Letlhakane Resources

A-Cap announced a JORC Mineral Resource Upgrade in September 2015 at Letlhakane which was completed by Optiro Pty Ltd, an independent expert. The updated resource uses a recoverable resource methodology which takes into account the proposed Standard Mining Unit (SMU). The SMU is defined by the proposed mining method utilising surface miners and the proposed grade control system using in-pit surface gamma radiation measurements.

The Localised Uniform Conditioning (LUC) estimate best reflects the mining methodology envisaged, taking into account the surface miners selective mining capability combined with the proposed grade control methodology. The accurate mining characteristics of surface miners and the ability to measure the gamma radiation on the surface during mining will ensure the optimum grade delivery to the process heap. The SMU of 20m x 4m x 0.25m forms the basis for the LUC estimation. Historic resource estimations were more reflective of conventional open pit mining and therefore had averaged resource data into blocks of bigger mining panels which smoothed or averaged the grade data.

Uniform conditioning (UC) and LUC is used for assessing recoverable resources inside a mining panel when the drill spacing does not provide sufficient coverage for direct grade estimation at the SMU scale. UC provides the proportion of SMUs inside a panel that are above cut-off and its corresponding average grade. LUC takes the UC result and spatially corrects the blocks making it more suited to extraction and optimisation studies.

The new global resource estimate is as follows:

Cut-off U3O8 Total Indicated Total Inferred Global Total
Mt U3O8 (ppm) Contained U3O8 Mt U3O8 (ppm) Contained U3O8 Mt U3O8 (ppm) Contained U3O8
100 197.1 197 85.5 625 203 280.1 822.1 202 365.7
200 59.2 323 42.2 209.7 321 148.2 268.9 321 190.4
300 22.2 463 22.7 81.6 446 80.3 103.8 450 102.9

Table 2: 2015 Mineral resource estimates for ALL DEPOSITS at various U3O8 cut-offs

The 2014 drilling programmes targeted the early optimised shells which typically represents the earliest production potential. Previous results as reported to the ASX during 2014 (27 August and 15 December) highlighted some of the better grade intersections which would come early on in the potential production sequence. The results of the drilling programme increased confidence in these early production areas within Letlhakane, namely Kraken, Gorgon South and Serule West. The global resource area is 14km long and 11km wide and is divided into the aforementioned main prospect areas. The Letlhakane Uranium Project is divided into prospect areas as defined in the table below:

At a 200 ppm U3O8 cut-off the resource by prospect is:

2015 Mineral resource estimate for the Gojwane and Serule deposits – 200 ppm U3O8 cut off (LUC)
Ore Type Deposit Prospects Indicated Inferred Total
Mt U3O8 ppm U3O8 Mlbs Mt U3O8 ppm U3O8 Mlbs Mt U3O8 ppm U3O8 Mlbs
Secondary Gojwane Gorgon Main/West
Mokobaesi 2.0 371 1.6 2.0 371 1.6
Kraken 0.1 261 0.0 0.0 202 0.0 0.1 261 0.0
Total Secondary 2.1 367 1.7 0.0 202 0.0 2.1 367 1.7
Oxide Gojwane Gorgon Main/West 6.1 313 4.2 9.3 280 5.7 15.4 293 10.0
Mokobaesi 3.4 365 2.7 3.4 365 2.7
Kraken 3.9 310 2.6 0.7 280 0.4 4.5 306 3.1
Gorgon South 4.4 323 3.1 2.6 292 1.6 7.0 312 4.8
Serule Serule East 0.5 246 0.3 0.5 246 0.3
Serule West 0.4 302 0.2 11.7 322 8.3 12.1 322 8.6
Total Oxide 18.1 324 13.0 24.8 301 16.4 42.9 311 29.4
Primary Gojwane Gorgon Main/West 15.4 280 9.5 98.2 313 67.7 113.5 309 77.2
Mokobaesi 0.5 359 0.4 0.3 330 0.2 0.8 347 0.6
Kraken 7.7 350 5.9 1.0 349 0.8 8.7 349 6.7
Gorgon South 12.1 337 9.0 22.8 309 15.5 34.9 319 24.5
Serule Serule East 0.4 259 0.2 0.4 259 0.2
Serule West 3.3 376 2.8 62.4 345 47.4 65.7 346 50.2
Total Primary 39.0 321 27.5 185.0 323 131.8 223.9 323 159.4
Total 59.2 323 42.2 209.7 321 148.2 268.9 321 190.4

Table 3: 2015 LUC resource estimate at 200ppm cut-off.

Recent work completed by Perth-based resource specialists Optiro on a drill spacing study comparison at the Kraken deposit confirmed that at a starting drill spacing of 200m by 200m, the change of contained metal is within +/-10% when drilled down to 100m by 50m drill spacing. The current criteria for inferred resources is nominally greater than 100m by 100m drill spacing. A-Cap has confidence that the deposit will retain its mineralisation continuity when it is further drilled out.