Galaxy Resources: Mt. Cattlin (Western Australia) Project No. 2541 NI43-101 Technical Report 31 December 2011
Final
Galaxy Resources: Mt. Cattlin (Western Australia) Project No. 2541
NI43-101 Technical Report 31 December 2011
Office Locations This report has been prepared by Snowden Mining Industry Consultants („Snowden‟) on behalf of Galaxy Resources. Perth 87 Colin St, West Perth WA 6005 2011 AUSTRALIA PO Box 77, West Perth WA 6872 All rights are reserved. No part of this document may be reproduced, AUSTRALIA stored in a retrieval system, or transmitted in any form or by any means, Tel: +61 8 9213 9213 electronic, mechanical, photocopying, recording or otherwise, without the Fax: +61 8 9322 2576 prior written permission of Snowden. ABN: 99 085 319 562 [email protected]
Brisbane Level 15, 300 Adelaide Street Prepared Robert Spiers Brisbane QLD 4000 AUSTRALIA by BSc, (Hons - DMajor Geology / Geophysics), MAIG Senior Consultant - Resource Geology ...... PO Box 2207, Brisbane QLD 4001 AUSTRALIA Jeremy Peters BEng (Mining Engineering), Tel: +61 7 3231 3800 BSc, (Geology), Mine Managers Certificate, MAusIMM Fax: +61 7 3211 9815 Principal Consultant – Mining ...... ABN: 99 085 319 562 [email protected] Leon Lorenzen PhD (Metallurgical Engineering), MSc(Eng), BEng (Chemical Engineering), PrEng, Johannesburg CPEng, CEng, PrEng, FAusIMM, FSAIMM, Technology House, Greenacres Office FIChemE, FSAAE Park, Cnr. Victory and Rustenburg Group General Manager / Executive Consultant (Metallurgy) ...... Roads, Victory Park JOHANNESBURG 2195 SOUTH AFRICA PO Box 2613, Parklands 2121 SOUTH AFRICA Tel: + 27 11 782 2379 Fax: + 27 11 782 2396 Reg No. 1998/023556/07 [email protected]
Vancouver Suite 550, 1090 West Pender St, VANCOUVER BC V6E 2N7 CANADA Tel: +1 604 683 7645 Fax: +1 604 683 7929 Reg No. 557150 [email protected]
Calgary Suite 850, 550 11th Avenue SW CALGARY, ALBERTA T2R 1M7 Tel +1 403 452 5559 Fax +1 403 452 5988 [email protected]
Belo Horizonte Afonso Pena 2770, CJ 201 A 205 Funcionários, 30.130-007, BELO HORIZONTE MG BRASIL Tel: +55 (31) 3222-6286 Fax: +55 (31) 3222-6286 [email protected]
Oxford Issued by: Perth Office Lvl 3, The Magdalen Centre 1 Robert Doc Ref: 120504_FINAL_2541_NI43-101_Galaxy.docx Robinson Avenue The Oxford Science Park OXFORD OX4 4GA Last Edited: 4/05/2012 11:24:00 AM Tel: +44 1865 784 884 Fax: +44 1865 784 888 Number of copies [email protected] Snowden: 2 Website Galaxy Resources: 2 www.snowdengroup.com
Galaxy Resources: Mt. Cattlin (Western Australia) NI43-101 Technical Report
1 Summary ...... 13 1.1 Property description ...... 13 1.2 Geology ...... 13 1.3 Mineralisation ...... 13 1.4 Current status of exploration ...... 14 1.5 Mineral resource estimate ...... 14 1.6 Mineral Reserve estimate ...... 15 1.7 Mining ...... 15 1.8 Mt. Cattlin processing plant ...... 16 1.9 Jiangsu lithium carbonate plant ...... 16 1.10 General ...... 17 1.11 Recommendations ...... 18 1.11.1 Future exploration strategy ...... 18 1.11.2 Mineral Resources ...... 18 1.11.3 Mining ...... 19 1.11.4 Mt. Cattlin process plant ...... 19 1.11.5 Jiangsu lithium carbonate plant ...... 19 2 Introduction and terms of reference ...... 20 2.1 Capability and independence...... 20 2.2 Qualified persons responsible for this report ...... 21 2.3 Scope of work ...... 21 2.4 Project team ...... 22 3 Reliance on other experts ...... 23 4 Property description and location ...... 24 5 Accessibility, climate, local resources, infrastructure and physiography ...... 27 5.1 Accessibility and infrastructure ...... 27 5.2 Climate ...... 27 6 History ...... 28 6.1 Ownership history ...... 28 6.2 Historical and current mining ...... 28 6.3 Historical estimates ...... 29 7 Geological setting ...... 30 7.1 Regional geology ...... 30 7.2 Property geology ...... 30 7.3 Mineralisation ...... 31 8 Deposit types ...... 37 8.1 Pegmatite deposits ...... 37 8.2 Greenbushes lithium mine ...... 38 8.3 Lithium brines ...... 38 9 Exploration ...... 39 9.1 Geological mapping ...... 39 9.2 Surface sampling ...... 40 9.3 Remote sensing ...... 40 9.4 Airborne geophysics ...... 41 9.5 Other exploration ...... 41 10 Drilling ...... 44
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10.1 RC drilling ...... 45 10.2 Diamond drilling ...... 47 10.3 Grid convention ...... 47 10.4 Drill collar surveying ...... 47 10.5 Downhole surveying ...... 47 10.6 Bulk density determination ...... 48 10.7 Drill hole data ...... 50 10.8 Drill hole spacing ...... 51 10.9 Results ...... 53 11 Sampling preparation, analyses and security ...... 54 11.1 Sample preparation ...... 54 11.2 Analytical methods ...... 55 11.3 Sample security ...... 56 11.4 Sample quality control measures ...... 56 11.4.1 Standards ...... 56 11.4.2 Coarse blanks – Galaxy provided to laboratory ...... 56 11.4.3 SGS laboratory internal blank analysis ...... 59 11.4.4 Certified reference material ...... 59 11.4.5 Internal duplicate and repeat analysis - SGS ...... 66 11.4.6 Analysis of Galaxy field duplicates - SGS ...... 69 11.4.7 SGS Re-analysis ...... 73 11.4.8 Inter-laboratory check analysis by Genalysis ...... 78 11.4.9 Drill sample recovery data ...... 79 12 Data verification ...... 81 12.1 Data verification ...... 81 12.1.1 Data verification procedures ...... 81 12.1.2 Data verification limitations ...... 81 12.1.3 Data adequacy ...... 82 13 Mineral Resource estimates ...... 83 13.1 Mt. Cattlin resource modelling ...... 83 13.1.1 Treatment of data and unsampled intervals ...... 84 13.1.2 Compositing ...... 85 13.1.3 Representation of data values ...... 85 13.1.4 Bivariate statistics and co-regionalisation...... 85 13.1.5 Conditional statistics and high end member modification...... 91 13.2 Spatial continuity analysis ...... 92 13.2.1 Domaining - Zones 1 to 6 ...... 93 13.3 Ordinary Kriging Resource Estimate ...... 95 13.3.1 Resource estimation methodology...... 95 13.3.2 Domain 1 to 6 Ordinary Kriging Parameters ...... 96 13.4 Resource classification ...... 96 13.5 Verification and validation ...... 98 13.6 Results ...... 103 14 Mineral Reserve Estimates ...... 105 14.1 Introduction ...... 105 14.2 Mineral Reserve Estimate ...... 105 14.2.1 Optimisation inputs ...... 105
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14.2.2 Mining recovery ...... 106 14.2.3 Mining dilution ...... 106 14.2.4 Cut-Off grades...... 106 14.3 Optimisation results ...... 108 14.4 Mining operations ...... 112 14.4.1 Pit design ...... 112 14.4.2 Mine life and project schedule ...... 115 14.5 Legal, social, environmental and governmental ...... 119 14.6 Mineral Reserve Estimate ...... 119 15 Mining methods ...... 120 15.1 Mt. Cattlin ...... 120 15.1.1 Mining method...... 120 15.1.2 Mine design ...... 120 15.1.3 Mining progress...... 121 16 Mineral processing (metallurgical and chemical plants) ...... 124 16.1 Mt. Cattlin Mine ...... 124 16.1.1 Introduction ...... 124 16.1.2 General process description ...... 124 16.1.3 Detailed process description ...... 125 16.1.4 Flowsheet changes from DFS to final design ...... 128 16.1.5 Lithium grade and recovery ...... 128 16.1.6 Throughput capacity ...... 129 16.1.7 Spodumene recovery ramp-up ...... 129 16.1.8 Spodumene grade ...... 129 16.1.9 Construction, commissioning and ramp-up of process plant ...... 129 16.1.10 Power station and borefield ...... 129 16.1.11 Tailings storage facility ...... 132 16.1.12 Operations ...... 133 16.1.13 Commissioning...... 133 16.1.14 Practical and operational completion ...... 135 16.2 Jiangsu ...... 137 16.2.1 Introduction ...... 137 16.2.2 Plant location ...... 137 16.2.3 Process description ...... 138 16.2.4 Area 10: Ore Stockpile and Reclaim ...... 139 16.2.5 Area 20: Calcination, Milling and Sulphation ...... 139 16.2.6 Area 30: Leaching and Impurity Removal ...... 140 16.2.7 Area 40: Lithium Carbonate Primary Crystallisation ...... 142 16.2.8 Area 50: Bicarbonate Purification...... 143
16.2.9 Area 60: Sodium Sulphate (Na2SO4) Crystallisation...... 145 16.2.10 Area 70: Reagents ...... 145 16.2.11 Area 80: Utilities ...... 146 16.2.12 Area 90: Alumina-Silicate Disposal ...... 148 16.2.13 DFS assumptions ...... 148 16.2.14 Construction progress ...... 149 16.3 Other comments ...... 153 16.3.1 Process patent ...... 153 16.3.2 Management ...... 154
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17 Reconciliations ...... 155 18 Infrastructure ...... 160 18.1 Background ...... 160 18.2 Roads ...... 160 18.3 Spodumene transport from Mt. Cattlin ...... 160 18.4 Spodumene unloading in China ...... 160 18.5 Jiangsu lithium carbonate plant ...... 161 18.6 Lithium carbonate deliveries to customers ...... 163 19 Market studies and contracts ...... 164 19.1 Background ...... 164 19.2 Overview of lithium demand ...... 165 19.3 Lithium demand outlook ...... 166 19.4 Overview of lithium supply ...... 166 19.5 Lithium mineral concentrate production ...... 166 19.5.1 Conversion of lithium minerals to lithium compounds...... 166 19.5.2 Brine production ...... 167 19.6 Supply outlook ...... 167 19.6.1 New hard rock lithium mineral conversion projects ...... 168 19.6.2 New brine projects ...... 168 19.7 Lithium carbonate pricing ...... 168 19.8 Offtake contracts ...... 170 20 Environmental studies, permitting and social impact...... 171 20.1 Mt. Cattlin ...... 171 20.1.1 Land disturbance...... 172 20.1.2 Waste rock ...... 172 20.1.3 Tailings storage facility ...... 173 20.1.4 Low grade ore stockpiles ...... 175 20.1.5 Land contamination ...... 175 20.1.6 Water resources ...... 175 20.1.7 Noise ...... 175 20.1.8 Air quality ...... 175 20.1.9 Environmental management ...... 175 20.1.10 Native title ...... 176 20.1.11 Aboriginal heritage ...... 176 20.1.12 Current environmental matters ...... 176 20.2 Lithium carbonate processing plant ...... 177 20.2.1 Statutory approvals and regulations ...... 177 21 Capital and operating cost ...... 179 21.1 Mt. Cattlin ...... 179 21.1.1 Process plant capital costs ...... 179 21.1.2 Operating costs ...... 179 21.2 Jiangsu ...... 179 21.2.1 Process plant capital costs ...... 179 21.2.2 Operating costs ...... 179 22 Adjacent properties ...... 180 23 Economic analysis ...... 181 23.1 General ...... 181
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23.1.1 Prices ...... 181 23.1.2 Exchange rates ...... 181 23.1.3 Physical assumptions ...... 181 23.1.4 Financial outputs ...... 181 23.2 Taxes and royalties ...... 185 23.2.1 Corporate tax ...... 185 23.2.2 Mineral royalty ...... 185 23.2.3 Value added tax ...... 185 23.2.4 Withholding tax...... 185 24 Interpretation and conclusions ...... 186 24.1 Potential risks ...... 186 25 Recommendations ...... 187 25.1 Mineral Resources ...... 187 25.2 Jiangsu lithium carbonate plant ...... 187 26 References ...... 188 27 Glossary of terms ...... 191 28 Dates and signatures ...... 195 29 Certificate of author...... 196 Tables Table 1.1 Measured and Indicated Mineral Resource Estimate ...... 15 Table 1.2 Inferred Mineral Resource Estimate ...... 15 Table 1.3 Galaxy Resources – Mt. Cattlin Mineral Reserves as of December 2011...... 15 Table 2.1 Site visits to Mt. Cattlin and Jiangsu ...... 20 Table 2.2 Responsibilities of each qualified persons ...... 21 Table 2.3 Responsibilities of project team ...... 22 Table 6.1 North Ravensthorpe Mineral Resource, Hellman & Schofield (May 2001) ...... 29 Table 9.1 Galaxy‟s granted exploration/prospecting licences and mining leases in the Ravensthorpe area – December 2011 ...... 43 Table 10.1 Details on drilling data in resource database ...... 45 Table 10.2 Regolith and geological data used ...... 49 Table 10.3 SCG 2011 Mineral Resource tabulation ...... 50 Table 10.4 Summary of the Mt. Cattlin assay methods for Galaxy drilling between 2001 and 2010 ...... 52 Table 11.1 Standard reference material-frequency of use by batch, for SGS ...... 60 Table 11.2 Statistics for 198 >1.5% re-assays, January 2011 ...... 78 Table 13.1 Modelling domains (codes) ...... 83 Table 13.2 Removed Holes...... 86
Table 13.3 Bivariate Li2O (ppm) and Ta2O5 (ppm) summary statistics, all data unmodified ...... 89
Table 13.4 Conditional statistics for Li2O (ppm) for the mineralised population at a range of probability thresholds, all data unmodified ...... 91
Table 13.5 Conditional statistics for Ta2O5 (ppm) for the mineralised population at a range of probability thresholds, all data unmodified ...... 92
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Table 13.6 Model framework and Kriging parameters for Domain 1 to 6 - OK model
for elements Li2O and Ta2O5 ...... 94 Table 13.7 Model framework and Kriging parameters for Domain 1 to 6 - OK model ...... 96 Table 13.8 Informing log-normally distributed Lithium data and model statistics for Mt. Cattlin ...... 103 Table 13.9 Measured and Indicated Mineral Resource Estimate ...... 103 Table 13.10 Inferred Mineral Resource Estimate ...... 103 Table 14.1 Optimisation input parameters (Auralia, 2011) ...... 107 Table 14.2 Pit optimisation results summary – physicals (Auralia, 2011) ...... 109 Table 14.3 Pit optimisation results summary – financials (Auralia, 2011) ...... 110 Table 14.4 Batter and Berm Width Configurations (based on Dempers and Seymour) ...... 113 Table 14.5 Mt. Cattlin September 2010 LoM Schedule ...... 117 Table 14.6 Mt. Cattlin December 2011 LoM Schedule ...... 118 Table 14.7 Galaxy Resources – Mt. Cattlin Mineral Reserves as of December 2011...... 119 Table 15.1 Mt. Cattlin mine production against budget ...... 122 Table 16.1 Spodumene production ...... 136 Table 16.2 Indicative analysis of product quality ...... 148 Table 17.1 Totals over the period for ore (including mineralised waste) ...... 155 Table 17.2 Reconciliations between the models/production ...... 155 Table 17.3 Reconciliations assuming CV06 overcall ...... 155 Table 23.1 Price assumptions ...... 181 Table 23.2 Exchange rate assumptions ...... 183 Table 23.3 Physical outputs ...... 183 Table 23.4 Forecast cash flows ...... 184 Table 24.1 Galaxy technical risks ...... 186 Figures Figure 4.1 Project location map ...... 25 Figure 4.2 Location of Mt. Cattlin mine and facilities ...... 26 Figure 7.1 Regional geology showing main tectostratigraphic subdivisions and structures of the Ravensthorpe greenstone belt (from Witt, 1998) ...... 31 Figure 7.2 Simplified geological map showing Mt. Cattlin Resource (within dashed line) ...... 32 Figure 7.3 Mt. Cattlin Pit 1A north wall showing pegmatite and quartz tourmaline veins (Qz-To) ...... 32 Figure 7.4 Mt. Cattlin geological model showing pegmatite lodes (coloured) and faults and dolorite dykes (grey) (Isometric view looking south)...... 33 Figure 7.5 Spodumene crystals (arrowed) in pegmatite, Mt. Cattlin Pit 1A north wall ...... 34 Figure 7.6 Schematic cross-section showing zoning in lepidolite-rich portions of Mt. Cattlin pegmatite ...... 35 Figure 7.7 Alteration of light green spodumene to a dark green mineral on the margins of a vein composed predominantly of prehnite (Drillhole GXMCMTD03, 22.5m) ...... 36 Figure 7.8 Cross-section 224320E (looking west) showing deeper NW zone pegmatite horizon...... 36
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Figure 8.1 Chemical evolution through a lithium-rich pegmatite group with distance from granitic source intrusion (London, 2008) ...... 37 Figure 9.1 Lithium soil anomaly over old mining lease (M74/12) outline, with collars from Haddington 2005 drilling ...... 40 Figure 9.2 Aeromagnetic image, Mt. Cattlin (RTP, NE shade) ...... 41 Figure 9.3 Ravensthorpe Tenements and Regional Location ...... 42 Figure 10.1 Offsiders on the RC drill rig marking sample bags up for later sample farming, 2007 field season ...... 44 Figure 10.2 Offsiders on the RC drill rig preparing to split a meter sample, 2007 field season ...... 46 Figure 10.3 Location of diamond holes for which density data has been recorded, superimposed over surface geology ...... 49 Figure 10.4 Plot of Mt. Cattlin drill collars colour coded by drill type ...... 53 Figure 10.5 Plot of Mt. Cattlin drill collars colour coded by company ...... 53 Figure 11.1 LM5 mill, SGS Lab, Newburn ...... 55
Figure 11.2 Galaxy filed blanks assayed for Li2O ppm by ascending date - no outliers removed...... 58
Figure 11.3 Galaxy filed blanks assayed for Ta2O5 ppm by ascending date - no outliers removed...... 58
Figure 11.4 SGS internal blanks assayed for Li2O ppm by ascending date ...... 59
Figure 11.5 Plot of Li2O ppm values for lithium standard NCS DC86303, by ascending code ...... 61
Figure 11.6 Plot of Li2O ppm values for lithium standard NCS DC86304 by ascending code ...... 62
Figure 11.7 Plot of Li2O ppm values for lithium standard GX521, by ascending date ...... 63
Figure 11.8 Standard NCS DC86306 for Ta2O5 ppm by ascending date ...... 64
Figure 11.9 Standard OKA-1 for Ta2O5 ppm by ascending date ...... 65
Figure 11.10 Standard TAN-1 for Ta2O5 ppm by ascending date ...... 66
Figure 11.11 Scatter plot of exploration data only, Li2O% original to repeat analysis for internal SGS, MTC-SGS and Genalysis QC samples - no outliers removed ...... 67
Figure 11.12 Scatter plot of grade control data only, Li2O% original to repeat analysis for internal SGS, MTC-SGS and Genalysis QC samples - no outliers removed ...... 67
Figure 11.13 Scatter plot of exploration data only, Ta2O5 ppm original to repeat analysis for internal SGS, MTC-SGS and Genalysis QC samples - no outliers removed...... 68
Figure 11.14 Scatter plot of grade control data only, Ta2O5 ppm original to repeat analysis for internal SGS, MTC-SGS and Genalysis QC samples - no outliers removed...... 68
Figure 11.15 Scatter plot of Li2O% original to field duplicate analysis for Galaxy field duplicates by SGS ...... 69
Figure 11.16 Scatter plot of Li2O% original to field duplicate analysis for Galaxy field duplicates by SGS - outliers removed ...... 70
Figure 11.17 QQ plot of Li2O% original to field duplicate analysis for Galaxy field duplicates by SGS ...... 70
Figure 11.18 QQ plot of Li2O% original to field duplicate analysis for Galaxy field duplicates by SGS -outliers removed...... 71
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Figure 11.19 QQ plot of Ta2O5ppm original to field duplicate analysis for Galaxy field duplicates by SGS ...... 72
Figure 11.20 QQ plot of Ta2O5ppm original to field duplicate analysis for Galaxy field duplicates by SGS - removal of outliers ...... 72
Figure 11.21 Scatter and QQ plots of Ta2O5 ppm original to field duplicate analysis for Galaxy field duplicates by SGS ...... 73
Figure 11.22 Plot of Li2O% original to duplicate analysis for selected samples, Sept 2010 ...... 74
Figure 11.23 QQ plot of Li2O% original to duplicate analysis for selected samples, Sept 2010 ...... 75
Figure 11.24 Plot of Li2O% original to pulp re-assay for samples selected by SGS, October 2010 ...... 76
Figure 11.25 QQ plot of Li2O% original to pulp re-assay for samples selected by SGS, October 2010 ...... 76
Figure 11.26 Plot of Li2O ppm values for lithium standard NCS DC86303, with problem batches circled ...... 77
Figure 11.27 Plot of original vs repeats for >1.5% Li2O re-assays, December 2010...... 78
Figure 11.28 Scatter and QQ plots of Li2O, Original SGS vs. Genalysis of pulp comparative analysis, no outliers removed...... 79 Figure 11.29 Graph of hole depth (x-axis) vs. sample recovery (y-axis) for available resource RC drill holes ...... 79
Figure 11.30 Graph of hole depth (x-axis) vs. Li2O% grade (y-axis) for available resource RC drill holes ...... 80
Figure 11.31 Graph of hole depth (x-axis) vs. Ta2O5 ppm grade (y-axis) for available resource RC drill holes ...... 80 Figure 13.1 Wireframe of the mineralised domains contained within the Mt. Cattlin project area put forth by GR representatives ...... 84 Figure 13.2 Section 6282464m (MGA94) view of data coloured by geology on panel
one and Li2O% on panel two (bottom panel) on drill trace ...... 87 Figure 13.3 Section 6282505mN (MGA94) view of data coloured by geology on
panel one and Li2O% on panel two (bottom panel) on drill trace ...... 88 Figure 13.4 Cumulative histogram plot of all sampled Lithium oxide (ppm) no top cut within the GR mineralised domains ...... 89 Figure 13.5 Histogram of all sample grades used in calculation for Lithium oxide (ppm) ...... 89 Figure 13.6 Cumulative histogram plot of all sampled Tantalum oxide (ppm), no top cut within the mineralised domains ...... 90 Figure 13.7 Histogram of all sample grades used in calculation for Tantalum oxide (ppm) ...... 90
Figure 13.8 Scatter plot of Li2O vs.Ta2O5 (ppm) for the total mineralised population, no top cut ...... 90
Figure 13.9 QQ plot of Li2O vs.Ta2O5 (ppm) for the total mineralised population, no top cut ...... 91
Figure 13.10 3D model shells of threshold for domains 1to 6 for Li2O ppm, Ta2O5, Nb2O5 and SnO2 ...... 95 Figure 13.11 Plan view showing resource classification over the Mt. Cattlin project mineralised zone ...... 97
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Figure 13.12 Plan view showing resource grades over the Main Li2O ppm mineralised zone ...... 98 Figure 13.13 Mt. Cattlin East-west section 6282300mN – drill holes and block model
dispaying Li2O% ...... 99 Figure 13.14 Mt. Cattlin East-west section 6282380mN – drill holes and block model
dispaying Li2O% ...... 100 Figure 13.15 Mt. Cattlin East-west section 6282460mN – drill holes and block model
dispaying Li2O% ...... 101 Figure 13.16 Mt. Cattlin East-west section 6282540mN – drill holes and block model
dispaying Li2O% ...... 102 Figure 13.17 Grade tonnage curves for December 2010 Mineral Resource Estimates ...... 104 Figure 14.1 Optimisation results – pit by pit graph ...... 111 Figure 14.2 Mt. Cattlin project – Shelll 22 ...... 112 Figure 14.3 Mt. Cattlin Project – Shell 34 ...... 112 Figure 14.4 Final limits pit design looking to the North East ...... 113 Figure 14.5 Final Limits pit design looking to the North West ...... 113 Figure 14.6 Mt. Cattlin project pit design stage 1 (Pit 1) ...... 114 Figure 14.7 Mt. Cattlin project pit design stage 2 (Pit 2) ...... 114 Figure 14.8 Mt. Cattlin project pit design stage 3 (Pit 3) ...... 114 Figure 14.9 August 2010 design (purple) and August 2011 design (green) looking to the North ...... 115 Figure 14.10 Road and water course layout ...... 119 Figure 15.1 Final limit pit design looking to the North East ...... 120 Figure 15.2 Final limit pit design looking to the North West ...... 121
Figure 15.3 Proposed pit shells, with contained resource blocks coloured by Li2O grade overlain on airphoto ...... 121 Figure 15.4 December 2011 Mt. Cattlin grade control reconciliation ...... 123 Figure 16.1 Mt. Cattlin mine and spodumene concentrator - flowsheet ...... 127 Figure 16.2 Site overview from access road to administration building (RHS) ...... 130 Figure 16.3 Crushed ore bin, with recycled product on right ...... 130 Figure 16.4 View over laboratory to administration building ...... 130 Figure 16.5 Workshop building with tailings storage facility in background ...... 131 Figure 16.6 View of power station generators, with ferro-silicon storage shed behind...... 131 Figure 16.7 View of solar power array ...... 132 Figure 16.8 TSF North-East Corner looking towards North-West Corner – February 2011 ...... 132 Figure 16.9 Secondary crushed ore ...... 133 Figure 16.10 Spodumene product at head of product conveyor ...... 134 Figure 16.11 Spodumene product stockpiled, awaiting shipment...... 134 Figure 16.12 Close-up of spodumene on stockpile ...... 134 Figure 16.13 Final product ...... 135 Figure 16.14 Tantalite packaged in bulk bags ...... 135 Figure 16.15 Night view of the plant ...... 138 Figure 16.16 Jiangsu lithium carbonate plant - flow diagram ...... 141 Figure 16.17 Jiangsu production and office building ...... 150
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Figure 16.18 Kiln and cooler ...... 150 Figure 16.19 Sodium sulphate crystalisation tower, dryer and storage bin ...... 151 Figure 16.20 Bagging station commissioning ...... 151 Figure 16.21 Jiangsu production building ...... 152 Figure 16.22 Stack conveyor unloading spodumene ...... 152 Figure 16.23 Maintenance building, substation and reagent storage bins (behind) ...... 153 Figure 17.1 Resource, grade control and production tonnages for March 2010 – December 2011...... 157
Figure 17.2 Li2O grades of the resource, grade control and production for March 2010 – December 2011 ...... 158
Figure 17.3 Li2O metal tonnages for resource, grade control and production for March 2010 – December 2011 ...... 159 Figure 18.1 Conveyer work in progress from the port ...... 161 Figure 18.2 Side view of some of the conveyer work from the port ...... 161 Figure 18.3 Location of Galaxy‟s lithium carbonate plant in China ...... 162 Figure 19.1 Sources and end-users of lithium ...... 165 Figure 19.2 Estimated consumption of lithium by end use, 2011 ...... 165 Figure 19.3 Location of hard rock lithium minerals producers ...... 167 Figure 19.4 Location of brine producers ...... 168 Figure 19.5 Global average values of exports and imports of lithium carbonate, 2000 – 2011 (US$/t) ...... 169 Figure 19.6 Global average values of exports and imports, plus average values of imports into Japan and South Korea 2000-2011 (US$/t) ...... 169 Figure 20.1 TSF North East Corner – February 2011 ...... 174 Figure 20.2 TSF North West Corner – February 2011 ...... 174 Figure 23.1 NPV sensitivity ...... 182
Appendices Appendix A Mineral Resource and Mineral Reserve Estimates Reporting Codes Appendix B Mt. Cattlin Significant Drill Intercepts
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1 Summary Galaxy has completed the construction of a one million tonne per annum (“Mtpa”) processing facility at their Mt. Cattlin site in Western Australia which is expected to produce 137,000 tonnes per annum (“tpa”) at 6.0% Li2O spodumene concentrate over an estimated 14 year mine life. Meanwhile, Galaxy has initiated the construction of their Jiangsu Lithium Carbonate Plant in China to process Mt. Cattlin spodumene concentrates. Mechanical completion was achieved in December 2011 and cold commissioning has commenced. First production from this section expected at end of 1st quarter of 2012. The Jiangsu Plant has a designated plant capacity of 17,000 tpa of Li2CO3 with a purity level of at least 99.5%.
1.1 Property description Galaxy‟s Mt. Cattlin Mine is located approximately 2 km north of the town of Ravensthorpe in Western Australia. The site is located in the Phillips River Mineral Field, which surrounds the township of Ravensthorpe, 450 km southeast of Perth, Western Australia. The regional centre of Albany is located 281 km to the west and the port of Esperance is 187 km to the east. Mt. Cattlin Mine area is 1832 Ha with location described as 120° 2' 4'' E, 33° 33' 47''S. The Mining Lease (M74/244) was granted on 24 December 2009 and will expire on 23 December 2030. Galaxy has freehold title of land subject to current mining operations and the plant site. There is also a tantalum ore royalty.
1.2 Geology The Mt. Cattlin Project lies within the Ravensthorpe Terrane, with host rocks comprising both the Annabelle Volcanics to the west, and the Manyutup Tonalite to the east. The contact between these rock types extends through the Project area. The pegmatites which comprise the ore body occur as a series of sub-horizontal dykes, hosted by both volcanic and intrusive rocks. Several dolerite or quartz gabbro dykes trending roughly ENE and north-south cut all lithologies including the pegmatite dykes and are believed to be Proterozoic in age. A NNW-trending, sub-vertical fault evident on cross sections and aeromagnetic data, transgresses the western side of the currently-defined ore body, and offsets the pegmatite as well as the main ENE trending dolerite dyke. Displacement across this fault appears to be oblique, with west block down and with a sinistral component. The weathering profile is shallow, with fresh rock generally being encountered at depths of less than 20 m.
1.3 Mineralisation Lithium and tantalum mineralisation occurs in pegmatites, which have intruded both the Annabelle Volcanics and the Manyutup Tonalite, close to the contact between these two sequences. The pegmatite dykes occur as a series of sub horizontal to gently-dipping horizons. In places they occur as stacked horizons which overlap in section. Pegmatite mineralisation defined to date covers an area of around 1.6 km east-west and 1 km north-south. The main pegmatite units drilled to date generally lie between 30 m and 60 m below the surface, and outcrop in some locations. However, deeper zones of lithium-mineralised pegmatites occur over 140 m below the surface to the northwest of the main ore body and may have potential to be mined from underground.
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The pegmatites have a diverse mineralogy with major minerals comprising quartz, albite, cleavelandite (platy albite), microcline, perthite, spodumene, muscovite and lepidolite. Minor minerals include tourmaline, schorlite, elbaite, beryl, microlite, columbite-tantalite, sphalerite, amblygonite-montebrasite, triphylite, apatite, spessartite and fluorite (Grubb, 1963, Sweetapple, 2010). Spodumene is the predominant lithium ore mineral, and several types of spodumene are recognised, including light green and white varieties. Tantalum occurs as the manganese-rich end members of the columbite-tantalite series including Ta-rich manganotantalite, and as microlite (Sweetapple, 2010).
1.4 Current status of exploration Galaxy acquired M74/12 (now contained within M74/244) from the administrators of Sons of Gwalia Limited in November 2006 and has conducted an extensive exploration programme over the tenement since then. The majority of Galaxy exploration work has comprised various drilling programs. In addition to drilling, various programs of surface geological mapping and sampling, and remote sensing and airborne geophysics have been carried out over the Mt. Cattlin mining lease. In 2009 the company also acquired several exploration and prospecting licences contiguous with M74/244 which are prospective for additional lithium/tantalum mineralisation. These make up the Floater and Sirdar projects. In 2010, Galaxy consolidated several mining and prospecting leases at Mt. Cattlin into a single mining lease (M74/244) covering a total area of 1,832 hectares. In addition, Galaxy owns several other project areas in the Ravensthorpe area. Tenements to the east of Ravensthorpe comprising the West Kundip and McMahon Projects contain manganese and copper/gold targets and are not the subject of this report. Projects to the west, including Aerodrome and Bakers Hill, in addition to Floater and Sirdar to the north of Mt. Cattlin have undergone exploration by Galaxy for pegmatite- hosted lithium/tantalum mineralisation. Various programs of mainly surface sampling and geological mapping, in addition to airborne geophysics have been carried out over the Floater, Sirdar, Aerodrome and Bakers Hill tenements. An RC program testing an outcropping pegmatite zone lying mainly on the Sirdar project was completed in 2009. This work followed up on significant pegmatite rock chip samples up to 2.04% Li2O. While the program encountered subsurface pegmatite, it was not successful in intersecting economic widths of mineralisation. The most advanced of the western projects is Bakers Hill. This area has undergone RAB drilling by Galaxy, which has intersected anomalous tantalum mineralisation in pegmatites. Galaxy has defined drill targets which include outcropping lepidolite and spodumene in several areas and the Company has planned follow up RC drilling for these areas.
1.5 Mineral resource estimate The mineral resource estimates have been constructed from the inclusion of all resource drill hole, (RC and DD) data deemed reliable by Robert Spiers from H&S. Table 1.1 and Table 1.2 gives the Mineral Resources estimated for the Mt. Cattlin Project within the mineralised domains identified by Galaxy and classified in accordance with the JORC Code (2004 edition). Please refer to Appendix A for a comparison of JORC and Canadian Institute of Mining, Metallurgy and Petroleum (CIM) Definition Standards for Mineral Resources and Mineral Reserves.
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Table 1.1 Measured and Indicated Mineral Resource Estimate
Resource Tonnes Li2O (%) Ta2O5 ppm Measured 3,192,000 1.17 149 Indicated 10,613,000 1.06 168 TOTAL 13,805,000 1.09 164
From Hellman & Schofield, December 2010
Table 1.2 Inferred Mineral Resource Estimate
Resource Tonnes Li2O (%) Ta2O5 ppm Inferred 4,382,000 1.07 132
From Hellman & Schofield, December 2010 The location, quantity and distribution of the current data are considered sufficient to allow the classification of Measured, Indicated and Inferred Resources.
1.6 Mineral Reserve estimate Mineral Reserves for the Mt. Cattlin Project are classified in accordance with the Australasian Joint Ore Reserves Committee Code (The JORC Code) 2004. Please refer to Appendix A for a comparison of JORC and Canadian Institute of Mining, Metallurgy and Petroleum (CIM) Definition Standards for Mineral Resources and Mineral Reserves. Table 1.3 illustrates the Mineral Reserves of Mt. Cattlin as of December 2011.
Table 1.3 Galaxy Resources – Mt. Cattlin Mineral Reserves as of December 2011
Reserve Tonnes Li2O% Ta2O5 (ppm) Proven 2,803,000 1.09 136 Probable 7,933,00 1.03 150 TOTAL 10,737,000 1.04 146
The reserve table is based on an assumption of 10% mining dilution and 95% ore recovery. This is consistent with the methodology that has been used since the start of this project.
1.7 Mining The Mt. Cattlin mine is based on conventional open-pit mining and processing of an Ore Reserve of 11.5 million tonnes of ore over a 13 to 14 year period from the Cattlin Creek ore body. The relatively flat lying ore body allows mining to proceed at a reasonably constant strip ratio once the ore is uncovered. Mining will be carried out using an excavator and truck combination, delivering to a conventional crushing and heavy media separation (“HMS”) gravity recovery circuit. Galaxy commenced with pre-stripping of open pit areas in early 2010, and the first ore was mined during June 2010. Production has continued since, stockpiling material as the plant has undergone commissioning.
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1.8 Mt. Cattlin processing plant The plant consists of a four-stage crushing circuit producing a -6mm product from ROM ore at a treatment rate of 1 million tonnes per annum. The crushing plant runs on day shift only, providing feed to an ore bin, which feeds the concentrator on a continuous 24 hour per day basis. The key process steps are: Open pit mining 4 stage crushing and screening of ROM ore to -6mm Screening at 0.5 mm Mica removal from the +0.5 mm ore fraction in a reflux classifier Dense Medium Separation (DMS) of the +0.5 mm ore fraction, to produce (at design rate) 137,000 tonnes per annum of spodumene concentrate at 6% Li2O Shipment of spodumene concentrate through Esperance to Zhangjiagang in China Gravity concentration by spirals and wet tables of the -0.5 mm ore fraction, to produce a tantalite concentrate.
1.9 Jiangsu lithium carbonate plant The key process steps of the Jiangsu lithium carbonate plant are: Ore conveying and stockpiling Calcination (Decrepitation) Milling Sulphation Leaching Filtration Impurity removal Primary lithium carbonate crystallisation Sodium sulphate crystallisation and drying Bicarbonation Secondary lithium carbonate crystallisation Drying and packaging The plant commissioning is planned as below: Start of Hot commissioning of Area 50 (Bicarbonate Production) and Production of battery grade lithium carbonate (Phase I) – Mechanical completion was achieved in December 2011 and cold commissioning had commenced. First production from this section expected at end of 1st quarter of 2012. Start of Hot commissioning of remainder of plant - Current forecast for end of 4th quarter of 2012.
