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Developing the next major nickel project in Brazil
Slide 1

Mineral Reserves and Mineral Resources

Mineral Resources reported for the Project deposits, were prepared by an Independent Qualified Person as defined in NI 43-101. 

A total of 46,000 meters (1,786 holes) of core drilling have been completed to date on Araguaia South (referred to as HZMA in the Pre-Feasibility Study) and 28,860 meters (839 holes) of core drilling completed on the Vale dos Sonhos deposit in Araguaia North (referred to as GAP in the Pre-Feasibility Study). Of this, a total of 40,330 meters (1,494 holes) from Araguaia South and 28,860 meters (839 holes) from Araguaia North were used in the Mineral Resource Estimation reported in the Pre-Feasibility Study.

Updated Mineral Resources for the Araguaia Project effective as at 30 September 2016 by material type (0.90% Ni cut-off grade)

Araguaia

Category

Material type

Tonnage (kT)

Bulk density (t/m3)

Contained Ni metal (kT)

Ni

Fe

MgO

SiO2

(%)

(%)

(%)

(%)

Subtotal

Measured

Limonite

1,232

1.39

15

1.2

37.43

2

17.15

Subtotal

Measured

Transition

6,645

1.26

116

1.75

18.89

10.2

42.06

Subtotal

Measured

Saprolite

10,291

1.4

130

1.27

12.03

24.08

41.24

Total

Measured

All

18,168

1.35

261

1.44

16.26

17.51

39.91

Subtotal

Indicated

Limonite

19,472

1.4

218

1.12

36.2

2.39

20.53

Subtotal

Indicated

Transition

31,143

1.2

444

1.43

21.39

11.24

38.92

Subtotal

Indicated

Saprolite

51,279

1.32

610

1.19

11.82

25.79

40.58

Total

Indicated

All

101,893

1.3

1,272

1.25

19.4

16.87

36.24

Total

Measured + Indicated

All

120,061

1.3

1,533

1.28

18.93

16.97

36.8

Subtotal

Inferred

Limonite

2,837

1.37

31

1.08

34.8

2.97

23.05

Subtotal

Inferred

Transition

4,955

1.2

65

1.31

21.2

11.11

39.05

Subtotal

Inferred

Saprolite

5,643

1.35

65

1.16

11.8

24.31

41.8

Total

Inferred

All

13,435

1.3

161

1.2

20.12

14.94

36.83

Note: Totals may not add due to rounding. Mineral Resources are inclusive of Mineral Reserves. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.

Mineral Reserves reported for the Project deposits, which are included in the Pre-Feasibility Study were established by Snowden in accordance with the CIM Definition Standards using only Indicated and Measured Resources, under the supervision of an Independent Qualified Person as defined in NI 43-101.

A Mineral Reserve estimate of 24,646.6 tonnes (dry) at an average grade of 1.77% nickel was estimated. The detailed breakdown of the Mineral Reserve allocated by deposit is presented in the following table:


Mineral Reserves for the Araguaia Project effective as at September 30, 2016

Class

Deposit

Ore dry mass (kt)

Ni

Fe

Al2O3

SiO2/MgO

(%)

(%)

(%)

Probable

Baião

2,381

1.8

18.7

4.93

2.52

Probable

Pequizeiro

11,828

1.73

16.8

5.91

2.83

Probable

Pequizeiro West

165

1.67

19.7

4.47

3.58

Probable

Jacutinga

1,198

1.82

16.7

3.16

2.16

Probable

Vila Oito East

1,190

1.64

15

3.74

1.99

Probable

Vila Oito

2,449

1.79

14.2

3.62

2.05

Probable

Vila Oito West

549

1.73

20.3

5.04

3.65

Probable

VDS

4,886

1.85

22.7

6.28

2.72

Total Probable

24,646

1.77

17.9

5.39

2.58

Proven

-

-

-

-

-

Total Proven and Probable

24,646

1.77

17.9

5.39

2.58

A nickel spot price of US$12,000/tonne was used in the Mineral Reserve estimate. The Mineral Reserve estimate resulted in a marginal cut-off grade of 1.28% Ni.


Mining

Araguaia North
Araguaia North

Araguaia South
Araguaia South

Araguaia South Close-Up: Pequezeiro deposits & Plant area
Araguaia South Close Up

Seven shallow open pits were designed for Araguaia South and one for Araguaia North through a process of pit optimisation using costs and process recoveries. All eight pits are designed using smoothed pit shells with the removal of small satellite pits through a standard process of pit optimisation, waste dump design and pit design. To minimise capital, the base case also assumes contractor mining using typical truck and excavator fleet which includes ore haulage to the plant. This fleet is supported by the usual array of support and ancillary equipment. Grade and mineralogy will be closely monitored in the mining process using close spaced grade control drilling ahead of mining.

High grade nickel feed is targeted in the early years of production. The average nickel (Ni) grade of the feed to the plant is as follows:

  • Years 1 to 5 — average grade 2.0% Ni
  • Years 6 to 10 — average grade 1.9% Ni
  • Years 11 to 28 — average grade 1.7% Ni

A number of processing constraints were applied to the schedule. These included a 13 month processing feed quantity ramp-up period, and specific process feed grade constraints throughout the life of the Project:

  • Iron (Fe) grade between 15.0% and 18.0%
  • Aluminium Oxide (Al2O3) grade between 4.0% and 5.5%
  • Aluminium dioxide / Magnesium oxide (SiO2/MgO) ratio between 2.2 and 2.6

Araguaia Mine Profile

  • Shallow open pit mining (max depth 25 metres)
    • 7 pits in South, 1 pit in North
    • 3–5 pits open at any given time
    • Do not expect explosives required
  • Total 30 year schedule
    • 2 year pre-production
    • 28 year life of mine
  • Ramp-up over 13 months
  • Contract mining


Pits Graph

Araguaia Project
Overview
Economics
Process
Reserves and Resources
Development Pathway
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