Luiri Hill Gold Project Resource Estimate 851,000 ounces

Luiri Hill Gold Project Mineral Resource Estimate 851,000 ounces at 2.6 g/t gold

Volt is pleased to announce the Mineral Resource estimate for the Luiri Hill Gold Project located in south-central Zambia, 120km westnorthwest of the Zambian capital of Lusaka.

Highlights include:

  • Luiri Hill Gold Project Mineral Resource estimate of 10.2 million tonnes at 2.6 g/t gold for 851,000 ounces of gold.
ClassificationMillion tonnesGrade (g/t gold)Gold ounces
Measured
Indicated
Inferred
1.0
4.3
4.9
2.7
2.8
2.4
86,000
381,000
385,000
Total10.22.6851,000
  • Matala deposit estimated to contain 674,000 ounces of gold and the Dunrobin deposit estimated to contain 177,000 ounces of gold
  • Matala and Dunrobin deposits are open at depth
  • Further project exploration potential
  • Leach Pads resource estimate to be progressed

Volt Resources Limited (ASX: VRC) (“Volt” or the “Company”) is pleased to announce the Mineral Resource estimate for the Luiri Hill Gold Project located in south-central Zambia, 120km westnorthwest of the Zambian capital of Lusaka.

Volt Managing Director, Trevor Matthews, said:

“This is a significant step forward for Volt’s gold business strategy with this updated Mineral Resource estimate confirming Luiri Hills as a quality gold project with outstanding economic potential.

“Combined with the numerous gold bearing stockpiles and local exploration potential, the Mineral Resource estimate provides the platform for early gold production based on the significant amount of study work already conducted for the Luiri Hill Gold Project.”

Optiro Pty Ltd (Optiro) has provided assistance to Volt Resources Ltd (Volt) with an updated Mineral Resource estimate for the Matala and Dunrobin deposits. These deposits are part of Volt’s Luiri Hill Gold Project, located in south-central Zambia, approximately 120 km west-northwest of the Zambian capital of Lusaka in the Mumbwa District. The Luiri Hill Gold Project is comprised of one large-scale exploration licence and a mineral processing licence with a total area of 31.38 km2.

The open pit Mineral Resources at Dunrobin and Matala are reported above a 0.5 g/t gold lower cut-off grade and within preliminary pit shells based on a gold price of US$1,800/oz and the potential underground resources, that are external to the pit shells, are reported above a 1.0 g/t gold lower cut-off (Table 1). These cut-off grades were selected by Volt and are commensurate with cut-off grades applied for the reporting of gold Mineral Resources elsewhere in Africa.

The Mineral Resources include Measured Mineral Resources of 1.0 Mt at 2.7 g/t gold (86 koz gold), Indicated Mineral Resources of 4.3 Mt at 2.8 g/t gold (381 koz gold) and Inferred Mineral Resources of 4.9 Mt at 2.4 g/t gold (385 koz gold). The total Mineral Resource is 10.2 Mt at 2.6 g/t gold for 851 koz gold.

Table 1 Dunrobin and Matala Mineral Resources as at June 2020

Notes
– Reported above a gold cut-off grade of 0.5 g/t for open pit potential (within a
preliminary pit shell) or 1.0 g/t or underground potential (external to the pit shell).

– Tonnages and grades have been rounded to reflect the relative uncertainty of the
estimate

Leach Pads Mineral Resource

The Company has previously advised of the presence of large leach pads at Luiri Hill containing gold bearing ore. Initially the Company is arranging for a representative sample to be analysed and is planning an auger drilling, survey and density measurement programme utilising the services of Optiro and Zambian based GeoQuest to enable the preparation of a JORC Mineral Resource estimate for the Leach Pads.

The Luiri Hill Gold Project

The Luiri Hill Gold Project is an advanced gold project with considerable drilling and studies already undertaken. The Matala and Dunrobin deposits, which collectively form the Luiri Hill Gold Project, have the potential to be developed into a medium scale gold mine in the near term.

The Project is comprised of one large-scale exploration licence (“LEL”) and a mineral processing licence (“MPL”) with a total area of 31.38km2 within the Matala Dome mineralised structure. Access to the Project area is by a bitumen sealed road, of approximately 120 km, in a westnorthwest direction from the Zambia capital city, Lusaka. The area has significant potential for gold occurrences both related to the Matala Dome mineralised structure and the surrounding Katangan rocks where there is potential for iron oxide copper-gold (“IOCG”) style mineralisation.