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1.10 General Snowden Mining Industry Consultants Pty Ltd (“Snowden”) was engaged by Galaxy Resources Limited (“Galaxy”) to generate a NI43-101 Technical Report (“TR”) of the Mount Cattlin Spodumene Mine (“Mt. Cattlin Mine”) located 2 km north of the town of Ravensthorpe in Western Australia, as well as the Jiangsu Lithium Carbonate Plant (“Jiangsu Plant”) situated in the Yangtze River International Chemical Industrial Park based in the Zhangjiagang Free Trade Zone close to Shanghai in the Jiangsu Province of China. The reason to cover both operations is that the reserves and financial models are based on income from expected sales of lithium carbonate produced by the Jiangsu plant rather than just spodumene produced at Mt. Cattlin. This Technical Report has been prepared in accordance with the requirements of Form NI 43-101F1. Snowden has no prior association with Galaxy in regard to the mineral assets that are the subject of this report, other than as an independent consultant and Snowden has no interest in the outcome of the technical assessment. Snowden is independent of Galaxy, its directors, senior management and advisers and has no economic or beneficial interest (present or contingent) in any of the assets being reported on. Snowden is remunerated for this report by way of a professional fee determined in accordance to a standard schedule of rates which is not contingent on the outcome of this report. None of the individuals employed or contracted by Snowden are officers, employees or proposed officers of Galaxy or any group, holding or associated company of Galaxy. The findings in this report are based on information compiled and prepared for a Valuation Report undertaken by Snowden during 2009 on the Mt. Cattlin Feasibility Study, and additional information which became available subsequent to the Feasibility Report through E-mail or Facsimile messages or various telephone conversations. During site inspections in 2010 and 2011, Snowden personnel held detailed discussions with site personnel at Mt. Cattlin mine and the Jiangsu Plant. Snowden conducted a review of Galaxy‟s Mineral Resources and Ore Reserves in 2010 and verified that these estimates were prepared according to the standards of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves also known as the JORC Code, 2004 edition as published by Joint Ore Reserves Committee of The Australasian Institute of Mining and Metallurgy, Australian Institute of Geoscientists and Minerals Council of Australia. Mineral Resource and Ore Reserve definitions stated in the JORC Code are contained in the Glossary and Definitions section of the report. Snowden did not conduct independent Mineral Resource and Ore Reserve estimates. All sections of the Technical Report were compiled by Qualified Persons (see Table 2.3). Snowden consents to this Technical Report (TR) to be filed on SEDAR, being included, in full in the form and context in which the technical assessment is provided, and not for any other purpose. Snowden provides this consent on the basis that the technical assessments expressed in the individual sections of this Report are considered with, and not independently of, the information set out in the complete Report.
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1.11 Recommendations
1.11.1 Future exploration strategy It is recommended Galaxy to continue with conducting exploration and sampling at Mt. Cattlin in conjunction with ongoing mining activities. Further exploration at Mt. Cattlin is advised to have the following objectives: Extension drilling where mineralisation is still open, such as portions of the NW zone. Deeper pegmatite horizons have been intersected in the few deeper holes drilled beneath the resource, and follow up work on these is required to determine their extent and grade.
The proposed pit shells contain 1.79 Mt at 0.96% Li2O and 139 ppm Ta2O5 of Inferred Resources. Additional infill drilling is required to upgrade the resource category in these areas. Geophysics to be used to assist in detecting blind pegmatite horizons. Further work is required at outcropping pegmatites on the mining lease (M74/244) and adjacent exploration licences. Improved geological understanding resulting from the exposure of significant mineralisation in the open pit will assist in targeting future exploration programs.
1.11.2 Mineral Resources Additional infill drilling to a 40 m x 40 m pattern is recommended for a portion of the eastern part of the orebody, where drill holes are currently spaced at 80 m x 40 m. The aim of this drilling is to convert a significant portion of the current inferred resource in this area to indicated and measured resources. This program would comprise around 30 RC holes totalling 1500 m, at a cost of approximately AUD220,000. In addition to the resource infill drilling, a program of RC holes is recommended to test for additional pegmatite zones beneath the north west and south west portions of the current resource. This program comprises twelve holes to a maximum depth of 230 m, totalling around 2900 m. The all-up cost of the program (inclusive of assaying and staff costs) is estimated at AUD430,000. A review of quality assurance, quality control (QA/QC) procedures is recommended. A programme of detailed grade control drilling is recommended to provide added confidence to the grade and geological continuity of the pegmatite ore zones. When mining commences it is recommended that ongoing reconciliation is carried out between mined ore and depleted ore reserves. Detailed geological mapping and sampling of significant mineralisation in the open pit is recommended which will assist in targeting future exploration programs. Further exploration by drilling and geophysics is recommended at Mt. Cattllin in the following areas: Extension drilling where mineralisation is still open, such as portions of the NW zone. Deeper pegmatite horizons, intersected in the few deeper holes drilled beneath the resource. Blind pegmatite horizons to be detected by geophysics. Outcropping pegmatites on the mining lease (M74/244) and adjacent exploration licences.
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1.11.3 Mining There were initially production rate problems, associated with the selection of inappropriate equipment. These problems have been overcome and a degree of overcapacity in the mining fleet has allowed production to incrementally catch up to schedule. Snowden comments that site management is qualified and suitably experienced and has reacted appropriately to commissioning issues. Site management has experienced some reconciliation difficulties between the mine and mill, a situation not uncommon in a newly-established operation. Snowden notes that Management has acted appropriately in improving the grade control and Resource geological models, driven by the geology exposed in the pit, and this has led to incremental improvements in reconciliation.
1.11.4 Mt. Cattlin process plant Galaxy has identified a number of design issues and commenced remedial action. These include: Aggressive wear conditions on slurry pumping and transfer equipment. Mica extraction reasonable and more efficient extraction is required. Reduce spodumene product contamination. Possible issues with borefield capacity. The aggressive wear rates are being progressively controlled by replacement of more suitable wear resistant materials. A number of initiatives are being implemented to existing equipment to improve mica removal whilst additional test work and engineering design work is progressing toward the installation of more equipment to achieve a higher level of mica removal from product. Snowden considers that this is the major outstanding process engineering issue to improve product quality and provide the opportunity to exceed plant design capacity. Snowden considers that a more formal engineering effort is required to rectify the mica issue in particular and achieve a more timely ramp up of production. Snowden notes that the sustainable capacity of the borefield has been reviewed by Rockwater and designs for two additional bores are being progressed.
1.11.5 Jiangsu lithium carbonate plant The plant commissioning and ramp-up should be done cautiously and slowly so to ensure quality of work, equipment and processes will meet appropriate standards.
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2 Introduction and terms of reference Snowden Mining Industry Consultants Pty Ltd (“Snowden”) was engaged by Galaxy Resources Limited (“Galaxy”) to generate a NI43-101 Technical Report (“TR”) of the Mt. Cattlin Spodumene Mine (“Mt. Cattlin Mine”) located 2 km north of the town of Ravensthorpe in Western Australia, as well as the Jiangsu Lithium Carbonate Plant (“Jiangsu Plant”) situated in the Yangtze River International Chemical Industrial Park based in the Zhangjiagang Free Trade Zone close to Shanghai in the Jiangsu Province of China. This Technical Report has been prepared in accordance with the requirements of Form NI 43-101F1 for listing on the Toronto Stock Exchange.
2.1 Capability and independence Snowden has provided consulting services to Galaxy on numerous occasions and Snowden‟s consultants are familiar with the Bankable Feasibility Study (“BFS”) as well as the ongoing progress in construction and initial mining of Mt. Cattlin Mine and processing plant. Snowden is also familiar with the Feasibility Study and construction of the Jiangsu Plant. Snowden‟s consultants Dr. Leon Lorenzen, Mr. Jeremy Peters and Mr. Robert Spiers, of Hellman & Schofield have visited the Mt. Cattlin mine site on numerous occasions from February 2010 to June 2011. Dr. Leon Lorenzen has also visited the Jiangsu Plant construction site in China between July 2010 and June 2011. The visits of the authors to Mt. Cattlin and Jiangsu sites are summarised in Table 2.1.
Table 2.1 Site visits to Mt. Cattlin and Jiangsu
Site visited Date Snowden Staff Visiting 17 March 2010 L Lorenzen 29 March – 1 April 2010 R Spiers 26 May 2010 L Lorenzen 7 – 9 June 2010 R Spiers Mt. Cattlin 23 June L Lorenzen 4 August 2010 L Lorenzen 5 and 6 October 2010 L Lorenzen 24 February 2011 J Peters 28 July 2010 L Lorenzen November 2010 L Lorenzen Jiangsu 13 April 2011 L Lorenzen 1 June 2011 L Lorenzen
Snowden has no prior association with Galaxy in regard to the mineral assets that are the subject of this report, other than as an independent consultant and Snowden has no interest in the outcome of the technical assessment. Snowden is independent of Galaxy, its directors, senior management and advisers and have no economic or beneficial interest (present or contingent) in any of the assets being reported on. Snowden will be remunerated on a time and materials basis which is not dependent on the findings of the Independent Technical Report. None of the individuals employed or contracted by Snowden are officers, employees or proposed officers of Galaxy or any group, holding or associated company of Galaxy. Snowden give Galaxy permission to file this report as a Technical Report with Canadian Securities Regulatory Authorities pursuant to provincial securities legislation. Except for the purposes legislated under provincial securities law, any other use of this report by any third party is at that party‟s sole risk.
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2.2 Qualified persons responsible for this report This Technical Report has been compiled by the list of qualified persons with each qualified person‟s responsibilities as listed in Table 2.2.
Table 2.2 Responsibilities of each qualified persons
Qualified Person’s Role Name Qualifications Responsibility
Project Manager PhD (Metallurgical Engineering), MSc(Eng), Project Management, Overall and Executive Leon BEng (Chemical Engineering), PrEng, document compilation Consultant - Lorenzen CPEng,CEng, FAusIMM, FSAIMM, FSAIChE, Sections 1, 2, 3, 4, 5, 6, 16, 18, Snowden FIChemE, FSAAE 19, 20, 21, 22, 23, 24, 25 Robert Hellman&Schofield BSc, Hons (Geology/Geophysics), MAIG Sections 7, 8, 9, 10, 11,12, 13, 17 Spiers
Principal Mining Jeremy BSc, BEng, FAusIMM Sections 14, 15, 19.1, 20.1 Consultant Peters
2.3 Scope of work Unless otherwise stated, information and data contained in this report or used in its preparation has been provided by Galaxy. The findings in this report are based on information gathered prior to and during site inspections to the Mt. Cattlin Mine site and Jiangsu plant site by Snowden, as well as on information subsequently supplied through e-mail or telephone conversations. The main sources of information supplied to Snowden on which this independent assessment was made include the following: Ravensthorpe Spodumene Project Feasibility Study Volume 1 (and associated appendices and drawings) – January 2009 – prepared by Galaxy Ravensthorpe Spodumene Project – Project Development Plan – January 2010 - prepared by Galaxy Jiangsu Lithium Carbonate Plant Project Definitive Feasibility Study – October 2009 - prepared by Hatch Associates Pty Ltd (“Hatch”) Jiangsu Lithium Carbonate Plant Project – Draft Project Development Plan – August 2010 – prepared by Galaxy and Hatch Mt. Cattlin Interim Resource Estimates, Lithium / Tantalum Elements, Ravensthorpe, WA – May 2009 – prepared by Hellman & Schofield Pty. Ltd. (“Hellman & Schofield”) Mt. Cattlin Interim Resource Estimates, Lithium / Tantalum Elements, Ravensthorpe, WA – December 2009 – prepared by Hellman & Schofield 091209_0694_Galaxy_Valuation_Report.pdf (Draft) – December 2009 – produced by Snowden 091218_0694_Galaxy_Valuation_Report_MineOnly.pdf (Final) – December 2009 – prepared by Snowden Mt. Cattlin Reserve Report, Croeser Pty Ltd - July 2010; Mt. Cattlin Reserve Report, Croeser Pty Ltd - September 2010; Various presentations and web site reports obtained from Galaxy.
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Various Independent Engineering Reports prepared by Snowden on the construction, commissioning and operations at Mt. Cattlin Mine as well as various Independent Engineering Reports prepared by Snowden on the construction of the Jiangsu Plant The results and opinions expressed in this report are based on the authors‟ field observations and assessment of the technical data supplied by Galaxy. Snowden‟s consultants have reviewed and commented on the data, assumptions and conclusions made by Galaxy in its review of the Mt. Cattlin Mine and downstream beneficiation at their Jiangsu Plant. Snowden has assessed the methods used for analysis and interpretation of data, as well reasonability of assumptions made on technical parameters, costs and forward looking estimates. Snowden has carefully reviewed all of the information provided by Galaxy and has satisfied itself that the information supplied is reliable.
2.4 Project team The authors were assisted in compiling this technical report by a project team of consultants listed in Table 2.3. The project team visited the sites on various occasions between February 2010 and June 2011. They observed the general geology of the area, including mineralisation, metallurgical and mining activities within the Mt. Cattlin open-pit as well as the process plant activities at Jiangsu Plant during their visits.
Table 2.3 Responsibilities of project team
Author for Responsible Role Name Qualifications sections PhD (Metallurgical Engineering), Project Manager MSc(Eng), Project Management, Overall and Executive Leon document compilation BEng (Chemical Engineering), PrEng, Consultant - Lorenzen Sections 1, 2, 3, 4, 5, 6, 16, 18, Snowden CPEng,CEng, FAusIMM, FSAIMM, 19, 20, 21, 22, 23 FSAIChE, FIChemE, FSAAE BSc (Hons) Geology, Diploma Surface Principal Consultant Review of Sections 4, 5, 6, 7, 8, Terry Parker Mining, Quarry Manager (WA), MBA, -Snowden 9, 10, 11, 12, 13 FAusIMM, CPGeo Sections 7, 8, 9, 10, 11,12, 13, Hellman&Schofield Robert Spiers BSc, Hons (Geology/Geophysics), MAIG 17 BEng (Mining), Roselt Croeser MSc(Mining Eng), FAusIMM Section 14 Croeser
Principal BEng (Chemical and Materials), Metallurgical David White Sections 16.1, 19.1, 20.1 MAusIMM, AMIChemE Consultant
Senior Metallurgical Nursen PhD(Eng), MSc(Eng), BSc(Eng) Section 4.2, 5.2.2, 6.1.2, 6.2.2, Consultant Guresin MAusIMM(CP), MIEAust, MTCMME 16.2, 19.2, 20.2
Principal Mining BSc, BEng, FAusIMM Jeremy Peters Sections 14, 15, 19.1, 20.1 Consultant
Senior Principal B(app)Sc(Hons),LLM (Dist.) MAIG Trevor Bradley Snowden internal review Consultant
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3 Reliance on other experts The Qualified Person involved in the compilation of information that relates to Mineral Resources and Exploration Results are Mr. Robert Spiers, who is a full time employee of Hellman & Schofield. Mr. Spiers has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity they are undertaking to qualify as a Qualified Person as defined in the National Instrument 43-101. The information in this report that relates to Ore Reserves is based on information compiled by Mr. Roselt Croeser who is a full time employee of Croeser Pty Ltd. Mr. Croeser has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration. Snowden‟s consultants have reviewed the Mineral Resources and Ore Reserves as well as the assumptions used to derive such figures, and have in this document commented on the validity and reasonability thereof. Mr. Jeremy Peters of Snowden acts as a qualified person for this section. The Qualified Person responsible for the compilation of information that relates to Mineral Resources and Exploration Results (Mr. Spiers), consents to the inclusion in this report of the matters based on their information in the form and context in which it appears. The Qualified Persons responsible for information in this report that relates to Ore Reserves (Mr. Roselt Croeser) consents to the inclusion in this report of the matters based on his information in the form and context in which it appears. Snowden consents to this report being included, in full, in Galaxy‟s prospectus, in the form and context in which the technical assessment is provided, and not for any other purposes. Snowden provides its consent on the understanding that the technical assessments expressed in the individual sections of this report will be considered with, and not independently of, the information set out in the complete report.
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4 Property description and location Galaxy began with the construction of mining and plant facilities at their Mt. Cattlin Mine project site in November 2009 and commenced early mining activities and subsequent production in June 2010. Meanwhile, Galaxy has initiated the construction of their Jiangsu Lithium Carbonate Plant in China and anticipates cold commissioning in the fourth quarter of 2011. Galaxy‟s current objective is to become the second largest hard rock Lithium (spodumene) producer in the world (after Talison Lithium Limited (“Talison”), which is also based in WA), and the fourth largest Li2CO3 producer. Galaxy has completed the construction of a one million tonne per annum (“Mtpa”) processing facility at their Mt. Cattlin site which will produce 137,000 tonnes per annum (“tpa”) at 6.0% Li2O spodumene concentrate over an estimated 14 year mine life. The Jiangsu Plant has a designated plant capacity of 17,000 tpa of Li2CO3 with a purity level of at least 99.5%. Galaxy‟s Mt. Cattlin Mine is located (Figure 4.1 and Figure 4.2) approximately 2 km north of the town of Ravensthorpe in Western Australia. The site is located in the Phillips River Mineral Field, which surrounds the township of Ravensthorpe, 450 km southeast of Perth, Western Australia. The regional centre of Albany is located 281 km to the west and the port of Esperance is 187 km to the east. Mt. Cattlin Mine area is 1832 Ha with location described as 120° 2' 4'' E, 33° 33' 47''S. The Mining Lease (M74/244) was granted on 24 December 2009 and will expire on 23 December 2030. Galaxy have freehold title of land subject to current mining operations and the plant site. There is a tantalum ore royalty. Galaxy holds Works Approval W4533/2009/1 for the Ravensthorpe Spodumene Project. The requirements for compliance reporting were recently revised following consultation between Galaxy and the Department of Environment and Conservation (“DEC”). An application for a Licence to Operate was submitted to the DEC on 4 August 2010 and granted on 14 October 2010. Galaxy submitted a compliance report, drawn up for the Mt. Cattlin site, together with the application for a Licence to Operate mentioned above. The report addresses two aspects identified by the DEC with respect to the TSF: an Operations Management Plan for the TSF a certification of the integrity of the final (compacted clay) liner of the TSF. A draft of the Operations Management Plan for the TSF has been sighted by Snowden. Galaxy submitted an Annual Environmental Report (“AER”) to the Department of Mines and Petroleum (“DMP”) on 29 October 2010. An earlier set of requirements indicated the need for an air quality impact assessment and additional reporting covering matters associated with radiation. These requirements have been removed. Snowden has sighted the amended licence, which no longer contains these conditions.
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Other obligations relating to environmental management are listed below, to emphasise the importance of compliance with environmental commitments, especially during the period of transition from construction to operations: Galaxy is continuously monitoring groundwater. Galaxy has been monitored the health of vegetation by photographic and other means since July 2010. Galaxy prepared a report on clearing in August 2010, to demonstrate compliance with Clearing Permits. Galaxy prepared reports related to the National Pollutant Inventory (NPI) and the National Greenhouse and Energy Reporting System (NGERS) in August 2010.
Figure 4.1 Project location map
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Figure 4.2 Location of Mt. Cattlin mine and facilities
(source: Galaxy)
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5 Accessibility, climate, local resources, infrastructure and physiography 5.1 Accessibility and infrastructure Galaxy‟s mining and processing works at the Mt. Cattlin Mine is serviced by existing infrastructure and facilities available within Western Australia generally, and within the vicinity of the project in particular. Albany and Esperance, the two nearest major centres of population, both have heavy industry support including construction, engineering and manufacturing services. Transport of materials and equipment from Perth is via a number of existing highways (Brookton, Albany and South Coast Highway), whilst product transport is via the South Coast Highway to Esperance. Spodumene produced at Mt. Cattlin is trucked in bulk to Esperance Port and stored in a nominated area within the port, from where it is then be shipped to China in bulk quantities between 12,000 tonnes and 25,000 tonnes per shipment. A five year fixed ocean freight contract has been signed with vessel owners, to ship a maximum of 25,000 tonnes +/-10% per shipment to the Zhangjiagang Port in China. A total of 137,000 tpa of spodumene will be shipped to China. Spodumene is unloaded at a private berth in Zhangjiagang and delivered by conveyors to Galaxy‟s Lithium Carbonate Plant, approximately 500 m away from the berth.
Galaxy‟s finished product (Li2CO3) will be shipped in 25 kg or 1 tonne bags on pallets from Zhangjiagang to two nominated warehouses in Tianjin (North China) and Changsha (South China) via barges, rail and trucks. Customers in the Central and Western China regions will receive product via trucks directly from a warehouse at the plant in Zhangjiagang.
5.2 Climate The Ravensthorpe area has a Mediterranean climate featuring moist, mild winters and hot, dry summers. The mean annual rainfall is 425 mm, and around 75% of the rainfall occurs between March and October. The highest daily recorded rainfall is 112.8 mm and the mean number of rain days per year is 74. Mean annual maximum temperature is 22.7 ºC and mean annual minimum 10.4 ºC. Daily maxima above 30 ºC are common from December to February. The mean daily maximum temperature in summer is 28.9 ºC. The mean daily minimum temperature in summer is 14.5 ºC. The mean maximum temperature for winter is 17.2 ºC, and the mean minimum temperature for winter is 6.7 ºC. Diurnal temperature variations are commonly high throughout the year. The average wind speeds vary throughout the year vary from 10.2 to 19.3 km/h in the morning and from 12.1 to 16.3 km/h in the afternoon. In this climatic region, the annual evaporation greatly exceeds the mean annual rainfall. Climate is a typical Western Australian climate and has been shown not to influence mining and processing at Mt. Cattlin.
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6 History 6.1 Ownership history The tenements within which the project is situated have been owned by numerous companies since the 1960‟s, including Western Mining Corporation (“WMC”), Pancontinental Mining Limited, Greenstone Resources NL, Haddington Resources Limited (“Haddington”) and Sons of Gwalia Limited. Galaxy acquired ML74/12 from the Administrators of Sons of Gwalia Limited in November 2006.
6.2 Historical and current mining Galaxy‟s Mt. Cattlin Project is located approximately 2 km north of the town of Ravensthorpe in Western Australia. The project site is located in the Phillips River Mineral Field, which surrounds the township of Ravensthorpe, 450 km southeast of Perth, Western Australia. The township of Ravensthorpe was surveyed in 1900 and gazetted in 1901 at which time 15 mines were operating. A total of 53 mines were listed as operating in 1903 by which time it was realised that most of the gold occurred with copper. The first government smelter was built in 1904 east of the town and a larger smelter was later erected on the Hopetoun road in 1906 which closed in 1918. The Phillips River Mineral Field was principally Western Australia‟s main copper mining centre with 19,000 tonnes being produced. A total of 83,942 ounces of gold was produced from copper mines and some auriferous quartz reefs from 88,220 tonnes of ore. The population of the gold field peaked in 1911 when the figure was in excess of 3,000 persons. The pegmatites upon which the Mt. Cattlin project is based were first reported in 1843. The Ravensthorpe district has been the subject of extensive exploration and mining activity dating back to 1892 with the discovery of small quantities of gold in association with copper and iron pyrites on the eastern side of the Ravensthorpe Range. The Cattlin Creek pegmatites have been the subject of several drilling, sampling and metallurgical test campaigns as well as feasibility studies dating back to the 1960s. During the period 1962 to 1966 WMC carried out an extensive drilling programme and established a resource of „green‟ and „white‟ spodumene (lithium-bearing ore mineral in the pegmatite). Extensive mineralogical and metallurgical test work was carried out as part of this programme, culminating in WMC preparing an internal feasibility study on the mining and production of 10,000 to 15,000 tpa of spodumene from the deposit on Mining Lease M74/12. Since the 1960s the tenements have been owned by several companies, all of whom have viewed them as a prospective tantalite resource and conducted drilling and metallurgical test work accordingly. Major programmes have been as follows: Pancontinental Mining Limited, July 1989, 101 RC holes. Pancontinental Mining Limited, 1990, additional 21 RC holes. Greenstone Resources NL, 1997, 3 diamond, 38 RC holes and soil sampling; also 23 by 44 gallon drums of freshly blasted mineralised material was sent to the Nagrom mineral processing facility (based in Kelmscott, WA) for crushing, screening and gravity separation testing. Haddington Resources Limited, 2001, 9 diamond holes for metallurgical test work, additional RC holes for in-fill and sterilisation.
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Galaxy acquired ML74/12 from the Administrators of Sons of Gwalia Limited in November 2006. At the Mt. Cattlin project site, Galaxy has established a mine and processing facilities intended to mine and process around 12 million tonnes of ore at a grade of about 1.0 % Li2O over a 13 to 14 year period. The flat lying ore body allows mining to proceed at a relatively constant strip ratio once the ore is uncovered. Mining is carried out using excavator and truck operations, delivering to a conventional crushing and Heavy Media Separation (“HMS”) gravity recovery circuit. The plant consists of a four-stage crushing circuit producing a -6 mm product from Run of Mine (“ROM”) ore at a treatment rate of 1 million tonnes per annum. Galaxy intends producing some 137,000 tonnes of spodumene concentrate at 6.0% Li2O, which will be shipped as bulk concentrate through Esperance to Galaxy‟s lithium carbonate processing facility in Zhangjiagang, China.
6.3 Historical estimates WMC carried out drilling campaigns in addition to metallurgical and feasibility studies in the 1960s, and established an initial spodumene resource covering part of the eastern portion of the current ore body. WMC completed an internal feasibility study based on the mining and production of 10,000 to 15,000 tpa of spodumene. In 2001, Hellman and Schofield completed a resource estimate of tantalum only, covering a small portion in the northeast of the current ore body. This work was completed for “Galaxy Resources NL”, prior to the company listing on the Australian Stock Exchange. Results of the tantalum resource estimate at a cut-off grade of 150 ppm Ta2O5 are shown in Table 6.1.
Table 6.1 North Ravensthorpe Mineral Resource, Hellman & Schofield (May 2001)
Resource Tonnes Li2O (%) Ta2O5 ppm Measured 720,000 - 381 Indicated 130,000 - 406 Measured + Indicated 850,000 - 385 Inferred 210,000 - 365
Note: Ta2O5 cut-off grade – 150ppm The Mineral Resource Estimate was compiled by Mr. P. Hellman of Hellman & Schofield.
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7 Geological setting 7.1 Regional geology The Mt. Cattlin Project is located in the Phillips River Mineral Field, within the Ravensthorpe Terrane, which forms part of the Archaean Ravensthorpe greenstone belt. The Ravensthorpe greenstone belt (see Figure 7.1) has been subdivided into three distinct tectonostratigraphic terranes by Witt (1998). The Carlingup Terrane (c. 2,960 Million years (“Ma”)) lies to the east and comprises metamorphosed mafic, ultramafic and sedimentary rocks with minor felsic volcanic rocks (Figure 7.1). The Ravensthorpe Terrane (c. 2,990 Ma to 2,970 Ma), which hosts the Mt. Cattlin deposit, forms the central portion of the belt and comprises a tonalitic complex, together with a volcanic association with predominantly andesitic volcaniclastic rocks. The Cocanarup greenstones to the west (Figure 7.1) consist mainly of metasedimentary rocks, with lesser ultramafic and mafic rocks. The Ravensthorpe Terrane is predominantly a calc-alkaline complex, and has been subdivided into the Annabelle Volcanics and the Manyutup Tonalite, with both sequences showing similar chemical and age characteristics. The Annabelle Volcanics sequence is dominated by volcaniclastic rocks with minor lavas. The sequence comprises roughly 10 % to 20% basalt, 50 % to 70% andesite and 20 % to 30% dacite (Witt, 1998). Witt interprets the terranes to represent fault-bounded accreted domains, with subsequent deformation producing the major south-plunging Beulah synform. Metamorphic grade indicated by metamorphic mineral assemblages varies from greenschist to amphibolite facies.
7.2 Property geology The Mt. Cattlin Project lies within the Ravensthorpe Terrane, with host rocks comprising both the Annabelle Volcanics to the west, and the Manyutup Tonalite to the east. The contact between these rock types extends through the Project area. The Annabelle Volcanics at Mt. Cattlin consist of intermediate to mafic volcanic rocks, comprising both pyroclastic material and lavas. Several phases of the Manyutup Tonalite were recognised by Witt (1998) in the Ravensthorpe Terrane, but in the Mt. Cattlin area it comprises mainly tonalite. Both the Annabelle Volcanics and the Manyutup Tonalite are intruded by numerous fine to coarse-grained metamorphosed dolerite dykes. A NNW trending gabbro (termed pyroxenite in earlier reports) occurs at the eastern edge of the Mt. Cattlin pegmatite ore body. Metamorphism of the Annabelle Volcanics and Manyutup Tonalite country rocks grades up to amphibolite facies at Mt. Cattlin. A simplified geological map of the Project area is given in Figure 7.2, showing the area of mineralisation within a dashed line. The pegmatites which comprise the ore body occur as a series of sub-horizontal dykes, hosted by both volcanic and intrusive rocks. Several dolerite or quartz gabbro dykes trending roughly ENE and north-south cut all lithologies including the pegmatite dykes (Figure 7.2) and are believed to be Proterozoic in age.
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A NNW-trending, sub-vertical fault evident on cross sections and aeromagnetic data, transgresses the western side of the currently-defined ore body, and offsets the pegmatite as well as the main ENE trending dolerite dyke. Displacement across this fault appears to be oblique, with west block down and with a sinistral component. The weathering profile is shallow, with fresh rock generally being encountered at depths of less than 20 m.
7.3 Mineralisation Lithium and tantalum mineralisation occurs in pegmatites, which have intruded both the Annabelle Volcanics and the Manyutup Tonalite, close to the contact between these two sequences. The pegmatite dykes occur as a series of sub horizontal to gently-dipping horizons (Figure 7.3 and Figure 7.4). In places they occur as stacked horizons which overlap in section. Pegmatite mineralisation defined to date covers an area of around 1.6 km east-west and 1 km north-south. The main pegmatite units drilled to date generally lie between 30 m and 60 m below the surface, and outcrop in some locations. However, deeper zones of lithium-mineralised pegmatites occur over 140 m below the surface to the northwest of the main ore body and may have potential to be mined from underground (Figure 7.8). Figure 7.1 shows main tectostratigraphic subdivisions and structures of the Ravensthorpe greenstone belt (from Witt, 1998)
Figure 7.1 Regional geology showing main tectostratigraphic subdivisions and structures of the Ravensthorpe greenstone belt (from Witt, 1998)
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Figure 7.2 Simplified geological map showing Mt. Cattlin Resource (within dashed line)
Figure 7.3 Mt. Cattlin Pit 1A north wall showing pegmatite and quartz tourmaline veins (Qz-To)
The pegmatites have a diverse mineralogy with major minerals comprising quartz, albite, cleavelandite (platy albite), microcline, perthite, spodumene, muscovite and lepidolite. Minor minerals include tourmaline, schorlite, elbaite, beryl, microlite, columbite-tantalite, sphalerite, amblygonite-montebrasite, triphylite, apatite, spessartite and fluorite (Grubb, 1963, Sweetapple, 2010). Spodumene is the predominant lithium ore mineral, and several types of spodumene are recognised, including light green and white varieties (Figure 7.4). Tantalum occurs as the manganese-rich end members of the columbite-tantalite series including Ta-rich manganotantalite, and as microlite (Sweetapple, 2010).
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The lithium minerals within the pegmatites are shown below:
Spodumene LiAl(SiO3)2 contains 4 to 8 % lithium oxide (lithia).
Amblygonite, LiAl(F,OH)PO4, contains 8 to 10 % lithia. Lepidolite, (lithium mica) contains 2 to 4 % lithia. Cookeite, (lithium chlorite) The mineralogy of the pegmatites varies laterally, and can also be crudely zoned in a sub-vertical manner (perpendicular to margins), with zones differentiated by mineralogy and grain size. Part of the northeast of the deposit contains the lithium-bearing mica lepidolite, which does not occur in the rest of the deposit. The lepidolite-rich zones contain higher tantalum (mainly microlite) grades. These zones also show more pronounced zoning perpendicular to the margins of the pegmatite, and an idealised sketch of the main zones is shown in Figure 7.8. Zones include an aplitic rock comprising mainly quartz- albite-muscovite near contacts with country rocks, and zones of predominantly light green, and predominantly white spodumene. Lepidolite is generally associated with the white spodumene. Quartz-tourmaline veins (Figure 7.3) are associated with the pegmatites and occur in places in the country rocks up to 10s of metres away from the pegmatites.
Figure 7.4 Mt. Cattlin geological model showing pegmatite lodes (coloured) and faults and dolorite dykes (grey) (Isometric view looking south).
Spodumene shows alteration in places, which falls into two groups: 1. alteration to greenish coloured muscovite with subordinate secondary feldspars (medium green spodumene), interpreted to be primary pegmatitic origin; and 2. alteration to a complex assemblage of pumpellyite, cookeite (lithian chlorite), sericitic mica and secondary feldspars (dark green spodumene). Figure 7.7 shows the second type of alteration, associated with prehnite-rich veins. This latter assemblage is interpreted to post-date pegmatite emplacement, and frequently has a much more limited extent of occurrence, often connected with fractures or faults cutting through the pegmatite (Sweetapple, 2010).
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Pegmatites are interpreted to have intruded late in the Archean geological history and have very sharp contacts with country rocks, generally showing no deformation across the contact (Figure 7.3). While metamorphism of the country rocks up to amphibolite facies grade is evident, the pegmatites are unmetamorphosed.
Figure 7.5 Spodumene crystals (arrowed) in pegmatite, Mt. Cattlin Pit 1A north wall
Figure 7.8 is a cross-section at 224320E looking west showing the deeper NW pegmatite, at about 140 m depth, which appears to be thinning at depth.
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Figure 7.6 Schematic cross-section showing zoning in lepidolite-rich portions of Mt. Cattlin pegmatite
(modified from Grubb, 1963)
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Figure 7.7 Alteration of light green spodumene to a dark green mineral on the margins of a vein composed predominantly of prehnite (Drillhole GXMCMTD03, 22.5m)
Figure 7.8 Cross-section 224320E (looking west) showing deeper NW zone pegmatite horizon
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8 Deposit types 8.1 Pegmatite deposits Pegmatites form the host rock to lithium and tantalum mineralisation at Mt. Cattlin. It is generally accepted that pegmatites form by a process of fractional crystallisation of an initially granitic composition melt. The fractional crystallisation concentrates incompatible elements, light ion lithophile elements and volatiles (such as B, Li, F, P, H2O and CO2) into the late-stage melt phase. The volatiles lower the viscosity of the melt and reduce the solidification temperature to levels as low as 350°C to 400°C. This permits fractional crystallisation to proceed to extreme levels, resulting in highly evolved end member pegmatites. The fluxing effect of incompatible elements and volatiles allows rapid diffusion rates of ions, resulting in the formation of very large crystals characteristic of pegmatites. The less dense pegmatitic magma may rise and accumulate at the top of the granitic intrusive body. However, typically the more fractionated pegmatitic melt phases escape into the surrounding country rock along faults or other structures to form pegmatites external to the parent intrusive, which is the case at Mt. Cattlin. The fractionation trend with distance from granitic source is shown diagrammatically in Figure 8.1 (London, 2008). Highly fractionated pegmatites can occur many kilometres from the parent intrusion.
Figure 8.1 Chemical evolution through a lithium-rich pegmatite group with distance from granitic source intrusion (London, 2008)
A broad differentiation between LCT (lithium-caesium-tantalum) and NYF (niobium- yttrium-fluorine) pegmatite families is recognised by Cerny (1993). LCT pegmatites are generally related to S-type granites, which originate from sedimentary rocks (London, 2010). NYF pegmatites are characteristic of A-type (anorogenic or “within plate” granites).
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The lithium-tantalum mineralised Mt. Cattlin pegmatites belong to the Spodumene sub- class of the LCT pegmatite family noted by Cerny (1993), and Cerny and Ercit (2005). Mt. Cattlin fractionation characteristics relating to rare element concentrations are consistent with published data from many other highly fractionated pegmatites of the LCT petrogenetic family of economic interest (e.g. for Cs, Ta and Li) worldwide (Sweetapple, 2010). Whole rock geochemistry and mineralogy at Mt. Cattlin indicates a broad fractionation trend to the north east. The broad change in mineralogy from spodumene only to spodumene+lepidolite towards the northeast may represent a residual concentration of volatile and incompatible elements in this direction (cf. Sweetapple, 2010). Various types of internal zonation from the footwall to the hanging wall of pegmatites, based on variation in mineralogy, grainsize and fabric is reported in the literature (e.g. London, 2008). While zonation is not strongly developed in the Mt. Cattlin pegmatites, changes in mineralogy and grainsize are recognised across the pegmatite in places. In addition, the characteristics of the Mt. Cattlin pegmatites vary to some extent laterally and between pegmatite sheets.
