 (0)20 3416 6471
Executive Chairman www.xtractresources.com
Beaumont Cornish Limited Roland Cornish +44 (0)207628 3369
Nominated Adviser Michael Cornish www.beaumontcornish.co.uk
and Joint Broker Felicity Geidt
Novum Securities Limited Jon Belliss +44 (0) 207 399 9427
Joint Broker Colin Rowbury www.novumsecurities.com
Updated Mineral Resource Estimate - Qualified Person
The information in this announcement that relates to the updated
mineral resource estimate has been prepared by Mr Christopher Grove
of Measured Group and who has acted as the Qualified Person. Mr
Christopher Grove, who has reviewed and confirmed the statements
related to the mineral resource estimate set out herein, is a
Competent Person as defined by the JORC Code 2012 Edition, having
at least five years of experience that is relevant to the style of
mineralisation and type of deposit described in the mineral
resources report, and to the activity for which he accepts
responsibility. Mr Christopher Grove is a Member of The
Australasian Institute of Mining and Metallurgy (AusIMM) and a
full-time employee of Measured Group and has more than 25 years of
experience in the estimation of mineral resources both in Australia
and overseas. This expertise has been acquired principally through
exploration and evaluation assignments at operating mines and
exploration areas.
Mr Christopher Grove has reviewed the information in this
announcement that relates to the mineral resource estimate and has
confirmed that the information so presented in this announcement is
balanced and complete and not inconsistent with Measured Group's
audit and review of the mineral resource estimate.
Qualified Person
Information in this announcement relating to the exploration
works has been reviewed by Edward (Ed) Slowey, BSc, PGeo, a
consultant to Xtract. Mr Slowey is a graduate geologist with more
than 40 years' relevant experience in mineral exploration and
mining, a founder member of the Institute of Geologists of Ireland
and is a Qualified Person under the AIM rules. Mr Slowey has
reviewed and approved the geological content of this
announcement.
Qualified Person
In accordance with AIM Note for Mining and Oil & Gas
Companies, June 2009 ("Guidance Note"), Colin Bird, CC.ENG, FIMMM,
South African and UK Certified Mine Manager and Director of Xtract
Resources plc, with more than 40 years' experience mainly in hard
rock mining, is the qualified person as defined in the Guidance
Note of the London Stock Exchange, who has reviewed the technical
information contained in this press release.
Mineral Reserves and Resources
The Company estimates and discloses mineral reserves and
resources using the definitions adopted by JORC. Further details
are available at www.jorc.org. See the "Glossary of Geological and
Mining Terms" for complete definitions of mineral reserves and
mineral resources.
About Mineral Resources
Mineral resources are not mineral reserves and do not have
demonstrated economic viability but do have reasonable prospect for
economic extraction. They fall into three categories: measured,
indicated, and inferred. The reported mineral resources are stated
inclusive of mineral reserves. Measured and indicated mineral
resources are sufficiently well-defined to allow geological and
grade continuity to be reasonably assumed and permit the
application of technical and economic parameters in assessing the
economic viability of the mineral resource. Inferred mineral
resources are estimated on limited information not sufficient to
verify geological and grade continuity or to allow technical and
economic parameters to be applied. Inferred mineral resources are
too speculative geologically to have economic considerations
applied to them. There is no certainty that mineral resources of
any category will be upgraded to mineral reserves.
Important Information about Mineral Reserve and Resource
Estimates
Whilst the Company takes all reasonable care in the preparation
and verification of the mineral reserve and resource figures. the
figures are estimates based in part on forward-looking information.
Estimates are based on management's knowledge, mining experience,
analysis of drilling results, the quality of available data and
management's best judgment. They are, however, imprecise by nature,
may change over time, and include many variables and assumptions
including geological interpretation, commodity prices and currency
exchange rates, recovery rates, and operating and capital costs.
There is no assurance that the indicated levels of metal will be
produced, and the Company may have to re-estimate the mineral
reserves based on actual production experience. Changes in the
metal price, production costs or recovery rates could make it
unprofitable to operate or develop a particular deposit for a
period of time.
Forward Looking Statements
Certain statements in this announcement, are, or may be deemed
to be, forward looking statements. Forward looking statements are
identi ed by their use of terms and phrases such as "believe",
"could", "should" "envisage", "estimate", "intend", "may", "plan",
"will" or the negative of those, variations or comparable
expressions, including references to assumptions. These
forward-looking statements are not based on historical facts but
rather on the Directors' current expectations and assumptions
regarding the Company's future growth, results of operations,
performance, future capital and other expenditures (including the
amount, nature and sources of funding thereof), competitive
advantages, business prospects and opportunities. Such forward
looking statements re ect the Directors' current beliefs and
assumptions and are based on information currently available to the
Directors. A number of factors could cause actual results to differ
materially from the results discussed in the forward-looking
statements including risks associated with vulnerability to general
economic and business conditions, competition, environmental and
other regulatory changes, actions by governmental authorities, the
availability of capital markets, reliance on key personnel,
uninsured and underinsured losses and other factors, many of which
are beyond the control of the Company. Although any forward-looking
statements contained in this announcement are based upon what the
Directors believe to be reasonable assumptions, the Company cannot
assure investors that actual results will be consistent with such
forward looking statements.
TECHNICAL GLOSSARY
The following is a summary of technical terms:
"Ag" Silver
"Au" Gold
"Cu" Copper
"CuEq" Copper equivalent grade, calculated using
assumed metal prices for copper, gold and
other metals
"Induced Polarisation A method of ground geophysical surveying which
(IP)" employs the passing of an electrical current
into the ground to test for indications of
conductive metallic sulphides
"Indicated Mineral That part of a Mineral Resource for which
Resource" quantity, grade (or quality), densities, shape
and physical characteristics are estimated
with sufficient confidence to allow the application
of Modifying Factors in sufficient detail
to support mine planning and evaluation of
the economic viability of the deposit. Geological
evidence is derived from adequately detailed
and reliable exploration, sampling and testing
gathered through appropriate techniques from
locations such as outcrops, trenches, pits,
workings and drill holes, and is sufficient
to assume geological and grade (or quality)
continuity between points of observation where
data and samples are gathered. (JORC 2012)
"Inferred Mineral That part of a Mineral Resource for which
Resource" quantity and grade (or quality) are estimated
on the basis of limited geological evidence
and sampling. Geological evidence is sufficient
to imply but not verify geological and grade
(or quality) continuity. It is based on exploration,
sampling and testing information gathered
through appropriate techniques from locations
such as outcrops, trenches, pits, workings
and drill holes. (JORC 2012)
"mineralisation" process of formation and concentration of
elements and their chemical compounds within
a mass or body of rock
"porphyry" a deposit of disseminated copper minerals
in or around a large body of intrusive rock
"Mtpa" Million tonnes per annum
ENDS
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END
UPDFLFLDLSLFFIF
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November 23, 2022 02:00 ET (07:00 GMT)
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