ACTIVITI ES REPORT ASX. (Figure 1). benefit from. grid. "Stage One" TARGETS (1) Feasibility Study Update Q Study August 2012 $1,600

Transcription

1 ACTIVITI ES REPORT QUARTER ENDED 303 th SEPTEMBER 2013 ASX / TSX & Media Release ASX Code AZM TSX Code AZR 29 th October Investment Highlights: Wa Gold Project: 1.4Moz Measured & Indicated and 0.8Moz Inferred Mineral Resource (JORC / NI compliant) Perthbased gold explorer and developer Azumah Resources Limited (ASX:AZM TSX:AZR) ( Azumah orr the Company ) provides the following summary of f activities undertaken during the Quarter endedd 30 th September 2013 at its Wa Gold Project, northwest Ghana, West Africa (the Project ) (Figure 1). Azumah is focused on the exploration and development of the 100%owned, 3,100km 2 Project, which contains a JORC & NI independently estimated Mineral Resource recently expanded to more thann 2Moz Au (refer Table 2) ). A Feasibilityy Study and Mineral Reserve completed in August 2012 is being revised to reflect the expanded Mineral Resources, including an 84% growth in resources att the Julie deposit. The 2012 Study was based on a conventional 1.0Mtpa gravity/cil gold plant located adjacent to the flagship Kunche and Bepkong deposits. It confirmed that the Project has no technical impediments and will greatly benefit from grid power to site, water availability, good roads and communications and having no communitiess to relocate. The revised Feasibility Study will bee based on a 1.3Mtpa plant producing an average of 100,000oz Au per annumm with other Study targets as presented in Table 1 (refer ASX/TSX release datedd 19 th June 2013). Feasibility Study completed on a 1.0Mtpa operation Update of Feasibility Study and Mineral Reserves underway following substantial Minerall Resource increases 100% of 3,100km 2 licences hosting over 150km of prospective Birimian greenstone belt. Table 1: Summary of 2013 Feasibility Study Update Targets Gold Price forr Optimisationss Gold Price forr Revenue Plant throughput (primary ore) US$/oz US$/oz Mtpa TARGETS (1) Feasibility Study Update Q $1,200 $1, "Stage One" Feasibility Study August 2012 $1,300 $1, % strategic investment in neighbour, Castle Minerals Limited Board and management team of successful explorers, mining and corporate professionals Issued Capital: 335.2M ordinary shares 8. 0M unlisted options 5. 3M performance rights Directors & Management: Chairman: Michael Atkins Managing Director: Stephen Stone NonExecutive Directors: Geoff M Jones Bill LeClair Company Secretary: Dennis Wilkins Contact: Stephen Stone Mb: +61 (0) Optimised Mineral Resourcee Average goldd grade Contained gold Recovery (average) Annual production (average) Establishment capital Site cash costs (LOM) (3) (pre royalties) Total costs (LOM) incl. capital & royalties Mine life Project payback (post royalties & tax) % oz pa US$M US$/oz US$/oz years years ~91.0 ~100,000 ~$160M ~700 ~1, (1) See Notes on Table 1 below (2) Mineral Reserve (3) LOM = Life of Minee During the September Quarter, Azumah: Continued work on the revision of the Feasibility Study. Commenced additional metallurgical testt work on Julie primary mineralisation. Mt g/t oz TBD ,000 8 (2) 0 (2) 0 (2) ,000 $144M 802 1, Page 1 of 5