The Matala and Dunrobin deposits were majority owned by Luiri Gold Limited until 2014, when the Project was sold to a South African company. Volt has entered into a binding term sheet to acquire an 85% interest in the Luiri Hill Gold Project. Mineral Resource estimates were completed by Coffey Mining Pty Ltd (Coffey) in 2010 for the Matala deposit and in 2012 for the Dunrobin deposit.

These Mineral Resource estimates were classified and reported in accordance with the 2004 edition of the JORC Code. Optiro reviewed the input data, mineralisation interpretations, block models and documentation provided by Coffey and has used this data as the basis for the current resource models

Figure 1: Luiri Hill Gold Project location

Summary of JORC 2012 Table 1

A summary of JORC Table 1 (included as Appendix 1) is provided below for compliance with the Mineral Resource and in-line with requirements of ASX listing rule 5.8.1.

Geology and Mineralisation Interpretation

The Luiri Hill Gold Project is located in an area of south-central Zambia that is dominated by the Mwembeshi Shear Zone. A significant number of south-central Zambia’s gold and gold-copper occurrences are located within or close to this regionally significant structural zone.

Gold mineralisation at Dunrobin is associated with ferruginous (hematite) gossans within dolomites and limestones with quartz veining; and in quartz veins and quartz vein stockworks within quartz-mica schists. The interpreted mineralised domain extends for 280 m along strike, 600 m down dip and has an average thickness of around 20 m. The mineralisation extends to a maximum vertical depth of 250 m and is open down-dip.

The mineralised zone at Matala forms an east-northeast trend along the proposed hinge zone to the Matala Dome and parallel to the Mwembeshi shear zone to the south. The gold mineralisation is associated with tourmalinised breccias and veins. The main mineralised domain extends for 1,200 m along strike, 625 m down dip and has an average thickness of around 12 m. The mineralisation extends to a maximum vertical depth of 500 m and is open down-dip.

Drilling

Drilling techniques used at the Luiri Hill Gold Project comprise: reverse circulation (RC/4.75”) with a face sampling hammer, and diamond core drilling (DD) was collared with HQ3 (63.5 mm diameter) to the base of weathering and then an NQ (47.6 mm diameter, single tube) core size was routinely adopted for fresh rock drilling.

The drilling database used to define the gold mineralisation at Dunrobin comprises 141 RC drillholes for a total of 9,078.7 m, 25 DD holes for a total of 4,317.8 m and 9 RC/DD for a total of 1,422.3 m. In general, the drill spacing ranges from 20 m by 20 m within the upper parts of the deposit to 40 m by 40 m at depth, with some closer spaced drilling within the upper area of the deposit.

The drilling database used to define the gold mineralisation at Matala comprises 85 RC drillholes for a total of 9,830.7 m, 72 DD holes for a total of 12,977.9 m and 5 RC/DD drillholes for a total of 1,249.2 m. The drill spacing ranges from 20 m by 25 m within the upper parts of the deposit to 40 m by 60 m at depth.

Sampling techniques

RC samples were at collected at 1 m intervals and were split using a 50-50 riffle splitter. Diamond core samples were marked after geological logging and the sample boundaries honour changes in the geology (sulphide concentration, alteration and lithology). Sample lengths were generally restricted to a minimum of 30 cm and a maximum of 150 cm. The core was cut lengthwise using a diamond saw and the half core sent for assaying.

Sampling Analyses

Samples were sent to South Africa and prepared at Genalysis’ preparation facilities in Johannesburg. The pulps were split and the Johannesburg laboratory used Fire Assay for gold analysis, while a second pulp was freighted to Genalysis Laboratories in Perth (Australia) for gold analysis by Fire Assay (using a lead collection fire assay of a 50 g sample with aqua regia digestion and an AAS finish) and silver, lead, zinc, copper and arsenic by Aqua Regia technique, followed by an atomic absorption spectrometer (AAS) reading.

Estimation Methodology

Optiro completed a gold Mineral Resource estimate for the Dunrobin deposit using a categorical indicator kriging (CIK) technique to define mineralised’ material within a wireframed volume of the mineralisation interpreted by Coffey in 2012. The categorical indicator was estimated to define volumes containing 0.3 g/t gold mineralisation within the mineralised wireframe.

