ALLIANCE NICKEL LIMITED Processing Agreement executed with Saracen Gold Mines.
Mining Contractor and Camp Supplier appointed and ready to mobilise.
Drilling results below pit provide encouraging results and highlight depth potential at Devon. Mining Approval expected to be granted February 2016.
Metallurgical test program deferred.
Program reporting updated to 31 December 2015.
Maiden drilling program delivers encouraging results
NYGRC002 4m @ 10.6 g/t from 25m (includes 1m @ 32 g/t) NYGRC004 1m @ 23.6 g/t from 23m
Devon Gold Mine
Significant progress over the quarter was made in relation to the stage two pit expansion at the Company's 100% owned Devon Gold Mine with the following agreements and appointments completed. Progress over the quarter included the following:
Ore Purchase Agreement executed with Saracen Gold Mines - Carosue Dam Processing Facility
Mining and Haulage Contractor Appointed
Dewatering Permits Issued
Completion of Geotechnical Studies
Final grade control and step out drilling completed
Final metallurgical test work completed in line with expectations
Finalisation of Pit Design / Optimisation and Economic Evaluation Studies near complete
Contractors ready to mobilise in February 2016
Mining operation expected to be completed by July 2016
The Company has submitted a Mining Proposal to the Department for Mines and anticipates that approval to commence the operation will be received by early February 2016.
GME Resources Limited Quarterly Report -December 2015
Page 1 of 15
The expansion of operations at the Devon Gold Mine follows on from the successful trial mining development in May 2015 that produced approximately 15,000 tonnes of high grade ore (6.2 g/t) mined from a shallow open pit.
The planned stage two operation will result in a cut back of the existing mine that will allow the open pit to be developed to a maximum depth of approximately 40 metres. The expansion is a relatively straight forward mine and haul operation with ore processing to be undertaken at Saracen Gold Mine's Carosue Dam plant site facilitated through an Ore Purchase Agreement.
Hampton Mining Services have been appointed to undertake the mining program and will provide road haulage services under the processing arrangements agreed with Saracen. Camp and messing services will be supplied by Longreach camps.
Water pump testing is currently in progress to determine water inflow rates so that suitable pumping equipment is installed to maintain dewatering of the pit and historic workings.
The final pit design which draws on the geotechnical work, metallurgical test results and the recent block model and subsequent optimisation updates will be used to complete final economic evaluation for the development. Information relating the financial modelling and mine production rates will be released in due course.
Based on the most recent mining schedule (update in progress) the expanded operation is expected to take between 4 and 5 months to complete. Contractors engaged with the project are ready to mobilise as soon as approval is received.
The Company is also reviewing a standby finance facility to provide funding cover over the initial stages of the development where higher strip ratios will be encountered.
The final infill /step out grade control RC drilling program (41 holes for 1558 metres total, DVRC224-265)) was completed in late December. The program was predominately designed to close out mineralisation and delineate the ore boundaries within the block model for the stage 2 mine development. The step out holes were drilled to test for extensions of mineralisation below the proposed Stage 2 pit from collar positions that will be lost when mining recommences. (Refer: Appendix 1 Figures and Plans Devon Project).
Results from the deeper step-out drilling (i.e.16 RC holes for 948 m total) which intersected the down dip ore positions at the base and below the planned pit were encouraging and confirm continuity of high- grade mineralisation. Although it appears to be narrowing with depth, the ore body does not appear to have closed off. Significant down hole intercepts from December RC, step-out drilling include:
8 m @ 7.3 g/t Au from 34 m in DVRC243
Including 1 metre at 45.6 g/t from 34 m
2 m @ 18.8 g/t Au from 34 m in DVRC241
Including 1 metre at 36.2 g/t from 34 m
4 m @ 7.0 g/t Au from 44 m in DVRC237
Including 1 metre at 16.0 g/t from 46 m
4 m @ 5.8 g/t Au from 45 m in DVRC247
Including 1 metre at 21.7g/t from 45 m
5 m @ 3.8 g/t Au from 49 m in DVRC238
Including 1 metre at 14.8 g/t from 49 m
4 m @ 3.2 g/t Au from 49 m in DVRC248
Including 1 metre at 7.9 g/t from 50 m
2 m @ 5.5 g/t Au from 38 m in DVRC244
Including 1 metre at 10.1 g/t from 38 m
(Details given in GME ASX announcement 27thJanuary 2016)
GME Resources Limited Quarterly Report -December 2015
Page 2 of 15
Results from the step out drilling demonstrate that follow up work is warranted to assist with improved evaluation on the potential of an underground development. Design of a drilling program aimed at intersecting the mineralisation below the historic workings (60 metres) will be will be progressed over the next quarter although further drilling will not be undertaken until the mining program has been completed.