2 Azumah Resourcess Limited Activities Report Quarterr ended 30th September 2013 Completed relogging of drill cores from Julie and Bepkong deposits in order to better understand structural and lithological controls on mineralisation.. Progressed desktop reviews of a substantial database of exploration data generated over the past few years. Reviewed target prioritisations, evaluated several in the field, compiled data andd planned work programmes. Continued programme to delineate arsenic and other gold pathfinder elementt anomalies through t analysis of historical soil and auger sample residues using handheld XRF analysers. a Corporate Continued to evaluate and advance a variety of corporate and direct Project funding opportunities. Implemented additional costsaving and cash preservation initiatives. Retained cash and listed investments as of 30 th September 2013 of $3.833 million, ncluding a 15.5% strategic investment in Castle Minerals Limited (19.3m shares). Planned activity in the December Quarter: Continue metallurgical test work, confirmm Julie recoveries, finalise process flowsheet and plant equipment selection. Commence update of operating costs to enable pit optimisations to be rerun, final pit designs to be completed and revised Mineral Reserves reported. Review and update all capital costs to enable financiall model to bee finalised andd Feasibility Study completed. Progress lowcost soil and auger sampling programmes at Julie West, Collette, Yagha North, Butelee and Basabli North targets in orderr to confirm and/or better define anomalies and to enable drill programmes to be planned. Advance corporate and directt Project funding opportunities For further general information on Azumah Resources Limited and its projects p please visit the website and Azumah s own website Canadian Sedar Stephen Stone Managing Director Tel: +61 (0) stone@azuma ahresources..com.au Robert Gundelach Australia NWR Communications +61 (0) robert@nwrcommunications.com.au Joannaa Longo North America Terre Partners Page 2 of 5

3 Azumah Resourcess Limited Activities Report Quarterr ended 30th September 2013 Figure 1: Wa Gold Project Key Deposits andd Prospects Page 3 of 5

4 Azumah Resourcess Limited Activities Report Quarterr ended 30th September 2013 Table 2: Mineral Resource Estimate (CSA Global Pty Ltd June 2013) ) Cutoff Measured Indicated Measured and Indicatedd Inferred 0.5 g/t Au Tonnes Grade Gold Tonnes T Gradee Gold Tonnes Grade G Golld Tonness Grade Gold (Mt) (g/t Au) (oz) (Mt) (g/t Au) (oz) (Mt) ( g/t Au) (oz) (Mt) (g/t Au) (oz) Kunche Bepkong Aduane Julie , ,000 50, , , , , , , , , , ,000 Collette ,000 Total Values have been rounded 646, , ,406,, ,000 Table 3: Summary of Wa Gold Project Mineral Reserves (Coffey Mining Pty Ltd August 2012) Bepkong Kunche Julie (As of 21st Aug 2012) Total Values have been rounded Mineral Reserve Summary Proved Tonnes (Mt) Grade (g/t Au) Probable Tonnes (Mt) Grade (g/tt Au) Contained Gold oz o Au 117, ,000 74, ,000 Notes on Table 1 In relation to Feasibility Study Update Targets in i Table 1 ( Targets ), the potential quantity andd grade of the Target Optimisedd Mineral Resources is conceptual in nature, in that there has been insufficient study work completed to presently define the Optimised Mineral Resources. It is uncertain if the further f Feasibility Study work will result in the additional Optimised Mineral Resources. Please also refer to the Cautionary Statement. The Target Optimised Mineral Resources are based on preliminary Whittle optimisations using the t independentlly estimated January 2013 Measured & Indicated Mineral Resources at Kunche, Bepkong and Julie (Appendix 1 and 2) with the addition of 50% of the Inferred material captured within the optimised pits at Julie. This addition is consistent with infill drilling undertaken since January 2013 (refer( ASX release dated 13th June 2013). Optimisations have been scaled to account for ore losses and additional a waste expected during the final pit design phase. Scalings are consistent with the August 2012 Feasibility Study. Mining costs were derived from a contractor ss proposal for the Study. Given the expected increased scale of o operations at Julie, a downward revision to Julie mining costs has been applied and iss consistent with those mining costs in the Studyy for Kunche andd Bepkong. The Target Mineral Resourcee optimisations for Julie also include a haulage cost. Mining costs and haulagee costs will be updated as part of the Feasibility Study revision. Processing costs included in the Target Optimised Mineral Resources were updated byy GR Engineering Services Limited as at January Additional variability metallurgicall test work has been b undertaken for Kunche, Bepkong and Julie and results incorporated into thee 2013 Targets. Capital costs have been factored by Azumah using the 1.0Mtpa Study ass a base and will be updated as part p of the Feasibility Study revision. Other assumptions are as per the Study. Cautionary Statement The Company has not made a production decision and its strategic plan to develop a gold mining operation is subject to the results of an update to the Stage One Feasibility Study (refer ASX release dated d 28th August 2012) and other factors, some of o which are beyond the Company s control. The Mineral Resources disclosed herein are preliminary in nature and include Inferred Mineral Resources that are considered too speculative geologically to have economic considerations applied to them to be categorised as Mineral Reserves. There is no certainty that the Mineral Resources disclosed herein will be realised or converted to Mineral Reserves. Inferred Mineral Resources captured in optimised pits may not all bee converted to Measured and Indicated Resources. Mineral Resources which are not Mineral Reserves do not have demonstrated economic viability. Target, expected and a anticipated numbers contained herein are not confirmed, are not JORC or NI 43:101 compliant and are indicative only. Target Minerall Reserves implied herein are based on preliminary Whittle optimisations using adjusted Feasibility Study assumptions. Page 4 of 5