8.2 Greenbushes lithium mine The Greenbushes Lithium Operations are located directly south and immediately adjacent to the town of Greenbushes, approximately 250 km south of Perth and 90 km south east of the Port of Bunbury in the south-west of Western Australia. It occurs about 350 km west of the Mt. Cattlin deposit. The Greenbushes ore body is a highly mineralised zoned pegmatite with a strike length of more than 3 km. The Mineral Resource is unique among known lithium deposits in that it contains approximately 50% spodumene. The deposit lies within the Balingup Metamorphic Belt (“BMB”) which forms the southern portion of the Western Gneiss Province, one of four divisions of the Archaean Yilgarn Craton. The Greenbushes pegmatite intrudes rocks of the BMB and lies within a 15 km to 20 km wide, north to north-west trending lineament called the Donnybrook-Bridgetown Shear Zone (Behre, Dolbear Australia Pty Ltd, 2011). The Greenbushes deposit comprises a main, rare-metal zoned pegmatite with numerous smaller pegmatite dykes and footwall pods. These are concentrated within shear zones running on the boundaries of granofels, ultramafic schists and amphibolites. The pegmatite body is 3 km in length, up to 300 m wide, strikes north to north-west and dips moderately to steeply west to southwest. The primary ore minerals are found in specific mineralogical zones or assemblages. Tantalum (tantalite) and tin (cassiterite) mineralization are concentrated in the Sodium Zone which is characterized by albite, tourmaline and muscovite. The Lithium Zone is enriched in spodumene. A third zone, of lesser commercial importance, contains concentrations of microcline (www.talisonlithium.com).
8.3 Lithium brines Deposits of lithium brines are found in South America throughout the Andes mountain chain, particularly in Bolivia, Chile and Argentina. Half the world's known reserves are located in Bolivia. In the United States lithium is recovered from brine in Nevada (USGS, 2010).
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9 Exploration Galaxy possesses a portfolio of several projects in Western Australia at various stages of exploration and development including base metals (copper-gold, nickel), gold, iron ore, rare earths and uranium. The company is currently focussed on the Mt. Cattlin mine and beneficiation plant at Ravensthorpe in Western Australia, and downstream lithium carbonate production at Galaxy‟s Jiangsu Plant in China. The Cattlin Creek pegmatite occurrence near Ravensthorpe, which makes up the Mt. Cattlin ore body was first discovered in the early 1900s, during gold exploration in the Ravensthorpe district. Large crystals of spodumene were noted in a pegmatite near Ravensthorpe (Maitland, 1901). Montgomery (1903) reported two intersections of pegmatite in the Lady Jessie shaft (a small gold mine), which lies within the current Mt. Cattlin pit outline. More detailed descriptions were given by Ellis (1944) and Sofoulis (1958). Sofoulis (1958) notes that in 1951 around 500 lbs of microlite (calcium pyrotantalate) and 16 lb. of bismuth ore (10.2 per cent.) were won from 3 tons of ore, which was extracted from a thin black-green vein occurring in the quartz core, to the east of Floater Road. During the period 1962 to 1966 Western Mining Corporation (“WMC”) carried out an extensive drilling programme and established a resource of “green” and “white” spodumene. Extensive mineralogical and metallurgical test work was carried out as part of this programme, culminating in WMC preparing an internal feasibility study on the mining and production of 10,000 to 15,000 tpa of spodumene from the deposit on Mining Lease M74/12. Since the 1960s the tenements have been owned by several companies, most of whom have viewed them as a prospective tantalite rather than spodumene resource and conducted drilling and metallurgical test work accordingly. Galaxy acquired M74/12 (now contained within M74/244) from the administrators of Sons of Gwalia Limited in November 2006 and has conducted an extensive exploration programme over the tenement since then. The majority of Galaxy exploration work has comprised various drilling programs, which are discussed in Section 10, Drilling. In addition to drilling, various programs of surface geological mapping and sampling, and remote sensing and airborne geophysics have been carried out over the Mt. Cattlin mining lease.
9.1 Geological mapping Various campaigns of geological mapping of the Mt. Cattlin pegmatites and surrounding lithologies have been undertaken, including by Sofoulis (1958), Western Mining Corporation (Cameron and Ross, 1963), and Pancontinental (Broomfield, 1989). The most recent mapping was undertaken for Galaxy in 2010 by Dr. Mike Grigson of the consultancy Arc Minerals, who conducted a regional mapping program which included the Mt. Cattlin area. Mapping was accompanied by rock chip sampling, which succeeded in identifying several sub-cropping pegmatite zones in the area surrounding Mt. Cattlin. The geological map for the Mt. Cattlin area is shown in Figure 7.2. This work has also been supported by various phases of petrological work by consultant Dick England, and detailed costean mapping and mineralogical work by CSIRO (Sweetapple, 2010). Results of this work have been used to develop the geological models described in Section 7 and Section 8.
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9.2 Surface sampling Various campaigns of surface rock chip and soil sampling have been carried out over the area, including by WMC in the 1960s and Pancontinental in the late 1980s (Broomfield, 1989). Haddington Resources Ltd (Haddington) in 2005 collected 84 soil samples taken on a 200 m by 100 m grid pattern using a -1.5 mm sieve and taking approximately 200 g of fine soil from around 20 cm below surface (Young, 2005). The Haddington program defined a lithium soil anomaly over the area of sub-cropping pegmatite to the east of Floater Road, in addition to the largely concealed pegmatite to the west of Floater Road (Figure 9.1). The lithium anomaly was backed up by anomalous results in Be, Sn, Rb and Cs, Ta and Nb. However, it should be noted that there are a number of narrow, sub-cropping pegmatites in the area west of Floater Road above the main pegmatite zones which may be responsible for the surface anomaly.
9.3 Remote sensing Galaxy has acquired various imagery including Landsat, Quickbird, and most recently aerial photography over the Mt. Cattlin area. The recent aerial photography acquired by Galaxy was captured in 2007, at a scale of 1:25,000.
Figure 9.1 Lithium soil anomaly over old mining lease (M74/12) outline, with collars from Haddington 2005 drilling
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9.4 Airborne geophysics Galaxy has flown various airborne geophysical surveys over Mt. Cattlin, including airborne magnetics, radiometrics and Versatile Time Domain EM (VTEM). In 2007, an airborne radiometric and magnetic survey was flown over a large area including Mt. Cattlin by UTS Geophysics in conjunction with Pioneer Nickel. This survey was flown at a sensor height of 30 m, on east west lines at 50 m spacing. An image showing total magnetic intensity covering the Mt. Cattlin area is shown in Figure 9.2. A helicopter borne VTEM survey was also flown in 2007, by Geotech Airborne Ltd, also in conjunction with Pioneer Nickel. These surveys did not directly detect lithium/tantalum mineralisation, but assisted in the lithological and structural interpretation of the geology of the area.
Figure 9.2 Aeromagnetic image, Mt. Cattlin (RTP, NE shade)
9.5 Other exploration In 2009 the company also acquired several exploration and prospecting licences contiguous with M74/244 which are prospective for additional lithium/tantalum mineralisation. These make up the Floater and Sirdar projects (see Figure 9.3). In 2010, Galaxy consolidated several mining and prospecting leases at Mt. Cattlin into a single mining lease (M74/244) covering a total area of 1,832 hectares. In addition, Galaxy owns several other project areas in the Ravensthorpe area (Figure 9.3). A listing of Galaxy‟s current tenements in the Ravensthorpe area is given in Table 9.1. Tenements to the east of Ravensthorpe comprising the West Kundip and McMahon Projects contain manganese and copper/gold targets and are not the subject of this report. Projects to the west, including Aerodrome and Bakers Hill, in addition to Floater and Sirdar to the north of Mt. Cattlin have undergone exploration by Galaxy for pegmatite- hosted lithium/tantalum mineralisation. Various programs of mainly surface sampling and geological mapping, in addition to airborne geophysics have been carried out over the Floater, Sirdar, Aerodrome and Bakers Hill tenements.
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An RC program testing an outcropping pegmatite zone lying mainly on the Sirdar project was completed in 2009. This work followed up on significant pegmatite rock chip samples up to 2.04% Li2O. While the program encountered subsurface pegmatite, it was not successful in intersecting economic widths of mineralisation. The most advanced of the western projects is Bakers Hill. This area has undergone RAB drilling by Galaxy, which has intersected anomalous tantalum mineralisation in pegmatites. Galaxy has defined drill targets which include outcropping lepidolite and spodumene in several areas and the Company has planned follow up RC drilling for these areas.
Figure 9.3 Ravensthorpe Tenements and Regional Location
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Table 9.1 Galaxy’s granted exploration/prospecting licences and mining leases in the Ravensthorpe area – December 2011
Lease Project Lease type Current Area (3) Grant Date Expiry Date E74/398 Aerodrome E New 15 (1) 08-04-08 07-04-13 E74/334 Aerodrome E Old 1 (1) 17-05-05 16-05-12 E74/415 Bakers Hill E New 19 (1) 10-03-09 09-03-14 E74/287 Bakers Hill E Old 8 (1) 18-12-02 17-12-12 E74/295 Bakers Hill E Old 2 (1) 12-09-03 11-09-12 E74/299 Bakers Hill E Old 3 (1) 13-02-08 12-02-13 E74/400 Floater E New 3 (1) 14-03-08 13-03-13 P74/307 Floater P Old 66.63 (2) 14-03-08 13-03-12 P74/308 Floater P Old 23.62 (2) 14-03-08 13-03-12 M74/165 McMahon M 158 (2) 26-11-10 25-11-31 M74/184 McMahon M 116 (2) 26-11-10 25-11-31 P74/334 McMahon P Old 11.736 (2) 11-11-10 10-11-14 M74/136 Mosaic M 23.37 (2) 26-11-10 25-11-31 L74/46 Mt. Cattlin L 9.34 (2) 18-03-10 17-03-31 M74/244 Mt. Cattlin M 1832 (2) 24-12-09 23-12-30 E74/401 Sirdar E New 4 (1) 14-03-08 13-03-13 P74/309 Sirdar P Old 92.20 (2) 14-03-08 13-03-12 P74/310 Sirdar P Old 19.60 (2) 14-03-08 13-03-12 M74/133 West Kundip M 285 (2) 29-10-09 28-10-30 M74/238 West Kundip M 288 (2) 29-10-09 28-10-30 L74/47 West Kundip L 1579.1(2) 14-12-11 13-12-32 Notes: E Old - Old Exploration Licence (WA) E New - - New Exploration Licence (WA) P Old - - Old Prospecting Licence (WA) L - - Miscellaneous Licence (WA) M - Mining Lease (WA) 1 – Blocks 2 – Hectares 3- Rounded to two decimals where relevant
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10 Drilling Samples in the drilling database have been collected using a mixture of diamond drill (DD), reverse circulation (RC), rotary air blast (RAB) and unspecified open-hole (OH) methods. Data from prior tenement holders to Galaxy has been incorporated into the resource database, but the vast majority of data has been generated by Galaxy drill programs (see Table 10.1). The sampling results presented herein are based on data provided by Galaxy, its representatives, employees and/or consultants. A field visit was undertaken by an H&S representative during July 2007, then again in 2009 and 2010 and in general the drilling and sampling practices, field QAQC and sampling cleanliness was considered adequate. Figure 10.1 and Figure 10.2 are two snap shots of field drilling activities. All field practices, data collection and QAQC are currently controlled and subsequently fall under the competency of Galaxy representatives. Whilst on site the author (Robert Spiers) had observed the on-site sample protocols at Mt. Cattlin and preparation procedures (core splitting, logging, sampling and storage) and has discussed with Galaxy staff the methodologies in use.
Figure 10.1 Offsiders on the RC drill rig marking sample bags up for later sample farming, 2007 field season
In general, all RC and DD drilling data have been used for Mineral Resource estimation. Face sampling, trench sampling and RAB and auger drilling data were not used owing to the unknown reliability of the information.
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H&S did not carry out any independent sampling of DD core or RC samples, but reviewed the sample quality control protocols introduced and conducted by Galaxy. In addition, H&S reviewed the results of the Quality Control exercises carried out by Galaxy and was satisfied that the outcomes are adequate. Further data, to be acquired over ensuing resource and grade control drilling programs, will be used to update the original findings if necessary. Mineralised pegmatite lenses at Mt. Cattlin are generally sub-horizontal with gentle undulation and are largely isotropic in the horizontal plane. Drill traverses are generally aligned perpendicular to the mineralised trend, with mostly vertical holes. All significant results (historical and recent) can be found in Appendix A.
Table 10.1 Details on drilling data in resource database
Drill No Total Company Years Hole No type Holes metres RC/O CCP040/000- Pancon 1988-1990 120 2,627 H CCP720/860 GRC060-GRC091, Green-stone 1996 RC 38 947 GRC247-GRC254 Green-stone 1996 DD GD018-GD020 3 57 Haddington 2001 RC CCC10-CCC58 48 1,042 Haddington 2001 DD CCM1-CCM9 9 118 Galaxy 2001 RC GX009-GX141 118 7,347 GX220-GX241, Galaxy 2001 RAB 23 402 GX297-GX299 Galaxy 2001 DD GXD01-GXD06 6 336 Galaxy 2007 RC GX450-GX799 341 13,853 Galaxy 2007 DD GXD09-GXD13 5 194 Galaxy 2008 RC GX800-GX909 109 6,382 GXMCMTD01-06, Galaxy 2008 DD 10 433 GXMCGTD01-04 Galaxy 2009 RC GX910-GX1065 154 9,174 Galaxy 2010 RC GX1066-GX1128 67 5,446 Galaxy 2010 DD GXD014-GXD018 5 390
10.1 RC drilling The bulk of drilling carried out by Galaxy has been RC drilling, and the majority of Galaxy field samples were collected as 1 m riffle-split, or more recently cone-split RC percussion chips. During the 2007 field season, samples were collected from the RC drilling via a conventional rig mounted cyclone and bag system and subsequently split in this instance through a 25/75 two stage splitter for final sample separation in the field and samples were collected at one metre intervals.
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During the 2008 drilling campaign samples were collected at one metre intervals in plastic bags via a conventional rig mounted cyclone and bag system and subsequently split. Samples were riffle split directly from the cyclone into calico bags which reduced the sample size to 12.5% of the original size producing a 2 kg to 4 kg sample. RC drilling in 2008 used a three-tiered riffle splitter. Since 2009 a cone splitter has been used on the RC rig, with samples split directly from the cyclone into calico bags which reduced the sample size to 12.5% of the original size producing a 2 kg to 4 kg sample. RC chips are then geologically logged and pegmatite intervals, together with an additional one to two metres of country rock either side of the pegmatite, are despatched for analysis. Samples from earlier Pancontinental drilling were also split on site, with around 2 kg samples despatched for analysis (Wanless, 1991). RC drilling carried out by Galaxy in 2001 and 2007 to 2008 was completed using a 4 5/8 inch conventional face-sampling hammer. During 2009 and 2010 the hammer diameter was 5 ¼ inch. Sample recovery of RC drilling since the start of 2008 has been routinely recorded using the weight of the split sample, which is collected in a calico bag. During 2007 to 2009, the entire sample from selected holes was weighed. Sample recovery from the 2001 RC drilling is reported by Hellman (2001) to be generally average to good, with greater than 80% recovery except when high flow rates of water were encountered. Historical sample recovery for Pancontinental RC drilling was also reported to have been acceptable, generally around 80% (Broomfield, 1991), although H&S were not able to verify the recovery analysis and conclusions for the Pancontinental work.
Figure 10.2 Offsiders on the RC drill rig preparing to split a meter sample, 2007 field season
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10.2 Diamond drilling DD core samples by Galaxy comprise around 5% of all samples in the resource database. DD was carried out for metallurgical and geotechnical, in addition to geological purposes, and all Galaxy core is HQ or PQ size. All angled diamond holes drilled by Galaxy were orientated, using either the Ezy-Mark tool or more recently the Reflex ACT electronic orientation tool. Diamond core drilled by Galaxy was collected from the rig by Galaxy personnel, then orientated and marked with metre marks. The core was then photographed both wet and dry before being geologically logged. Core has been sampled on an average interval of around 1 m to geologically consistent boundaries. Pegmatite intervals and an additional 1 m to 2 m of waste in the footwall and hanging wall of the pegmatite were sampled. Quarter core samples were collected from HQ and PQ core after being cut with a diamond saw. Prior to cutting, holes GXMCGTD01-04 and GXD014-018 were also geotechnically and structurally logged by geologists from a geotechnical consultancy. Dempers and Seymour Pty Ltd. (Dempers, 2008).
10.3 Grid convention All of the results presented in this report were supplied by Galaxy in MGA94 Zone 51 projection coordinates, based upon the GDA94, Geodetic Datum of Australia, with elevations relative to the Australian Height Datum (AHD).
10.4 Drill collar surveying Drill hole collars from companies previous to Galaxy were picked up by various surveying companies. Elevations were not available for some of this drilling, and in these cases collar elevations have been snapped to an accurate surface elevation model. Since 2008, drill collars have been pegged using a handheld GPS. After drilling, collars are then surveyed using more accurate techniques. Collars from the 2008 Galaxy RC and diamond drill programs were picked up by Cardno Spectrum Survey, using a Real Time Kinematic (RTK) GPS, with accuracy to ±0.025 m. From 2008 to February 2010, collar surveying was completed by Dave MacMahon Surveys Pty Ltd. These were taken using an RTK GPS (accuracy +/- 0.050 m). Since February 2010, all resource drilling collars have been surveyed by Galaxy staff from the Mt. Cattlin operation, using a Trimble R6 GPS system which is accurate to +/- 20 mm.
10.5 Downhole surveying Most resource drill holes at Mt. Cattlin are vertical and fairly shallow, with an average depth of 48 m for the resource database. Most of these holes have not been down- hole surveyed, and the planned surface rig setup orientation is used to provide the hole orientation. During 2009 and early 2010, Surtron Technologies Australia Pty Ltd of Welshpool completed down hole surveying of selected RC and DD holes to investigate the amount of deviation in drill holes. A total of 71 holes were surveyed by an Electronic Multishot (EMS) instrument, and 25 of these holes were also surveyed with a gyroscope. Instruments used were a Tensor CHAMP Electronic Multishot, and a Humphreys Gyroscope.
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The surveying showed minimal deviation down to 50 m (generally less than 2 m horizontally from the planned location at the bottom of hole). At depths greater than 100 m, hole deviation can be up to 4 m. Down hole surveying is recommended in future. The majority of holes greater than 100 m depth, and all Galaxy DD holes within the resource have now been surveyed using either a magnetic tool or gyroscope.
10.6 Bulk density determination The majority of drilling at Mt. Cattlin has been RC, producing chips and as such, no specific gravity or bulk density measurements have been carried out on this material. Five density determinations were completed in 2001 and 2002 on un-waxed core (10 cm sticks of HQ core), dried at 110°C for 2 hours and using the water displacement (immersion) method. These samples were all from mineralised pegmatite (average Ta2O5 grade of 300 ppm). The densities averaged 2.70 kg/m³ and ranged between 2.64 kg/m³ and 2.75 kg/m³. A density of 2.70 kg/m³ was therefore assumed for the pegmatite zones in the 2007 and 2008 resource models. No density determinations were available for the unmineralised mafic units, so for the 2007 and 2008 resource models a constant value of 2.90 kg/m³ was assumed. An assumed density of 2.30 kg/m³ was used for a thin (~2 metres) skin of surface weathered material. In 2009, 270 bulk density measurements were completed on core from each metre of diamond holes GXMCMTD01 to GXMCMTD05 and GXD009 to GXD013. Using this data, Tornatora (2009) recommended values of 2.05 kg/m³ for soil/weathered material (down to a depth from 0 m to 7 m, in the absence of a regolith model), 2.65 kg/m³ for fresh pegmatite, and 2.85 kg/m³ for fresh waste. These values were used in resource and reserve modelling during 2009 to early 2010. The latest resource model (March 2011) used the value of 2.70 kg/m³ for fresh pegmatite ore, which is close to the latest average value for pegmatite of all data (see below). A simple regolith model comprising a DEM which is the interpreted base of the saprolite surface was developed in January 2010 and has been used for reserve models since that date. During 2009/2010 bulk density measurements were completed on every metre (including waste) of all additional available diamond core, including recently completed diamond holes. This included DD holes GXD01 to -GXD06, GXMCGTD01 to GXMCGTD04, and GXD014 to GXD018. This data was added to the existing database of 270 readings, for a total of 963 measurements. Figure 10.3 shows location of DD collars for which density data has been recorded. The method used for determining these bulk densities was the water immersion method. A coherent segment of diamond drill core around 10 cm in length and representative of the metre interval was selected. The weight of the segment of core is measured dry, in air, then measured when submerged in water. Density is calculated using the formula:
WAir SG ( Air WW Water)
Where:
WAir = Dry weight in air
WWater = Weight submerged in water Samples in the weathered zone were wrapped in glad wrap before being weighed in water.
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The down hole depth of the mid-point of the segment of core used in the measurement is recorded, and this is used to merge geological and regolith data from the geology database. Results from this work for the various regolith units and main rock types are summarised in Table 10.2. The average bulk density of the TPD and SAP horizons combined is around 2.10 kg/m³. It is recommended that this value be used for material above the January 2010 regolith surface representing the interpreted base of the saprolite surface. This surface should be updated as more information becomes available from continued mining, drilling and seismic geophysical work. Waste lithology densities range from an average of 2.76 kg/m³ for felsic and intermediate volcanic rock (which make up a minor portion of the waste material) to 3.00 kg/m³ for Proterozoic dolerite. The predominant lithologies in the western portion of the ore body are basalt and dolerite, which average 2.88 kg/m³ and 2.94 kg/m³ respectively. Tonalite (2.82 kg/m³) is more common in the eastern portion (see Figure 10.3).
Figure 10.3 Location of diamond holes for which density data has been recorded, superimposed over surface geology
Table 10.2 Regolith and geological data used
Min Max Average Approximate No. Regolith Rock type density density density depth range of readings (kg/m³) (kg/m³) (kg/m³) geological unit TPD+SAP All 1.745 3.018 2.098 67 0 m – 7 m FR Pegmatite 2.427 3.082 2.693 369 >10 m FR Waste 2.419 3.105 2.892 467 >10 m Regolith type descriptions: TPD = Transported – transported surficial material. SAP = Saprolite – in situ material, mostly weathered to clay minerals, (generally after basalt) FR = Fresh – unweathered, can include some staining along fractures
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The average bulk density for all the waste samples was 2.89 kg/m³. Because of the relatively small range in densities of the main waste rock types it is considered reasonable to use an average density of 2.89 kg/m³ for fresh waste material. If a more detailed waste density model is required in future, this could be created by using geological wireframes to develop domains of varying densities. As detailed above, bulk density for pegmatite ore used in the latest resource estimation (March 2011) was 2.70 kg/m³. Densities used in the latest reserve estimation (September 2010) were 2.65 kg/m³ for pegmatite ore, 2.05 kg/ m³ for material above the base of saprolite, and 2.85 kg/ m³ for fresh waste material. Based on the latest density information detailed above, in future the following values will be used: Soil/Weathered - 2.10 kg/m³ - (above the base of saprolite DEM) Fresh Pegmatite – 2.69 kg/m³ Fresh Waste – 2.89 kg/m³
10.7 Drill hole data Within the collar file datasets for Mt. Cattlin are 1,107 holes for a total of 52,692.56 metres. Open hole and RAB drilling method/type holes were excluded from the modelling investigation due to potential for sample contamination and/or unspecified detail of sample handling. A summary showing drilling details is presented in Table 10.3.
Table 10.3 SCG 2011 Mineral Resource tabulation
Min depth Max depth Ave (m) Count Sum (m) (m) (m) DD 39.19 39 6.4 125.1 1528.56 PC 33.88 59 2.0 132.0 1999.00 RAB 17.48 23 9.0 70.0 402.00 RC 49.46 986 1.0 232.0 48763.00
The assay file has been regularised and where appropriate composited to 1 m intervals and subsequently contains 8,030 after removal of co-located data and for data coded within pegmatite wireframes. Entries are all multi-element determinations. The extent of the solid models and subsequent limitation of the coding of the dataset was at the discretions of Galaxy staff. Galaxy representatives provided the following procedural summary for the data handling prior to the hand-over to H&S: "Lithium, tantalum, tin and niobium assays from the drilling programs were captured via direct import of the digital laboratory assay report to a relational database. Initially, Microsoft Access was used, but all data was converted to the SQL Server based Gbis in 2010. The assay reports were received via email in ASCII text format, with a header that reports each analyte with the laboratory assay code, units of measure and lower detection limit. Assay data was stored in the database without conversion to systematic units. For each sample the analyte details were read from the report header, and stored with the reported analyte value, so that each assay is stored in the units that it is reported in. Oxide results were stored as the oxides, and elements were stored as the elements. Results below detection were stored as the negative of the detection limit reported in the assay file.
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During the life of the project, assays have been reported in different combinations of oxide/element and ppm or percent. The detection limit for each element has been dependant on the analytical method used, and changes in the analytical methodology for each method. The variation in reporting measures requires data to be converted to uniform units when data was retrieved for resource modelling. This was achieved by applying element/oxide and ppm/percent conversions as needed via automatic look-up of conversion values stored in database reference tables. Below detection results were converted to a positive value of ½ detection limit. Data are rounded to the appropriate level of significance using the precision that is stored for each analytical method. For each element the retrieved value of below detection results will be a function of the reported detection limit and element/oxide conversion factor, which will then be rounded to the method precision. As an example, a below detection result of 5 ppm Li, will be converted to a Li2O (%) value of 5*0.5*2.153/10,000 = 0.00053825 and then rounded to a precision of three decimal places, i.e. 0.001%. The drilling undertaken by Galaxy since 2001 has been assayed and reported as summarised in Table 10.4.
10.8 Drill hole spacing The mineralisation at Mt. Cattlin has been drilled on regular east - west oriented drill traverses with the exception of a period of drilling by Pancontinental in the central-east of the project area whereby a 45o rotated grid was employed. The mineralisation is generally considered to be sub horizontal with local gradual undulations in both the north-south and east-west orientations. True thicknesses across the project areas range from as little as 2 m up to 22 m across strike. In the north - central portion of the project area, drill hole spacing varies from 20 mE to 25 mE across strike and 20 mN to 25 mN along strike to variable depth coverage, approaching the maximum drilled depth of 100 m. The remainder of the project area in the north-west and east, is drilled primarily on a regular 40 mE by 40 mN grid pattern to variable depths with a maximum depth of 232 m in hole GX864. Drilling in these areas is a mixture of RC, DD, RAB and OH. In the south-western portion of the project area the drill spacing is generally 40 mE x 80 mN and is largely RC drilling with minor DD twinning and tails. Figure 10.4 and Figure 10.5 show Mt. Cattlin drill-hole coverage colour coded by drilling date and by drill type and drilling company respectively.
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Table 10.4 Summary of the Mt. Cattlin assay methods for Galaxy drilling between 2001 and 2010
Reported Detection Year Units Lab Method Comments Analyte Limit Lithium 2007 Li PPM 5 SGS Perth AAS40Q 4 acid digest, AAS 2008 Li PPM 5 SGS Perth AAS40Q 4 acid digest, AAS 2009 Li PPM 5 SGS Perth AAS40Q 4 acid digest, AAS 2010 Li PPM 5 SGS Perth AAS40Q 4 acid digest, AAS 2010 Li PPM 5 SGS MTC Mine AAS40Q 4 acid digest, AAS 2010 Li PPM 50 SGS Perth AAS40Q AAS40Q methodology changed Tantalum
2001 Ta205 PPM 10 SGS Perth XRF2 Pressed powder XRF 2007 Ta Percent 0.005 SGS Perth XRF78O Alkali fusion XRF 2008 Ta Percent 0.005 SGS Perth XRF78O Alkali fusion XRF 2009 Ta Percent 0.005 SGS Perth XRF78O Alkali fusion XRF 2010 Ta Percent 0.005 SGS Perth XRF78O Alkali fusion XRF
2010 Ta205 Percent 0.005 SGS MTC Mine XRF78S Alkali fusion XRF Tin 2001 Sn PPM 10 SGS Perth XRF2 Pressed powder XRF 2007 Sn Percent 0.005 SGS Perth XRF78O Alkali fusion XRF 2008 Sn Percent 0.005 SGS Perth XRF78O Alkali fusion XRF 2009 Sn Percent 0.005 SGS Perth XRF78O Alkali fusion XRF 2010 Sn Percent 0.005 SGS Perth XRF78O Alkali fusion XRF 2010 Sn Percent 0.005 SGS MTC Mine XRF78S Alkali fusion XRF Niobium
2001 Nb205 PPM 10 SGS Perth XRF2 Pressed powder XRF 2007 Nb Percent 0.005 SGS Perth XRF78O Alkali fusion XRF 2008 Nb Percent 0.005 SGS Perth XRF78O Alkali fusion XRF 2009 Nb Percent 0.005 SGS Perth XRF78O Alkali fusion XRF 2010 Nb Percent 0.005 SGS Perth XRF78O Alkali fusion XRF
2010 Nb205 Percent 0.005 SGS MTC Mine XRF78S Alkali fusion XRF
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Figure 10.4 Plot of Mt. Cattlin drill collars colour coded by drill type
The drilling density is considered sufficient to define the geometry and extent of the mineralisation for the purpose of estimating the Lithium, Tantalum and Niobium resources given the understanding of the local project geology, structure and confining formations. It is understood that further drilling will be undertaken in future as deemed appropriate by Galaxy in-line with project development and company strategy. H&S recommended further drill testing be undertaken to define more clearly the limits, geometry and style of the mineralisation present in all project areas in order to assist in the fine tuning of the mineralised solids used in the resource estimation.
Figure 10.5 Plot of Mt. Cattlin drill collars colour coded by company
10.9 Results Typical cross sections are shown Section 13 of this report. All drilling significant intercepts (historical and recent) can be found in Appendix B at the end of this report. Drilling discussed in this Section constitutes the data used to estimate the Mineral Resources discussed in Section 13.
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11 Sampling preparation, analyses and security Drilling from 2001 onwards has been undertaken by Galaxy. Prior to 2001, some historical data has been incorporated into the resource database (see Section 10, Table 10.1 and Figure 10.5). Pre-Galaxy data utilised in this investigation are historical in nature, with drilling, sampling and assaying processes undertaken by a number of different entities and by a range of representatives within each entity over time. The continuity of processes and procedures has been assumed in this instance. H&S conducted an analysis of the QAQC outcomes to establish confidence in the data. The integrity and appropriateness of the drilling data will remain the responsibility of the client until such a time as the entire investigation from first principles can be undertaken upon request by the client.
11.1 Sample preparation RC samples are split and collected in calico bags from a splitter on the drill rig (see Section 10). These bags are individually numbered and sample numbers and hole details are recorded on site. Samples to despatch to the laboratory are inserted into plastic bags (generally around 5 calico bags to a plastic bag) and the plastic bags are sealed with cable ties. The plastic bags are despatched directly from site to Esperance Freight Line‟s (EFL) Ravensthorpe depot by the field supervisor or geologist and trucked by EFL to the assay laboratory. Here the samples are sorted and a reconciliation advice is provided to Galaxy detailing any missing or extra samples. Action is then taken by Galaxy to reconcile the difference if any problems are reported, which is rarely. Samples since 2007 have been assayed at SGS Laboratories, WA, with check assaying undertaken at Ultratrace and Genalysis Laboratories. All samples sent to SGS are sorted, then dried and pulverised to 90% less than 75 µm in a Labtech Essa LM5 pulveriser (Figure 11.11) (preparation method PRP86). Samples weighing over 3.5 kg in weight were riffle split to 50% of original weight (SPL26). A pulp sample of around 200 g is scooped from the total pulverised sample. All crushing and grinding is carried out by the analytical laboratory. Sample pulps and coarse reject material is stored by the laboratory and returned to Galaxy upon request only after completion of both the initial sample analysis and any additional checks which Galaxy may require following receipt of the initial sample assays. Galaxy typically inserts random blank samples into the assay stream. These blanks have consistently returned very low lithium and tantalum assays, as was anticipated. In addition, random pulps and rejects are submitted to other certified labs for checking or confirmation purposes. See Section 11.4 for details of analysis of blank and inter- laboratory comparisons. For the most part on this project, comparison of the results from the various different assays and labs indicate a high measure of confidence in the assay data. The assay labs utilized by Galaxy also have their own in house QAQC programs (See Section 11.4 for details). These include standards, repeat analysis, duplicates and blanks. SGS state that as a minimum in every batch of 50 samples analysed there is one reagent blank positioned at the start of the rack; two certified reference materials randomly placed in the rack; one repeat sample randomly selected and placed at the end of the rack; and one duplicate sample selected at random placed at the end of the job. In addition, Galaxy inserts a blank in the field every 25 samples, and provides pulp standard material to SGS to insert at random every 25 samples (see Section 11.4).
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Figure 11.1 LM5 mill, SGS Lab, Newburn
All sampling has been carried out under the supervision of Galaxy senior personnel - either the Exploration Manager or Senior Geologist. All drill core and samples were geologically and structurally logged (where appropriate), split / sawn (where appropriate), photographed (in the case of diamond core) and stored at the Company‟s sample farm in the field, or storage facility in Perth.
11.2 Analytical methods Samples since 2007 have been assayed at SGS Laboratories, WA, with check assaying undertaken by Ultratrace and Genalysis Laboratories. Elements that are routinely analysed for are Li (method AAS40Q) and Ta, Nb and Sn (method XRF78O). Routine lithium analysis is by AAS. The samples are digested using method DIG40Q, in which the sample is digested by nitric, hydrochloric, hydrofluoric and perchloric acids. The solution from the digest is then presented to an AAS for the quantification of Li, using method AAS40Q (lower and upper detection limits of 5ppm and 20,000ppm respectively). Samples over the Li upper limit are re-analysed using method AAS42S.
Ta, Nb and Sn, and in some cases SiO2, Al2O3, CaO, Cr2O3, Fe2O3, K2O, MgO, MnO, P2O5, SO3, TiO2 and V2O5 were analysed by XRF using method XRF78O. This involves fusing the sample in a platinum crucible using lithium metaborate/tetraborate flux (one gram of sample in 2.75 g of flux). The resultant glass bead is then bombarded with X-rays and the elements of interest quantified. In addition to the elements described above, selected samples (mainly from diamond core) were also analysed for Cs, Rb, Ga, Be, and Nb using method IMS40Q, in which the solution from the DIG40Q digest is presented to an ICPMS for the quantification of elements of interest.
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In addition to analysis of standard reference material supplied by Galaxy, SGS carried out analysis of the laboratories internal standard reference material, as well as internal laboratory duplicate and repeat sample analysis. Duplicate Sample, (DUP) is a re- assay from a separate split of the total pulverised sample taken by SGS. Repeat Sample, (REP) is a repeat sample taken by SGS from the 200 g pulp.
11.3 Sample security RC samples are collected in calico bags at the drill rig (see Section 10). Samples for despatch to the laboratory are inserted into plastic bags (generally around 5 calico bags to a plastic bag) and the plastic bags are sealed with cable ties. The plastic bags are despatched directly from site to Esperance Freight Line‟s (EFL) Ravensthorpe depot by the Field Supervisor or Geologist and trucked by EFL directly to the assay laboratory. Upon arrival at the assay laboratory, the samples are sorted and a reconciliation advice is provided to Galaxy detailing any missing or extra samples. The Geologist is responsible at all times for the secure shipment to the laboratory of the samples. The authors consider that the sample preparation, security and analytical procedures adopted by Galaxy provide an adequate basis for the current Mineral Resource estimates.
11.4 Sample quality control measures A program of field duplicate and check sampling and insertion of blanks and standards was commenced in 2008, and has been consistently applied from October 2008.
11.4.1 Standards Galaxy has provided SGS with Chinese lithium standard reference material in pulp form (see Section 11.4.4 for details), and these are inserted every 25 samples by SGS during analysis. Currently, there is a limited choice of certified Lithium standards in Australia or internationally. The standards most commonly used are provided by the China National Analysis Centre for Iron and Steel. These standards are sourced by Galaxy and SGS from China and are supplied with a Certificate of Certified Reference Material. The Certification notes that values are calculated according to analytical results from nine independent laboratories. However, apart from the standard preferred value and standard deviation, no other details are provided on the certification procedures and results, so the reliability of these certified reference standards is subject to question. SGS currently uses one standard for Ta determination which is certified, STD-TAN1.
11.4.2 Coarse blanks – Galaxy provided to laboratory A blank is inserted every 25 samples, preferably after a high grade pegmatite sample. The blank comprises barren feldspar or quartz. Since the blank material samples have not been rigorously homogenised (or certified) it is reasonable to expect some variation between individual assays, particularly for the secondary attributes. All of the samples used to generate the coarse blanks were assayed by SGS in the sample analysis runs. No independent analysis with reference material control was undertaken for the coarse blanks. In the following sections of this report any reference to the warning limits and action limits is the theoretical value for the level which is calculated as:
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Action level = mean ± 3.09 x standard error of the mean, where the standard error of the mean = standard deviation/square root of the number of samples in a group. Galaxy has inserted various blank materials at regular intervals since August 2008. These generally consist of 3 kg to 4 kg of a feldspar material and therefore test SGS‟s preparation procedures in addition to analytical determinations. Results are shown in Figure 11.2 below. The lower limit of detection quoted by SGS for lithium analysis is 50ppm Li (i.e. ~107.6 ppm Li2O). Galaxy has utilised various blank material over the last few years, with lithium grades for the blanks reported by suppliers to be in the range of around 5 ppm to 10 ppm Li2O. A data set containing 392 blank samples was provided to H&S for analysis. With the application of the lower detection limit as the reference mean (107.625 ppm Li2O) of the expected value, a Shewharts control chart analysis was undertaken. It is apparent that SGS Perth and SGS Mt. Cattlin laboratories have found it difficult to reproduce the lower detection limit for the blank sample inserted by GR. On average, a mean value of 90.5 ppm Li2O was obtained from the SGS Perth and SGS Mt. Cattlin analyses of the blank samples inserted by GR which is heavily skewed by outliers. The outcomes are lower than the anticipated lower detection limit but exceeds the half lower detection limit.