NiWest Nickel Laterite Heap Leach Project
Metallurgical test work on the development of the flow sheet for NiWest Nickel Laterite Heap Leach-SX- EW project has been deferred. As flagged in October the Company has decided to defer the remaining stages of the program due to the sustained fall in Nickel prices over the past 12 months. Work on the flow sheet design has now ceased and reporting has been updated. The deferral of the program will not have any detrimental effect on the PLS that has been generated from the bulk column test work that is to be used for the continuous piloting stages of the program.
The Company is of the view that the shifting of the funds allocated for the NiWest metallurgical test program to the Devon Gold Project is prudent in the current market.
New Y ear's Gift Prospect - Linden
During the reporting period the Company completed a first pass RC drilling program at the New Year's Gift gold prospect. The project was acquired in July 2015 and is located approximately 1000 metres to the north of the Company's Devon Gold Mine lease at Linden.
The New Year's Gift prospect is situated on the western flank of Lake Carey and hosted within the same north-northwest trending greenstone rock package as the Devon deposit. Minimal exploration in the modern era has been undertaken at New Year's Gift. Previous exploration included four shallow RAB holes that returned up to 6.2 g/t Au and recent rock chip sampling from costeans across the sub-cropping main quartz-limonite lode that returned grades between 0.5 to 29.2 Au grams per tonne.
The recent drilling program of four RC holes (i.e. NYGRC001-4) for a total of 200 metres was designed to intersect the projected mineralised lode below 20 metres. RC drill holes were nominally spaced 40 m apart testing the zone over approximately 150 metres of strike length. The results which include significant and multiple high-grade intercepts are encouraging and warrant further investigation. Details of drill hole intercepts, cross sections and a drill hole plan are shown in Appendix 2.
A follow up program is planned for Q3 2016 to test deeper into the structure and along strike, in particular the untested southern strike where shallow costean sampling returned an assay grading 29.2 g/t.
The next six months is a busy period for the Company as the Devon Project transitions to production phase and I look forward to providing further updates on activities as they unfold.
JAMIE SULLIVAN
MANAGING DIRECTOR
29 January 2016
GME Resources Limited Quarterly Report -December 2015
Page 3 of 15
Competent Person Statements
The Company confirms that it is not aware of any new information or data that materially affects the information included in the original market announcements and the Company confirms that the form and context in which the Competent Person's findings are presented have not materially changed from the original market announcement.
Devon Gold Project and New Year's Gift Project
The information in this report that relates to Exploration Results is based on information compiled by Mr Mark Gunther who is a member of The Australasian Institute of Geoscientists. Mr Gunther is a Principal Consultant with Eureka Geological Services. Mr Gunther has sufficient experience, which is relevant to the style of mineralization and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Gunther consents to the inclusion in the report of the matters based on information provided in the form and context in which it appears.
Where the Company refers to the Devon Gold Project Mineral Resource Estimate in this report (referencing the release made to the ASX on 29 June 2015), it confirms that it is not aware of any new information or data that materially affects the information included in that announcement and all material assumptions and technical parameters underpinning the resource estimate with that announcement continue to apply and have not materially changed.
NiWest Nickel Project
The information in this report that relates to Exploration Results and Mineral Resources is based on information compiled by Mr Stephen Hyland of Ravensgate Resource Consultants. Mr Hyland is a fellow of The Australasian Institute of Mining and Metallurgy. Mr Hyland is a Principal Consultant with Ravensgate Minerals Industry Consultants who consults to the Company. Mr Hyland has sufficient experience, which is relevant to the style of mineralization 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 Mineral Resources and Ore Reserves". Mr Hyland consents to the inclusion in the report of the matters based on information provided in the form and context in which it appears. This Mineral Resource Estimate has not been updated to JORC 2012 on the basis that the available information has not materially changed since the last review.
The information in this announcement that relates to Processing / Engineering and related operating and capital cost estimates is based on information reviewed by Mr David Readett (B.E. Met Eng., FAusIMM, CP (Met)). Mr Readett is an independent consulting engineer working through a Company known as MWorx Pty Ltd. Mr Readett is a Chartered Professional Metallurgical Engineer and has 25 years of relevant experience in this area of work. Mr Readett consents to the inclusion in this announcement of the matters based on information provided by him and in the form and context in which it appears.
Forward Looking Statements This announcement contains statements related to our future business and financial performance and future events or developments involving GME Resources (GME) that may constitute forward-looking statements. These statements may be identified by words such as "potential", "exploitable", "proposed open pit", "evaluation", "expect," "future," "further," "operation, "development, "plan," "permitting", "approvals", "processing agreement" or words of similar meaning. Such statements are based on the current expectations and certain assumptions of GME management & consultants, and are, therefore, subject to certain risks and uncertainties. A variety of factors, many of which are beyond GME's control, affect our operations, performance, business strategy and results and could cause the actual results, performance or achievements of GME to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements.
GME Gold Projects - Golden Cliffs NL - 100%
GME Resources Limited Quarterly Report -December 2015
Page 4 of 15
GME Resources Limited issued this content on 29 January 2016 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 08 February 2016 16:30:22 UTC
Original Document: http://clients3.weblink.com.au/pdf/GME/01707017.pdf