5 Azumah Resourcess Limited Activities Report Quarterr ended 30th September 2013 Competent Persons Statement The scientific and technical information in this report that relates to the insitu Mineral Resource estimates for thee Kunche, Aduane and Julie deposits is based on information compiled by Mr Dmitry Pertel, who a fulltimee employee (Manager Resources) of CSA Global Pty Ltd. Mr Pertel is a Member of the Australian Institute of Geoscientists and has sufficient experience which is relevant to the style of mineralisation andd type of deposit under consideration and to t the activity which he is undertaking to qualify ass a Competent Person as defined in the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves and to qualify as a Qualified Person as defined inn National Instrument Standards of Disclosure for f Mineral Projects ( NI ) of the Canadian Securities Administrators. Mr Pertel has reviewedd and approved the disclosure of the relevant scientific or technical t information contained in this announcement that relates to the Kunche, Aduane and Julie Mineral M Resourcee estimates. The scientific and technical information in this report that relates too the insitu Mineral Resource estimates for the Bepkong deposit is based on information compiled by Mr David Williams, who is a geological consultant employed by CSA Global Pty Ltd. Mr Williams is s a Member of the Australian Institute of Geoscientists and the Australian Institute of Mining and Metallurgyy and has sufficient experience which w is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person P as definedd in the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and d Ore Reserves and to qualify as a Qualified Person as defined inn National Instrument Standards of Disclosure for Mineral Projects ( NI ) of the Canadiann Securities Administrators. Mr Williams has reviewed and approved the disclosure of all scientific or technical information contained c in this announcement that relates to thee Bepkong Mineral Resource estimate. The scientific and technical information in this report that relates too the geology of the deposits andd exploration results is based on information compiled by Mr Stephen Stone, who is a fulltime employee (Managing Director) of Azumah Resources Ltd. Mr Stone is a Member of the Australian Institute of of Mining and Metallurgy and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves and to qualify as a Qualified Person as definedd in National Instrument Standards of Disclosure for Mineral Projects ( NI ) of the Canadian Securitiess Administrators. Mr Stone is the Qualified Person overseeing Azumah s exploration projects and has reviewed and approved the disclosure of all scientific or technical information contained in this announcement. For further information, including a description of o Azumah s standard data verification processes, quality assurance and quality control measures, and details of the key assumptions, parameters and methods used to estimate the Mineral Resources and a Mineral Reserves set out in this report and the extent to t which the estimate of previously declared Mineral Resources and Mineral Reserves set out herein may be materially affected a by any known environmental, permitting, legal, title, taxation, sociopolitical, marketing or relevant issues, readers are directed to the technical report titled Wa Gold Project, Ghana Technical Report, effectivee as of 27 August, 2012, available on com. The reported Mineral Reserves have been compiled by Mr Harry Warries. Mr Warries is a Fellow of o the Australasian Institute of Mining and Metallurgy and an employee of Coffey Mining Pty Ltd. He has sufficient experience, relevant to the style of mineralisation and type of deposit under considerationn and to the t activity he is undertaking, to qualify as a Qualified Person ass defined in the Canadian Institute of Mining, Metallurgy and Petroleum (CIM) Definition Standards of November 2010, as well as a Competent Person as defined in the Australasian Codee for Reporting of Mineral Resources and Ore Reserves of December 2004 ( JORC Code ) as prepared byy the Joint Ore Reserves Committee of the Australasian Institute of Mining and Metallurgy, the Australian Institute of Geoscientists and the Minerals Councill of Australia. Mr Warries gives Azumah Resources Limited consent to use this reserve estimate in reports. ForwardLooki ing Statement This release contains forwardlooking information. Such forwardlooking information is often, but not always, identified by the use of o words such as seek, anticipate, believe, plan, estimate, expect and intend, andd statements that an event or result may, will, should, could, or might occur or be achieved, and other similar expressions. In providing the forwardlooking information in this news release, r the Company has made numerous assumptions regarding: (i) the accuracy of exploration results received to date; (ii) anticipated costs and expenses; (iii) that the results of the feasibility study continue to be positive; and (iv) that future exploration results are as anticipated. Management believes that these assumptions aree reasonable. Forwardlooking information is subject to known andd unknown risks, uncertainties and other factors f that could cause actual results to differ materially from those contained in the forwardlooking information.. Some of these risks, uncertainties and other factors are described under the heading Risks Factors inn the Company s annual information form available on Forwardlookinlaw, Azumah does not information is based on estimates and opinions of managementt at the date the statements aree made. Except t as required by undertake any obligation to update forwardlooking information even if circumstances or management s estimates or opinions should change. Readers should not place reliance on forwardlooking information and readers are advised to consider such forwardlooking f statements in light of the risks set forth in the t Company s continuous disclosure filings as found at the (Canadian) SEDAR website. Page 5 of 5