After removal of 4 outliers an average value of 69.33 ppm Li2O was observed which reflects a value lower than the anticipated lower detection limit but marginally higher than the half lower detection limit of 53.812. More significantly though, a number of determinations were 3 to 5 times higher than the anticipated blank value (Figure 11.2 below) and will require further follow up to resolve. In total 12 samples were higher than the upper action limit, 16 samples were higher than the upper warning limit 2 and 46 samples were higher than the upper warning limit 1. In total 74 samples exceed the lower detection limit for GR inserted blanks samples, this constitutes 19% of the population. The issue of why analyses continue to overstate the base line blank values on a consistent base is still a question and requires further discussion. Values over around 200 ppm Li2O in blanks are not deemed acceptable by H&S. However, levels of lithium registered in the blanks are much lower than would be material to resource estimates.
Figure 11.3 shows Ta2O5 values for blanks inserted by Galaxy. Up until recently the blanks for Ta2O5 were reading appreciably low values consistently. In total 355 samples are contained in the dataset under investigation and a total of 2 samples were seen to be out of control high above the upper action limit. Clearly batch MC000022 is considerably higher than anticipated and all of the samples associated with these blanks samples should be re-analysed to determine the source of the issue and to determine the impact of this on the remaining samples in the batches concerned. Re-analysis of this batch is currently in progress.
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Figure 11.2 Galaxy filed blanks assayed for Li2O ppm by ascending date - no outliers removed
Figure 11.3 Galaxy filed blanks assayed for Ta2O5 ppm by ascending date - no outliers removed
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11.4.3 SGS laboratory internal blank analysis Blank samples inserted by SGS internally comprise an empty test tube, into which reagents are inserted during the course of an analysis. The blank is therefore a check on whether reagents carry detectable levels of elements of interest and on whether the analytical readings are returning spurious values. The SGS blanks are not a check on sample preparation or contamination. Figure 11.4 shows a chart of SGS internal blank analyses of Li2O for the period under review.
Figure 11.4 SGS internal blanks assayed for Li2O ppm by ascending date
It is apparent that SGS laboratories have on average achieved the 0.00 ppm Li2O value expected of the blank sample analysis. There is only one sample which exceeds the upper warning limit 1 and it is thus clear that the blank analysis are in control. The issue of what is an achievable lower detection limits still stands. Clearly a number of samples which have been found to give higher than expected values have been impacted by an error of one form or another. It is not presently clear as to the source of the error or whether the error has been carried over into the remainder of the batch analysis. This particular issue will require further investigation to resolve. However, the lithium levels seen are much lower than those required to have any impact on the resource estimate.
11.4.4 Certified reference material Galaxy has provided SGS with Chinese lithium standard reference material in pulp form), and these are inserted every 25 samples by SGS during analysis. Other standards used by SGS and Ultratrace internally for QAQC are not certified and thus are subject to unspecified quality performance. Table 11.1 lists all standard reference material and blanks inserted by both Galaxy and SGS during the period April 2007 to May 2011, by batch and date. Certified reference material supplied by Galaxy to SGS which were inserted regularly by SGS during analysis of each batch included Lithium standards NCS DC86303 and NCS DC86304, and Tantalum standard NCS DC86306.
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Table 11.1 Standard reference material-frequency of use by batch, for SGS
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A chart showing values for standard NCS DC86303 plotted against date is shown in Figure 11.5. The graph shows standard reference material provided by Galaxy and SGS.
Figure 11.5 Plot of Li2O ppm values for lithium standard NCS DC86303, by ascending code
Standard deviations plotted on the chart are supplied by the China National Analysis Centre for Iron and Steel. Utilised on 529 occasions, standard NCS DC86303 for Li2Oppm (Figure 11.5 above) performed within industry standards with the exception of 9 samples above the upper action limit (batches WM118885, WM119013, WM119405, WM126224, WM123744, WM123928) and another 1 sample below the lower action limit (batch WM122336). Batches WM123744 and WM123928 have been re-analysed and latest results used in preference to the earlier results. A chart showing values for standard NCS DC86304 plotted against date (and batch) is shown in Figure 11.6.
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Figure 11.6 Plot of Li2O ppm values for lithium standard NCS DC86304 by ascending code
The mean value for all the samples is 24,360 ppm Li2O, around 6% higher than the expected value of 22,900 ppm Li2O. Several batches of analyses from 15/01/2009 to 27/01/2009 have returned results significantly higher than average.
Standard NCS DC86304 for Li2O ppm performed within industry standards (control chart represented in Figure 11.6 above) with the exception of 6 sample above the upper action limit (batches WM13815, WM13817, WM19013, WM19311) and another 1 sample below the lower action limit (batch WM123744). These batches have been re-analysed and latest results used in preference to the earlier results. The standard STD-NCS_DC86304 outcomes have tended to approach the mean expected value over time. All of the out of control samples were encountered early in the analysis history. The analysis methodology has since been updated and improved and these batches re-analysed. Standard GX521 is an internal SGS standard. It was developed in house by SGS and has undergone analysis by them, but does not have external certification. It is a pulp standard and is not available externally. A chart showing values for standard GX521 plotted against date (and batch) is shown in Figure 11.7.
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Figure 11.7 Plot of Li2O ppm values for lithium standard GX521, by ascending date
Apart from some analyses in May/June 2007, and also in late in 2009, reference material GX521 performed within industry standards (control chart represented in Figure 11.7 above) with the exception of 2 sample above the upper action limit (batch WM100499) and another 3 samples below the lower action limit (batch WM100500). Notably, however, is the trend toward diminishing values over recent batch run which has resulted in the 3 samples lower than the lower action limit. SGS has now run out of this standard, and it is possible anomalously low results for batches WM119870 and WM119922 in late 2009 may be related to homogeneity issues with the standard as the supply ran out. A chart showing values for tantalum standard NCS DC86306 plotted against date (and batch) is shown in Figure 11.8. This standard is supplied by the China National Analysis Centre for Iron and Steel.
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Figure 11.8 Standard NCS DC86306 for Ta2O5 ppm by ascending date
Utilised on 458 occasions, STD-NCS_DC86306 standard performed within industry standards (control chart represented in Figure 11.8 above). No samples were seen to be out of control. However, it was observed that 2 samples fell between the lower warning limit 2 and lower action limit.
SGS analyses average 639 ppm Ta2O5 compared to a preferred value of 700 ppm Ta2O5 (supplied by the China National Analysis Centre for Iron and Steel). While the average value returned by SGS is consistently lower than the preferred value, all analyses are within acceptable limits. Standard OKA1-Ta standard used by SGS and supplied by CANMET is a Nb standard, not a Ta standard, comprising carbonatite ore and is therefore not directly applicable to Mt. Cattlin, but the graph is included in Figure 11.9. Figure 11.9 displays the analytical outcomes for STD-OKA-1 for Nb2O5 ppm. The analysis of Nb2O5 ppm by SGS is clearly in control with no samples falling outside the upper and lower warning limits 1.
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Figure 11.9 Standard OKA-1 for Ta2O5 ppm by ascending date
Standard TAN-1 is used by SGS and supplied by CANMET. It is a Ta standard with preferred value of 0.288% Ta2O5 and was utilised on 343 occasions (Figure 11.10). Eleven samples were above the upper action limit (batches WM100499, WM126819, WM126310, WM126389, WM102606, WM126981, MC000020 and MC000014), equivalent to two standard deviations from the mean expected value). The majority of the analytical outcomes have been higher than the mean expected value on average with a large number of samples (31 samples) falling above the upper warning limit 2 and 85 samples falling above the upper warning limit 1. Only 6 samples fall below the lower warning limit 1. However, the mean value is only 1.25% higher than expected.
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Figure 11.10 Standard TAN-1 for Ta2O5 ppm by ascending date
11.4.5 Internal duplicate and repeat analysis - SGS A number of internal laboratory duplicate and repeat analyses were undertaken by SGS as a standard function of the internal QAQC process. Scatter and QQ plots (Figure 11.11 to Figure 11.14) are used to display the outcomes.
As can be seen in Figure 11.11, Li2O ppm (exploration data only, grade control data subset), repeat analysis is consistently precise to within ~6.62% (Micromine software precision utilising element statistics). The populations display strong correlation across the whole population with the Pearson and Spearman correlation coefficients approaching 0.999 and 1.00 respectively and has a slope of 0.993. The population is not materially impacted by outliers and has no significant spurious high end members impacting the outcomes.
As can be seen in Figure 11.12, Li2Oppm (grade control data only, exploration data subset), repeat analysis is consistently precise to within ~7.29% (Micromine software precision utilising element statistics). The populations display strong correlation across the whole population with the Pearson and Spearman correlation coefficients approaching 0.998 and 1.00 respectively and has a slope of 0.994. The population is not materially impacted by outliers and has no significant spurious high end members impacting the outcomes.
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Figure 11.11 Scatter plot of exploration data only, Li2O% original to repeat analysis for internal SGS, MTC-SGS and Genalysis QC samples - no outliers removed
Figure 11.12 Scatter plot of grade control data only, Li2O% original to repeat analysis for internal SGS, MTC-SGS and Genalysis QC samples - no outliers removed
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Figure 11.13 Scatter plot of exploration data only, Ta2O5 ppm original to repeat analysis for internal SGS, MTC-SGS and Genalysis QC samples - no outliers removed
Figure 11.14 Scatter plot of grade control data only, Ta2O5 ppm original to repeat analysis for internal SGS, MTC-SGS and Genalysis QC samples - no outliers removed
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For Ta2O5 ppm, repeat analysis outcomes are much the same as for that of Li2O% (see Figure 11.13 with the removal of grade control data), with a slope of 0.985 and the Pearson and Spearman correlation coefficients are 0.996 and 0.96, respectively. The lower Spearman suggests that the population may be very weakly impacted by a number of high end members, however these end members have not impacted the slope overall.
For Ta2O5 ppm, repeat analysis outcomes looking at the grade control data only (Figure 11.14), the slope of the regression is 0.994 and the Pearson and Spearman correlation coefficients are 0.985 and 0.97, respectively. The lower Spearman suggests that the population may be very weakly impacted by one or two high end members, however these end members have not impacted the slope overall. Whilst the number of determinations undertaken by each laboratory are not equal it would appear that overall all laboratories have performed consistently. No repeatability problems are apparent from the laboratory checks, indicating good repeatability of assays and homogenisation has been achieved during pulverisation.
11.4.6 Analysis of Galaxy field duplicates - SGS An additional number of field splits were recommended by H&S and subsequently undertaken by GR, the total dataset now totalling 432 samples since 2008. The outcomes provided in Figure 11.15 to Figure 11.18 indicate consistent treatment of sample in the field on the assumption that the SGS laboratories have produced repeatable determinations to within acceptable limits (as indicated by section above) with the exception of 14 outliers samples.
Figure 11.15 Scatter plot of Li2O% original to field duplicate analysis for Galaxy field duplicates by SGS
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After removal of outliers, duplicate sampling is consistently moderately precise to within ~21.73% (Micromine software precision utilising element statistics), has moderate correlation across the whole population with the Spearman and Pearson numbers approaching 0.98 and 0.99 respectively and has a slope of 1.00. The population is not materially impacted by outliers and has no significant spurious high end members impacting the outcomes.
Figure 11.16 Scatter plot of Li2O% original to field duplicate analysis for Galaxy field duplicates by SGS - outliers removed
Figure 11.17 QQ plot of Li2O% original to field duplicate analysis for Galaxy field duplicates by SGS
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As can be seen from the above QQ plot (Figure 11.17), there appears to be some departure between the two populations at the higher end of the distribution beyond 23000 ppm Li2O. After removal of outliers (Figure 11.18) the comparison is improved with the exception of the upper most sample comparison. The outlier original sample to duplicate sample differences may be the result of sample number or sequence miss match in the field, in any case these issues need resolution and final attribution.
Figure 11.18 QQ plot of Li2O% original to field duplicate analysis for Galaxy field duplicates by SGS -outliers removed
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Figure 11.19 QQ plot of Ta2O5ppm original to field duplicate analysis for Galaxy field duplicates by SGS
Figure 11.20 QQ plot of Ta2O5ppm original to field duplicate analysis for Galaxy field duplicates by SGS - removal of outliers
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Figure 11.21 Scatter and QQ plots of Ta2O5 ppm original to field duplicate analysis for Galaxy field duplicates by SGS
After removal of 10 outliers the Ta2O5 ppm, field duplicate outcomes are much the same as for that of Li2O% (see Figure 11.15 to Figure 11.18), however the slope is 0.994 and the Pearson and Spearman correlation coefficients are 0.96 and 0.92 respectively. The lower Spearman suggests that the population is weakly impacted by a number of end members which have caused the resulting decrease in slope overall.
11.4.7 SGS Re-analysis Tornatora and Hamdorf (2010) noted some concerns with SGS lithium assays of standard reference material. It was originally thought that the cause may have been poor reliability and homogeneity of the Chinese standards. However, after meetings with SGS in mid 2010 to discuss Galaxy‟s concerns, SGS conducted a review and analysis of their previous lithium analyses by methods DIG40Q and AAS40Q. On 8 October 2010 SGS provided a report to Galaxy which concluded that there were some issues with precision and reproducibility of both reference materials and samples. Recommendations made by SGS to improve their lithium analyses included: The digestion of the samples remain the same (0.2g to 20mL – DIG40Q) A 1 in 10 dilution be performed on all samples by a calibrated auto dilutor to reduce matrix effects using 10% HCl. Two calibration ranges only be used for the FAAS work. Low calibration range be 0 to 4 mg/L and the high range be 0 to 30 mg/L. Low calibration standards to be 0, 1, 2, 3, 4 mg/L in 10% HCl. The high calibration standards to be 0, 10, 20, 30 mg/L in 10% HCl. The flow rate of the nebuliser to be checked each day and recorded. The glass bead to be adjusted to obtain the best sensitivity for Li. A neutral to slightly rich flame to be used. Where possible the top standard to have an absorbance of 0.8 Extra repeats need to be scheduled of some previous jobs for client confidence.
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This change in technique was made by SGS in August 2010. The changed methodology also resulted in SGS changing their lower detection limit from 5ppb Li to 50ppb Li. The changed detection limit does not affect Galaxy resource database, because these grades are well below economic or marginal grades. Several programs of re-assaying pulps to follow up on the above were carried out since July 2010, and these are discussed in the following sections.
Program 1 In September 2010, 100 pulp samples were selected by Galaxy for re-assay for Li (AAS40Q) + XRF78O (entire suite). The samples were selected from two batches (original batch numbers WM119405, WM123744) where the standards data showed unexpected trends. The samples were selected to bracket the lowest and highest standard in each of the two batches. Re-assays (batch WM125937) returned results an average of 4.7% lower than the original assays. Results are plotted in Figure 11.22 and Figure 11.23.
Figure 11.22 Plot of Li2O% original to duplicate analysis for selected samples, Sept 2010
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Figure 11.23 QQ plot of Li2O% original to duplicate analysis for selected samples, Sept 2010
Program 2 In late October 2010, SGS provided to Galaxy results of an internal laboratory check program of Galaxy‟s resource and grade control assays between October 2009 and August 2010. This showed a trend for lower grade SGS internal lithium repeats to be higher than the original and very high grade Li repeats to be lower than the original assay. In order to test whether there were matrix effects which may have affected the lithium assay result, the difference between the original lithium result and the repeat result was plotted against each of the major elements of the matrix. The results of this did not indicate any particular trends associated with matrices. SGS then ranked data according to chronological order and a cumulative data plot was created which identified groups of jobs with the greatest difference between original and repeat assays. SGS then selected several batches totalling 1324 samples (including standards) to re-assay from pulps for Li only (AAS40Q, AAS42Q methods), using their updated methodology. Samples included both resource and grade control completed at SGS Perth, with graphs of results shown in Figure 11.24 and Figure 11.25.
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Figure 11.24 Plot of Li2O% original to pulp re-assay for samples selected by SGS, October 2010
Figure 11.25 QQ plot of Li2O% original to pulp re-assay for samples selected by SGS, October 2010
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The results show a relatively consistent trend of higher repeat lithium for samples less than 1% Li (2.15% Li2O), and lower repeat lithium for samples greater than 2.15% Li2O. Samples from 0.2% Li2O to 2.15% Li2O returned results an average of 4.0% higher than the original. Samples greater than 2.15% Li2O returned re-assay results an average of 8.3% lower than the original. (Note: 0.2% Li2O was chosen as the lower limit in this case because values lower than this are not significant to resource or grade control figures). SGS also noted the inflection point was at 1% Li (2.15% Li2O). SGS believe that a higher concentration of major elements was depressing the signal for lithium. Performing the initial dilution in their revised technique significantly reduces this effect. SGS reported that the reason for the values above 1% lithium being lower on the repeats is probably due to the original values being skewed high by calibration curvature when they tried to extend the calibration higher than it should have been. Their revised procedure has only two calibration ranges and if the result goes over range then a further dilution is prepared. Program 3.
Due to the trend for samples above 2.15% Li2O to return re-assays lower than the original using SGS‟s revised assay technique, a portion of higher grade samples from previous work were selected to be reassayed from pulps. 198 samples were selected from batches WM113815, WM113816, WM113817, WM118885, WM118943, WM119013 and WM119311, assayed during 2009 which previously showed higher than expected values for the high grade standard NCS DC86304 (Figure 11.26).
All samples greater than 1.5% Li2O were selected from these batches and re-assayed in January 2011.
Figure 11.26 Plot of Li2O ppm values for lithium standard NCS DC86303, with problem batches circled
As expected from previous work, repeat assay results from 1.5% to 2.15% Li2O returned values similar to the original assay. Assay checks for samples greater than 2.15% Li2O returned values lower than the original assay on average.
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Statistics are shown in Table 11.2. Repeats above 2.15% Li2O returned assays an average of 93% of the original, whereas repeats below 2.15% Li2O (and above 1.5% Li2O) returned assays an average of 99% of the original.
Table 11.2 Statistics for 198 >1.5% re-assays, January 2011
Assay range No. samples Li2O original Li2O repeat Ratio >2.15% 98 3.00 2.78 0.93 >1.5%, <2.15% 106 1.84 1.82 0.99 >1.5% 198 2.38 2.26 0.95
Figure 11.27 Plot of original vs repeats for >1.5% Li2O re-assays, December 2010
The re-assay programs indicate that there is a tendency for samples greater than 2.15% Li2O to report lower than the original value using the SGS revised lithium analysis method. Several re-assay programs have now been completed (discussed above), and these results were used in the latest resource estimate (February 2010). Currently around 5.5% of the total number of lithium assays in the resource database are over 2.15% Li2O and have been analysed using the old SGS technique. Given the tendency for samples less than 2.15% Li2O to report higher lithium values using the revised technique and the low number of samples above 2.15% Li2O, it is not considered necessary to extend the re-assay program further. It should be noted that samples selected for re-assay during the three programs described above were selected batches or samples which originally showed the poorest QAQC results and therefore are likely to represent the worst case situation.
11.4.8 Inter-laboratory check analysis by Genalysis The comparison of original SGS to Genalysis pulp analysis illustrated in Figure 11.28 display good correlation between the two populations up to 26,000ppm Li2O, after which the original sample tends to be of slight higher grade at the deciles.
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Figure 11.28 Scatter and QQ plots of Li2O, Original SGS vs. Genalysis of pulp comparative analysis, no outliers removed.
The correlation coefficients are high at 0.99 and 0.99 for the Pearson and Spearman coefficients and the slope of the scatter plot is 0.94 again suggesting that the original grades are generally marginally higher than those completed by Genalysis. This trend is influenced by the high end members. Up to values of 700ppm Li2O Genalysis have tended to be higher than those observed in the original SGS dataset.
11.4.9 Drill sample recovery data A total of 1,985 entries of RC sample recovery data for resource drilling occur in the Galaxy drill database at June 2011. The data were collected from a range of drill holes across a range of locations over the resource area. The majority of readings are weights of the 12.5% calico bag split of the bulk sample. Recoveries are estimated by using this weight to calculate the actual sample recovery, and then comparing this weight with the maximum sample recovery based on the RC hammer dimension. An additional study was done in 2008 whereby the bulk plastic bag plus the calico split were both weighed and compared to the calico bag split weights. This indicated that weighing the calico bag was a suitable proxy for the full sample. Figure 11.29 shows the recovery by hole depth, which averages about 80%. Figure 11.30 and Figure 11.31 display average lithium and tantalum grades by depth, respectively.
Figure 11.29 Graph of hole depth (x-axis) vs. sample recovery (y-axis) for available resource RC drill holes
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Recovery of sample is consistently above 60% for most of the depth range, averaging close to 80% of the theoretical recovery. There is a slight decrease in recoveries with increasing depth. Recoveries for the first few metres are lower than average as can be expected. However, since there is generally several metres of transported overburden, or lithium grades are depleted near-surface, this is not considered to be a problem. As can be seen in Figure 11.29 and Figure 11.30, there is no significant correlation between recovery and lithium grades which can be discerned from the sample dataset under investigation. Figure 11.31 suggests slightly lower tantalum grades below a depth of 78 m. However, this is thought to be because of the Northwest Zone, which extends to a greater depth than other pegmatite units, appears to be lower in tantalum.
Figure 11.30 Graph of hole depth (x-axis) vs. Li2O% grade (y-axis) for available resource RC drill holes
Figure 11.31 Graph of hole depth (x-axis) vs. Ta2O5 ppm grade (y-axis) for available resource RC drill holes
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12 Data verification 12.1 Data verification
12.1.1 Data verification procedures The current resource estimates are based on a sampling database provided by Galaxy. Checks undertaken to confirm the validity of the supplied data include: Assay values are routinely compared to geological logging of mineralised units, and surrounding holes. Comparative drilling (drill hole twinning) over some areas was undertaken to assess the repeatability of the local mineralization. Checking between, and within data tables in the supplied database was done for internal consistency. For the majority of sampling from Galaxy‟s drilling which dominates the resource datasets, the author of this section (Robert Spiers) compared a cross section of the results from laboratory source files and hard copies supplied by Galaxy (where available and applicable) with entries in the supplied database to assess the prevalence of transcription errors. Comparisons between assay results from different sampling phases. These checks showed no significant discrepancies in the databases used for resource estimation. The information that relates to Ore Reserves is based on information compiled by Mr. Roselt Croeser who is a full time employee of Croeser Pty Ltd. Mr. Croeser has more than 5 years experience which is relevant to the style of mineralisation and type of deposit under consideration. Snowden‟s consultants have reviewed the Mineral Resources and Ore Reserves as well as the assumptions used to derive such figures, and have in this document commented on the validity and reasonability thereof (see Section 14). Mr. Jeremy Peters of Snowden acts as a qualified person for the ore reserve estimation. The updated Reserve was based on the Life of Mine (LoM) schedule produced in September 2010. This schedule was depleted up to the end of December 2011 in order to achieve this updated Reserve estimate. Snowden is confident in the economic viability of the Galaxy Mt. Cattlin project. It is satisfied that the data has been studied in sufficient detail to demonstrate this and that any impediments to implementation have been identified and reasonable mitigation strategies proposed. A due diligence review was completed by qualified person (Dr. L Lorenzen) on all metallurgical data related to the processing of material at both sites to evaluate and verify the data with regards to accuracy, adequacy and variability. Snowden is confident in the economic viability of the Mt Cattlin Mine. It is satisfied that the project has been studied in sufficient detail to demonstrate this and that any impediments to implementation have been identified and can be satisfactorily resolved in operation.
12.1.2 Data verification limitations The report authors consider that to the best of their knowledge, no verification limitations were imposed by the client or where found to exist by Hellman&Schofield and Snowden during the course of the investigation.
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12.1.3 Data adequacy The report author (Robert Spiers) considers that the all resource data reported in this technical report has been adequately verified to form the basis of the current Mineral Resource estimates. All paper copies of the historical data previously entered into the current data base were made available to H&S. Quality control measures implemented by Galaxy to confirm the quality of sampling and assaying are discussed in Section 11.4. The report authors (Leon Lorenzen and Jeremy Peters) for the reserve and processing reported in this technical report that all technical reserve and processing data has been adequately verified to form the basis for the current Mineral Reserve estimates. All relevant technical pre-feasibility, feasibility, detailed design, development plans and design reports were evaluated and reviewed. During commissioning and first year of operations at Mt. Cattlin, both mining and metallurgical qualified persons visited the mine on various occasions and familiarised themselves with the data collection, data management and data reconciliation during that time. Both mining and metallurgical QPs also evaluated data for the Mineral Reserve and metallurgical accounting and both are confident in the integrity of the data as well as the procedures of the company to obtain and manage the data. Quality control measures implemented by Galaxy to confirm the quality of the Mineral Reserve and processing data are discussed in Sections 14, 15 and 16.
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13 Mineral Resource estimates The Mt. Cattlin Mineral Resources were estimated by Ordinary Kriging (OK) of one metre down-hole composited grades within mineralized domains at Mt. Cattlin. The resource model summarised in this report was used to provide estimates of Mineral Resources at various Li2O cut-off grades (with a lower cut-off grade of 0.4% Li2O) for public release in the form of the National Instrument 43-101 reporting requirements (Standard of Disclosure for Mineral Projects - Canadian Ventures Exchange (TSXV)). Micromine software was used for data compilation, wire-framing and composite calculation, and GS3©, the resource estimation software developed by Hellman & Schofield (H&S) was used for resource estimation. The resulting GS3© model was imported into a Micromine format model for validation, section verification and reporting of estimates. The Galaxy Mineral Resource estimation was undertaken by Robert Spiers, MAIG, who is a full-time employee of H&S. The work was reviewed by Dr. Phillip Hellman, FAIG, who is a Qualified Person in terms of NI43-101 standards for resource estimation of elements in the field of interest. Mr. Spiers has more than five years‟ experience in the field of reporting Exploration Results and is a Qualified Person in terms of NI43-101 standards for Exploration Results and of resource estimation in general.
13.1 Mt. Cattlin resource modelling The mineralisation strings and wireframes that had been supplied by Galaxy‟s geologists were used to identify the sample data prior to compositing. The wireframes were created from strings interpreted using the pegmatite lithological units as the defining limits to the mineralisation. All other lithologies were excluded from the pegmatite solid (unless used to establish pegmatite continuity). Wireframes were constructed using a detailed approach to identifying individual pegmatite lodes throughout the deposit. Internal mafic waste blocks were removed where continuity of these was demonstrated. These will be further dealt with once mining constraints are defined. The completed wireframes of the mineralised domains (Figure 13.1) were used to code (flag) the raw assay data. The domain codes are presented in Table 13.1.
Table 13.1 Modelling domains (codes)
Domain Description 0 All other data outside of the wireframe solids 1 Dowling pit- central northern domain - coded by wireframe solids 2 Western domain – coded by wireframe solids 3 Eastern domain – coded by wireframe solids 4 Far eastern domain – coded by wireframe solids 5 Southern domain – coded by wireframe solids 6 North western domain – coded by wireframe solids
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Figure 13.1 Wireframe of the mineralised domains contained within the Mt. Cattlin project area put forth by GR representatives
13.1.1 Treatment of data and unsampled intervals The preparation of the dataset prior to estimation was undertaken by Galaxy representatives including all substitutions for assays lower than detection limit. H&S were provided with a dataset which was modified and amended in the following ways: CCP OH drillholes were found to contain spurious Li ppm results and as such were cut from the data set (see Table 13.2). All RAB and OH coded hole data was removed from the dataset (Table 13.2) to be used in the estimation process. These holes were removed as neither Galaxy nor H&S could vouch for the accuracy of the sampling technique in this instance; the like hood for contamination of sample was deemed high. Missing values in the Ta ppm field were replaced with 0.000 where it was deemed mineralisation is absent. Replace missing Li values in the drilling predating Galaxy with -99 in the assumption that it is possible that mineralisation may be present in these un-sampled zones but at the time of drilling analyses was only on Ta mineralisation where Ta values exceed a minimum mineralised value of 50 ppm. Missing values in the Li ppm field were replaced with -99 where Ta ppm is equal to not sampled (NS) (and assumed to be mineralised), and also -99 (formerly -10 in the Galaxy dataset). It is not assumed that because there is little or no Ta considered to be present that Li will not be present as the two elements are not always well correlated.
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13.1.2 Compositing The samples were composited across the interval defined by the solid model mineralised wireframes at 1 m lengths, consistent with the majority of the drilling data.
13.1.3 Representation of data values Figure 13.2 and Figure 13.3 show two long section views of the sample data coloured by geology and by Li grade (ppm). The majority of the lithium mineralisation forms within a particular horizon which in these sections conforms to the pegmatite.
13.1.4 Bivariate statistics and co-regionalisation.
Lithium and tantalum Bivariate summary statistics of sample data in the mineralised domains 1 to 6 is shown in Table 13.3. Mineralised domains are defined by the extent of the pegmatite. Cumulative histograms and histograms are displayed in Figure 13.4, Figure 13.5, Figure 13.6 and Figure 13.7 for lithium oxide and tantalum oxide respectively. Lithium oxide exhibits a low coefficient of variation (CV) of 1.024 for the whole mineralised population and has a mean value of 0.941% Li2O. For tantalum oxide the CV is moderate to low at 1.673 for the whole mineralised population. Ta2O5 ppm values have a mean of 180.94 for the complete dataset within the geological framework.
A regression and QQ plot of Li2O vs. Ta2O5 are shown in Figure 13.8 and Figure 13.9 to determine the extent to which the two elements exhibit statistical similarity. It is clear that the two populations do not exhibit similar summary statistics; the scatter plot displays no defined trend with numerous relationships of Li2O (ppm) to Ta2O5 (ppm) existing. Similarly the QQ plot does not follow a clear linear trend which suggests that no trend emerges in any quartiles of the populations. If the Ta2O5 values are multiplied by a factor of ten the QQ plot illustrates an approximately linear trend in the lower three deciles of the populations which infers that there are correlations at different multiples in some quartiles of the populations.
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Table 13.2 Removed Holes
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Figure 13.2 Section 6282464m (MGA94) view of data coloured by geology on panel one and Li2O% on panel two (bottom panel) on drill trace
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Figure 13.3 Section 6282505mN (MGA94) view of data coloured by geology on panel one and Li2O% on panel two (bottom panel) on drill trace
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Table 13.3 Bivariate Li2O (ppm) and Ta2O5 (ppm) summary statistics, all data unmodified
Figure 13.4 Cumulative histogram plot of all sampled Lithium oxide (ppm) no top cut within the GR mineralised domains
Figure 13.5 Histogram of all sample grades used in calculation for Lithium oxide (ppm)
(truncated dataset due to selective sampling and removal of OH and RAB drillholes) within the Galaxy mineralised domains, no top cut.
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Figure 13.6 Cumulative histogram plot of all sampled Tantalum oxide (ppm), no top cut within the mineralised domains
Figure 13.7 Histogram of all sample grades used in calculation for Tantalum oxide (ppm)
(truncated dataset due to selective sampling and removal of OH and RAB drillholes) within the GR mineralised domains contained within pegmatite inclusive of mafic unit, no top cut
Figure 13.8 Scatter plot of Li2O vs.Ta2O5 (ppm) for the total mineralised population, no top cut
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Figure 13.9 QQ plot of Li2O vs.Ta2O5 (ppm) for the total mineralised population, no top cut
13.1.5 Conditional statistics and high end member modification.
Lithium and tantalum The conditional statistics (refer to a set of statistics which are compartmentalised by a threshold in this case a grade threshold) of Li2O and Ta2O5 sample data in the mineralised domains are shown in Table 13.4 and Table 13.5, respectively. All of the probability thresholds have strong to moderate data support with the upper bin of the grade thresholds having 58 class data available. It is common practice to consider applying a top cut to a mineralised population where the distribution exhibits a highly skewed statistical geometry and poor data support in order to minimise the impact (and bias) of the higher end member grades of the population which have the weakest data support. The mean and median values do not depart significantly in the upper grade (top 1% of data) threshold for Li2O (at 4.547% Li2O and 4.370% Li2O, respectively) to warrant the replacement of the class mean with the class median.
Table 13.4 Conditional statistics for Li2O (ppm) for the mineralised population at a range of probability thresholds, all data unmodified
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Table 13.5 Conditional statistics for Ta2O5 (ppm) for the mineralised population at a range of probability thresholds, all data unmodified
In the case of tantalum, whilst it is clear that the differences between the mean and median for the last bin of the Ta2O5 conditional statistics is in excess of 10%, in this instance it was elected that the mean value of the last percentile of the population from the whole of the Mt. Cattlin area would not be replaced by the median value. The application of a top cut to the last probability threshold data would result in a change to the resource estimates which is not considered material to the project, given the current data support. As the mine is developed and further drilling data is undertaken the issue of the impact of extreme end members and outliers on the mineralised populations should be revisited and assessed for their impact on the local estimates.
13.2 Spatial continuity analysis Most resource estimation methods use a measure of spatial continuity to estimate the grade of blocks in a resource model. In some methods, the measure is implicit; for example a polygonal method assumes that the grade is perfectly continuous from the sample to its surrounding polygon boundary. Geostatistical methods like Ordinary Kriging (OK) and Indicator Kriging (IK) are among those methods for which the continuity measure is explicit and is customised to the data set being studied. This measure in its many forms is usually called the variogram. Geostatistical methods provide several ways of describing spatial continuity, including the variogram, the covariance, the correlogram and others. All are valid descriptions but not all provide a basis for constructing Kriging models of mineralisation. Whatever the method of description used, it is common to use the term variogram in a generic sense to describe contour plots and directional plots of spatial continuity measures. Throughout the present work, the maps and directional variograms used are all based on the correlogram measure. Directional correlograms are displayed inverted so as to resemble familiar variogram plots. The use of the correlogram as a robust and reliable measure of spatial continuity is proposed by Srivastava & Parker (1988) and Isaaks & Srivastava (1989).
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The correlogram measure has the advantages of being standardised to a sill of 1.0 and being robust with respect to clustering in the sample data. Models of the sample correlogram can be used directly in OK and IK. The various parameters of the variogram model, such as the nugget effect and ranges in different directions, describe properties of the statistical continuity of metal grades. For example, a variogram with high nugget may indicate that there is a high level of error in the sample grades being used to construct the variograms or that there is a high degree of variability in the grade over very short distances in the mineralisation. A different range in one direction compared to another is likely to be indicating that grade is more continuous in one direction than another. All of the variography presented here was calculated using data which conforms to the MGA94 grid system. Variograms were calculated using directions which followed mathematical trigonometric convention; with east being 0° and north being 90°. Each domain was analysed individually. Variogram details displayed in the following section are for all domains combined.
13.2.1 Domaining - Zones 1 to 6 Directional variograms were calculated for the following variables: Lithium Tantalum Niobium Tin The directional variograms (Table 13.6) for Lithium oxide and Tantalum oxide generally show that the mineralisation is anisotropic with the greatest continuity in the plan of the pegmatite horizontally (in this instance the pegmatite is very flat lying) followed by along strike to the north (plane of the pegmatite lode). With the exception of the NW mineralised zone which also has a gentle plunge toward the north at 15° all mineralised domains display relatively shallow undulating geometry.
The nugget is highest at 0.15 of the total sill in domain 5 for Li2O variogram analysis, whilst for Ta2O5 the highest nugget is observed in domain 4 being 0.32 of the total sill. The first structure ranges of both lithium and tantalum oxides, in the down hole direction are generally at or around 2.5 m to 4.0 m across all domains, (Table 13.6). The mineralisation is generally flat lying and as such the z direction represents the width of the mineralised zones (this is however dependent on the rotations) and is considered consistent with the down hole direction. Along strike the ranges of the first structure vary from 12 m to 36.5 m as is also seen in the across strike direction. Again the findings from the 2011 geometry modelling are largely consistent with those observed during the previous round of estimation. Again it is worth noting that in the along strike direction the range of continuity is reduced during this round of variography compared to the last round of variography analysis. The shorter range continuity observed may be again a reflection of a mineralised trend which is more complicated than that which was first considered to be the case. In support of this notion is the fact that the grade control drilling has found the local complexity to be much greater than indicated by the resource drilling. As such it is likely that the grade control models will tend to find marginally less tonnage at a marginally higher grade than is defined by the resource model assuming industry best practice during mining and ore selection. Using the trigonometric convention the rotations for each of the domains are unique, however, for all domains, the rotations resolve to produce approximately equivalent 3D model shells of threshold as seen in Figure 13.10
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Table 13.6 Model framework and Kriging parameters for Domain 1 to 6 - OK model for elements Li2O and Ta2O5
Co C1 C2 C3 Rotations Element Domain Nugget Sill Mod X Y Z Sill Mod X Y Z Sill Mod X Y Z X Y Z 1 0.15 0.51 exp 10.5 25.5 2.5 0.23 sph 18 69 7 0.11 sph 891 89 161 0 0 39 2 0.15 0.57 exp 27.5 13 3 0.04 sph 30 22.5 193 0.24 sph 238 39 256 -4 -25 -6 3 0.13 0.44 exp 36.5 3 17.5 0.31 sph 83.5 12 37 0.12 sph 86 34 223 0 0 -67 Li20 4 0.16 0.28 exp 18.5 25 2.5 0.41 sph 29 56 10 0.15 sph 700 190 273 2 8 -4 5 0.23 0.5 exp 9 25.5 2.5 0.26 sph 20.5 31 3 0.01 sph 318 315 31 -81 0 0 6 0.11 0.11 exp 12 8.5 2.5 0.63 sph 30 24.5 3.5 0.15 sph 122 115 47 -70 28 11 1 0.22 0.41 exp 14.5 5 3.5 0.35 sph 16.5 22.5 4 0.02 sph 488 667 107 -44 12 -2 2 0.27 0.56 exp 24 2.5 5.5 0.035 sph 54 519.5 97 0.14 sph 522 817 104 -11 -5 81 3 0.31 0.66 exp 13.5 2.5 9 0.02 sph 38.5 302.5 300.5 0.01 sph 810 856 642 0 0 81 Ta2O5 4 0.32 0.66 exp 13.5 2.5 2.5 0.02 sph 14.5 3.5 11 0.01 sph 546 475 55 0 -2 79 5 0.22 0.63 exp 10.5 2.5 5 0.025 sph 18 3.5 33.5 0.13 sph 26 5 37 4 3 81 6 0.21 0.62 exp 22 2.5 22 0.02 sph 26.5 3.5 26.5 0.15 sph 155 16 155 81 0 81
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Figure 13.10 3D model shells of threshold for domains 1to 6 for Li2O ppm, Ta2O5, Nb2O5 and SnO2
13.3 Ordinary Kriging Resource Estimate
13.3.1 Resource estimation methodology In deposits where the coefficient of variation in samples is less than 2.0, OK is one method that can be used to provide reliable estimates. In order to provide reliable estimates at Mt. Cattlin project the modelling has been performed using a 3D method with OK of Li2O, Ta2O5 and Nb2O5; with block sizes chosen that are compatible with the available sample data. Following is a summary of the methodology used:
1. Variables were created for Li2O (ppm), Ta2O5 (ppm) and Nb2O5 (ppm). 2. The data is in a local grid for modelling. 3. Variograms of the variables were calculated and modelled. 4. OK of the variables was performed in the local grid. The OK used blocks with dimensions of 20 mE by 20 mN by 2.5 mRL. 5. The estimated grades were checked to ensure that they had values that were within the bounds of the original data. 6. The estimated blocks and associated grades were exported to Micromine which had been created in real world coordinates and post process trimming to the geological model (3D solid model) were completed (Figure 13.12). 7. The model was validated against the original data and re-blocked for export into other mining applications.
