AuKing Mining Limited Prospectus

A U K ING M INING L IMITED I NDEPENDENT T ECHNICAL A SSESSMENT R EPORT – W ESTERN A USTRALIAN M INERAL A SSETS CSA Global Report Nº R278.2020 27 mining operations: underground only at both Sandiego and Onedin; and an open pit operation at Onedin. No major mining problems were identified in this study; however, further work was subject to metallurgical recoveries. In 2008, internal mining study work by AAR focused on underground mining of the sulphide and transition zones at Sandiego, with construction of a 500 tpa processing plant (using flotation technologies) with a 4–5 year operating life, with Onedin development having the capacity to extend project life to eight years mining Sandiego transition and sulphide ore. A conceptual study was also completed on open pit mining of Onedin base on conceptual metallurgical recoveries. In 2009, AAR engaged Noel O’Brien of Trinol Pty Ltd to review the more than 300 metallurgical tests that had then been completed over the various ore-types at Sandiego and Onedin, with a focus on the application of flotation recovery techniques. This study concluded that the metallurgy of the Sandiego transition and primary zones, whilst complex, is amenable to established flotation technology. The Onedin primary zone is amenable to the same flotation technology and can be processed through the same plant with minor modifications. The Onedin transition zone contains most of its value in the form of zinc oxide minerals and is not amenable to conventional flotation recovery, but extraction by hydrometallurgy is possible. The Onedin oxide zone contains copper in the form of malachite which may be amenable to hydrometallurgy. Conventional flotation flowsheets were designed for processing the Onedin and Sandiego sulphide mineralisation. Project economics are very sensitive to metal recoveries and the grade of concentrate achieved. The O’Brien study recommended further testwork focused on being as near to actual plant operating conditions as possible, and that further testwork should encompass a continuous pilot-scale test facility. During the period 2009 to 2010, AAR engaged a number of metallurgical/mineral processing specialists to review the possibilities of implementing novel treatment processes to treat the problematic transitional and oxide ores of Koongie Park including Controlled Potential Sulphidisation, Galvanox and Albion (O’Brien, 2010). Meaningful trials recommended were not implemented. No metallurgical testwork has been undertaken from 2012 to the present. In 2010, AAR engaged Coffey Mining to undertake a review of the Koongie Park project which recommended additional diamond drilling, re-estimation of the Sandiego deposit resource and geotechnical work (Slater and Hastings, 2010). Subsequently, Dempers and Seymour (D&S) was engaged to complete a preliminary geotechnical model for Sandiego based on geotechnical diamond drilling results. The geotechnical assessment involved construction of a three-dimensional (3D) Mining Rock Mass Model for the prospect and determination of preliminary geotechnical parameters for use in mine design studies. Raw data for the project comprised geotechnical and structural logging by D&S of 23 diamond holes. For the underground project, the rock mass has been classified into three geotechnical domains based on estimated Q’ 3 values. Preliminary inter ramp slope angles (excluding ramps) for the prospect were developed for use in pit design studies (Dempers and Seymour, 2010). In 2011, Minesure undertook a scoping study on mining the Sandiego deposit based on the Coffey Resource model (Slater, 2010). It concluded that exploitation of the Koongie Park Sandiego deposit by open pit and underground mining methods using an on-site concentrator and off-site smelting is potentially viable. Copper concentrates and zinc concentrated produced would be trucked to a suitable port facility such as Wyndham and stored until shipped to overseas smelters. A prefeasibility-level study was recommended (Spicer, 2011). No further mining studies have been undertaken since 2011. 3 The Q-system for rock mass classification expresses the quality of the rock mass in the so-called Q-value, on which are based design and support recommendations for underground excavations. 6. Independent Technical Report continued 102