6 Appendix 5B Mining exploration entity ly report Appendix 5B Rule 5.3 Mining exploration entity ly report Name of entity Azumah Resources Limited ABN Quarter ended ( current ) SEPTEMBER 2013 Consolidated statement of cash flows Cash flows related to operating activities Current Year to date (3 months) 1.1 Receipts from product sales and related debtors 1.2 Payments for (a) exploration & evaluation (b) development (c) production (d) administration (505) (560) (505) (560) 1.3 Dividends received 1.4 Interest and other items of a similar nature received 1.5 Interest and other costs of finance paid 1.6 Income taxes paid 1.7 Other (provide details if material) Research & Development Tax Incentive Net Operating Cash Flows (563) (563) Cash flows related to investing activities 1.8 Payment for purchases of: (a) prospects (b) equity investments (c) other fixed assets 1.9 Proceeds from sale of: (a) prospects (b) equity investments (c) other fixed assets 1.10 Loans to other entities 1.11 Loans repaid by other entities 1.12 Other (provide details if material) Net investing cash flows 1.13 Total operating and investing cash flows (carried forward) (563) (563) + See chapter 19 for defined terms. Appendix 5B Page 1

7 Appendix 5B Mining exploration entity ly report 1.13 Total operating and investing cash flows (brought forward) (563) (563) Cash flows related to financing activities 1.14 Proceeds from issues of shares, options, etc Proceeds from sale of forfeited shares 1.16 Proceeds from borrowings 1.17 Repayment of borrowings 1.18 Dividends paid 1.19 Other (provide details if material) Net financing cash flows Net increase (decrease) in cash held (563) (563) 1.20 Cash at beginning of /year to date 3,619 3, Exchange rate adjustments to item Cash at end of 3,056* 3,056* * Excludes listed investments of $772,632 Payments to directors of the entity and associates of the directors Payments to related entities of the entity and associates of the related entities 1.23 Aggregate amount of payments to the parties included in item Aggregate amount of loans to the parties included in item 1.10 Current $A' Explanation necessary for an understanding of the transactions Item 1.23 includes aggregate amounts paid to directors including salary, directors fees, consulting fees and superannuation Noncash financing and investing activities 2.1 Details of financing and investing transactions which have had a material effect on consolidated assets and liabilities but did not involve cash flows Details of outlays made by other entities to establish or increase their share in projects in which the reporting entity has an interest Financing facilities available Add notes as necessary for an understanding of the position. Amount available Amount used 3.1 Loan facilities Nil Nil 3.2 Credit standby arrangements Nil Nil + See chapter 19 for defined terms. Appendix 5B Page 2

