FEASIBILITY STUDY - NYNGAN SCANDIUM PROJECT Bogan Shire, NSW, Australia
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Brisbane, QLD, Australia FEASIBILITY STUDY - NYNGAN SCANDIUM PROJECT Bogan Shire, NSW, Australia NI 43-101 Technical Report Prepared For: Scandium International Mining Corp. Prepared By: Maxel Rangott, B.Sc, FAusIMM Stuart Hutchin, B.Sc (Geology), MAusIMM, MAIG CP (Geo) Dean Basile, B.Eng.(Mining), GDipAppF&I, MAusIMM CP(Min) Dr. Nigel Ricketts, B.Eng (Chem), PhD (Metallurgy), MAusIMM, CP (Metallurgy) Dr. Geoffrey Duckworth, B.Eng (Chem), M.Eng.Sc, PhD, FIChemE, MIEAust, FAusIMM, RPEQ 2702 Timothy David Rowles, B.Sc., M.Sc. MAusIMM CP (Enviro), RPEQ 10166 Effective Date: April 15, 2016 Report Date: May 4, 2016 Revision: 0 NYNGAN SCANDIUM PROJECT NATIONAL INSTRUMENT 43-101 TECHNICAL REPORT Effective Date and Certificates The Effective Date of this technical report is 15 April 2016. The Report Date of publication of this technical report is 4 May, 2016. Following are signed and dated Certificates of Qualifications of the persons responsible for the report. 3185\16.04\3185-000-GEREP-0001_0 May 2016 NYNGAN SCANDIUM PROJECT NATIONAL INSTRUMENT 43-101 TECHNICAL REPORT Certificate of Qualified Person – Stuart Hutchin, B.Sc (Geology), MAusIMM, MAIG CP (Geo) I, Stuart Hutchin, B.Sc (Geology), MAusIMM, MAIG CP (Geo), Level 9, 50 Market Street, Melbourne, Victoria, Australia, do hereby certify that: I am employed as Geology Manager for Mining One consultants of, Melbourne, Victoria, Australia, specialising in mining engineering consulting, contracting for a wide variety of clients, and have been so employed since 2011. This certificate applies to the Technical Report, titled “Feasibility Study - Nyngan Scandium Project” with an effective date of 15 April, 2016. I graduated with a Bachelor of Science degree Applied Geology from the University of South Australia, Australia. I am a current member of the Australasian Institute of Mining and Metallurgy (MAusIMM) and the Australian Institute of Geoscientists (MAIG). I have read the current definition of a “Qualified Person” (QP) as set out in NI 43-101, and state by virtue of my education, membership in professional associations, and past relevant work experience, which spans over 17 years in the field of exploration, 3D modelling, resource estimation and mine geology in both open pit and underground projects, I fulfil the requirements to be a QP for the purposes of NI 43-101. I have conducted a site visit to the Nyngan site on October 15, 2015, in conjunction with issuance of this report. I am responsible for Sections 10 to 12 and 14 of this Report. I contributed in the areas covered by these Sections in the Summary, Section 1, as well. I am an independent of the issuer, as defined by the test in section 1.5 of the NI43-101. I have read the NI43-101 and Form 43-101F1 and all of the sections of the Technical report for which I am responsible, and those sections have been prepared in compliance therewith. As of the date of this certificate, to the best of my knowledge, information and belief, the sections referenced above contain all scientific and technical information that is required to be disclosed to make the Technical Report not misleading. Dated: 4 May, 2016 Signed: Stuart Hutchin, B.Sc (Geology), MAusIMM, MAIG CP (Geo) 3185\16.04\3185-000-GEREP-0001_0 May 2016 NYNGAN SCANDIUM PROJECT NATIONAL INSTRUMENT 43-101 TECHNICAL REPORT Certificate of Qualified Person – Dean Basile, B Eng. (Mining), GDipAppF&I, MAusIMM CP (Min) I, Dean Basile, B.Eng.(Mining), GDipAppF&I, MAusIMM CP(Min), Level 9, 50 Market Street, Melbourne, Victoria, Australia, do hereby certify that: I am employed as a Principal Mining Engineer for Mining One consultants of, Melbourne, Victoria, Australia, specialising in mining engineering consulting, contracting for a wide variety of clients, and have been so employed since 2008. This certificate applies to the Technical Report, titled “Feasibility Study - Nyngan Scandium Project” with an effective date of 15 April, 2016. I graduated with a Bachelor of Engineering in Mining from Ballarat University, Australia. I am a current member of the Australasian Institute of Mining and Metallurgy (MAusIMM CP Min). I have read the current definition of a “Qualified Person” (QP) as set out in NI 43-101, and state by virtue of my education, membership in professional associations, and past relevant work experience, which spans over 20 years in the field of mine design, planning, reserves, technical and operational management with multiple companies and projects, I fulfil the requirements to be a QP for the purposes of NI 43-101. Stuart Hutchin attended site on October 15, 2015 as a representative of Mining One confirming that it is a “greenfield site”, the existing landscape and relevant infrastructure