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13.3.2 Domain 1 to 6 Ordinary Kriging Parameters Table 13.7 details the model grid framework and search parameters used to construct the Domain 1 to 6 OK model.
Table 13.7 Model framework and Kriging parameters for Domain 1 to 6 - OK model
It is customary for the block dimensions to reflect the sample density in the X and Y directions and be a multiple of the potential mining flitch / bench height in the Z direction. In addition, it is important to consider the geometry of the mineralisation and continuity of geology (where appropriate) when defining block dimensions and search extent in conjunction with density of drilling. It may be the case that more detailed drilling is required to define adequately the continuity and establish the local variability within the mineralised populations. H&S employed an octant data criteria strategy which requires that minimum and maximum data be achieved within a set number of octants in order to satisfy modelling criteria for each resource category. In this instance four octants need to have a minimum of 12 data and no more than 8 data per octant within the search radii defined in Table 13.7 to satisfy a Measured Resource category. For Indicated Resource the same data criteria apply but the search radii are expanded by 100% and for Inferred Resource two octants need to have a minimum of 6 data in total to satisfy modelling criteria.
13.4 Resource classification Blocks in the resource model have been allocated a confidence category based on the number and location of samples used to estimate the grade of each block (Figure 13.11 and Figure 13.12), which are a consequence of taking into account such issue as sample recovery, geological variability and QAQC etc. The approach is based on the principle that larger numbers of samples, which are more evenly distributed throughout the search neighbourhood, will provide a more reliable estimate. The number of samples and the particular geographic configurations that may qualify the block as Measured rather than Indicated or Inferred are based on the expertise of the Qualified Person. The search parameters used to assist in the definition of the classification of model blocks in this study are: Minimum number of samples found in the search neighbourhood. For Measured and Indicated categories, this parameter is set to twelve. For Inferred category, a minimum of six samples is required. This parameter ensures that the block estimate is generated from a reasonable number of sample data.
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Minimum number of spatial quadrants informed. The space around the centre of a block being estimated is divided into octants by the axial planes of the data search ellipsoid. This parameter ensures that the samples informing an estimate are relatively evenly spread around the block and do not all come from one drill hole. For Measured and Indicated categories, all four quadrants must contain at least 12 samples combined. For Inferred panels a minimum of 2 quadrants must contain at least 6 samples combined. The distance to informing data. The search radii define how far the Kriging program may look in any direction to find samples to include in the estimation of resources in a panel. Block dimensions and the sampling density in various directions usually influence the length of these radii. It is essential that the search radii be kept as short as possible while still achieving the degree of resolution required in the model. A single pass approach was adopted. For the Measured category, the search radii were set to 40mE by 40mN by 5mRL. For the Indicated and Inferred categories, the search radii were set to 80 mE by 80 mN by 10 mRL and the data criteria were halved from 12 data to a minimum data of 6 data in at least two octants. One of the most time consuming parts of the data analysis is typically the description of spatial continuity. Though the variogram is the most common analysis used by geostatisticians, it often suffers in practice from the combined effect of heteroscedasticity and the preferential clustering of samples in areas with high values, thus ignoring the covariance function and the correlogram which are another valuable tool in the development of the spatial continuity story. The quality of estimates produced by OK depends on the time taken to choose an appropriate model of the spatial continuity. OK with a poor model may produce a worse result than other simpler methods. The experimental variogram provides the weighting for the Kriging of points at given distances from the sample data within the constraints of the search criteria. An octant search with minimum and maximum points per octant was utilised to define the data set that was used.
Figure 13.11 Plan view showing resource classification over the Mt. Cattlin project mineralised zone
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Figure 13.12 Plan view showing resource grades over the Main Li2O ppm mineralised zone
13.5 Verification and validation The resource model was undertaken by H&S (Robert Spiers) in Micromine software which was used for data compilation, wire-framing and composite calculation; GS3©, the resource estimation software developed by H&S was used for resource estimation. The resulting GS3© model was imported into a Micromine format model for validation, section verification and reporting of estimates. The statistics of the informing data used in the modelling of the Mt. Cattlin Project compared to the subsequent block model statistics are summarised in Table 13.8 which show that the model forms a weakly to moderately smoothed representation of the local informing data. This is evidenced in the lower variance, standard deviation and relative standard deviation in the block model when compared to the data. In addition, the models generally display median values 1.14 times higher than the informing data. This suggests that the population is tending toward a more normally distributed population as would be expected as a result of the larger relative sample size in the model blocks when compared to the sample interval. Another verification measure undertaken is to review the block model on section with the drill-hole data and assess the distributions visually (Figure 13.13 to Figure 13.16). Globally the OK model reflects the drill hole data distribution, whilst accounting for the average grades very well. Blocks shown in Figure 13.13 to Figure 13.16 are colour coded according to Li2O grade.
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Figure 13.13 Mt. Cattlin East-west section 6282300mN – drill holes and block model dispaying Li2O%
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Figure 13.14 Mt. Cattlin East-west section 6282380mN – drill holes and block model dispaying Li2O%
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Figure 13.15 Mt. Cattlin East-west section 6282460mN – drill holes and block model dispaying Li2O%
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Figure 13.16 Mt. Cattlin East-west section 6282540mN – drill holes and block model dispaying Li2O%
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Table 13.8 Informing log-normally distributed Lithium data and model statistics for Mt. Cattlin
Data Model Minimum Value: 0.00 Minimum Value: 0.01 Maximum Value: 7.60 Maximum Value: 3.15 2nd highest: 6.44 2nd highest: 3.15 3rd highest: 6.07 3rd highest: 3.15 4th highest: 5.64 4th highest: 3.15 N: 3243 N: 87067 Mean: 1.12 Mean: 0.98 Variance: 1.09 Variance: 0.22 Standard Deviation: 1.04 Standard Deviation: 0.47 Coeff of Variation: 0.93 Coeff of Variation: 0.47 Median: 0.86 Median: 0.98 Ln Mean: -0.61 Ln Mean: -0.18 Ln Std Deviation: 1.53 Ln Std Deviation: 0.66 Geometric Mean: 0.54 Geometric Mean: 0.84 Geometric Std Deviation: 4.62 Geometric Std Deviation: 1.93 Sichel‟s Estimator: 1.75 Sichel‟s Estimator: 1.04 Scichel‟s V: 2.34 Scichel‟s V: 0.43 Sichel‟s Gamma: 3.22 Sichel‟s Gamma: 1.24 Chi Square Test: 1287.58 Chi Square Test: 137487.53 Degree of Freedom: 52 Degree of Freedom:37
13.6 Results The mineral resource estimates have been constructed from the inclusion of all resource drill hole, (RC and DD) data deemed reliable by Robert Spiers from H&S. Table 13.9 and Table 13.10 give the Mineral Resources estimated for the Mt. Cattlin Project within the mineralised domains identified by Galaxy and classified in accordance with the JORC Code (2004 edition). Please refer to Appendix A for a comparison of JORC and Canadian Institute of Mining, Metallurgy and Petroleum (CIM) Definition Standards for Mineral Resources and Mineral Reserves.
Table 13.9 Measured and Indicated Mineral Resource Estimate
Resource Tonnes Li2O (%) Ta2O5 ppm Measured 3,192,000 1.17 149 Indicated 10,613,000 1.06 168 TOTAL 13,805,000 1.09 164
From Hellman & Schofield, December 2010
Table 13.10 Inferred Mineral Resource Estimate
Resource Tonnes Li2O (%) Ta2O5 ppm Inferred 4,382,000 1.07 132
From Hellman & Schofield, December 2010
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The location, quantity and distribution of the current data are considered sufficient to allow the classification of Measured, Indicated and Inferred Resources. Mineral resources that are not mineral reserves do not have demonstrated economic viability. Table 13.9 and Table 13.10 display a summary of the Mineral Resource Estimates which represent in-situ material prior to surface depletion as at December 2010. Significant figures do not imply an added level of precision. Figure 13.17 shows grade tonnage curves for the December 2010 Mineral Resource estimates at different cut-off grades. As can be observed from this figure, the grade tonnage curve for Li2O% tends to display a moderate rate of change of decreasing grade with increasing tonnage.
Figure 13.17 Grade tonnage curves for December 2010 Mineral Resource Estimates
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14 Mineral Reserve Estimates Snowden has based its assessment of the Ore Reserves upon consideration of: An update of the ore Reserves depleted to December 31, 2011 as published in Galaxy 2011 Annual Report. Update of pit designs, mining schedule of Ore Reserves over LOM issued 14 September 2010. Mining schedule of Ore Reserves over LOM issued July 2010. Ore Reserve update issued March 2010. Resource update December 2009. Ore Reserve statement issued September 2009. Mt. Cattlin Feasibility Study dated January 2009.
14.1 Introduction Snowden understands that Croeser Pty Ltd (Croeser) has been engaged by Galaxy Resources Limited (Galaxy) to carry out a 2012 Ore Reserve update on its Mt. Cattlin Lithium project. This section describes the work undertaken by Mr. Roselt Croeser, of Croeser Pty. Ltd. (“Croeser”), in updating the current Mt. Cattlin Reserve. The previous Reserve study of September 2010 was also carried out by Croeser. The updated Reserve is based on the depletion of the life of mine (LoM) schedule up to the end of December 2011. Two sets of LoM schedules and Mineral Reserves are contemplated in this section: one is based on the total LoM and the other depleted to the end of December 2011.
14.2 Mineral Reserve Estimate The information in this report that relates to Ore Reserves is based on information compiled by Mr. Roselt Croeser who is a full time employee of Croeser Pty Ltd. Mr. Croeser has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration. Snowden‟s consultants have reviewed the Ore Reserves as well as the assumptions used to derive such figures, and have in this document commented on the validity and reasonability thereof. Mr. Jeremy Peters of Snowden acts as a qualified person for this section. The updated Reserve was based on the Life of Mine (LoM) schedule produced in September 2010. This schedule was depleted up to the end of December 2011 in order to achieve this updated Reserve estimate. Both the September 2010 and the updated reserves are included in this section.
14.2.1 Optimisation inputs The pit optimisation input parameters are summarised in Table 14.1. These inputs have been agreed to by Galaxy and are based on a comprehensive cost model supplied by Galaxy and also on previous pit optimisation work completed for Galaxy. Pit slope angles are based on a geotechnical report completed by Dempers and Seymour in December 2008 (Dempers, 2008). The 45 degree slope angle used in the pit optimisation is a reasonable approximation of the actual overall slope angles achieved in the pit design. This project is not sensitive to slope angles since the pit is relatively shallow and the strip ratio is relatively low.
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The primary basis for the pit optimisation is the resource block model. The resource model used for the final pit optimisation was prepared by geological consultants Hellman and Schofield in December 2009 and is documented in Mt. Cattlin Resource Estimation Report, Lithium / Tantalum Elements, Ravensthorpe, WA, dated December 2009. The previous version of the model was prepared by Hellman and Schofield and documented in Mt. Cattlin, Interim Resource Estimates, Lithium / Tantalum Elements, Ravensthorpe WA, dated May 2009. The same methodology was used for the December 2009 model. This model was supplied in text format and imported into Datamine software for checks and coding before export to Gemcom Whittle software. The model as supplied included density values for ore blocks. Waste blocks were added using a topography file and a bottom of oxide surface supplied by Galaxy. In the waste blocks, oxide densities were set to 2.05 tonnes per m3 while in the fresh material the densities were set to 2.85 tonnes per m3, based on information supplied by Galaxy.
14.2.2 Mining recovery Croeser has assumed that 95% of ore contained in the resource model and flagged as measured and indicated will be recovered during the mining process. This assumption takes into account the nature and shape of the ore body and the planned mining method. The ore body is mostly flat lying and varies in thickness up to 18m thick over a substantial part of the ore body. Galaxy is using a 190 tonne excavator for digging of the ore and mining is in progress and ore has been exposed and stockpiled. The excavator is used to dig 2.5 m high benches or flitches, which gives good selectivity. Most of the ore will be blasted to assist extraction. Grade control drilling is done with a reverse circulation (RC) drill rig and Galaxy use visual control to assist with identifying ore. Taking all this into account Croeser considers a 95% mining recovery assumption to be reasonable.
14.2.3 Mining dilution A 10% mining dilution was assumed to be incurred during mining and this dilution assigned a zero grade. The considerations discussed (in Section 14.2.2 have been taken into account when choosing the dilution including the size and shape of the ore body and the mining method.
14.2.4 Cut-Off grades
A cut-off grade of 0.4% Li2O has been used for the Reserve estimate, which is slightly higher than the theoretical cut-off grade. The reason for the higher cut-off grade is to maintain a sufficiently high head grade for optimal plant operation.
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Table 14.1 Optimisation input parameters (Auralia, 2011)
Mt. Cattlin Project Metal prices Units Quantity
Lithium Carbonate Li2CO3 US$/t 7,173 Exchange rate US$/A$ 0.88
Lithium Carbonate Li2CO3 A$/t 8,151
Lithium Carbonate Li2CO3 A$/10kg 81.51
Tantalum Ta2O5 US$/lb 75.00 Exchange rate US$/A$ 0.88
Tantalum Ta2O5 A$/lb 85.23
Tantalum Ta2O5 A$/10kg 1,879 Costs Units Quantity Total spodumene costs, year 2, ex vat MA$ 46.635 Mining cost, year 2, ex vat MA$ 16.052 Total spodumene costs excl mining MA$ 30.583 Total spodumene cost excluding mining A$/ t ore feed 30.58 Total LC costs, year 2 MA$ 29.795 Total LC costs, year 2 A$/ t LC 1,719 Mining cost Units Amount Mining cost A$/bcm mined 13.10 Mining cost A$/ t mined 4.76 Whittle Schedule Parameters Ore production rate Mtpa 1.000 Annual discount rate % 8 Pit slopes degrees 45 Mining dilution % 10.0 Mining recovery % 95.0 Metallurgical recoveries % Units Amount Lithium % 75.00 Lithium Carbonate % 85.00 Stoichiometric constant factor 0.4044
LC product tonne per tonne of Li2O 1.576 Tantalum (Total Aust + China) % 31.00 Recovery from concentrate % 95.00 Tantalum total incl concentrate % 29.45
Note: All costs and prices are in A$ unless otherwise indicated. All excluding VAT
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14.3 Optimisation results Using the previously described optimisation input parameters, a set of nested pit shells for each prospect were produced by the optimisation. It must be noted no initial CAPEX or taxes were applied to the optimisation; these costs are to be applied during financial modelling. All cash flow figures shown (discounted or otherwise) do not take these factors into account. The following gives a brief breakdown describing each case scenario type (ref Gemcom Whittle): Best: The Best case scenario consists of mining out pit 1, the smallest pit, and then mining out each subsequent pit shell from the top down, before starting the next pit shell. In other words, there are as many intermediate mining pushbacks as there are pit outlines. This schedule is seldom feasible because the pushbacks are usually much too narrow. Its usefulness lies in setting an upper limit to the achievable Net Present Value. Worst: The worst case scenario consists of mining each bench completely before starting on the next bench. This schedule is usually feasible and is used for most baseline and sensitivity runs, as this practice sets a lower limit to the DCF (unless waste is mined, to the exclusion of ore). Scheduled (Specified): If, as is usually the case, the difference between Worst and Best case is significant, a more realistic mining schedule can be approximated, between the two extremes, by specifying the sequence of pit outlines to push back to. Ideally, pushbacks are chosen that satisfy mining constraints and produce a DCF curve that is as close as possible to the Best case curve. A summary of pit optimisation results is detailed in Table 14.2 and Table 14.3. Pit shells 22 and 34 are highlighted since pit shell 22 represents the pit shell with the highest average discounted cash flow and pit shell 34 represents the pit shell with the highest undiscounted cash flow. These results were the final option of a number of runs and were used as the base case for pit design. In this option the Li2O cut-off grade was raised to 0.40% to improve cash flow and increase the head grade.
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Table 14.2 Pit optimisation results summary – physicals (Auralia, 2011)
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Table 14.3 Pit optimisation results summary – financials (Auralia, 2011)
Average Best Discounted Worst Discounted Processing, and Undiscounted Discounted Pit Mining Costs Revenue Li2CO3 Revenue Ta2O5 Revenue Cashflow Cashflow other Costs Cashflow Cashflow M$ M$ M$ M$ M$ M$ M$ M$ M$
1 0.0 -0.1 0.4 0.0 0.4 0.3 0.3 0.3 0.3 2 0.0 -0.4 1.3 0.0 1.3 0.9 0.9 0.9 0.9 3 -0.4 -4.5 12.8 0.5 13.3 8.3 8.3 8.3 8.3 4 -0.8 -7.4 20.3 1.2 21.5 13.3 13.2 13.2 13.2 5 -2.1 -17.4 46.5 2.5 49.0 29.6 29.0 29.0 29.0 6 -16.8 -71.2 194.0 11.4 205.4 117.4 108.8 108.8 108.8 7 -31.8 -127.9 343.5 19.1 362.7 203.0 183.1 181.6 182.3 8 -73.3 -292.8 765.6 34.9 800.5 434.3 356.6 349.2 352.9 9 -89.5 -359.3 925.0 44.2 969.2 520.4 413.1 399.3 406.2 10 -98.4 -399.1 1014.9 49.7 1064.6 567.2 441.4 422.0 431.7 11 -107.1 -436.0 1096.0 54.9 1150.9 607.9 465.5 440.4 453.0 12 -112.9 -459.5 1145.5 58.6 1204.1 631.7 478.8 449.3 464.1 13 -121.9 -491.9 1214.1 63.0 1277.1 663.3 496.0 460.6 478.3 14 -134.6 -530.5 1295.7 68.0 1363.8 698.7 514.2 470.0 492.1 15 -140.8 -553.5 1340.4 71.5 1411.8 717.5 523.2 472.7 498.0 16 -148.4 -575.8 1384.5 74.5 1459.0 734.9 531.5 475.8 503.6 17 -154.8 -594.5 1420.1 77.8 1497.9 748.5 537.8 477.0 507.4 18 -165.7 -618.5 1468.2 81.8 1550.0 765.8 545.4 477.9 511.6 19 -174.8 -638.2 1505.9 85.9 1591.8 778.8 551.1 478.5 514.8 20 -177.9 -648.9 1524.0 87.5 1611.5 784.7 553.5 477.3 515.4 21 -180.6 -657.7 1538.3 89.0 1627.3 789.1 555.2 475.1 515.2 22 -194.5 -679.8 1582.9 92.5 1675.4 801.2 560.1 471.0 515.6 23 -205.3 -698.9 1618.5 95.8 1714.3 810.2 563.6 466.4 515.0 24 -212.5 -712.3 1641.7 98.9 1740.6 815.8 565.6 463.2 514.4 25 -215.5 -718.8 1652.4 100.1 1752.5 818.1 566.5 461.0 513.8 26 -256.6 -770.9 1758.0 106.1 1864.1 836.6 573.2 451.1 512.1 27 -261.0 -778.1 1770.5 107.4 1877.9 838.7 573.9 448.4 511.2 28 -266.0 -787.1 1785.2 108.8 1894.0 840.9 574.7 446.5 510.6 29 -274.7 -797.9 1805.0 110.8 1915.8 843.2 575.4 443.6 509.5 30 -293.4 -817.9 1844.7 114.0 1958.6 847.3 576.7 437.6 507.1 31 -299.0 -824.1 1856.3 114.9 1971.2 848.2 577.0 435.0 506.0 32 -303.4 -828.4 1864.7 115.7 1980.4 848.7 577.1 433.0 505.1 33 -305.1 -830.6 1868.5 116.1 1984.6 848.8 577.2 432.1 504.7 34 -308.4 -834.7 1875.2 116.7 1992.0 848.9 577.2 430.7 504.0 35 -309.7 -836.5 1878.1 117.0 1995.1 848.9 577.2 429.7 503.5 36 -314.3 -841.0 1885.8 118.2 2004.0 848.6 577.1 427.3 502.2 37 -319.1 -845.6 1893.3 119.6 2012.9 848.2 577.0 425.3 501.1 38 -320.7 -847.2 1895.9 119.9 2015.8 848.0 576.9 424.7 500.8 39 -321.9 -848.4 1898.0 120.1 2018.0 847.7 576.8 424.1 500.5 40 -326.9 -852.1 1903.9 122.0 2025.8 846.9 576.5 421.9 499.2 41 -329.5 -854.7 1908.0 122.5 2030.5 846.3 576.3 419.9 498.1 42 -330.5 -855.8 1909.6 122.7 2032.3 846.0 576.2 419.0 497.6 43 -331.6 -857.0 1911.2 123.0 2034.2 845.7 576.1 418.0 497.1 44 -335.2 -860.0 1916.3 123.4 2039.8 844.6 575.8 416.0 495.9 45 -335.7 -860.4 1917.0 123.5 2040.5 844.4 575.8 415.6 495.7 46 -336.8 -861.3 1918.4 123.7 2042.1 844.1 575.6 414.9 495.3 47 -337.4 -861.9 1919.3 123.8 2043.2 843.8 575.6 414.3 494.9 48 -408.2 -892.7 1997.5 125.7 2123.2 822.3 568.4 378.7 473.6 49 -409.2 -893.4 1998.8 125.8 2124.5 821.9 568.3 378.1 473.2 50 -410.2 -894.0 1999.8 125.9 2125.7 821.5 568.2 377.5 472.8 51 -412.3 -895.5 2002.0 126.4 2128.4 820.7 567.9 376.3 472.1 52 -413.1 -896.2 2003.0 126.5 2129.5 820.2 567.7 375.6 471.7 53 -415.5 -897.9 2005.8 126.8 2132.6 819.1 567.4 374.3 470.8 54 -416.2 -898.4 2006.4 126.9 2133.4 818.8 567.3 373.9 470.6 55 -417.0 -898.9 2007.3 127.1 2134.4 818.4 567.1 373.1 470.1 56 -417.4 -899.2 2007.7 127.2 2134.8 818.2 567.1 372.8 469.9 57 -418.0 -899.5 2008.2 127.2 2135.4 818.0 567.0 372.3 469.6 58 -421.0 -900.8 2010.8 127.6 2138.4 816.6 566.5 370.6 468.5 59 -422.6 -901.6 2012.2 127.7 2140.0 815.8 566.3 369.9 468.1
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Figure 14.1 Optimisation results – pit by pit graph
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The following figures (Figure 14.2 and Figure 14.3) illustrate shell 22 and 34 which were used to base the final mine designs on.
Figure 14.2 Mt. Cattlin project – Shelll 22
Figure 14.3 Mt. Cattlin Project – Shell 34
14.4 Mining operations
14.4.1 Pit design A final limits pit design was completed based, for the most part, on pit shell 34 of the base case pit optimisation as detailed above. The western part of the pit design was based on a combination of pit shell 22 and pit shell 34 to improve the overall cash flow of the project and to exclude some high strip ratio ore from the life of mine. The final design consists of 3 distinct pits, a relatively large central pit, a smaller pit to the west and another pit to the South East. The pit design guidelines used are as follows: Two way access ramp widths of 24 m One way access ramp widths of 15 m Ramp gradient of 1 in 9 everywhere Berm widths of 5 m everywhere
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Batter slope angles and berm widths were designed according to the guidelines supplied in a geotecnical report by Dempers and Seymour, geotechnical consultants to the project. These details are summarised in Table 14.4. Views of the final limits pit design are shown in Figure 14.4 and Figure 14.5.
Table 14.4 Batter and Berm Width Configurations (based on Dempers and Seymour)
Pit Design Slopes and Berm Widths Batter Height Batter Angle Berm Width Rock Type – Area m deg m Oxide 20 50 5 Transitional 20 50 5 Fresh North Wall 20 55 5 Fresh - All Other Areas 20 60 5
Figure 14.4 Final limits pit design looking to the North East
Figure 14.5 Final Limits pit design looking to the North West
Due to the nature of the pit shell shapes, three major pit designs were produced. Pit 1 to the north, pit 2 on the eastern edge and pit 3 to the south west. These are planned to be mined in sequence using interim pits where necessary in order to bring high grade ore forward as soon as possible. Figure 14.6, Figure 14.7 and Figure 14.8 illustrate the separate pit designs.
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Figure 14.6 Mt. Cattlin project pit design stage 1 (Pit 1)
Figure 14.7 Mt. Cattlin project pit design stage 2 (Pit 2)
Figure 14.8 Mt. Cattlin project pit design stage 3 (Pit 3)
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During 2011, a number of pit design revisions were completed to optimise the reserve based on the March 2011 resource model update. These changes have had the effect of maintaining the reserve estimate at a similar figure to that of June 2011, even after depletion of the December 2011 facelines. A view of the August 2010 design (purple) compared with the August 2011 design (green) is presented in Figure 14.9. This design covers only the priority mining area and no changes have been introduced to the remaining pit area. Figure 14.9 illustrates the areas where the August 2011 design has been extended deeper than the August 2010 design in the southern and eastern parts of the pit.
Figure 14.9 August 2010 design (purple) and August 2011 design (green) looking to the North
14.4.2 Mine life and project schedule A life of mine (LoM) schedule has been completed based on the final limits pit design. The scheduling guidelines used for the LoM are as follows: Steady state processing plant throughput rate 1 Mtpa. The processing plant ramp up was assumed to be from 25,000 tonnes per month in September 2010, increasing to 50,000 tonnes per month in October 2010, then 60,000 tonnes per month in November 2010, then 70,000 tonnes per month in July 2011 and then levels out at approximately 83,000 tonnes per month in December 2011. Mining fleet capacity assuming one 190 tonne excavator working 12 hours per day – 150,000 bcm per month. Additional mining fleet capacity assumed to be 100,000 bcm per month, based on an additional 120 tonne excavator also working a 12 hour day.
The ore feed grade was targeted to be above 1.1% Li2O for as much of the schedule period as possible. Only proved and probable ore was included in the schedule.
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Ore recovery of 95% and mining dilution of 10% was assumed in the preparation of the mining inventory.
Ore was divided into mineralised waste (from 0.4% to 0.6% Li2O), low grade (from 0.6% Li2O to 1.0% Li2O) and high grade (above 1.0% Li2O). High grade ore was assumed to be treated in preference to low grade and in preference to marginal grade. The aim was to keep the stockpile of high grade to zero, while the stockpile of low grade was allowed to go to a maximum of 150,000 tonnes. The mineralised waste stockpile (below 0.6% Li2O) was unrestricted. Features of the life of mine schedule as completed: The mining rate required to meet the processing throughput requirements was 150,000 bcm per month from the start of the mine life until December 2014, when it increases to 250,000 bcm per month until the end of 2015. From the first quarter of 2016 the mining rate reduces to 150,000 bcm per month and gradually ramps down until the third quarter of 2020. From the fourth quarter of 2020 the mining rate increases again to access ore in the Western pit, which is relatively high strip ratio.
The average head grade from September 2010 until June 2013 is 1.14% Li2O, with a minimum of 0.98% in April 2011 and a maximum of 1.21% in June 2012. There is an extended period from January 2015 until December 2016 where the head grade is substantially below target (average 0.99% Li2O) as a result of low grade stockpile feed to the crusher. From January 2019 until the end of the mine life in June 2022, the ore feed consists of a substantial amount of low grade stockpiles and the average head grade is 0.88% Li2O.
The low grade stockpile (0.6% to 1.0% Li2O) reaches a maximum size of 165,000 tonnes in November 2012.
The stockpile of mineralised waste (0.4% to 0.6% Li2O) reaches a maximum of 542,000 tonnes in December 2015. The final pit is divided into 7 stages. The first four stages have been designed in detail and provide ore until September 2015. The three final stages are not optimised and will be refined during the mine life. The total amount of waste mined is 16.7 Mbcm or 46.8 Mt. Table 14.5 represents the September 2010 LoM schedule and Table 14.6 represents the latest LoM schedule depleted up to the end of December 2011, respectively. The latest LoM schedule (Table 14.6) is based on the most up to date pit design and resource model and includes all the incremental changes that have been made to the mine plan. This includes scheduling with smaller increments, the management plan for the road and creek and backfill of the pits. In this latest schedule, the ore is reported in the grade ranges (marginal, low grade and high grade) and also in the reserve categories (proven, probable and inferred). The sum of the grade ranges and the reserve categories is the same. This total is shown again at the bottom of the table as the total ore greater than 0.4% Li2O.
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Table 14.5 Mt. Cattlin September 2010 LoM Schedule
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Table 14.6 Mt. Cattlin December 2011 LoM Schedule
Mining Schedule Summary Physicals Total Periods 2012 2013 2014 2015 2016 2017 2018 2019 2020 Material Mined Marginal Ore Mined tonnes 297,772 357,751 515,309 377,121 6,365 105,163 194,327 519,358 396,731 2,769,898 0.4 - 0.8 % Li2O Li2O % 0.55 0.57 0.59 0.58 0.66 0.56 0.57 0.57 0.55 0.57 Ta2O5 ppm 136 108 130 113 217 192 155 137 172 137 Low grade ore mined tonnes 343,699 439,464 519,619 633,908 14,295 108,247 282,393 512,057 304,802 3,158,484 0.8 - 1.1% Li2O Li2O % 0.87 0.88 0.87 0.87 0.92 0.87 0.86 0.86 0.85 0.87 Ta2O5 ppm 146 139 118 125 170 246 187 112 171 140 High grade ore mined tonnes 727,897 799,960 666,292 938,470 439,696 644,701 811,545 660,104 295,023 5,983,689 > 1.1% Li2O (undiluted) Li2O % 1.33 1.31 1.34 1.29 1.42 1.51 1.40 1.26 1.34 1.35 Ta2O5 ppm 147 131 94 140 201 220 189 117 145 152 Proved ore mined tonnes 500,216 794,596 533,323 370,266 32,933 49,383 211,902 230,773 79,847 2,803,238 >0.4% Li2O Li2O % 1.12 1.07 1.03 1.17 1.33 1.34 1.25 0.97 0.92 1.09 Ta2O5 ppm 157 177 124 120 225 177 216 110 155 136 Probable ore mined tonnes 810,697 737,655 1,077,422 1,502,796 384,433 655,009 920,231 1,127,889 716,768 7,932,898 >0.4% Li2O Li2O % 1.02 1.00 0.94 0.98 1.38 1.35 1.17 0.89 0.82 1.03 Ta2O5 ppm 136 140 108 132 208 222 189 124 166 150 Inferred material mined tonnes 58,454 64,924 90,476 76,438 42,990 153,720 156,133 332,858 199,942 1,175,934 >0.4% Li2O Li2O % 0.73 0.82 0.94 1.03 1.59 1.12 1.00 1.04 1.05 1.03 Ta2O5 ppm 158 122 94 139 111 224 107 121 160 140 Total ore mined bcm 484,998 559,453 602,104 692,565 168,990 310,312 479,299 611,165 397,848 4,306,735 >0.8% Li2O tonnes 1,071,596 1,239,424 1,185,911 1,572,378 453,991 752,948 1,093,938 1,172,161 599,826 9,142,173 Li2O % 1.18 1.16 1.13 1.12 1.41 1.41 1.26 1.09 1.09 1.18 Ta2O5 ppm 147 134 104 134 200 224 189 115 159 148 Total Ore mined incl. marginal ore bcm 516,742 602,708 641,970 735,660 173,719 323,815 486,138 638,309 376,059 4,495,121 >0.4% Li2O tonnes 1,369,368 1,597,175 1,701,221 1,949,499 460,356 858,111 1,288,266 1,691,520 996,557 11,912,071 Li2O % 1.04 1.03 0.97 1.02 1.40 1.31 1.16 0.93 0.87 1.04 Ta2O5 ppm 145 128 112 130 200 220 184 122 164 145 Waste mined - includes marginal bcm - adjusted 1,452,230 1,222,119 1,180,459 1,308,313 1,957,853 1,811,986 1,649,462 2,367,694 1,768,183 Waste mined bcm 1,420,486 1,178,865 1,140,594 1,265,218 1,953,125 1,798,483 1,642,624 2,340,549 1,789,972 14,529,915 tonnes 4,024,341 3,375,204 3,234,490 3,541,440 5,476,928 5,033,916 4,378,876 6,080,675 4,957,080 40,102,949 Total rock mined bcm 1,937,228 1,781,572 1,782,564 2,000,878 2,126,844 2,122,298 2,128,762 2,978,859 2,166,031 19,025,036 tonnes 5,393,709 4,972,378 4,935,710 5,490,939 5,937,284 5,892,027 5,667,142 7,772,194 5,953,637 52,015,020
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14.5 Legal, social, environmental and governmental A potential obstruction to the achievement of the LoM schedule is the relocation of a minor road and water course (Figure 14.10). Croeser understands that the approval process for relocation of the road and water course have commenced but are yet to be completed. Croeser also understands that these approvals will be completed in time for mining of the affected areas.
Figure 14.10 Road and water course layout
14.6 Mineral Reserve Estimate “Mineral Reserves for the Mt. Cattlin Project are classified in accordance with the Australasian Joint Ore Reserves Committee Code (The JORC Code) 2004.” Please refer to Appendix A for a comparison of JORC and Canadian Institute of Mining, Metallurgy and Petroleum (CIM) Definition Standards for Mineral Resources and Mineral Reserves. Table 14.7 illustrates the Mineral Reserves of Mt. Cattlin as of December 2011.
Table 14.7 Galaxy Resources – Mt. Cattlin Mineral Reserves as of December 2011
Reserve Tonnes Li2O% Ta2O5 (ppm) Proven 2,803,000 1.09 136 Probable 7,933,00 1.03 150 TOTAL 10,737,000 1.04 146
The reserve table is based on an assumption of 10% mining dilution and 95% ore recovery. This is consistent with the methodology that has been used since the start of this project.
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15 Mining methods 15.1 Mt. Cattlin
15.1.1 Mining method The mine is based on conventional open-pit mining and processing of an Ore Reserve of 11.5 million tonnes of ore over a 13 to 14 year period from the Cattlin Creek ore body. The relatively flat lying ore body allows mining to proceed at a reasonably constant strip ratio once the ore is uncovered. Mining will be carried out using an excavator and truck combination, delivering to a conventional crushing and heavy media separation (“HMS”) gravity recovery circuit. Contractors will be engaged for grade control drilling and earthmoving operations (drilling, blasting, load, haul and ancillary work) for the open-cut mining operation. The initial pit design encompasses existing measured and indicated resources and has been called as “The Dowling Pit”.
15.1.2 Mine design The revised ultimate limit, pit design on which the March 2010 Ore Reserve is based is provided in Figure 15.1 and Figure 15.2. A surface topographical view looking south is provided in Figure 15.3.
Figure 15.1 Final limit pit design looking to the North East
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Figure 15.2 Final limit pit design looking to the North West
Figure 15.3 Proposed pit shells, with contained resource blocks coloured by Li2O grade overlain on airphoto
15.1.3 Mining progress Galaxy commenced with pre-stripping of open pit areas in early 2010, and the first ore was mined during June 2010. Mine operations are conducted in close proximity to the town of Ravensthorpe and considerable attention is paid to relations with the residents. Snowden notes that internal site reports indicate a good relationship with the town regarding noise and dust from the operation. Production has continued since, stockpiling material as the plant has undergone commissioning. There were initially production rate problems, associated with the selection of inappropriate equipment. These problems have been overcome and a degree of overcapacity in the mining fleet has allowed production to incrementally catch up to schedule. Snowden illustrates the development of the pit in Table 15.1 and notes the incremental “catch up” progression toward the annual budget figure.
