Highfield Resources: Resource Estimate Covers a Small Percentage of Entire Project Area
November 20, 2013 (Source: Highfield Resources) — Highlights:
- Maiden JORC Inferred Mineral Resource estimate of 187m tonnes of sylvinite at 11.2% K2O (17.8% KCl)
- The Mineral Resource estimate covers a small percentage of the entire project area (12 kms2 of project area of 125 kms2)1
- Drilling campaign to start in January 2014 Quarter aimed at upgrading and expanding the Mineral Resource estimate
- Project provides scale upside to Javier potash project, where a drilling campaign is underway designed to upgrade the existing JORC Mineral Resource estimate
The Board of Highfield Resources (ASX: HFR) is pleased to report a maiden Inferred Mineral Resource estimate for its 100%-owned Pintano Potash Project, Northern Spain.
Independent geology and mining consultant Agapito Associates, Inc. prepared the JORC maiden Inferred Mineral Resource estimate of 187 million tonnes of sylvinite at 11.2% K2O (17.8% KCl).
Highfield´s Managing Director, Anthony Hall commented,
We are delighted by the maiden JORC on our 100% owned Pintano project. Importantly it covers less than 10% of the project area suggesting significant potential resource upside. The average 7.3m sylvinite seam is also encouraging as there would appear to be grade upside in thinner potential mining heights that would not comprise optimum mining sections. In addition having thick halite in both the hanging and foot walls is important for ultimate mineability. The project is likely to provide significant scale upside to our 100% owned adjacent Javier project that is our current development focus along with our 100% owned Sierra del Perdón project that hosts two former operating mines.
PINTANO POTASH PROJECT MAIDEN MINERAL RESOURCE JORC
|Table 1. Pintano Property Mineral Resource|
|(Effective date 12 November 2013)|
|Potash Bed||Average Thickness (m)||Resource Area (ha)||In-Place Tonnes (millions)1||In-Place K2O (wt %)||In-Place KCl (wt %)||Contained K2O Tonnes (millions)||Contained KCl Tonnes (millions)|
|1 Average bulk density of sylvinite 2.1 tonnes/m3.|
|2 Resource cutof f s: composite grade 8.0% K2O and bed thickness 2.0 m.|
|3 Inf erred Resource located w ithin 1,500-m radius f rom an historical exploration core hole w ith assays.|
|4 Main potash intercept comprised of sylvinite Bed A, sylvinite Bed B, and low er grade sylvinite A-B interburden.|
Potash mineralisation on the Pintano property (the “property”) occurs in three principal sylvinite beds (A, B, and 1) ranging in depth from 500 meters (m) to more than 2,000m. The property hosts the same potash beds as Highfield´s 100% owned Javier potash project adjoined to the west. The Javier property contains a 163 million tonne Inferred sylvinite Mineral Resource at an average grade of 10.9% K2O (17.3% KCl) estimated from historical drilling.1 Highfield initiated a multi-drill rig exploration drilling campaign on the Javier property in July 2013 for the purpose of expanding and upgrading the Inferred Mineral Resource. Early drilling results have corroborated historical exploration data and confirmed favourable sylvinite mineralisation.
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A maiden Mineral Resource estimate for the Pintano property was independently developed by U.S. geology and mining consultant Agapito Associates, Inc. and is based on the results of documented geological studies, 2D seismic analysis, exploration drill logs, and chemical analyses on core from 7 exploration holes drilled during the 1980’s through 1990 by Potasis de Subiza and E.N. Adaro.
The Mineral Resource estimate was calculated using a computer gridded-seam geologic model constructed with Mintec Inc. MineSight 3D© v7.9 software by Mr. Leo J. Gilbride, P.E., Vice President AAI, and Ms. Vanessa Santos, AAI Chief Geologist, both registered members of the Society for Mining, Metallurgy, and Exploration, Inc. and JORC competent persons. Proprietary historical data for the property have been reviewed by the competent persons for quality and completeness.
The Pintano Mineral Resource estimate is summarised in Table 1. The resource comprises a single, continuous mineralised interval containing the historically identified A sylvinite bed, the B sylvinite bed, and the lower grade sylvinite interval between the A and B beds. The continuous A-B interval represents a single mineralised horizon with reasonable prospects for economic extraction by conventional and/or solution mining methods. No mineralisation of significance was identified in Bed 1. The resource assumes a minimum bed composite cut-off grade of 8.0% K2O and a minimum bed thickness of 2.0m. The resource ranges in depth from 400 to 1,200m. Drill holes reporting mineralisation show that the A-B composite true thickness ranges from 6.9 to 9.7m with composite grades ranging from 10.9 to 11.5% K2O. All drill holes included in the model were assumed vertical as no deviation surveys were available. The Mineral Resource estimate has an effective date of 12 November 2013.