The block model was built using a parent block size of 15 mE by 15 mN on 2 m benches and the parent blocks were allowed to sub-cell down to 5 mE by 5 mN by 1 mRL. The sub-cell size was used for development of the CIK model and for definition of the ‘mineralised’ material and for postprocessing using local uniform conditioning (LUC).

The gold Mineral Resource estimate for the Matala deposit was constrained within a mineralisation wireframe interpreted by Coffey in 2010 using a 0.4 g/t gold cut-off grade. The block model was built using a parent block size of 25 mE by 5 mN on 4 m benches and the parent blocks were allowed to sub-cell down to 5 mE by 2.5 mN by 2 mRL to more accurately represent the geometry and volume of the mineralised domain and for post-processing using LUC.

The parent (panel) block grades were post-processed using LUC to provide a theoretical indication of the tonnage and grade conditions that may be encountered at Dunrobin and Matala if more selectivity is applied during mining, based on data from closer-spaced grade control data becoming available or visual indications of the presence of quartz veining.

Mineral Resource Classification

The Mineral Resources at Dunrobin have been classified as Measured, Indicated and Inferred and the Mineral Resources at Matala have been classified as Indicated and Inferred on the basis of confidence in geological and grade continuity and taking into account data quality, data density and confidence in the estimation of the gold content (using the modelled grade continuity and kriging metrics as criteria).

In general, the mineralisation at Dunrobin that has been tested by the close spaced (up to 20 m by 20 m) 2012 drilling has high confidence in the geological interpretation and, having higher estimation quality, were classified as Measured. Areas where the drill spacing is up to 40 m by 40 m that have good confidence in the geological interpretation and estimation quality were classified as Indicated. Areas at depth, that have been tested by wider spaced drilling and where there is interpreted geological continuity, have been classified as Inferred.

In general, the mineralisation at Matala that has been tested by the close spaced (20 m by 25 m) drilling in the upper areas of the deposit has high confidence in the geological interpretation and, having higher estimation quality, were classified as Indicated. Areas at depth, that have been tested by wider spaced drilling and where there is interpreted geological continuity have been classified as Inferred.

Cut-off Grade

Preliminary pit shells were developed using a gold price of US$1,800/oz. The Mineral Resources have been reported within these pit shells above a cut-off grade of 0.5 g/t gold and external to the pit shells using a cut-off grade of 1 g/t gold.

Mining Factors

Preliminary pit shells, developed using a gold price of US$1,800/oz, have confirmed RPEEE for extraction of the near surface material by open pit mining. In addition, it is expected that a portion of the defined gold mineralisation outside of the US$1,800/oz pit has RPEEE by underground mining methods.

Metallurgical Factors

Detailed metallurgical test work was completed on composite samples from Dunrobin for a Feasibility Study completed by Coffey 2013. These indicated that the average metallurgical recovery over the LOM is 88.1%. An earlier scoping metallurgical study indicated average recoveries of 94% at Matala.

Project Acquisition

The proposed acquisition of the Luiri Hill Gold Project continues Volt’s progression in establishing a new gold business whilst continuing with the development of its Bunyu Graphite Project in Tanzania. Together with the proposed acquisition of the Guinea gold projects announced on 14 May 2020 (the “Guinea Gold Projects”), the acquisition of the Luiri Hill Gold Project will provide Volt with a combination of highly prospective grass roots exploration in Guinea together with an 85% interest in an advanced gold project in Zambia that has near term development potential.

The creation of a new gold business provides Volt shareholders with the opportunity to participate in the potential value accretion from gold exploration and development activities, particularly through leveraging the Company’s existing extensive networks in Africa.

The Company has entered into a binding term sheet to acquire an 85% interest in the Project. Completion of the acquisition is subject to the satisfactory completion of Volt’s due diligence enquiries, the execution of a share sale agreement in a form acceptable to Volt, as well as the approval of Volt shareholders to the issue of the consideration shares to be sought at an upcoming meeting of Volt shareholders to be held at 10.00am Monday 20 July 2020.

Settlement of any acquisition is expected to occur within 5 business days of shareholder approval to the issue of the proposed consideration shares for the acquisition of an 85% interest in the Luiri Hill Gold Project being obtained.

Authorised by:

Trevor Matthews
Managing Director
Volt Resources Limited


FOR PERSONAL USE ONLY
For further information please contact:

Trevor Matthews
Managing Director
Tel: +61 8 9486 7788