was representative of the electronic topographic data provided and sited representative drill core. I am responsible for Sections 15 and 16 of this Report. I reviewed and contributed in the areas covered by these Sections in the Summary, Section 1, as well. I am an independent of the issuer, as defined by the test in section 1.5 of the NI43-101. I have had prior involvement with the property that is the subject of this Technical Report, in that I was QP on the Preliminary Economic Assessment Report, titled “Amended Technical Report and Preliminary Economic Assessment on the Nyngan Scandium Project, NSW, Australia” with an effective date of October 10, 2014. I have read the NI43-101 and Form 43-101F1 and all of the sections of the Technical report for which I am responsible, and those sections have been prepared in compliance therewith. As of the date of this certificate, to the best of my knowledge, information and belief, the sections referenced above contain all scientific and technical information that is required to be disclosed to make the Technical Report not misleading. Dated: 4 May, 2016. Signed: Dean Basile, B.Eng.(Mining), GDipAppF&I, MAusIMM CP(Min) 3185\16.04\3185-000-GEREP-0001_0 May 2016 NYNGAN SCANDIUM PROJECT DEFINITIVE FEASIBILITY STUDY NATIONAL INSTRUMENT 43-101 TECHNICAL REPORT 3185-000-GEREP-0001 Table of Contents Page 1.0 SUMMARY 1.1 1.1 Introduction and Statement of Objectives of the Technical Report 1.1 1.2 DFS Financial Highlights 1.2 1.3 Property Description and Location 1.3 1.4 Project Geology and Resources 1.4 1.5 Mineral Reserve Estimates 1.5 1.6 General Project Description 1.5 1.7 Mining Activity Detail 1.7 1.8 Process Plant Detail 1.7 1.9 Project Infrastructure 1.10 1.10 Environmental Studies, Social or Community Impact 1.11 1.11 Project Permitting Requirements 1.11 1.12 Mine Closure Requirements 1.12 1.13 Key Research and Investigations 1.13 1.14 Project Capital Cost 1.14 1.15 Project Operating Cost 1.15 1.16 Sensitivities to Finance and Operating Variances 1.17 1.17 Interpretation and Conclusions 1.20 1.18 Recommendations 1.21 2.0 INTRODUCTION 2.1 2.1 Introduction 2.1 2.2 Terms of Reference and Purpose of Report 2.1 2.3 Effective Dates 2.2 2.4 Definitions 2.2 3.0 RELIANCE ON OTHER EXPERTS 3.1 3.1 Introduction 3.1 4.0 PROPERTY DESCRIPTION AND LOCATION 4.1 4.1 Property Location 4.1 4.2 Mineral Titles 4.2 5.0 ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND PHYSIOGRAPHY 5.1 5.1 Topography, Elevation and Vegetation 5.1 5.2 Climate and Length of Operating Season 5.1 5.3 Access to Property 5.1 5.4 Surface Rights 5.1 5.4.1 Access Roads and Transportation 5.2 5.4.2 Power Supply 5.2 5.4.3 Town of Nyngan 5.2 5.4.4 Water Supply 5.3 5.4.5 Port 5.3 5.4.6 Buildings and Ancillary Facilities 5.3 5.4.7 Manpower 5.3 3185\16.04\3185-000-GEREP-0001_0 May 2016 NYNGAN SCANDIUM PROJECT DEFINITIVE FEASIBILITY STUDY NATIONAL INSTRUMENT 43-101 TECHNICAL REPORT 3185-000-GEREP-0001 Table of Contents Page 6.0 HISTORY 6.1 6.1 Origins of the Name ‘Gilgai’ 6.1 6.2 Past Exploration and Development 6.1 7.0 GEOLOGICAL SETTING AND MINERALISATION 7.1 8.0 DEPOSIT TYPE 8.1 8.1 Mineralisation 8.1 9.0 EXPLORATION 9.1 9.1 Surveys and Investigations Done For/By SCY or EMC 9.1 9.2 Surveys and Investigations Done by Others 9.1 10.0 DRILLING 10.1 10.1 Drill Program Overview 10.1 10.2 Initial 2006 Drilling Program - Procedures 10.1 10.3 EMC-A 2014 to 2015 Drilling Program - Procedures 10.2 10.4 Drill Recoveries and Drilling Conditions 10.3 10.5 Drill Collar Surveying and Locations 10.3 10.6 Establishing Higher Confidence in Proposed Mining Location 10.4 10.7 Relevant Samples – 2014 and 2015 Drilling Results 10.4 10.8 Specific Gravity Determinations 10.14 11.0 SAMPLING PREPARATION, ANALYSES AND SECURITY 11.1 11.1 Sample Recovery Methods - General 11.1 11.2 Sample Recovery Methods – 2006 Drill Program 11.1 11.3 Sample Recovery Methods – 2014 to 2015 Drill Program 11.2 11.4 Assaying and Analytical Procedures 11.4 11.5 Laboratory Certification 11.6 11.6 Quality Control – Duplicates, Blanks, and Standards 11.6 11.7 Adequacy Opinion of Author 11.10 12.0 DATA VERIFICATION 12.1 12.1 Data Verification Measures 12.1 12.2 Data Verification on 2010 and 2014 Technical Reports 12.1 12.3 Mining One Data Verification on 2016 Technical Report 12.2 12.4 Site Inspections 12.3 12.5 Opinion on Data Adequacy 12.3 13.0 MINERALS PROCESSING AND METALLURGICAL TESTING 13.1 13.1 Metallurgical Sampling and Test Programs 13.1 13.2 Mineralised Resource Provided to Metallurgical Laboratories 13.1 13.3 Metallurgical Testing - Current Project Flowsheet 13.4 13.3.1 High Pressure Acid Leach Test Work 13.5 13.3.2 Solvent Extraction Test Work 13.6 13.3.3 Scandium Oxide Precipitation Test Work 13.7 13.3.4 Filtration and Residue Settling Test Work 13.8 13.3.5 Future Test Work 13.8 3185\16.04\3185-000-GEREP-0001_0