The Mineral Resource estimate is reported as in-place tonnes of sylvinite contained in the respective potash beds. Sylvinite is a mechanical mixture of halite and sylvite (KCl) with minor inclusions of insolubles (typically clays) and limited carnallite (KCl·MgCl2·6H2O). Tonnages are based on an average bulk density of 2.1 tonnes per cubic meter (t/m3) derived from 2012 bulk density testing of historical sylvinite cores by North Rim Exploration Ltd. and historical values published by E.N. Adaro de Investigaciones Mineras S.A. for the Javier and Pintano properties. Also reported are equivalent tonnes of pure K2O and KCl contained within the mineralised interval derived from the K2O and KCl grades of the in-place sylvinite. No discount for extraction ratio has been applied to the Mineral Resource estimate.
The Mineral Resource estimate is classified as Inferred because of reliance upon historical exploration data. The historical data are sufficient to imply, but not verify, geological and grade continuity. A radius of influence (ROI) of 1,500 m around core holes was used to define the Inferred Resource. This was further limited by the presence of lease boundaries, barren holes, interpreted boundary faults and basin margins, and projected dissolutioning of the potash beds near outcrops.
Highfield’s exploration plan for Pintano includes 8 core holes scheduled to be drilled in 2014. Planned holes are shown in red in Figure 1.
The reader is cautioned that a Mineral Resource is an estimate only and not a precise and completely accurate calculation, being dependent on the interpretation of limited information on the location, shape, and continuity of the occurrence and on the available sampling results. Actual mineralisation can be more or less than estimated depending upon actual geological conditions.
PINTANO PROJECT PERMITS
Spanish mining permits are split into three categories: Exploration Permit (PE), Investigation Permit (PI) and Mining Concession. A PE is for desk top studies and lasts for a period of one year (it may be rolled over once). A PI is necessary for drilling and may include sinking shafts and declines and lasts for a period of three years (it may also be rolled over for multiple three year periods). For a PI to be granted an environmental review must be completed by the relevant Government. A Mining Concession is for mineral extraction and lasts for periods of 30 years (it may be rolled over two times).
The Pintano Project comprises three named permits: Molineras 10, Molineras 20 and Puntarrón.
Molineras 10 – a PE in the process of being converted to a PI Molineras 20 – a PE in the process of being converted to a PI Puntarrón – a PE granted in May 2013.
Highfield´s 100% owned Pintano project is likely to ultimately provide significant scale upside to Highfield´s 100% owned Javier project. Importantly both projects have similar sylvinite mineralisation capable of being processed by the same processing plant.
Highfield intends to complete an 8 hole drilling campaign in 2014 with a view to expanding and upgrading the present Inferred Mineral Resource estimate. Assuming drilling success the project´s largest permit, Puntarrón will be converted into a PI with a view to completing further drilling aimed at drilling out the entirety of the project area. Consideration will then be given to project optimisation with a view to developing a mine to complement the initial production at Javier.
The Company´s focus remains on developing its 100% owned Spanish potash projects. The Company is presently developing both its Javier and Sierra del Perdón potash projects where significant in place infrastructure and shallow sylvinite mineralisation that appears ideal for mineral extraction via a decline is likely to support a relatively low capex initial mines.
Competent Persons’ Statement
This ASX release was prepared by Mr Leo Gilbride, P.Eng, Ms Vanessa Santos, P.Geo of Agapito Associates and Mr. Anthony Hall, Managing Director of Highfield Resources. The Competent Person under JORC Code standards and reviewer for this release pertaining to the resource information is Mr Leo Gilbride, P.Eng and Ms Vanessa Santos, P.Geo. of Agapito Associates of Colorado, USA. Mr Gilbride is a licensed professional engineer in the State of Colorado, USA and is a registered member of the Society of Mining, Metallurgy and Exploration Inc. Ms Santos is a licensed professional geologist in South Carolina and Georgia, USA, and is a registered member of the Society of Mining, Metallurgy and Exploration Inc. The Society of Mining, Metallurgy and Exploration Inc is a JORC Code ‘Recognized Professional Organization’ (RPO). An RPO is an accredited organisation of which the Competent Person under JORC Code Reporting Standards must belong in order to report Exploration Results, Mineral Resources, or Ore Reserves through the ASX. Mr Gilbride is the Vice President of Engineering and Field Services and Ms Santos is the Chief Geologist with Agapito Associates and both have sufficient experience to qualify as a Competent Person for the relevant style and type of mineralisation and deposit under consideration of this release. Mr Gilbride and Ms Santos consent to the inclusion in the report of the matters based on information in the form and context in which it appears.
ABOUT HIGHFIELD RESOURCES
Highfield Resources is an ASX-Listed potash company with three 100% owned projects located in Spain.
Highfield’s Javier, Pintano and Sierra del Perdón potash projects are located in the Ebro potash producing basin in Northern Spain covering a project area of around 300km2. The Sierra del Perdón project includes two former operating mines. The Company has recently raised significant funds to progress feasibility studies at both the Sierra del Perdón and Javier Projects.
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