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Table 15.1 Mt. Cattlin mine production against budget
Mt. Cattlin Production Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Feb-11 Mar-11 Apr-11 May-11 June-11 July-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 TOTAL Total
Budget Ore (tonne) 10,861 65,377 66,767 57,340 42,436 64,775 51,122 53,333 52,429 51,976 55,000 55,000 60,000 60,000 60,000 70,000 876,416 Actual Ore (tonne) 157 23,306 9,329 41,674 21,135 42,226 47,681 36,944 50,831 50,015 49,528 69,709 38,146 71,442 67,124 71,934 691,181 Budget Waste (BCM) 145,862 124,551 125,664 126,982 163,379 153,862 159,732 160,272 160,950 160,310 156,367 157,592 152,032 146,261 148,897 143,975 2,386,688 Actual Waste (BCM) 111,892 118,108 135,587 116,590 171,003 188,151 166,172 194,396 159,581 168,043 164,647 164,324 159,167 175,591 171,635 92,479 2,457,366 Budget Total Rock (BCM) 149,916 148,955 150,646 148,485 179,392 178,305 179,024 180,397 180,734 179,924 179,780 179,961 180,251 179,414 180,042 180,574 2,755,800 Actual Total Rock (BCM) 111,952 127,175 139,220 132,316 178,736 204,101 184,164 208,337 178,731 186,916 182,995 190,614 173,564 202,683 196,986 119,490 2,717,980
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The current Site strategy is to mine half of one pit (Pit 1B) and strip waste from the next pit increment (Pit 1C). This strategy will allow continuity of ore through the shift of operations between the pits. Snowden comments that site management is qualified and suitably experienced and has reacted appropriately to commissioning issues. Site management has experienced some reconciliation difficulties between the mine and mill, a situation not uncommon in a newly-established operation. Snowden notes that Management has acted appropriately in improving the grade control and Resource geological models, driven by the geology exposed in the pit, and this has led to incremental improvements in reconciliation. By way of illustration, Snowden has included the latest grade control reconciliation (Figure 15.4). Snowden comments that the “as mined against grade control” deviation of +22% and +35% for ore and mineralised waste is significantly skewed by the identification and subsequent stockpiling of low grade mineralised waste not identified in the grade control model. Other reconciliations fall within around +/- 10%, an acceptable figure for a relatively new operation.
Figure 15.4 December 2011 Mt. Cattlin grade control reconciliation
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16 Mineral processing (metallurgical and chemical plants) 16.1 Mt. Cattlin Mine
16.1.1 Introduction Snowden evaluated the metallurgy, and process engineering of the Mt. Cattlin Project, focussing on the following areas: Lithium grade and recovery; Suitability of final flowsheet design; Predicted ramp-up in process plant performance; Processing facility status, including: Construction status of process plant, power station, borefield, and tailings storage facility (TSF) Operational readiness Capital cost Operating cost Environmental compliance status. The documentation relied upon for these evaluations are the relevant sections of the: Galaxy Resources Limited, Ravensthorpe Spodumene Project, Definitive Feasibility Study, January 2009. Ravensthorpe Spodumene Project, Project Development Plan, Galaxy Resources Limited, January, 2010. Operating Budget, Galaxy Group of Companies, January 2010 to December 2011, Galaxy Resources Limited. Review and Interpretation of Heavy Liquid Separation on Galaxy Resources Spodumene Samples. Mineral Processors (WA) Pty Ltd, Report No. J337 0902270 Rev A. February 23 2009. Monthly Independent Engineering Reports, Snowden, February to August 2010. Practical Completion Report (Commissioning Report). Interim Operational Completion Report (Ramp-up Report).
16.1.2 General process description Galaxy‟s Mt. Cattlin processing plant is located to the west of the mine, approximately two kilometres north-west of the Ravensthorpe town site. The plant consists of a four-stage crushing circuit producing a -6mm product from ROM ore at a treatment rate of 1 million tonnes per annum. The crushing plant runs on day shift only, providing feed to an ore bin, which feeds the concentrator on a continuous 24 hour per day basis.
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The concentrator consists of a reflux classifier for mica removal, and dual size stream, two stage Dense Media Separation (“DMS”) cyclones. The final spodumene concentrate is stacked on a pad adjacent to the plant area, drained and then hauled by road to either Bunbury or Esperance for shipment in bulk. Coarse waste DMS plant float material is conveyed to the Rejects Load Out Bin, and hauled by truck to mined out areas of the pit(s) as back-fill, or used as road base. The DMS pre-screen undersize (-0.5mm) is treated by gravity separation using spiral classifiers and wet tables to recover a tantalite concentrate, which is contract dressed and sold, or stockpiled at site or, depending on price. Tantalite circuit tailings and other plant spillage streams are directed to a thickener for process water recovery. Thickener underflow is pumped to the tailings storage facility, approximately 500 metres north of the plant. Power is provided by dedicated diesel generators, supplemented by a solar power array, and process water is sourced from bores located on the tenements. The key process steps are: Open pit mining 4 stage crushing and screening of ROM ore to -6mm Screening at 0.5 mm Mica removal from the +0.5 mm ore fraction in a reflux classifier Dense Medium Separation (DMS) of the +0.5 mm ore fraction, to produce (at design rate) 137,000 tonnes per annum of spodumene concentrate at 6% Li2O Shipment of spodumene concentrate through Esperance to Zhangjiagang in China Gravity concentration by spirals and wet tables of the -0.5 mm ore fraction, to produce a tantalite concentrate. The key process steps are shown in Figure 16.1.
16.1.3 Detailed process description Ore from the mine is stockpiled on the Run of Mine (ROM) stockpile. Ore is reclaimed from the ROM stockpile by Front End Loader and fed via the ROM Bin to the Primary Jaw Crusher. It is crushed to a nominal size of 80% passing 110 mm. Ore is then fed via conveyors and a feed bin to a Sizing Screen, with 50 mm and 18 mm apertures. Plus 50 mm ore is fed to the Secondary Crusher. Ore between 18 and 50 mm is fed to the Tertiary Crusher. Secondary and Tertiary Crusher Discharge is fed over the Sizing Screen again. Ore minus 18 mm is fed via conveyor to the Fine Ore Bin. The Fine Ore Bin has a nominal capacity of 2,500 tonnes. It provides a break between the crushing plant, which operates for 12 hours per day and the remainder of the plant, which operates continuously. Ore from the Fine Ore Bin is fed over a 6.4 mm aperture Wet Screen. Oversize is fed via conveyors and a Feed Bin to two Quaternary Crushers, operating in parallel. Crusher discharge returns to the Wet Screen. Wet Screen undersize, nominally -6 mm, is pumped to the Dense Media Separation (DMS) plant. Fine material of less than 75 µm is removed in de-sliming cyclones. The fines are transferred to the Tailings Thickener.
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The plus 75 µm ore is fed to a Reflux Classifier for Mica removal. The Mica containing stream is screened at 1.6 mm, with the undersize recovered. The plus 1.6 mm Mica slurry is pumped to the Tailings Thickener, or bagged for sale. The Mica and fines free ore is screened at 0.5 mm on the Fines Screen. The minus 0.5 mm ore is fed to the Spiral plant for tantalite recovery. The plus 0.5 mm ore is fed to the DMS plant. DMS plant feed is split into 0.5 to 3 mm and 3 to 6 mm size fractions over the DMS Feed Preparation Screen. The two fractions are separately sent through two stages of Dense Medium Separation. Each size fraction is added to a ferrosilicon slurry, then pumped through DMS Cyclones. Spodumene containing concentrate, or “Sinks”, then passes to a second stage of DMS Cyclones for product upgrading. Ferrosilicon is recovered from both product and waste streams by screening and magnetic separation. It is then recycled to the DMS process. Fresh ferrosilicon is added as required, to make up for losses incurred in processing. After separation from the ferrosilicon, the spodumene concentrate is stacked on a concrete pad adjacent to the plant area. After draining it is loaded into trucks and hauled by road to Esperance for shipment in bulk. Coarse waste DMS plant float material is conveyed to the Rejects Load Out Bin. It is hauled by truck to mined out areas of the pit(s) as back-fill. The DMS pre-screen undersize (-0.5 mm) is treated by spiral classifiers and Wet Tables to recover tantalite. Tantalite concentrates will either be stockpiled at site or sent for contract dressing in Perth, depending on price. Tantalite circuit tailings, along with -75 µm slimes, Mica and plant spillage streams, are directed to the Tailings Thickener for process water recovery. Thickener underflow is pumped to the Tailings Storage Facility, approximately 500 metres north of the plant. Power is provided by dedicated diesel generators, under a contract with Contract Power Australia. Raw water is sourced from bores located on the tenements. Snowden notes that the methods of concentrate production are conventional and are therefore of relatively low risk. Snowden‟s observations during site visits and from reviews of monthly reports generally confirm that with some relatively minor modifications, design throughput will be achieved.
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Figure 16.1 Mt. Cattlin mine and spodumene concentrator - flowsheet
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16.1.4 Flowsheet changes from DFS to final design The final flowsheet design was essentially the same as the DFS, with some exceptions, which included: Crushing changed from 3 stage to 4 stage. Removal of attritioning between first and second stage DMS. A Hydrosizer for Mica removal has been added.
Concentrate grade was changed from 5% to 6% Li2O. Tailings thickener has been increased from 10 m to 15 m diameter. Details of the Tantalite recovery have changed: Low Intensity Magnetic Separation between the Spirals and Wilfley Tables has been removed. Table Concentrate is simply drained in product bins, not filtered. The Semi enclosed shed for concentrator plant noise reduction has been removed. Following a review of documentation and discussions with senior Galaxy staff, Snowden determined that these changes came about as follows: Crushing was changed to 4 stages on the recommendation of the EPCM Engineer based on modelling by the Crusher equipment vendor. Interstage attrition testwork data determined that losses of spodumene mirrored Mica removal, so that there was no rationale for retaining this process. Subsequent test work established that the addition of a Hydrosizer would have a positive effect on plant performance, by removing Mica platelets from DMS plant feed.
A 6% Li2O grade product was chosen, to allow sales to third parties, as it is a recognised and accepted sales grade.
Pilot plant test work confirmed that the recovery was achievable at a 6% Li2O grade. The 15 m diameter Tailings Thickener was chosen as a more conservative design, based on Vendor test work. It was established by test work that magnetic separation was of no benefit. Table concentrate is dewatered sufficiently by gravity drainage to allow for transport and off-site dressing. The higher noise producing Quaternary (4th stage) crushers remain in an enclosed building. Snowden believes that the above changes were justified.
16.1.5 Lithium grade and recovery
The design concentrate grade is 6% Li2O at an overall lithium recovery of 75%. Snowden notes that Galaxy carried out bench scale and pilot plant test work during and subsequent to the feasibility study phases of the Mt. Cattlin Project. Snowden has reviewed the test work and is of the opinion that it supported the design grade and recovery.
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16.1.6 Throughput capacity Starting in November 2010, plant throughput was predicted by Galaxy to ramp up to 71% of design 3 months after commissioning, remain at this level for 6 months, ramp up to 82% of design thereafter for 5 months, with design throughput of 85,000 tonnes per month being achieved in December 2011. Whilst such predictions are unlikely to be met exactly, Snowden considered the general approach and timing of this ramp up acceptable for this style of plant.
16.1.7 Spodumene recovery ramp-up During 2011, spodumene recovery has been slightly down on budget predictions due in part to treating a small, near surface, low grade portion of the ore body which was weathered and contained spodumene crystals that had been leached. This area of the ore body has since been extracted to expose fresh higher grade spodumene ore. Ramp up in recovery continues towards the design recovery with recovery estimated to reach 70% by the end of 2012. Snowden considers the general approach and timing of the recovery ramp up acceptable for this style of plant.
16.1.8 Spodumene grade
The design Spodumene grade was 6% Li2O.
Snowden notes that Galaxy‟s first shipment of spodumene graded 5.57% Li2O.
Project to date Mt. Cattlin has averaged 5.22% Li2O against a predicted 5.45% Li2O. The lower than expected product grade towards the end of 2011 can be attributed to a small, near surface portion of the ore body in close proximity to an east west dolerite dyke in pit 1B, being weathered and slightly leached.
16.1.9 Construction, commissioning and ramp-up of process plant The process plant construction, commissioning and ramp-up to full production were completed satisfactorily. The standard of process equipment and plant construction observed during Snowden‟s site visits on eight occasions from March 2010 to February 2011 was determined to be generally appropriate for this style of plant. Galaxy has experienced a number of issues in plant operation which have caused unscheduled plant downtime. The main issues have been high wear rates in certain slurry pumps and piping. Operations personnel are progressively working through these issues, replacing components with more wear resistant items.
16.1.10 Power station and borefield The power station is operational. A solar array has been installed and is providing some supplementary power. The borefield is operational. Galaxy have found it necessary to increase the number of bores to meet operational demand.
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Figure 16.2 Site overview from access road to administration building (RHS)
Figure 16.3 Crushed ore bin, with recycled product on right
Figure 16.4 View over laboratory to administration building
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Figure 16.5 Workshop building with tailings storage facility in background
Figure 16.6 View of power station generators, with ferro-silicon storage shed behind
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Figure 16.7 View of solar power array
16.1.11 Tailings storage facility The tailings storage facility (TSF) is operational. All underdrainage is directed towards a sump in the northeast corner of the cell, near the highest part of the TSF wall. It is then pumped to the decant tower, from where it is returned to the Process Plant. During the Snowden site visit of February 2011, tailings was being deposited along the northern wall (Figure 16.8) with decant liquor collecting towards the north-east corner of the facility and being pumped to the decant tower using a temporary pump. Snowden considers the operation to be satisfactory, with the tailings observed to have excellent dewatering characteristics, with subsequent high rates of decant water recovery.
Figure 16.8 TSF North-East Corner looking towards North-West Corner – February 2011
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16.1.12 Operations The operations work force has been in place since mid-2010, with additional staff only being recruited to replace resignations. The workforce is domiciled in Ravensthorpe and Hopetoun. The processing plant operations and maintenance workforces is 32, made up as follows: Processing Manager Processing Superintendent Maintenance Superintendent 7 maintenance staff 6 day crew including crusher operators 16 process plant operator/maintainers, including shift supervisors on 4 shifts of 4 staff. Shared services include site administration and safety support (5 staff). The laboratory is operated by SGS and staffed independently (4 staff). Snowden considers that the manning is consistent with this style of operation.
16.1.13 Commissioning Based on observations made during the May 2011 site visit, as well as discussions with Galaxy representatives, Snowden was of the opinion that construction and commissioning was complete at that point. Galaxy has been proceeding with production ramp-up since that time (see Figure 16.9 through Figure 16.14).
Figure 16.9 Secondary crushed ore
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Figure 16.10 Spodumene product at head of product conveyor
Figure 16.11 Spodumene product stockpiled, awaiting shipment
Figure 16.12 Close-up of spodumene on stockpile
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Figure 16.13 Final product
Tantalite packaged in bulk bags was also observed, as shown in Figure 16.14.
Figure 16.14 Tantalite packaged in bulk bags
16.1.14 Practical and operational completion Reported monthly production since the October 2010 commencement of operations is shown in Table 16.1.
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Table 16.1 Spodumene production
Spodumene Production, t Li2O grade, % Month Actual Budget Actual Budget November 2010 461 - 6.14 - December 2010 1,184 - 6.19 - January 2011 758 1,558 6.18 6.00 February 2011 1,999 3,106 5.15 5.10 March 2011 4,043 4,271 5.41 5.10 April 2011 4,976 4,566 5.21 5.30 May 2011 6,443 4,550 5.21 5.50 June 2011 6,373 5,170 5.32 5.50 July 2011 8,095 5,720 5.35 5.50 August 2011 5,843 6,360 5.20 5.50 September 2011 6,630 6,720 5.05 5.50 October 2011 7,242 7,150 5.07 5.50 November 2011 5,865 7,670 5.14 5.50 December 2011 5,585 8,580 4.92 5.50 Total 65,497 65,421 5.22 5.45 Spodumene production from January to December is meeting budget. Production shows an increasing trend, with May showing a significant improvement to average over 55% of design throughput. For the period November 2010 to December 2011, the average lithium oxide content of the product of 5.22% is less than the budget specification of 5.45% and the design value of 6%. Snowden understands that Galaxy is targeting a lower product grade of 5.5% Li2O, to improve recoveries.
Design issue rectification As discussed above in Section 16.1.9, Galaxy has identified a number of design issues and commenced remedial action. These include: Aggressive wear conditions on slurry pumping and transfer equipment. Mica extraction reasonable and more efficient extraction is required. Reduce spodumene product contamination. Possible issues with borefield capacity. The aggressive wear rates are being progressively controlled by replacement of more suitable wear resistant materials. A number of initiatives are being implemented to existing equipment to improve mica removal whilst additional test work and engineering design work is progressing toward the installation of more equipment to achieve a higher level of mica removal from product. Snowden considers that this is the major outstanding process engineering issue to improve product quality and provide the opportunity to exceed plant design capacity. Snowden considers that a more formal engineering effort is required to rectify the mica issue in particular and achieve a more timely ramp up of production. Snowden notes that the sustainable capacity of the borefield has been reviewed by Rockwater and designs for two additional bores are being progressed.
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16.2 Jiangsu
16.2.1 Introduction Galaxy is developing a wholly owned battery grade lithium carbonate plant in China. The main attributes of the location in China are a shorter supply chain, proximity to river port for spodumene concentrate transportation, to cement to brick making plants for residue disposal and to detergent plants for sales of sodium sulphate by-product. The plant will be operated by a subsidiary of Galaxy called Galaxy Lithium (Jiangsu) Co Ltd, which is a wholly foreign-owned enterprise in China. Production will use a well- proven production process that is enhanced through process automation and careful selection of high grade reagents. The plant is designed to produce 17,000 tpa of lithium carbonate that is suitable for use in manufacturing battery cathode materials. The following information was used by Snowden to assess the reasonableness of the process followed and assumptions used by Galaxy to design and provide performance assumptions for the Lithium Carbonate plant: Study Report for Jiangsu Lithium Carbonate Plant Project – Definitive Feasibility Study by Hatch dated October 2009 (Revisions A, B and C). Financial model spreadsheet from Galaxy entitled “Lith Carb China 6% 0 75 FX DFS V1.xls” Galaxy Lithium (Jiangsu) Co Ltd, Monthly Progress Status Reports by Hatch for the months of May 2010 to May 2011. Provisional Project Development Plan for Jiangsu Lithium Carbonate Plant Project by Hatch dated November 2010.
16.2.2 Plant location Galaxy's lithium carbonate plant (“the Jiangsu Plant”) is located in the Yangtze River International Chemical Industrial Park of the Zhangjiagang Free Trade Zone in the Jiangsu Province of China (see Figure 18.3). This is a rapidly growing industrial port city located in the centre of the Yangtze River delta, some 80 km northwest of Shanghai. The Yangtze is the largest river in China and is of key importance to the Chinese economy. Galaxy's plant is located in a highly developed and modern part of China. Galaxy‟s strategy has been aimed at establishing itself on competitive terms within a nation which has demonstrated its ability to successfully produce high quality lithium carbonate from hard rock sources (spodumene) through the up and down cycles of the market. The Company‟s spodumene feed will be shipped from Esperance and unloaded at the Zhangjiagang port at a wharf that is less than 500 m from the Lithium Carbonate Plant and directly transported to the plant stockpile by a conveyor. The chemical park has approximately 3,380 enterprises including 40 international companies such as Dow Chemical, Dow Corning, Chevron Philips, Dupont, Unocal, Wacker, Ineos, Asahi Kasei, Sumitomo, Mitsui Chemical and Vopak. All necessary infrastructure is available in the Yangtze River International Chemical Industrial Park. Key utilities including water supply, sewage treatment, power supply, steam, telecommunications, industrial gas and fire-fighting facilities are available at the Company‟s site. The location of the site that has been selected for the Jiangsu plant also provides access to supplies of sulphuric acid, hydrochloride, soda ash and caustic soda from neighbouring producers.
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Figure 16.15 Night view of the plant
16.2.3 Process description Production of lithium carbonate is taking place via a well-proven process that is enhanced through process automation and careful selection of high grade reagents. Galaxy has also included a further step of purification which has the potential to increase the quality of the product to greater than 99.9% Li2CO3. The plant is designed to produce 17,000 tpa of lithium carbonate with a purity level of at least 99.5% that will be suitable for use in manufacturing battery cathode materials. Galaxy has filed for a provisional patent on the Jiangsu Plant process called “process for the production of Lithium Carbonate”. The key process steps are: Ore conveying and stockpiling Calcination (Decrepitation) Milling Sulphation Leaching Filtration Impurity removal Primary lithium carbonate crystallisation Sodium sulphate crystallisation and drying Bicarbonation Purified lithium carbonate crystallisation Drying and packaging
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The detailed process flow diagram is presented in Figure 16.16. It consists of the following main unit operations: Decrepitation Sulphation roasting Leaching and residue removal Precipitation of impurities Ion exchange Primary lithium carbonate crystallisation Lithium carbonate drying, micronising and packaging Bicarbonate purification to produce high purity lithium carbonate . This step is the subject of a provisional patent by Galaxy (see Section 16.3.1), which has been reviewed by Snowden. Sodium sulphate crystallisation, drying and packaging Sales of 800 kg or 1 tonne lots of lithium carbonate, in 20 kg or 25kg bags, through the port of Zhangjiagang to Japan, Korea and Europe Sales of 800 kg or 1 tonne lots of lithium carbonate, in 20 or 25 kg bags, within China.
16.2.4 Area 10: Ore Stockpile and Reclaim Spodumene concentrate will be shipped from Australia in shipments of up to 30,000 tonnes. It will be unloaded at a wharf located approximately 500 m from site and transported by belt conveyor to the site boundary by others. A spodumene concentrate stockpile with overhead conveyor complete with tripper is being established on site with a storage capacity of 37,500 t. Spodumene concentrate is recovered from the stockpile by Front End Loader and fed into one of two loading hoppers.
16.2.5 Area 20: Calcination, Milling and Sulphation Calcination (decrepitation) is an essential requirement for the subsequent hydrometallurgical processing of spodumene ore. In this step, the heat treatment of the ore results in a crystal phase change from alpha to beta-spodumene, making the lithium amenable to digestion by sulphuric acid. Calcination takes place within the Rotary Kiln during which the alpha-spodumene is converted to beta-spodumene. The kiln product leaves the kiln and is then cooled in the Rotary Cooler. Off-gases from the kiln are cleaned in a cyclone and an electrostatic precipitator before discharging to the atmosphere via a stack. Particulates recovered from the off-gases are conveyed by a tubular drag chain conveyor to the Calcined Spodumene Storage Bin. Cooled beta-spodumene is conveyed from the Calciner Rotary Cooler discharge by an inclined screw conveyor to a rubber-lined ball mill. Ball Mill product is conveyed via a tubular drag chain conveyor to the Calcined Spodumene Storage Bin. Milled beta-spodumene is drawn from this bin by a belt feeder complete with a weightometer and a bucket elevator to the Pug Mixer where it is thoroughly mixed with concentrated sulphuric acid. The mixed material from the pug mixer is fed directly into the Sulphating Kiln. The sulphating kiln liberates lithium from the spodumene ore.
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Hot material exiting the sulphating kiln is cooled in the Pre-Leach Rotary Cooler. Off-gases from the sulphating kiln pass through a venturi scrubber to recover fines and remove acid mist. These are transferred to the leach. The scrubber exhaust is discharged to atmosphere via the Calciner ESP Stack. Cooled product from the Pre-Leach Rotary Cooler is conveyed via an inclined screw conveyor to the Leach Slurry Feed Tank.
16.2.6 Area 30: Leaching and Impurity Removal Lithium is extracted from the calcined concentrate as soluble lithium sulphate, along with some soluble impurities, which are then removed to give a purified solution of lithium and sodium sulphate. The leach liquor is largely recycled solution from Area 60. Leaching takes place in a series of three leach tanks at atmospheric pressure. The calcined solids for leaching enter this circuit via the Leach Slurry Vortex Mixer, discharging to the Leach Slurry Feed Tank, where recycled liquor stored in the Leach Feed Liquor Tank is combined with solids from the Sulphated Spodumene Screw Conveyor. The leach feed liquor is cooled in the Leach Feed Liquor Cooler to maximise lithium solubility and extraction and is added to the solids in a ratio to maintain a slurry. Discontinuous flows of lithium-containing solutions from the Sulphating Kiln Venturi Scrubber, the Secondary Filter, the Ion Exchange Columns, the Bleed Stream Treatment Tanks and the Lithium Carbonate Filter are combined in the Dilute Leach Feed Tank from which solution is fed at a steady rate to the Leach Slurry Feed Tank and forms part of the leaching solution. Once leaching is largely complete, the leach slurry enters the Oxidation Tank, where hydrogen peroxide from the Hydrogen Peroxide Storage Tank is added to convert the soluble ferrous iron impurity to ferric iron, allowing its removal from the lithium sulphate solution by the addition of a slurry of hydrated lime in a series of two Neutralisation Tanks. Aluminium is also precipitated in this tank. The tanks will operate at a neutral pH. The leach slurry is collected in the Leach Slurry Storage Tank and pumped to the Leached Solids Filters. These two vacuum belt filters operate with a primary filtration area followed by a three stage on-belt counter current wash using cold water as the wash liquor. Most of the residual soluble lithium sulphate washings from the leached solids filter cake are recovered in this manner and are recycled by pumping from the Leached Solids Filter Filtrate Receivers to the Leach Feed Liquor Storage tank. The damp filter cake is transferred to the Alumina Silicate Stockpile via conveyors. The impure leach liquor, still containing unacceptable amounts of soluble calcium and magnesium, is pumped from the Leached Solids Filter Filtrate Receivers to the Leach Solution Tank for subsequent removal of any solids that pass through the belt filter using the duty/standby Polishing Filters. The on-line filter operates in filtration mode followed by a cleaning mode.
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Figure 16.16 Jiangsu lithium carbonate plant - flow diagram
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Diatomaceous earth (DE) is added as a body feed filtration aid to the leach solution from Body Feed Tank before filtration. The filter is pre-coated with a dilute DE from the Pre-coat Tank to minimise blinding of the Polishing Filter cloths. At the end of the filtration cycle the filtration is switched to the standby filter and a cake discharge sequence is initiated on the loaded filter. The filter cake is dislodged using plant air and is collected in the Filter Sludge Bunker from where it is periodically removed to the filter residue Alumina Silicate Stockpile by a front end loader. The filter is then pre-coated and prepared for the next cycle. The polished leach liquor passes through the polishing filter to the Magnesium Removal Tank where the solution pH is raised using hydrated lime to precipitate magnesium hydroxide. This slurry overflows to the Calcium Removal Tank where a sodium carbonate solution is added to the dilute slurry to precipitate calcium carbonate. The sodium carbonate solution is added on a ratio control to the solution flow from the polishing filter. This dilute slurry is filtered on the Secondary Filter operated in a duty/standby mode. In a similar fashion to the Polishing Filter, the Secondary Filter requires a DE pre-coat and body feed DE addition. The Body Feed Tank adds sufficient body feed continuously to the Calcium Removal Tank, while the filter is pre-coated with DE from the Pre-coat Tank. The Secondary Filter discharge cake is collected in the Filter Sludge Bunker from where it is periodically removed to the filter residue Alumina Silicate Stockpile by a front end loader. The purified solution of lithium sulphate is collected in the pH Control Tank where the pH is adjusted to neutral using sulphuric acid from the Sulphuric Acid Storage Tank. In the leach and purification tanks to this point of the circuit, provision has been made to by-pass any tank for maintenance. This is necessary since the tanks are rubber lined and are in a relatively arduous duty. The supply of reagents to the tanks reflects this flexibility. The lithium sulphate leach liquor is further purified by pumping to Ion Exchange Columns No.1 and No.2 which operate in a lead-lag mode. These columns remove residual magnesium and calcium by ion exchange with sodium on the resin. Approximately half of the time both columns are in use in series, but when one is loaded with calcium and magnesium, as determined by assay, it is taken off line and regenerated. The purified leach liquor passes through the ion exchange (IX) columns to the Crystallisation Feed Tank. The spent IX column is regenerated by controlled sequence of draining the column, washing with process water, backwashing, desorbing the calcium and magnesium with a hydrochloric acid solution, washing the column with process water and then regenerating the resin with sodium hydroxide before a final rinse. The sodium hydroxide is pumped from the Sodium Hydroxide Storage Tank to the Dilute Sodium Hydroxide Tank where it is diluted on flow ratio control with process water. The ion exchange regeneration solutions are sent to the Waste Water Tank for neutralisation and discharge from the site.
16.2.7 Area 40: Lithium Carbonate Primary Crystallisation Lithium carbonate is crystallised from the crystallisation feed liquor by the addition of a solution of sodium carbonate. The crystal is then recovered from the sodium sulphate solution by thickening, centrifuging and washing the crystal. Crystallisation takes place at high temperatures. The lithium carbonate crystalliser feed is passed through the Lithium Carbonate Crystalliser Feed Heat Exchanger to raise the liquor temperature.
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Lithium carbonate crystallisation then takes place in the two agitated crystallisation tanks in series, Lithium Carbonate Primary Crystalliser and Lithium Carbonate Secondary Crystalliser by the addition of sodium carbonate solution pumped from the Sodium Carbonate Storage Tank. Most crystallisation occurs in the primary crystalliser. The lithium carbonate slurry from the Lithium Carbonate Secondary Crystalliser is pumped to the Lithium Carbonate Thickener where the carbonate crystals are allowed to settle to an approximately underflow pulp density. The thickener overflow drains to the Lithium Carbonate Thickener Overflow Tank where the pH is adjusted to neutral using sulphuric acid pumped from the Sulphuric Acid Storage Tank. The overflow tank is sparged with plant air to remove dissolved carbon dioxide. The thickener underflow is pumped to the Lithium Carbonate Thickener Underflow Tank and from there to the two duty batch Lithium Carbonate Centrifuges. The centrifuge cake is washed with hot water to remove soluble sodium sulphate and other soluble salts from the damp centrifuge cake. The centrifuge collects the centrate and washings separately. The centrate is collected in the Lithium Carbonate Centrate Tank and is pumped to the Lithium Carbonate Thickener Overflow Tank before proceeding to Area 60 for sodium sulphate recovery. The Lithium Carbonate Wash Solution is recycled to Area 30. The damp lithium carbonate crystals are discharged from the centrifuges to the Dewatered Lithium Carbonate Hopper and are then conveyed by the Dewatered Lithium Carbonate Screw Conveyor to the Crystal Storage Tank before additional purification in Area 50. These crystals are able to bypass the Area 50 bicarbonate purification and can be pumped to the Purification Centrifuges for recovery and washing, then drying in the rotary Lithium Carbonate Dryer and storage in the Lithium Carbonate Storage Bins before bagging a lower quality product.
16.2.8 Area 50: Bicarbonate Purification. In order to produce a very high quality lithium carbonate product, the lithium carbonate from Area 40 is dissolved and recrystallised to free any impurities entrapped within the crystal. The dissolution is done using carbon dioxide gas. A slurry of lithium carbonate is pumped from Crystal Storage Tank, where bagged lithium carbonate can also be recycled via the Bag Breaker, to the first of three agitated digester tanks operated in series. In the first digester the solids pulp density is adjusted with lithium carbonate recirculation liquor to ensure complete dissolution of the lithium carbonate. The digesters operate at close to atmospheric pressure and 40 ºC. The lithium carbonate is dissolved using carbon dioxide to form soluble lithium bicarbonate, also freeing entrapped sodium sulphate and other impurities from the crystal The reaction is exothermic, so the digester temperature is controlled by cooling the recycled make-up liquor. Recycled carbon dioxide is sparged into the digesters using the Carbon Dioxide Blower. Make-up carbon dioxide is drawn from the Liquid Carbon Dioxide Storage Tank, vaporised in the Carbon Dioxide Vaporiser and passed through a Carbon Dioxide Receiver. The lithium bicarbonate solution from the digesters is pumped through the Digester Filter to the first Purification Crystalliser Tank. The filter collects any insoluble components associated with the impure lithium carbonate, including some magnesium and calcium solids. The filter has provision for washing and air discharge to the Sludge Bin. The sludge will be added to the Alumina Silicate Stockpile.
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There are four agitated Purification Crystalliser Tanks in series where the solution is heated using live steam to recrystallise the lithium carbonate by the removal of carbon dioxide. The first Purification Crystalliser Tank is seeded with crystals recycled from the Purification Thickener underflow to enhance crystal growth and make subsequent crystal recovery easier. The recrystallised lithium carbonate is pumped to the Purification Thickener where it is thickened and the underflow is pumped to the Thickener Underflow Tank. The thickener overflow is collected in the Thickener Overflow Tank where it is pumped to the Thickener Overflow Heat Exchanger for cooling. This cooled liquor is subsequently recycled to the first Digester Tank for solubility control and a bleed is taken to make-up the sodium carbonate solution in the Sodium Carbonate Make-Up Tank. The Thickener Underflow Tank contents are pumped to the Purification Centrifuges and the purified lithium carbonate is recovered as a centrifuge cake. Hot wash water is used to remove the majority of any remaining impurities associated with the lithium carbonate crystals. The centrifuge collects the centrate and washings together in the Purification Centrate Tank, and this is returned to the Thickener Overflow Tank. The washed centrifuged solids pass via the Dewatered Lithium Carbonate Hopper to the Dewatered Lithium Carbonate Screw Conveyor for conveying to the Area 40 Dryer. The digester vent gases, comprised of a mixture of mainly carbon dioxide and water vapour are cooled in the Condenser and are then compressed in the Carbon Dioxide Blowers for recycle to the digesters. A small quantity of this compressed gas is vented to prevent the accumulation of inert gases, such as nitrogen, which would have an adverse effect on the digester efficiency. The Dewatered Lithium Carbonate Screw Conveyor conveying the purified lithium carbonate crystals from the Purification Centrifuges discharges the crystals to the Lithium Carbonate Dryer Screw Feeder and from there to the natural gas heated rotary Lithium Carbonate Dryer. The moisture in the crystals is removed by drying them. The dry crystals are cooled in the Lithium Carbonate Dryer Screw Cooler and then conveyed by the Lithium Carbonate Tubular Drag Conveyor to Lithium Carbonate Storage Bin A or B. Dust generated within the bins is contained using the Lithium Carbonate Storage Bin Dust Collectors and the solids are kept dry by blanketing them with dry plant air. Solids from the bins can be bagged in 1 tonne bulka bags or in 25 kg bags, but in general the solids will be micronized to approximately 4 microns before bagging. The lithium carbonate from the bins is conveyed to the Lithium Carbonate Micronizer Feed Bins. The Lithium Carbonate Micronizer Feed Screw Feeders convey the solids to the Lithium Carbonate Micronizers where filtered and dried air from the Lithium Carbonate Micronizer Air Compressors supplies the motive force for size reduction. The micronized solids are pneumatically conveyed to the Lithium Carbonate Micronizer Baghouse and the air is extracted using the Lithium Carbonate Micronizer Baghouse Fan. These bags are then warehoused for QC and trucking. The warehouse has approximately six weeks storage capacity. Bags of lithium carbonate can also be recycled to the micronizer to meet quality specifications using the Lithium Product Bag Breaker as a means of reintroducing the solids to the micronising circuit. The unbagged material passes via the Lithium Product Hopper and a rotary valve onto the Lithium Carbonate Tubular Drag Conveyor and from there to the Lithium Carbonate Storage Bins.
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16.2.9 Area 60: Sodium Sulphate (Na2SO4) Crystallisation The sodium sulphate generated in Area 40 lithium carbonate crystallisation is crystallised and recovered as a co-product in Area 60. The sodium sulphate co-product is anhydrous. The spent lithium carbonate solution from Area 40 is piped to and stored in the Sodium Sulphate Solution Storage Tank. From there it is pumped to the Neutralization Tank where sodium hydroxide is added to adjust pH to neutral. The sodium sulphate solution is then pumped into the evaporative Sodium Sulphate Crystalliser which operates at 80°C and at approximately 40 kPa (abs) pressure. The Sodium Sulphate Crystalliser Re-Compression Fans compresses the steam boiled off in the vacuum crystalliser and this steam is then piped to the Sodium Sulphate Heat Exchanger to generate the heat to boil the crystalliser slurry contents. The load on the Sodium Sulphate Crystalliser Vacuum Pump is reduced by removing most of the water vapour to this pump with the Sodium Sulphate Crystalliser Condenser. Condensate from the Sodium Sulphate Heat Exchanger is pumped to the Hot Water Tank. The sodium sulphate crystals in the crystalliser slurry are discharged from the crystalliser. The sodium sulphate crystals are washed with cold water on the centrifuge to remove impurities in the liquor associated with the crystals. Some of this wash solution is recycled as wash liquid for efficiency and the saturated wash solution is then recycled to the crystalliser feed via the Sodium Sulphate Wash Solution Tank. The sodium sulphate centrate is collected in the Sodium Sulphate Spent Liquor Tank and most is recycled to the leach circuit by pumping it to the Leach Feed Liquor Storage Tank. A small quantity is bled from the system to remove accumulating chlorides, potassium and other salts. The washed centrifuged sodium sulphate discharges to the Dewatered Sodium Sulphate Screw Conveyor and is conveyed via the Sodium Sulphate Product Dryer Screw Feeder to the rotary, natural gas fired Sodium Sulphate Product Dryer. The solids discharge from the dryer are then cooled in the Sodium Sulphate Product Dryer Screw Cooler before being conveyed by the Sodium Sulphate Product Dryer Tubular Drag Conveyor to the Sodium Sulphate Product Storage Bin. Plant air is used to blanket the solids and to keep them dry. Any dust generated in the bin is contained by the Sodium Sulphate Product Storage Bin Dust Collector. The stored solids are discharged from the bin via a rotary valve to trucks collecting this co-product. The bleed stream of sodium sulphate spent liquor, to control the build up of undesirable salts in the circuit, is treated in the Bleed Stream Treatment Tanks.