8 Appendix 5B Mining exploration entity ly report Estimated cash outflows for next 4.1 Exploration and evaluation Development 4.3 Production 4.4 Administration 278 Total 612 Reconciliation of cash Reconciliation of cash at the end of the (as shown in the consolidated statement of cash flows) to the related items in the accounts is as follows. Current Previous 5.1 Cash on hand and at bank 581 1, Deposits at call 2,475 2, Bank overdraft 5.4 Other (provide details) Total: cash at end of (item 1.22) 3,056 3,619 Changes in interests in mining tenements 6.1 Interests in mining tenements relinquished, reduced or lapsed 6.2 Interests in mining tenements acquired or increased Tenement reference Nature of interest (note (2)) Interest at beginning of Interest at end of + See chapter 19 for defined terms. Appendix 5B Page 3

9 Appendix 5B Mining exploration entity ly report Issued and quoted securities at end of current Description includes rate of interest and any redemption or conversion rights together with prices and dates. Total number Number quoted 7.1 Preference + securities (description) 7.2 Changes during (a) Increases through issues (b) Decreases through returns of capital, buybacks, redemptions Ordinary securities 335,189, ,189,096 Issue price per security (see note 3) (cents) Amount paid up per security (see note 3) (cents) 7.4 Changes during (a) Increases through issues (b) Decreases through returns of capital, buybacks Convertible debt securities (description) 7.6 Changes during (a) Increases through issues (b) Decreases through securities matured, converted 7.7 Options (description and conversion factor) 7.8 Issued during 1,125,000 1,125,000 4,500,000 1,000,000 2,000, ,000 Exercise price 26 cents 26 cents 60 cents 92.4 cents Expiry date 15 December November November December Exercised during 7.10 Expired/cancelled during 7.11 Performance Rights Expiry date 5,000, , November November Issued during 4,000, November Exercised during 7.14 Expired/cancelled during 1,000, , , , November November November November See chapter 19 for defined terms. Appendix 5B Page 4

10 Appendix 5B Mining exploration entity ly report Compliance statementt 1 2 This statement has been prepared under accounting policies whichh comply with accounting standards as defined in the Corporations Act A or other standards acceptable to ASX (see note 5). This statement does /does not* (delete one) give a true and fair view of the matters disclosed. Sign here: Date: 299 October 2013 (Company secretary) Print name: Denniss Wilkins Notes The ly report providess a basis for informing the market howw the entity s activities have been financedd for the past and the effect onn its cash position. An entity wanting to disclosee additional information is i encouraged to do so, in a note or notes attached to this report. The Nature of interest (items 6.1 and 6.2) includes options in respect of interests in mining tenements acquired, exercised or lapsed during the reporting period. If I the entity is involved in a joint venture agreement and there are conditions precedent which will change its percentage interest in a mining tenement, it should disclose the change of percentage interestt and conditions precedent in the list required for items 6.1 and 6.2. Issued and quoted securities The issue price and amount paid up is not required in items 7.1 and 7.3 for fully paid securities. The definitions in, and provisions of, AASB 6: Exploration for andd Evaluation of Mineral Resources and AASBB 107: Statement of Cashh Flows applyy to this report. Accounting Standards ASX will accept, for example, the use of International Financial Reporting Standards for foreign entities. If the standards used do not address a topic, the Australian standard on that topic (if any) must be complied with. == == == == == + See chapter 19 for defined terms. Appendix 5B Page 5