16.2.10 Area 70: Reagents The key reagents for the sulphate process for lithium carbonate production are soda ash and sulphuric acid. Galaxy signed a Letter of Intent (LOI) with its future neighbour, Two Lions (Zhangjiagang) Fine Chemicals Co., Ltd. to supply 38,000 tonnes of sulphuric acid per annum for 15 years. The supply arrangement also includes supply of sodium hydroxide and steam and access to modern automated bulk mineral unloading facilities. Galaxy has also secured a supply of soda ash with the Jiangsu Huachang Chemical Co. Limited (Huachang). Huachang will supply 40,000 tonnes of soda ash (Na2CO3) per annum for 15 years.
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The main reagents used in the process and stored in Area 70 are sulphuric acid, sodium hydroxide, sodium carbonate and hydrated lime. Sulphuric acid is received across the fence via pipeline from Two Lions Fine Chemicals Company. The acid is stored in the Sulphuric Acid Storage Tank and is pumped from this tank to the various process users. Sodium hydroxide is trucked to the plant, stored in the Sodium Hydroxide Storage Tank and is pumped from this tank to the various process users. Sodium carbonate will be delivered in powder form by tanker trucks which will be pneumatically unloaded at site to the Sodium Carbonate Storage Bin. Dust is contained by the Sodium Carbonate Storage Bin Dust Collector. The sodium carbonate is dissolved in batches and transferred to a tank for distribution of the solution to the process users. The Sodium Carbonate Screw Feeder conveys the sodium carbonate powder from the storage bin to the Sodium Carbonate Make-Up Tank. Lithium carbonate liquor from the Area 50 bleed, along with some hot or cold water is used to make up a solution of sodium carbonate. This is then filtered through the Sodium Carbonate Filter to remove insoluble compounds, and is transferred to the Sodium Carbonate Storage Tank for distribution of the solution to the process users. Calcium hydroxide will be delivered in powder form by tanker trucks which will be pneumatically unloaded at site to the Calcium Hydroxide Storage Bin. Dust is contained by the Calcium Hydroxide Storage Bin Dust Collector. The calcium hydroxide is slurried in batches for distribution of the solution to the process users. The Calcium Hydroxide Screw Feeder conveys the calcium hydroxide from the storage bin to the agitated Calcium Hydroxide Slurry Make-Up Tank via the Calcium Hydroxide Slurry Make-Up Mixer. Cold water is added to the hydrated lime in the mixer to produce a slurry of calcium hydroxide in water at ambient temperature for distribution to process users. Once the tank level decreases to approximately 40% of the volume a make-up sequence is initiated. This ensures that the calcium hydroxide slurry has “aged” and is more reactive than freshly made up slurries.
16.2.11 Area 80: Utilities
Water Municipal water is supplied to the boundary of the site and is directed to the Process Water Tank. The Process Water Tank also accepts return water from heat exchangers and a bleed of cooled hot water from condensate lines in order to reduce net water usage of the plant. Process water is distributed to the process users from this tank. Condensate generated from heat exchangers is returned to the Hot Water Tank and is used for washing the lithium carbonate crystal in Area 40 and 50, as well as for sodium carbonate solution make-up. Water in excess of these requirements is cooled in the Hot Water Cooler and is used as process water, for Area 50 make-up water or for make up to the Cooling Tower. The Cooling Tower accepts return water at typically 50°C from the process plant users and cools this, dependent on weather conditions, to approximately 30°C (max). The cooled water is distributed to the process users from the cooling tower basin. The cooling water quality is maintained by the addition of a biocide, anti-scaling agent and corrosion inhibitor, supplied as a vendor package. There is also a blow-down stream to the Waste Water Tank. The Waste Water Tank accepts the cooling tower blow-down, spillages from sump areas, the sulphating scrubber solution and the bleed from Area 60. The pH of the water in the Waste Water Tank is adjusted with sulphuric acid or sodium hydroxide to attain a neutral pH before discharge of the water to the municipal water treatment plant.
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Natural Gas Natural gas will be supplied by a pipeline to the plant boundary by others with metering established inside the property line close to the point of connection. Natural gas is distributed to the process users from the metering point.
Electricity Electricity supply will be provided by the local electricity bureau via a 10kV feeder along Dongxin Road at the north of site. The project will establish an on-site high voltage substation to distribute this 10 kV supply to six 10/0.4 kV transformers located around the site near load centres.
Steam Steam supply will be connected to the site boundary and metered by others. Steam is distributed to the process users from the metering point.
Compressed Air Compressed air will all be of instrument air quality (oil <0.01 mg/m3 and particulates <0.01 micron) and approximately -40°C dew point dryness. The compressed air pressure is 750 kPa. Ambient air is compressed by the Air Compressors, before passing to the Compressed Air Receiver. After filtering and drying, the air is distributed to the process users.
Data and Communications Digital voice communications will be established by the connection of a minimum of 8 incoming lines and installation of a PABX, cabling and handsets in the management offices, laboratory, control room, warehouses and maintenance workshop. Data communications, including email, will be via wide-band internet connections.
Sampling and Laboratory Testing Provisions will be made for sampling at numerous locations including the sampling of spodumene concentrate, products and co-products. A laboratory with appropriate testing and analytical equipment will be established on site to store and process these samples. Test results will be used for metallurgical accounting, for product quality control (QC) and process control.
Operation, Maintenance and Spares Adequate stairs, access ways and platforms will be provided to enable the safe and convenient operation and maintenance of equipment. Provision of isolation points and locations of valves and other operable devices will be in accordance with good practice and confirmed by HAZOP. Though maintenance philosophies have not been finalised in detail, provision will be made for a maintenance building and equipment suitable for smaller scale on-site maintenance and repair of equipment such as pumps, agitators, etc. A secure spares store was provided within the Maintenance Building.
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16.2.12 Area 90: Alumina-Silicate Disposal The damp filter cake from the Leached Solids Filters is stored on a stockpile and is loaded onto trucks for removal from site on a continuous basis. This stockpile will be covered, bunded and fitted with a sump and pump. A contract was signed with a company to collect the alumina-silicate waste for storage and use in their products.
16.2.13 DFS assumptions
Product quality and throughput capacity An Indicative Analysis of the product is presented in Table 16.2. The Jiangsu Plant will have a nominal design production rate of 17,000 tpa of high quality lithium carbonate (Li2CO3) with a purity level of at least 99.5%, utilising 137,000 tpa of spodumene concentrate from the Mt. Cattlin mine. These design rates are based on a 2 shift, 24 hours/day operation with a 2 week annual maintenance shut-down. Target plant availability is 85% and target recovery rate for lithium is 85%, i.e. 85% of the lithium contained in the spodumene concentrate is to be recovered as packaged lithium product.
Table 16.2 Indicative analysis of product quality
Element Symbol Content
Lithium Li2CO3 >99.5% Sodium Na 0.025% Iron Fe 0.001% Copper Cu 0.001% Magnesium Mg 0.01% Aluminum Al 0.005% Lead Pb 0.001% Calcium Ca 0.005% Potassium K 0.001% Manganese Mn 0.001% Silica Si 0.005% Chloride Cl 0.003%
Sulphate SO4 0.08%
Moisture H2O 0.40% Snowden believes the quality (refer to Purification Test Report - Central South University) and throughput to be achievable with the proposed process design discussed. Plant throughput is expected by Galaxy to commence at 5,000 t of spodumene concentrate in the first month of production, increasing broadly linearly to designed throughput of 137,000 tpa after 8 to 12 months. While such predictions are unlikely to be met exactly, Snowden considers the general approach and timing of this assumed throughput ramp up profile to be acceptable for this style of plant.
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Galaxy expects lithium carbonate recovery to commence at 60% in the first month of production, increasing to 70% in the second month, and 75% in the third to fifth months with design steady state recovery of 85% being achieved by the sixth month. Snowden considers the general approach and timing of the assumed recovery ramp up profile to be acceptable for this style of plant. The Jiangsu Plant has been designed to produce lithium carbonate with grades of 99.9% and above. Galaxy intends to produce lithium carbonate with minimum grades of 99.5%. Galaxy expects to produce lithium carbonate predominantly with grades of less than 99.5% in the first two months of production. By the sixth month, Galaxy expects that at least 40% of total lithium carbonate produced will have grades of 99.5% or above. Within 10 months, Galaxy expects to be producing saleable quantities of material with grades of 99.5% and above. During second quarter of 2012, Galaxy expects to be producing at a rate of 17,000 tpa with purity levels of at least 99.5%.
Flow sheet changes from DFS to proposed final design The final flow sheet design is essentially the same as the DFS, with some exceptions, as noted below: Use of lime for neutralisation in the leach circuit Incorporation of additional impurity removal filtration steps Incorporation of a Lithium Bicarbonate purification process route Addition of a stockpile conveyer and tripper Taking out the milled spodumene sizing screen Addition of a Pre-leach rotary cooler Taking out the leach solids thickener Taking out the alumina-silicate residue drying Snowden considers these changes either add value to the final product, or are part of normal design development.
16.2.14 Construction progress As of end of year 2011, Construction Completion Certificates were issued for all areas with exceptions and punch list. Transition from construction phase to commissioning phase has been achieved. Utilities such as water, natural gas, steam and electricity and plant air are in services. Phase one cold commissioning and spodumene stack conveyors were completed and handed over to Galaxy for hot commissioning. The balance of the plant is under cold commissioning. Fire approval, special equipment permit and quality assessment approval were obtained. All procedures are implemented during the commissioning phase.
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Figure 16.17 Jiangsu production and office building
Figure 16.18 Kiln and cooler
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Figure 16.19 Sodium sulphate crystalisation tower, dryer and storage bin
Figure 16.20 Bagging station commissioning
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Figure 16.21 Jiangsu production building
Figure 16.22 Stack conveyor unloading spodumene
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Figure 16.23 Maintenance building, substation and reagent storage bins (behind)
16.3 Other comments
16.3.1 Process patent In January 2010, Galaxy filed a provisional patent application for an invention that relates to the process of producing lithium carbonate. The process covered by the invention is intended to provide a high purity or battery grade lithium carbonate product. The process on which the invention is based may also provide a sodium sulphate product. Known processes for the production of lithium carbonate from lithium containing ores or concentrates typically utilise the thermal treatment of an alpha-spodumene ore or concentrate. This thermal treatment can be referred as decrepitation and transforms the alpha-spodumene to beta-spodumene which is in turn able to be solubilised by acid. However, the known processes for the production of lithium carbonate are relatively inefficient in the removal of impurities remaining in the pregnant leach solution, which results in a relatively impure lithium carbonate product. This is particularly problematic when attempting to produce a high quality or battery grade lithium carbonate product. The process/invention proposed by Galaxy has as one objective to overcome the above mentioned as well as a number of other problems associated with prior processes, or to at least provide a useful alternative thereto.
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16.3.2 Management Mr. Iggy Tan, Managing Director of Galaxy, has over 25 years of experience in the mining and chemical industry as well as background in marketing and business development. Mr. Tan has a strong senior management team supporting his efforts. Mr. Terry Stark, the Managing Director – Resources Division, is a mining engineer with experience throughout Australia in various commodities covering mine development and operation. He has been responsible for the construction of two new projects in recent years. Mt. Cattlin Mine is managed by a team consisting of the Resident Manager, Mr. Chris Rainsford, a mining engineer with over 25 years experience, Manager Processing , Mr. Roger Pover, a metallurgist with over 16 years experience and Manager Mining, Mr. Robert Michalski a mining engineer. In China, Mr. Allen Qian is Managing Director – China and will oversee the Chinese operations. Mr Qian has solid operational and business management experience in the chemical and automotive industries in China. His previous major career history includes Managing Director roles with two public companies for more than six years and almost seven years‟ service with General Motors in various engineering & management functions. Mr Qian obtained a dual Bachelor of Engineering from Shanghai Jiao Tong University and a Master of Business Administration from Harvard Business School. He will be assisted by Mr. Frank Shi the Operations Director and Mr. Wang XiaoYi Chief Engineer at the Jiangsu Process Plant. Mr. Shi, a chemical engineer, has over 21 years of operational management experience in China including 11 years with multinational chemical companies such as Wacker and Dow Chemical, He was previously the plant manager of Wacker Chemical (Zhangjiaganag) Co. Ltd. Mr. Shi also holds a degree of Master of Business Administration (MBA). Mr. Wang a chemical engineer has extensive experience in lithium carbonate processing in China over many decades. Snowden believes that Galaxy enjoys the support and expertise of a well equipped and qualified team of professionals with the relevant experience to bring value to the Mt. Cattlin mine and Jiangsu Plant.
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17 Reconciliations This section covers results of reconciliations between resource and grade control models and mine production (including mineralised waste) from commencement of mining until the end of December 2011. Table 17.1 shows tonnes and grade figures for the different ore models, ore blockouts and production. Table 17.2 shows reconciliations between the models/production over the period studied. Table 17.3 shows reconciliations after applying the overcall in Li2O grade shown by the plant at CV06 to production figures. Graphs showing monthly data for resource, grade control and production are shown in Figure 17.1 to Figure 17.3.
Table 17.1 Totals over the period for ore (including mineralised waste)
Li20 Metal Source Period Tonnes Li2O% (t) Resource March 2010 - Dec 2011 1,023,530 1.022 10,466 Resource - Diluted March 2010 - Dec 2011 1,069,589 0.930 9,942 GC March 2010 - Dec 2011 892,861 1.103 9,848 Ore Blocks March 2010 - Dec 2011 888,241 1.075 9,547 Production March 2010 - Dec 2011 944,176 0.942 8,892
Production-CV06 Li2O Upgrade March 2010 - Dec 2011 944,176 1.009 9,528
Table 17.2 Reconciliations between the models/production
%Diff %Diff Li20 %Diff Li20 Recon Period Tonnes Grade Metal (t) GC vs Resource March 2010 - Dec 2011 -15% 7% -6% GC vs Resource Diluted March 2010 - Dec 2011 -20% 16% -1% GC vs Ore Blocks March 2010 - Dec 2011 1% 3% 3% Production vs GC March 2010 - Dec 2011 5% -17% -11% Production vs Resource March 2010 - Dec 2011 -8% -9% -18% Production vs Resource Diluted March 2010 - Dec 2011 -13% 1% -12%
Table 17.3 Reconciliations assuming CV06 overcall
%Diff %Diff Li20 %Diff Li20 Recon Period Tonnes Grade Metal (t)
Production-CV06 Li2O Upgrade vs GC March 2010 - Dec 2011 5% -9% -3%
Production-CV06 Li2O Upgrade vs March 2010 - Dec 2011 -8% -1% -10% Resource
Production-CV06 Li2O Upgrade vs March 2010 - Dec 2011 -13% 8% -4% Resource Diluted
Notes:
Data includes all material over 0.4% Li2O. Resource diluted is the resource which has been diluted as for reserve statements. That is, 95% mining recovery and 10% dilution at zero grade.
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A lithium grade overcall is noted at sample point CV06 in the plant which is located after the ore has been crushed to less than 20 mm and somewhat homogenised. Data comparing production grade for ore entering the crusher (calculated from ore block grades) with CV06 assay results shows that lithium assays at CV06 are an average of 7% higher than predicted by production figures. This has been factored into grades in Table 17.3. Reconciliations between production tonnes, ROM survey and crusher weightometer are good.
Total Li2O metal for the period for grade control and resource models reconciles reasonably well (grade control model 6% lower than resource model, but 1% lower if the resource model is diluted as for reserve estimations). However, the grade control model shows higher grade, and lower tonnes than the resource model. This is due to a more selective geological modelling method being used for grade control compared to the resource model. Grade control to ore block reconciliation is good, and demonstrates that the mine ore blockout procedure is working well.
If the grade overcall at CV06 is factored into production grades, Li2O metal for production is 3% lower than expected from grade control. The lower than predicted grade and higher tonnes relates partly to mining dilution. Production grades were also influenced by generic grade assignment to ore mined from outside ore blocks that was not picked up in the grade control model. This results from the grade control geology model not being optimal. The grade issue is expected to improve with closer spaced grade control drilling, improved dilution management and the more consistent ore zones outside of the initial pit. Production versus the resource model shows a shortfall of 8% in tonnes and 9% in grade. However, if dilution/ore recovery factors and the overcall in the plant are accounted for, then, Li2O metal production is 4% less than predicted. In summary, the period covers the startup of mining, and development and improvement of geology, mining and ROM management procedures, in addition to being one of the most complex portions of the Mt. Cattlin ore body. Considering the above, the reconciliations of grade control and resource models with production do not highlight any major problems. When dilution/ore recovery of the resource model is accounted for, together with Li2O grade overcall at CV06, total Li2O metal from production is within 3-5% of both resource and grade control model predictions.
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Figure 17.1 Resource, grade control and production tonnages for March 2010 – December 2011
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Figure 17.2 Li2O grades of the resource, grade control and production for March 2010 – December 2011
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Figure 17.3 Li2O metal tonnages for resource, grade control and production for March 2010 – December 2011
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18 Infrastructure 18.1 Background The existing infrastructure and service facilities available and accessible to the Mt. Cattlin Mine within WA will be sufficient to maintain ongoing operations of the mining and processing works. Albany and Esperance, the two nearest major centres of population, both have heavy industry support including construction, engineering and manufacturing services. It is envisaged that these resources will be utilised throughout the life of the mine including planned shutdown maintenance personnel and carnage as well as provide ready access for emergency breakdown repairs. The township of Ravensthorpe is also able to provide these services on a more limited scale following the construction of the Ravensthorpe Nickel Project. Other facilities within the town include a hospital, police station, primary and secondary schooling, a large recreation facility, hotel, motel and caravan park, in addition to a number of small business enterprises and a telecentre. A fully sealed airstrip capable of accepting commercial jets has been established south of the town near the Hopetoun road.
18.2 Roads Transport from Perth will be via either the Brookton Highway (450 kms) or the Albany and South Coast Highways (690 kms). These highways are not anticipated to present difficulties in carrying the materials and equipment for the project to site. Product transport will substantially be via the South Coast Highway to Esperance, a distance of 187 kms. A new access road from the Lake King Road has been developed to provide heavy vehicle access from the site for product transport.
18.3 Spodumene transport from Mt. Cattlin Spodumene produced at Mt. Cattlin mine site will be trucked in bulk by Esperance Freight Lines (EFL) to Esperance Port and stored in a nominated area within the port. Shipments to China will be in bulk quantities of 12,000 t to 25,000 t per shipment. A five year fixed ocean freight contract has been signed with Pacific Basin IHC (UK) Ltd, vessel owners, to ship a maximum of 25,000 t +/-10% per shipment to the Zhangjiagang Port in China. A total of 137,000 tpa of spodumene will be shipped to China. Inchcape Shipping Services Pty Ltd has been appointed as shipper‟s agent at Esperance Port. Their responsibility includes coordinating the shipping activities with Mt. Cattlin, the vessel owners and Esperance Port.
18.4 Spodumene unloading in China Spodumene will be unloaded in China at a private berth owned by Two Lions Company in Zhangjiagang and delivered by conveyors to Galaxy‟s lithium carbonate site, approximately 500 m away from the berth. An unloading and delivery contract has been signed with the Two Lions Logistics Company. The port authority is progressing well with the construction of the conveyer belt support structure from the port to the plant. This part of the project does not fall under the Management of Hatch, but of Galaxy China itself (see Figure 18.1).
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Figure 18.1 Conveyer work in progress from the port
Figure 18.2 Side view of some of the conveyer work from the port
18.5 Jiangsu lithium carbonate plant Galaxy‟s Lithium Carbonate Plant (“the Jiangsu Plant”) is located in the Yangtze River International Chemical Industrial Park of the Zhangjiagang Free Trade Zone in the Jiangsu Province of China, 80 km northwest of Shanghai (Figure 18.3). The Company‟s spodumene feed is shipped from Esperance and unloaded at the Zhangjiagang port at a wharf that is less than 500 m from the Lithium Carbonate Plant. The chemical park has approximately 3,380 enterprises including 40 international companies such as Dow Chemical, Dow Corning, Chevron Philips, Dupont, Unocal, Wacker, Ineos, Asahi Kasei, Sumitomo, Mitsui Chemical and Vopak.
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The main attributes of the location in China are a tighter supply chain, proximity to cement plants for residue disposal and detergent plants for sales of sodium sulphate by-product. The plant is operated by a subsidiary of Galaxy called Galaxy Lithium (Jiangsu) Co Ltd, which is a wholly foreign-owned enterprise in China. Production will use a well-proven production process that is enhanced through process automation and careful selection of high grade reagents. The plant is designed to produce 17,000 tpa of lithium carbonate that is suitable for use in manufacturing battery cathode materials. All the necessary infrastructure is available in the Yangtze River International Chemical Industrial Park. Key utilities including water supply, sewage treatment, power supply, steam, telecommunications, industrial gas and fire-fighting facilities are available at the Company‟s site. The location of the site that has been selected for the Jiangsu plant also provides access to supply of sulphuric acid, soda ash and caustic soda from neighbouring producers. The Jiangsu plant will be wholly owned by Galaxy Resources.
Figure 18.3 Location of Galaxy’s lithium carbonate plant in China
Climate The Jiangsu area has a sub-tropical monsoon climate, with four clearly distinguished seasons. The climate is mild, with a long frostless period. Based on 20-year statistical data provided by the Zhangjiagang Weather Bureau, the average temperature is 15.2 ºC. The maximum recorded temperature is 38.1 ºC, and the minimum temperature is -11.3 ºC.
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The annual average rainfall is 1034.3 mm, mainly concentrated between April and September, making up 71.7% of the total annual rainfall. The annual average sunshine duration is 2080 hours. In winter, northeast and northwest winds prevail, while southeast wind prevails in spring and summer. The annual average wind velocity is 3.5 m/s. Strongest winds are from the southeast and ESE, and the maximum wind velocity is 20 m/s. There are 28.7 days of fog per year on average. The area is in a zone of strong thunderstorms, and there are an average of 30.8 thunderstorm days per year, normally between the 10th of March and the 22nd of September. Average relative humidity is 80%, with a maximum of 85% during July and August.
Landform and Physiognomy The landscape at Jiangsu lies within the Yangtze River Delta. The terrain is flat, with about +2.5 m ground elevation and 7.5 m (Huang Hai Altitude) embankment elevation along the Yangtze River. The ground surface comprises loose sediment, which overlies clayey and silty soil. The majority of soil was formed during long-term cultivation and farming. Seismic activity is minimal, with low earthquake magnitude and frequency.
18.6 Lithium carbonate deliveries to customers
Galaxy‟s finished product (Lithium Carbonate - Li2CO3) in 25 kg bags or 1 tonne bags on pallets, will be shipped from Zhangjiagang to two nominated warehouses in Tianjin (North China) and Changsha (South China) via barges, rail and truck. Customers in the Central and Western China regions will receive product via trucks directly from the warehouse at the plant at Zhangjiagang. Sinotrans, one of the largest logistics and warehousing services providers in China, has been appointed to manage the warehousing (Tianjin and Changsha) and distribution of the product. A contract has been signed with Sinotrans, fixing annual charges for transport and storage.
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19 Market studies and contracts 19.1 Background Lithium (chemical symbol Li) is the third element in the periodic table and is the lightest of the alkali metals. Due to its high reactivity, lithium never occurs as a pure element but rather in the form of stable minerals or salts. Lithium has a wide variety of end-use applications, including the manufacture of lithium-ion batteries, ceramics and glass, continuous casting, greases, rubbers, thermoplastics, pharmaceuticals, as well as in air conditioning, air treatment and aluminium smelting. Lithium production is predominantly derived from two primary sources: (1) lithium-bearing minerals, which are mainly extracted at hard rock mines in Australia, Brazil, Canada, the PRC, Portugal, Spain and Zimbabwe; and (2) lithium-bearing salt lakes in South America, the PRC and North America. Lithium-bearing minerals, which occur mainly in coarse-grained granitic rocks called pegmatites, include spodumene, petalite and lepidolite. Spodumene is the most important of these minerals in terms of production because spodumene deposits are often large, the lithium content is relatively high and spodumene-bearing ores are comparatively easy to process. However, petalite and lepidolite are also recovered in economic quantities at smaller mines. Once extracted, the lithium ore is concentrated through a combination of physical separation processes into lithium mineral concentrate. This concentrate is either consumed directly in end-uses such as the manufacture of glass, ceramic or continuous casting, or converted into various lithium compounds and chemicals for input into other end-uses. Roskill estimates that in 2011, approximately 50% of total global lithium production (161,000 tonnes lithium carbonate equivalent (“LCE”)) came from hard rock lithium minerals. Of this, approximately 55% was sold directly to end- users in the form of lithium mineral concentrates. Roskill estimates that the remaining 45% was converted into lithium compounds and chemicals, over 95% of which occurred at plants located in the PRC. High concentrations of lithium are also found in numerous dry playa lakes, or salars, in South America, the PRC and North America, where mineral-rich brines are located just under a layer of crusted salt deposits. Most deposits are located at high altitudes in major mountain chains. The process of extracting lithium from brines typically involves pumping the brines into a series of evaporation ponds to crystallize other salts, leaving a lithium-rich liquor. This liquor is further processed to remove impurities before it is used to produce various lithium compounds and chemicals. Roskill estimates that in 2011, approximately 50% of total global lithium production came from brines, of which 95% was from the top three producers and 90% was produced in South America. Unlike hard rock lithium production, all lithium production from brines is converted into lithium compounds and chemicals before sale.
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Figure 19.1 Sources and end-users of lithium
Lithium Rich Mineral Lithium Rich Brine (Spodumene) (Salar) 50% 50% Lithium Mineral Concentrate Lithium Brine Concentrate 55% 45% 100% Chemical Lithium Compounds Chemical Direct Sales Conversion Plants and Chemicals Extraction Plants
Technical Market Chemical Market
• Glass • Fibreglass • Batteries • Lubricants • Ceramics • Glass-Ceramics • Pharmaceuticals • Refrigeration Continuous Casting Other Aluminium Other • • • • Note: Percentages show Roskill’s estimates of total lithium supply in 2011 Source: Roskill
19.2 Overview of lithium demand Roskill estimates that total demand of lithium in 2011 was approximately 142,000 t 21,280 tonnes LCE, representing growth in demand of approximately 7.2% p.a. since 2000. According to Roskill, in 2009 demand for lithium fell by 13% to approximately 103,000 tonnes LCE due to the effects of the global financial crisis, but recovered strongly in 2010 and 2011. Roskill estimates that the largest uses of lithium are in the manufacture of ceramics and glass, which accounted for 30% of total demand in 2011, and the manufacture of lithium-ion batteries, which accounted for 28%. Other significant end-uses include the manufacture of greases, and in aluminum smelting, air treatment and continuous casting.
Figure 19.2 Estimated consumption of lithium by end use, 2011
Ceramics and glass Pharmaceuticals Other 30% 2% 17% Rubber and thermoplastics 3% Continuous casting Batteries 4% 28% Air treatment 4% Aluminium Greases 1% 11%
Between 2000 and 2011, demand for lithium in the manufacture of lithium-ion batteries experienced the highest rate of growth of all end uses at approximately 25% p.a., and it was the only sector where consumption of lithium grew in 2009.
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Roskill estimates that the most common lithium compound or chemical is lithium carbonate, which accounted for 55% of total lithium demand in 2011 (equating to approximately 77,000 tonnes of lithium carbonate). The compound annual growth rate of demand for lithium carbonate was 8% p.a. between 2000 and 2011. Of the other forms of lithium, demand for lithium mineral concentrates comprised 25% of total demand, lithium hydroxide 15% and lithium bromide 5%, with the remaining 20% comprising of butyllithium, lithium metal, lithium chloride and specialty lithium chemicals.
19.3 Lithium demand outlook Roskill‟s view is that the medium-term outlook for lithium demand appears optimistic. As of early 2012, Roskill estimates that demand for lithium could increase by a compound annual growth rate of 6.3% per annum from estimated 2011 consumption levels to approximately 192,000 tonnes LCE by 2016. According to Roskill, growth in demand for lithium will be driven by the lithium-ion battery sector, with demand for lithium in lithium-ion batteries forecast to increase from approximately 40,500 tonnes LCE in 2011 to approximately 67,000 tonnes LCE by 2016, representing a compound annual growth rate of 10.6%. Much of this growth is expected to be driven by demand for lithium in rechargeable batteries for consumer electronics, transport applications and grid storage. This is motivated by the recent commencement by major automotive manufacturers of the mass production of hybrid, plug-in and full electric vehicles using lithium-ion batteries and the continued growth in demand for consumer electronic devices such as tablets and smart phones. The replacement of lead-acid, nickel-metal hydride and nickel-cadmium batteries in other applications, such as power tools and e-bikes, is also contributing to current and future growth in demand for lithium.
19.4 Overview of lithium supply Roskill estimates that total world production of lithium was approximately 161,000 tonnes LCE in 2011, having grown at approximately 8.3% p.a. between 2000 and 2011. Of this production, 50% (or 81,000 tonnes LCE) is estimated to have come from lithium minerals mined from hard rock sources, whilst 50% (or 80,000 tonnes LCE) came from brine production. Roskill estimates that lithium production fell to approximately 98,000 tonnes LCE in 2009 due to the effects of the global financial crisis, but has since rebounded strongly.
19.5 Lithium mineral concentrate production Of the supply of lithium from hard rock lithium minerals in 2011, 70% was in the form of spodumene concentrate produced at one mine, Greenbushes in Western Australia which is owned by Talison Minerals. Mines in the PRC accounted for a further 11% of production, with small amounts also produced at mines in Portugal, Brazil and Zimbabwe.
19.5.1 Conversion of lithium minerals to lithium compounds Roskill estimates that in 2011, approximately 45% of the global production of lithium from hard rock lithium minerals was converted into lithium compounds and chemicals, with the remaining 55% sold directly to end users in the glass and ceramics market as lithium mineral concentrate. According to Roskill, more than 95% of the lithium compounds and chemicals converted from hard rock lithium minerals occurred at nine producers variously located in Xinjiang, Sichuan, Jiangxi and Jiangsu provinces in the PRC.
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Figure 19.3 Location of hard rock lithium minerals producers
Bernic Lake (TANCO)
Jiajika (Sichuan Province Mining) Mesquitela & Guarda Maerkang(Sichuan Guorang) (Soc. Min. De Pegmatites)
Cachoeira (CBL)
Bikita & Al Hayat (Bikita) Greenbushes (Talison)
Mt Cattlin (Galaxy)
19.5.2 Brine production Production of lithium from brines was estimated by Roskill at 80,000 tonnes LCE in 2011. According to Roskill, the brine industry is highly concentrated, with the top three producers accounting for approximately 95% of total brine-based lithium supply in 2011. These producers are: Sociedad Química y Minera de Chile S.A., based at the Salar de Atacama in Chile, who produced approximately 40,700 tonnes of lithium compounds in 2011; Rockwood Lithium, through its subsidiaries Sociedad Chilena de Litio Ltda., based at the Salar de Atacama in Chile, and Chemetall Foote Corp., based at Silver Peake in the United States. Rockwood Lithium‟s production of lithium compounds from these operations is estimated by Roskill to have been approximately 25,000 tonnes LCE in 2011; and FMC Corporation, through its subsidiary Minera del Altiplano S.A., based at the Salar de Hombre Meurto in Argentina. FMC Corporation‟s production of lithium compounds in 2011 is estimated by Roskill to have been approximately 15,000 tonnes LCE. The remaining brine-based lithium supply was from three producers located at salt lakes in remote parts of the Tibet and Qinghai provinces in the PRC. Lithium compound production from brines is relatively new in the PRC. According to Roskill, production from these producers was estimated at 5,000 tonnes LCE in 2011, which is significantly lower than their estimated capacity of 17,000 tonnes p.a. LCE.
19.6 Supply outlook According to Roskill, increasing demand for lithium chemicals and compounds is expected to be met by a combination of existing capacity at hard rock lithium mineral converters in the PRC, new hard rock lithium mineral conversion projects in Australia, Canada and China, expansion projects at existing brine producers and new brine projects in South America.
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19.6.1 New hard rock lithium mineral conversion projects In addition to Galaxy‟s Mt. Cattlin Project, there are several companies evaluating hard rock lithium mineral projects with the potential for downstream lithium compound production. These projects include the Quebec Lithium project in Canada (Canada Lithium), the Whabouchi project in Canada (Nemaska Lithium), the Kings Mountain project in the United States (Western Lithium) and the Mt. Marion project in Australia (Reed Resources and Mineral Resources).
19.6.2 New brine projects There are several new lithium brine projects currently under evaluation, the most advanced of which include the Salar del Rincón Project in Argentina (Sentient Group), the Salar de Olaroz Project in Argentina (Orocobre), the Sal de Vida Project in Argentina (Lithium One) and the Cauchari-Olaroz Project in Argentina (Lithium Americas)..
Figure 19.4 Location of brine producers
Dongtai& Xitai (Qinghai Guoan / Silver Peak (Rockwood Lithium) Qinghai Sal lake) Zabuye (Tibet Zabuye)
Salarde Atacama (SQM) Salar de Hombre Meurto (FMC) La Negra (Chemetall)
19.7 Lithium carbonate pricing There is no exchange traded market for lithium carbonate. However, prices can be estimated by considering the global average values of exports and imports of lithium carbonate. According to Roskill, in 2011, 52% of total lithium carbonate demand was from the production of lithium-ion batteries. Consequently, the global average values of lithium carbonate exports and imports shown above are likely to include large quantities of “industrial grade” or “technical grade” lithium carbonate. It is possible to estimate the pricing of lithium carbonate used in the manufacture lithium-ion batteries by considering the average value of lithium carbonate imports into Japan and South Korea, as both countries import lithium carbonate primarily for lithium-ion battery manufacture.
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Figure 19.5 Global average values of exports and imports of lithium carbonate, 2000 – 2011 (US$/t)
8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Exports Imports
Source: Global Trade Information Services, Inc.
As shown below, the average values of lithium carbonate imports into Japan and South Korea were approximately US$5,350 / tonne and US$4,470 / tonne in 2011, which is 19.8% and 3.6% higher respectively than the global average value of lithium carbonate imports.
Figure 19.6 Global average values of exports and imports, plus average values of imports into Japan and South Korea 2000-2011 (US$/t)
8,000
7,000
6,000
5,000
4,000
3,000
2,000
1,000
0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Exports Imports Japan Imports South Korea Imports
Source: Global Trade Information Services, Inc.
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19.8 Offtake contracts To support its production, Galaxy has entered into offtake agreements covering all of its expected production of lithium carbonate with Mitsubishi Corporation for 5,000 tpa and 13 major cathode producers in the PRC for an aggregate of 12,000 tpa. These offtake framework agreements are legally binding between the parties to each of the agreements where the obligations to buy and sell are subject to the parties further agreeing the price of the product to be soldach quarter. None of these agreements include any take or pay obligations. The offtake agreements require Galaxy to produce lithium carbonate with a minimum purity level of 99.5% and impurities below a certain specification. Under the terms of the offtake agreements with the 13 PRC customers, each customer is granted priority customer status and the Galaxy guarantees to supply minimum agreed annual quantities to these priority customers for five years. However, if these customers do not purchase the minimum agreed annual quantities for any contract year, Galaxy can terminate that customer‟s status as a priority customer. Under the terms of the offtake agreement with Mitsubishi Corporation, Mitsubishi Corporation will make reasonable efforts to purchase 5,000 tpa of lithium carbonate production over a five year term. This agreement also appoints Mitsubishi Corporation as exclusive distributor of our product in Japan for a period of five years from date of first shipment.
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20 Environmental studies, permitting and social impact Galaxy submitted a Licence to Operate to the Department of Environment and Conservation (“DEC”) on 4 August 2010, and received approval on 14 October 2010. Galaxy also drew up a compliance report for their Mt. Cattlin site which was submitted to the DEC as part of the Operating Licence Application. The report addresses two aspects identified by the DEC with respect to the Tailings Storage Facility (TSF). The compliance report includes: an Operations Management Plan for the Tailings Storage Facility (“TSF”) a certification of the integrity of the final (compacted clay) liner of the TSF.
A draft of the Operations Management Plan for the TSF has been sighted by Snowden. Other obligations relating to environmental management involves the monitoring of groundwater and the health of vegetation, clearing in accordance with Clearing Permits, and reports related to the National Pollutant Inventory (NPI) and the National Greenhouse and Energy Reporting System (“NGERS”). Galaxy submitted their Annual Environmental Report (“AER”) to the DMP in September 2010. Snowden has sighted documentation related to the above and is satisfied that Galaxy is meeting its obligations. In terms of the environmental status at the Jiangsu construction site, the environmental approval process in China commenced with an Environmental Registration which was submitted on 10 August 2009 and was approved on 17 August 2009. This then allowed the project to continue with the preparation and submission of the Environmental Impact Assessment (EIA) Report. The final EIA report was submitted to the Jiangsu Province Environmental Protection Bureau for approval on 25 September 2009 and approval was obtained on 17 November 2009. Upon completion of construction, an Environmental Pre-Acceptance clearance will have to be obtained. This can only be applied for after 6 months of operation.
20.1 Mt. Cattlin During the design and construction of the Mt. Cattlin mine and processing facilities, Galaxy has taken account of the environmental issues and requirements of the Department of Minerals and Petroleum (DMP) in Western Australia as part of the Feasibility Study. The Mining Proposal and associated Project Management Plan provide a framework for managing the environmental impacts of mining activities to within nominated acceptable limits. The Mining Proposal provides for acceptable levels of environmental impact for the project and the associated control measures that have been developed to mitigate the impacts to achieve the following objectives: Good stewardship of natural resources, consistent with safe and efficient mining practice Minimal disturbance of land Conservation of flora and fauna habitats Protection of sites of cultural and spiritual significance
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Confirmation of the success of impact control measures by means of monitoring and audits Compliance with all statutory requirements Rehabilitation to a stable land form and an acceptable post-disturbance land use and land capability Preservation of downstream water quality. Achievement of these objectives, together with continuation of the consultative process with stakeholders and the expected economic return to the community, will ensure consistency with the objectives for the Mining Industry in Australia‟s National Strategy for Ecologically Sustainable Development. The environmental impacts arising from the development and operation of the Mt. Cattlin mine are mostly associated with land disturbance and waste disposal. The strategies for minimising and managing the projects are described in the Mining Proposal and supporting documentation. The management of each environmental issue is broadly outlined in the following sections.
20.1.1 Land disturbance Land disturbance is the largest impact for the project. The total area of disturbance for all project components is estimated at 158 Ha, and will not exceed 94 Ha in the first 5 years of operation. The impact of disturbance will be limited to the loss of land capability and use of the areas occupied by the open pit void, waste rock dump, ore stockpiles, tailings dam and process plant. This will have a significant impact on that area of the project currently used for dry land agriculture and grazing. A surface material stripping plan will be developed for the major areas of disturbance which will require site supervision to provide operational control. Any material classified as suitable for growth media or subsoil (cover materials) use will be stripped and stockpiled in selected areas. These „topsoil‟ stockpiles will be located away from watercourses. At the cessation of mining, the mine infrastructure will be removed and the TSF, waste dump, mine access tracks and other disturbed areas will be rehabilitated to achieve pre-mining land uses and land capability. The open pit void will be the only loss of land use.
20.1.2 Waste rock Galaxy‟s mine plan endeavours to maximise the amount of waste returned to the open pit void. This will not be possible in the early years of mining, so the waste rock stockpile will be constructed as a series of terraces to conform to the local topography and will store up to 8 Mt of waste rock from the open pit. The construction sequence will involve the initial placement of waste rock at the base elevation of the stockpile, then in lifts and benches. The stockpile surfaces, including outer sloping faces will be constructed of near surface weathered material. The stockpile will be constructed with a setback of 5 m between benches and a bench at each 10 m interval of height. The outer faces of the stockpile will be constructed at an angle of 18 degrees to form an erosion resistant surface. Benches will be constructed with a 5% back slope to retain any stockpile runoff to assist revegetation of the benches. Potential surface runoff will be contained within the stockpile. Rehabilitation of the waste dump stockpile will include topsoil replacement, contour ripping and revegetation of the stockpile surfaces done progressively after the final slopes are contoured.
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20.1.3 Tailings storage facility During the compilation of their feasibility studies, Galaxy requested Australian Tailings Consultants (“ATC”) to conduct a Feasibility Study for the tailings storage facility (“TSF”) in February 2009. The original design had the TSF comprising an above ground storage facility, formed by a primary embankment on three sides and a natural hillside slope providing the fourth side. The total design storage capacity, based on a maximum crest level of 269mRL, is 2 Million m3 and covers a surface area of approximately 17 Ha. Maximum embankment heights will be 13 m for the starter embankment and 18 m for the final crest height. Some of the key features of the TSF are: TSF is to be constructed in three stages. The starter embankment, Stage 1, will provide approximately 7 years of storage life and will be constructed to a level of 264mRL. The final embankment will require a further 5 m lift and provide an additional 8 years of storage life. This lift will be achieved by two separate 2.5 m lifts (stages 2 and 3) each providing approximately 4 years additional storage. Tailings in the form of slurry are discharged sub-aerially around the storage. Tailings is deposited in discrete layers from multi point discharges. The discharge points are moved regularly to ensure there is an even development of the tailings beach. The length of time between successive depositions (i.e. drying time) on any one area will be maximised. Tailings discharge or spigotting is to be carried out such that the water pond is maintained around the decant tower, once sufficient tailings have been deposited. The pond is to be kept away from the containment embankments at all times. One decant structure has been incorporated into the design to remove surface water from the TSF which will be pumped from the decant for re-use in the plant. A rehabilitation strategy has been developed that allows for geotechnical stabilisation of the tailings surface followed by re-vegetation.
Since the compilation of the original design several changes have taken place to the mine plan, process design and site layout. Knight Piesold (KP) was engaged to revise the design and provide an addendum to the design (Mt. Cattlin Project – Tailings Storage Facility Permitting Design Addendum, January 2010). The revised tailings storage facility remains in the same location. Snowden has summarised key changes to the design as follows: General arrangement changed from one large cell to two smaller cells to reduce active ponds and simplify operating requirements Embankments constructed using modified centreline construction by the mining fleet. If tailings strengths are found to be sufficient during future operation upstream construction may be adopted Cell 1 operated for seven years prior to constructing Cell 2 to reduce catchment area Underdrainage system modified so that no pipes perforate the embankment Decant tower moved to central location to improve supernatant water management Embankment stages modified to defer construction quantities Process modified to use only flocculants and saline water producing benign tailings Increase in target permeability of soil liner from 1 x 10-9 m/s to 1 x 10-8 m/s (due to change in tailings characteristics).
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As part of licensing requirements, it is expected that independent geotechnical and hydrological specialists will carry out annual audits of the tailings storage facility. The TSF will be operated in accordance with a TSF Management Plan developed prior to the commencement of operations. As is normal with rehabilitation of TSF‟s, it is expected a period of about two years is required after final tailings disposal, for the tailings to dry out and enable heavy earthmoving equipment to access the tailings surface, especially around the decant.
Figure 20.1 TSF North East Corner – February 2011
Figure 20.2 TSF North West Corner – February 2011
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20.1.4 Low grade ore stockpiles Temporary low grade stockpiles may be constructed at a location adjacent to the treatment plant. Stockpiled low grade may be treated in the plant prior to the plant closure. In the event that there is any material remaining at the end of operations, this will be rehabilitated in situ in a similar manner to the waste rock stockpile.
20.1.5 Land contamination Land contamination may potentially arise from trace metal enrichment, salinity (brackish groundwater), spillage of process reagents and petroleum hydrocarbons, disposal of waste materials, or acid mine drainage from sulphides in waste stockpile. The primary objectives will be to avoid or manage the contamination of land by a strategy used during the project operation.
20.1.6 Water resources The project area lies in a catchment area with the drainage direction predominantly to the south and east into Cattlin Creek, which passes through the site in a northwest/southeast direction. The creek does not flow permanently, however there is permanent standing saline water in areas where it intersects the water table. There are no current uses of this water due to its high salinity level. The water supply for the project will be drawn from limited dewatering of the pit, external bore water sources and return water from the TSF. Water will be pumped from the external sources via a pipeline to the process plant. Impacts on water resources could potentially occur due to degradation by deleterious substances contained in mine run-off and seepage. The objective will be to maintain the current albeit saline water quality downstream of the project area. A control strategy is in place for the protection of surface and groundwater resources.
20.1.7 Noise The project is located two kilometres north of the Ravensthorpe township and control of noise to within guidelines is not considered to be an issue. It is anticipated that the activities most likely to generate noise, namely mining and ore crushing will, as much as is possible be restricted to dayshift operation only.
20.1.8 Air quality Gaseous emissions will be limited to those from vehicle and equipment exhaust emissions. Dust suppression methods will be employed such as watering of mine haul roads and other areas as appropriate and progressive rehabilitation of disturbed areas where possible.
20.1.9 Environmental management Galaxy‟s Mining Proposal and associated Project Management Plan provide a framework for managing the environmental impacts of the mining activities to within nominated acceptable limits.
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20.1.10 Native title Galaxy has completed negotiations with the South West Aboriginal Land and Sea Corporation representing the Wagyl Kaip and Southern Noongar People with respect to a Native Title Mining Agreement covering the tenements surrounding the project. It should be noted that the areas required for project development and operation are covered by granted tenements over which native title has been extinguished. The mining agreement involves a range of provisions, including compensation during the life of the project and a commitment by the Company to employment and training initiatives for traditional owners.
20.1.11 Aboriginal heritage In order to fulfil its obligations under the Western Australian Aboriginal Heritage Act (1972), Galaxy commissioned Deep Woods Surveys of Albany to undertake an aboriginal heritage survey in conjunction with members of the Wagyl Kaip WC98_070 and Southern Noongar WC 96_109 native title claim groups. As a result of a search of the DIA Aboriginal Heritage Sites Register prior to the site survey it was determined that there were no previously recorded heritage sites within the project area. During the field survey and consultations with the claimant representatives, no new ethnographic sites, as defined by Section 5 of the Western Australian Aboriginal Heritage Act (1972), were identified within the project mining leases. In contrast to this, the archaeological survey identified sites within the mining impact area requiring management. In June 2011, Galaxy was granted consent by the Department of Indigenous Affairs under a Section 18 application to access the affected site for the purpose of mining. Galaxy signed a Claim Wide Mining Agreement with the Native Title Claimants in April 2010, which covers all Galaxy tenements in the Ravensthorpe area. In June 2011, Galaxy was granted consent by the Department of Indigenous Affairs under a Section 18 application to access the affected site for the purpose of mining. Galaxy signed a Claim Wide Mining Agreement with the Native Title Claimants in April 2010, which covers all Galaxy tenements in the Ravensthorpe area.
20.1.12 Current environmental matters Galaxy holds Works Approval W4533/2009/1 for the Ravensthorpe Spodumene Project. The requirements for compliance reporting were recently revised following consultation between Galaxy and the Department of Environment and Conservation (“DEC”). An application for a Licence to Operate was submitted to the DEC on 4 August 2010 and granted on 14 October 2010. Galaxy submitted a compliance report, drawn up for the Mt. Cattlin site, together with the application for a Licence to Operate mentioned above. The report addresses two aspects identified by the DEC with respect to the TSF: an Operations Management Plan for the TSF a certification of the integrity of the final (compacted clay) liner of the TSF.
A draft of the Operations Management Plan for the TSF has been sighted by Snowden. Galaxy submitted an Annual Environmental Report (“AER”) to the Department of Mines and Petroleum (“DMP”) on 29 October 2010.
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An earlier set of requirements indicated the need for an air quality impact assessment and additional reporting covering matters associated with radiation. These requirements have been removed. Snowden has sighted the amended licence, which no longer contains these conditions. Other obligations relating to environmental management are listed below, to emphasise the importance of compliance with environmental commitments, especially during the period of transition from construction to operations: Galaxy is continuously monitoring groundwater. Galaxy has been monitored the health of vegetation by photographic and other means since July 2010. Galaxy prepared a report on clearing in August 2010, to demonstrate compliance with Clearing Permits. Galaxy prepared reports related to the National Pollutant Inventory (NPI) and the National Greenhouse and Energy Reporting System (NGERS) in August 2010. Snowden has sighted documentation related to the above and is satisfied that Galaxy is meeting its obligations. Snowden has reviewed the monthly construction reports and weekly reports up to September 2010 and the operations monthly reports up to May 2011. These indicate that there were no specific environmental management issues.
20.2 Lithium carbonate processing plant
20.2.1 Statutory approvals and regulations Galaxy has informed Snowden that the approvals process would not delay work on the project since Galaxy was granted permission from the Zhangjiagang authorities to commence bulk earthworks, road works, plant foundation piling, site utilities, concrete padding and some steel work construction of buildings while applications were still being processed. Galaxy has successfully completed the registration procedures within the Zhangjiagang Free Trade Zone (Yangtze River International Chemical Industrial Park) to establish a Wholly Foreign Owned Enterprise. Galaxy has also successfully negotiated agreements for: Land Use Rights over approximately 53,300 m2 of land within the Free Trade Zone Connection of electricity and natural gas supplies free of charge to the site boundary Steam and sulphuric acid supplies from Two Lions Fine Chemicals Company from a wharf located approximately 400 m from site. The statutory approvals and regulations which need to be addressed by Galaxy Lithium (Jiangsu) Co Ltd, assisted by their EPCM contractors, Hatch during the various phases of the project are summarised in the sections to follow.
Business establishment
Business License Environmental Impact Assessment Report and Approval Safety Appraisal Energy Appraisal Health (Hygiene) Appraisal Project Application Approval
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At this stage the business license has been approved and all the above documents and processes are in various stages of progress (some have been approved). The environmental approval process in China commenced with an Environmental Registration which was submitted on 10 August 2009 and was approved on 17 August 2009. This then allowed the project to continue with the preparation and submission of the Environmental Impact Assessment (EIA) Report, to be conducted (responsible for preparation, submission and gaining approval) by the Nanjing Environmental Science and Research Institute. During this process, Hatch has assisted in providing technical inputs and reviewing the EIA report prior to its submission to the Environmental Protection Bureau. The final EIA report was submitted to the Jiangsu Province Environmental Protection Bureau for approval on 25 September 2009 and approval was obtained on 17 November 2009.
Construction permitting
Construction Permit Preliminary Design Approval Concept Design Approval Third-party Design Check Certificate Drawing Approval from Construction Bureau Drawing Approval from Fire Bureau Project Planning Permit Tendering Registration Quality Station Registration
In parallel with the above list, land issues also needed to be addressed during this stage. These included Land Planning Permit, Land Leasing Contract and Land Use Rights Certificate. All these were in progress and needed to be completed before applying for the Project Planning Permit.
Final acceptance After construction was completed, the following acceptances were required before the plant was put into operation. They were applied for during the construction phase: Safety/Health Acceptance Environmental Pre-Acceptance (final Acceptance is applied for after 6 months of operation) Planning Bureau Acceptance Fire Bureau Acceptance Quality Station Acceptance Archive Office Acceptance Building Ownership Certificate
Snowden was of the opinion that the necessary processes were in place to ensure that all the above approvals were obtained in a timely fashion.
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21 Capital and operating cost 21.1 Mt. Cattlin 21.1.1 Process plant capital costs The Capital Budget for the Process Plant was developed by Galaxy Resources and the EPCM Engineer, DMBJV in late 2009. The approved budget for the Process Plant was A$60,909,530, including contingency. At the end of construction, the final cost for the process plant was A$64,534,352, effectively taking the project 6% over budget after contingency. The total capital expenditure for the Mt. Cattlin Mine was A$79 million. 21.1.2 Operating costs Galaxy has provided Snowden with detailed estimated operating costs for Mt. Cattlin for 2012 onwards. Snowden would expect operating costs at Mt. Cattlin to be in the range of A$ 42-44 per tonne treated, comprising: Mining A$19-20/ tonne treated Processing A$14-15/ tonne treated Transport A$5 /tonne treated Site administration and other A$4/ tonne treated Snowden considers the operating costs reasonable for this style of plant. 21.2 Jiangsu 21.2.1 Process plant capital costs The Capital Budget for the Jiangsu Plant was revised by Galaxy and the EPCM engineering company, Hatch. The original proposed budget for the Jiangsu Plant as of 1 December 2010 is Chinese Yuan (CNY) 477 million (US$74 million), including contingency of CNY 15.8 million (US$2.45 million). The revised budget for the plant was Chinese Yuan (CNY) 689 million. The plant construction achieved completion by early December 2011, one month ahead of schedule. The cost for the construction of the project is 690.27 million or US$107.22 million (A$99.8 million), on budget. 21.2.2 Operating costs Galaxy has provided Snowden with detailed estimated operating costs for the Jiangsu Plant for 2012 onwards. Total operating costs at the Jiangsu Plant are considered by Snowden to include processing (including reagents), laboratory, utilities, environmental, safety, maintenance, and transport costs, but excluding the internal transfer price of spodumene concentrate and the shipping cost of transporting spodumene concentrate from Esperance to the port of Zhangjiagang. For 2012, while the Jiangsu Plant is in ramp-up stage, total operating costs at the Jiangsu Plant will amount to a total of approximately RMB 17,900 (US$ 2,800) per tonne of lithium carbonate. This will reduce to approximately RMB 14,400 (US$ 2,200) per tonne of lithium carbonate once the Jiangsu Plant reaches steady state. Snowden considers the operating costs reasonable for this style of plant, completing ramp up to design throughput.
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22 Adjacent properties Mt. Cattlin is the only known major lithium/tantalum deposit in the Ravensthorpe region. Occurrences of copper and gold mineralisation are known from within the Mt. Cattlin mining lease and on adjacent properties and have been the subject of historic, small-scale mining. The most important of these are the Mt. Cattlin gold-copper mine (around 1 km ESE of Galaxy‟s lithium deposit), Marion Martin (1.5 km south), Floater (1.5 km north) and Maori Queen (3.5 km NE) (Witt, 1998). Various open file Department of Mines and Petroleum sources quote remaining small, non-compliant copper-gold resources for these properties. They are currently not the subject of any active exploration or mining.
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23 Economic analysis 23.1 General The economic analysis presented in this section is based on a detailed cash flow model developed by Galaxy utilising the depleted LoM schedule set out in Table 23.1. The economic analysis is based on the following assumptions.
23.1.1 Prices Galaxy will produce various lithium carbonate products which it intends to both export and sell domestically within China. In all cases, Galaxy adopts a 2011 price, which increases at an assumed growth rate (see Table 23.1).
Table 23.1 Price assumptions
Lithium carbonate product Unit 2012 price Assumed growth rate Export technical grade (inc. VAT) USD/t 6,000 2% per annum over inflation Domestic technical grade (ex. VAT) RMB/t 39,600 2% per annum over inflation Export battery grade (inc. VAT) USD/t 6,500 2% per annum over inflation Domestic battery grade (ex. VAT) RMB/t 42,900 2% per annum over inflation Export EV grade (inc. VAT) USD/t 8,500 2% per annum over inflation Domestic EV grade (ex. VAT) RMB/t 56,100 2% per annum over inflation
Source: Galaxy Resources The 2012 price reflects Galaxy‟s expectation of the pricing its products could achieve in the market and the growth rate reflects Galaxy‟s outlook on demand for lithium carbonate.
23.1.2 Exchange rates Galaxy has utilized forecast exchange rates as set out in Table 23.2.
23.1.3 Physical assumptions Presented in Table 23.3 are the physical assumptions for the Mt. Cattlin Project and the Jiangsu Plant. The mining and processing assumptions are based on the schedule constructed by Croeser. Physical assumptions for the Jiangsu Plant are based on plant design rates, namely the processing of 137,000 tonnes per annum of spodumene concentrate to produce approximately 17,000 tonnes per annum lithium carbonate.
23.1.4 Financial outputs Forecast cash flows for the Mt. Cattlin Project and Jiangsu Plant on a real basis are set out in Table 23.4. Based on a post-tax real discount rate of 8%, the combined Mt. Cattlin Project /Jiangsu Plant operation has a net present value (“NPV”) of AUD 438 million. Sensitivity analysis has been carried out on key parameters of the cash flow model. Lithium carbonate price, lithium oxide grade, capital costs and operating costs were varied by ±5%, ±10%, ±15%, with the impact on NPV presented in Figure 23.1. The analysis indicates that NPV is most sensitive to changes in price, opex and grade. The NPV isn‟t sensitive to capex, because all capex (excluding sustaining capex) has been spent as at 31 December 2011.
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Figure 23.1 NPV sensitivity
600
550
500
450 tax real (AUDm) - 400
350 NPV atNPV 8%post 300
250 -15% -10% -5% 0% 5% 10% 15% Change from base case
Price Grade Capex Opex
Total capital expenditure for the Mt. Cattlin Mine was A$79 million and total capital expenditure for the Jiangsu Plant was A$100m. This capital expenditure, which has already been incurred by Galaxy, is expected to be paid back over approximately the next 5 years.
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Table 23.2 Exchange rate assumptions
Item 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025/6 AUD:USD 1.008 0.981 0.957 0.928 0.899 0.874 0.852 0.836 0.819 0.807 0.791 0.780 0.768 0.751 RMB:AUD 6.404 6.280 6.181 6.037 5.832 5.688 5.543 5.395 5.313 5.249 5.168 5.103 5.037 4.937 RMB:USD 6.351 6.400 6.459 6.509 6.489 6.509 6.508 6.453 6.485 6.509 6.530 6.542 6.555 6.574 Source: Bloomberg.
Table 23.3 Physical outputs
Item Unit 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025/6 Total1 Mt. Cattlin Ore mined kt 1,369 1,597 1,701 1,949 460 858 1,288 1,692 997 - - - - - 11,912 Ore processed kt 923 1,020 1,020 1,020 1,020 1,003 1,000 1,000 1,003 1,000 1,000 904 - - 11,912
Grade processed % Li2O 1.23 1.22 1.18 1.26 1.11 1.27 1.29 1.12 1.00 0.59 0.57 0.57 - - 1.04 Spod. conc. produced kt 149 163 158 169 149 168 170 147 131 77 75 68 - - 1,623 Spod. conc. shipped kt 100 75 150 125 125 150 125 150 125 150 125 150 83 - 1,623 Jiangsu Spod. conc. received kt 100 75 150 125 125 150 125 150 125 150 125 150 83 - 1,623 Spod. conc. processed kt 72 137 137 137 137 137 137 137 137 137 137 137 110 - 1,689 LC produced kt 7.3 17.3 17.3 17.3 17.3 17.3 17.3 17.3 17.3 17.3 17.3 17.3 13.9 - 211.8 LC sales Tech. grade export kt 0.2 ------0.2 Tech. grade China kt 3.0 ------3.0 Battery grade export kt 0.4 4.0 4.0 4.0 4.0 4.0 4.0 4.0 4.0 4.0 4.0 4.0 0.2 - 48.6 Battery grade China kt 2.8 10.0 10.0 10.0 10.0 10.0 10.0 10.0 10.0 10.0 10.0 10.0 0.5 - 123.3 EV grade export kt 0.1 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 0.0 - 12.1 EV grade China kt 0.5 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0 0.1 - 24.6 Notes: 1: Totals may not sum due to rounding.
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Table 23.4 Forecast cash flows
Item Unit 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025/6 Total1 Revenue – lithium AUDm 46 124 129 135 142 149 156 163 169 174 181 187 193 10 1,955 Revenue – other AUDm 12 16 15 16 17 18 18 17 18 18 18 17 5 - 206 Opex AUDm (68) (85) (90) (92) (93) (96) (97) (108) (98) (73) (72) (74) (44) (6) (1,097) Working capital adj. AUDm 1 (5) 0 (0) (0) (0) (0) 1 (1) (2) (0) (0) (2) 13 2 Capex paid AUDm - (1) (1) (3) (3) (3) (3) (3) (3) (3) (3) (3) (3) (2) (31) Tax paid AUDm - (9) (11) (14) (16) (15) (18) (18) (21) (20) (24) (23) (32) (1) (223) Total net cash flow1 AUDm (10) 39 42 42 47 52 56 52 64 93 99 104 118 13 812 Notes: 1: Totals may not sum due to rounding.
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23.2 Taxes and royalties
23.2.1 Corporate tax Galaxy will be required to pay corporate tax in both Australia and China. In Australia, the corporate tax rate is 30%. Galaxy‟s taxation in Australia will also be subject to a transfer pricing arrangement for all internal transfers of spodumene concentrate from Australia to China. Galaxy is currently negotiating the transfer price with the Australian Tax Office and Chinese Tax authorities. In China, the corporate tax rate is 25%.
23.2.2 Mineral royalty Under the Mining Act 1978 (WA), royalties are payable on all mineral in Western Australia. Galaxy is required to pay a royalty of 5% of gross invoice value of all spodumene concentrate sold (less any allowable deductions) to the state government of Western Australia.
23.2.3 Value added tax Galaxy is required to pay value added tax (VAT) of 17% of revenue on all export sales from China.
23.2.4 Withholding tax Galaxy is required to pay withholding tax of 5% on all dividends paid from China.
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24 Interpretation and conclusions 24.1 Potential risks Snowden has summarised key areas of risk which could impact on the viability of the mine and processing facilities (see Table 24.1).
Table 24.1 Galaxy technical risks
Risk Comment Mineral Resources have been defined by a CP, according to the requirements of the JORC Code and classified into Measured (17%), Indicated (61%) and Inferred (22%) Mineral Resource & Reserve Resources. The classification is appropriate for the information levels and type of mineralisation. Low-Medium risk Ore Reserves have been defined by a CP, according to the requirements of the JORC Code from Mineral Resources and technical assumptions were based on information obtained through a Scoping /Feasibility study.
Mining The mine is based on low risk conventional open-pit mining and the relatively flat lying ore body allows mining to proceed at a reasonably constant strip ratio once the ore is
uncovered. Mining will be carried out using excavator and truck combination, delivering to a Low risk conventional crushing and HMS gravity recovery circuit.
Processing (Mt. Cattlin) The proposed methods for concentrate production at Mt. Cattlin are conventional and are therefore of relatively low risk. There is flexibility in the design to ensure design throughput Low risk and grade is achieved. Quality - achieving a quality level of 99.5% to meet customer specifications contained in off- Chemical plant (Jiangsu) take agreements is a relatively low risk, however producing a high quality product of 99.9% and above is a moderate risk. It will also take some time to produce this higher quality (6-9
months from commissioning), during which time lower grade product with purity levels below Medium risk 99.5% may be produced. This lower grade material is saleable, but at a lower price than higher grade material.
Equipment for Chemical Quality – the quality of the equipment to be installed in the chemical plant at Jiangsu will be plant (Jiangsu) of high importance to ensure throughput and final product quality. The process plant has been designed to achieve product quality grade if quality equipment is installed. Regular
quality control procedures and inspection of the manufacturing standards of equipment to be Medium -Low risk installed in chemical plant is very important to reduce the risk to the final product quality.
Infrastructure Mt. Cattlin - Infrastructure, roads and port facilities are available and have been secured by Galaxy for transport of their spodumene concentrate from the mine to the port at Esperance.
Shipping agents have been appointed to facilitate and coordinating the shipping activities Low risk with Mt. Cattlin, vessel owners and Esperance Port. Snowden has not undertaken a title search or legal due diligence on the status of the Tenement & Title tenements or regulatory approvals held by Galaxy but has sited correspondence between Galaxy and their tenement and title consultants (Hetherington Exploration & Mining Title Low risk Services Pty Ltd). Snowden had been advised by Galaxy that there are no material tenement issues relating to title to any of Galaxy‟s assets.
Social One of the main social risks is related to the local Ravensthorpe community‟s attitude to noise and dust created by the mining activities at Mt. Cattlin. A similar risk exists at the Low risk Jiangsu plant where housing of small farmers exists across the access road. Environmental Snowden has sighted documentation related to confirmation of approval or applications for approval of various areas of environmental compliance and is satisfied that Galaxy is meeting its general environmental obligations. Low risk
Capital Cost (Mt. Cattlin) Snowden has been involved in the monitoring of the construction of the Mt. Cattlin mine and processing plant and considers that the construction budget is unlikely to be exceeded by Low-Medium risk more than 10% by the completion of plant construction.
Operating cost (Mt. Cattlin) Snowden has reviewed budgeted operating cost for 2010 to 2011 and believes that the assumptions used are reasonable. The accuracy of the budget estimates to actual figures Low-Medium risk will only be able to be established after a reasonable period of operation has lapsed.
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25 Recommendations 25.1 Mineral Resources Additional infill drilling to a 40 m x 40 m pattern is recommended for a portion of the eastern part of the orebody, where drill holes are currently spaced at 80 m x 40 m. The aim of this drilling is to convert a significant portion of the current inferred resource in this area to indicated and measured resources. This program would comprise around 30 RC holes totalling 1500 m, at a cost of approximately AUD220,000. In addition to the resource infill drilling, a program of RC holes is recommended to test for additional pegmatite zones beneath the north west and south west portions of the current resource. This program comprises twelve holes to a maximum depth of 230 m, totalling around 2900 m. The all-up cost of the program (inclusive of assaying and staff costs) is estimated at AUD430,000 A review of quality assurance, quality control (QA/QC) procedures is recommended. A programme of detailed grade control drilling is recommended to provide added confidence to the grade and geological continuity of the pegmatite ore zones. When mining commences it is recommended that ongoing reconciliation is carried out between mined ore and depleted ore reserves. Detailed geological mapping and sampling of significant mineralisation in the open pit is recommended which will assist in targeting future exploration programs. Further exploration by drilling and geophysics is recommended at Mt. Cattlin in the following areas: Extension drilling where mineralisation is still open, such as portions of the NW zone. Deeper pegmatite horizons, intersected in the few deeper holes drilled beneath the resource. Blind pegmatite horizons to be detected by geophysics. Outcropping pegmatites on the mining lease (M74/244) and adjacent exploration licences.
25.2 Jiangsu lithium carbonate plant The plant commissioning and ramp-up should be done cautiously and slowly so to ensure quality of work, equipment and processes will be up to the standards.
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26 References Behre Dolbear Australia Pty Limited, 2011, Greenbushes Lithium Operations, NI 43-101 Technical Report, 15 June 2011. Broomfield,D. P., 1990. Cattlin Creek ML74/12 – PL74/139. Annual Report for the year ending 21/07/1990. Cameron, E., Ross, J. R., 1963. Ravensthorpe Pegmatite, Western Mining Corporation Limited Report K/1375. Cerny, P., 1993. Rare-element Granitic Pegmatites Part I; Anatomy and Internal Evolution of Pegmatite Deposits; in P.A. Sheahan and M.A. Cherry (eds), Ore Deposit Models Volume II, Geoscience Canada, pp 29-47. Cerny, P. and Ercit T.S., 2005. The Classification of Granitic Pegmatites Revisited, Canadian Mineralogist, Vol. 43, pp 2005-2026. Consensus Economics, 2011. Foreign Exchange Consensus Forecasts, 9/5/2011. Croeser Pty Ltd - „Mt Cattlin Reserve Report‟ by Roselt Croeser, dated 14 September 2010. Croeser Pty Ltd - Pit designs („Reserve_designs_9Sep2010.zip‟), topography („Galaxy_DEM.zip‟), resource model („GXY_okmodel_domall_211209_subblock_forclient.txt‟) and density estimate („MtCattlin_Density_PT090114.doc‟) supplied by Roselt Croeser dated 9 September 2010. Croeser Pty Ltd - Life of mine (LOM) schedule „schedule_v83_LOM_res_6aug2010.xlsx‟ based on Ore Reserves only, by Roselt Croeser, dated 7 September 2010. Croeser Pty Ltd - Life of mine (LOM) schedule „schedule_v82_LOM_upside_5aug2010.xlsx‟ inclusive of inferred material, by Roselt Croeser, dated 7 September 2010. Croeser Pty Ltd - „Mt Cattlin Reserve Report‟ by Roselt Croeser, dated 11 July 2010. Croeser Pty Ltd - Ore Reserve Design File „des1_28jan2010.zip‟ by Roselt Croeser, dated 28 January 2010. Croeser Pty Ltd - Inputs for Mt Cattlin Reserve Report‟, optimisation, design and cut-off grade evaluation, „Inputs_V22_21Jan2010.xlsx‟, by Roselt Croeser, dated 21 January 2010. Croeser Pty Ltd - Life of mine (LOM) schedule „schedule_v8_LOM_res_22Jul2010.xlsx‟ based on Ore Reserves only, by Roselt Croeser, dated 22 July 2010. Croeser Pty Ltd - Life of mine (LOM) schedule „schedule_v8_LOM_19Jul2010.xlsx‟ inclusive of inferred material, by Roselt Croeser, dated 22 July 2010. Dempers, G. 2008. Galaxy Resources, Mount Cattlin Pit Slope Design, Final Report. Dempers & Seymour Pty Ltd, December 2008. Ellis, H. A., 1944. A spodumene deposit, Ravensthorpe, W.A.: Western Australian Geological Survey, Western Australian Department of Mines, Annual Report for 1943. Galaxy Resources - report on density determination „MtCattlin_Density_PT090114.doc‟ dated 14 January 2009. Galaxy Resources - „Galaxy Increases Ore Reserves by 23 Percent‟, ASX Announcement/Media Release, by Robert Spiers, Philip Tornatora and Roselt Croeser, dated 11 March 2010.
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Galaxy Resources - „Galaxy Increases Mt Cattlin Resource & Mine Life‟, ASX Announcement/Media Release, by Robert Spiers, Philip Tornatora and Roselt Croeser, dated 20 January 2010. Galaxy Resources - Galaxy LOM Financial Model „Lith Carb China 6% 0 9 FX 145 Capex 16 Yrs 100315.xls‟, by Galaxy Resources. Galaxy Resources - „Galaxy‟s Ravensthorpe Spodumene Project Feasibility Study‟, Volume 1, dated January 2009. Galaxy Resources - „Galaxy Ore Reserve Statement‟, ASX Announcement/Media Release, by Robert Spiers, Philip Tornatora and Glen Williamson, dated 11 September 2009. Galaxy Resources - „Summary of Inventory to be Mined‟ provided by Galaxy 11 November 2009. Galaxy Resources - Financial model spread sheet from Galaxy titled „Lith Carb China 6% 0 75 FX DFS V1.xls‟. Galaxy Resources - Spreadsheet from Galaxy titled “GalaxyMtCattlinResourcesa909.xlsx” dated 08/09/2009. Galaxy Resources, 2010a. Galaxy Commences Mining at Mt Cattlin Ahead of Schedule. ASX Announcement / Media Release. 2pp. 5 March 2010. Galaxy, 2010b. Galaxy Extracts First Ore at Mt. Cattlin. ASX Announcement / Media Release. 2pp. 17 June 2010. Grubb, P. L., 1963. Spodumene from Ravensthorpe and Mt Marion, WA. Mineralogical and chemical study. CSIRO Mineragraphic investigation, Report No. 871. Hellman & Schofield, 2009. Mt Cattlin Resource Estimation Report, Lithium / Tantalum Elements, Ravensthorpe, WA. Report prepared for Galaxy Resources Ltd, May 2009. Hellman & Schofield, 2009. Mt Cattlin Resource Estimation Report, Lithium / Tantalum Elements, Ravensthorpe, WA. Report prepared for Galaxy Resources Ltd, Dec 2009. Jiangsu Lithium Carbonate Plant Project Definitive Feasibility Study – October 2009 - prepared by Hatch Associates Pty Ltd (“Hatch”). Jiangsu Lithium Carbonate Plant Project – Draft Project Development Plan – August 2010 – prepared by Galaxy and Hatch. JORC, (2004). The Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Prepared by the Joint Ore Reserves Committee of The Australasian Institute of Mining and Metallurgy, Australian Institute of Geoscientists and Minerals Council of Australia (JORC). Keith Lindbeck and Associates, February 2009, Ravensthorpe Spodumene Project – Mining Proposal M74/12, M74/155 & M74/182. London, D., 2008. Pegmatites (Canadian Mineralogist Special Publication 10). Mineralogical Association of Canada. Maitland, A. G., 1901. Western Australian Geological Survey. Annual progress report of the Geological Survey for 1900, pp 34. Mineral Resources Pty Ltd, „Appendix 25, Mineral Resources Final Mine Design Report, dated March 2009. Montgomery, A., 1903. The Phillips River Gold Field. Department of Mines Report. Orelogy, Optimisation Study (0061 Mt Cattlin) dated August 2009. Ravensthorpe Spodumene Project Feasibility Study Volume 1 (and associated appendices and drawings) – January 2009 – prepared by Galaxy.
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Ravensthorpe Spodumene Project – Project Development Plan – January 2010 - prepared by Galaxy. Roskill Information Services Ltd, THE ECONOMICS OF LITHIUM, Eleventh Edition, 2009. School of Metallurgical Science and Engineering - Central South University, Purification of Lithium Carbonate Extracted from Spodumene – Test Report, 2010-7-28. Snowden, 2009. Galaxy Resource Mt Cattlin resource review. Report prepared for Galaxy Resources Ltd. November 2009. Snowden, Dec 2009, 091209_0694_Galaxy_Valuation_Report.pdf (Draft). Snowden, Dec 2009, 091218_0694_Galaxy_Valuation_Report_MineOnly.pdf (Final). Snowden, Dec 2010, Independent Technical review of the Assets of Galaxy Resources, 110120_FINAL_1054 Galaxy Project_Lion.pdf. Stephenson, P. R., Allman, A., Carville, D. P., Stoker, P. T., Mokos, P., Tyrrel, J. and Burrows, T., 2006. Mineral Resource Classification – It‟s time to shoot the „Spotted Dog‟, in Proceedings 6th International Mining Geology Conference, Darwin, NT. pp91- 95. (The Australasian Institute of Mining and Metallurgy: Melbourne). Sofoulis, J., 1958. Report on Cattlin Creek spodumene pegmatite, Ravensthorpe, Phillips River Gold Field, Western Australia. Western Australian Geological Survey, Bulletin 110. Sweetapple, M. T., 2010. Geochemistry and Mineralogy of the WMC Costeans, and diamond drillholes GXD02, GMCGTD02 and GMCMTD03, Mt. Cattlin Spodumene Project, Western Australia. CSIRO Earth Science and Resource Engineering CSIRO Restricted Report EP103516 June 2010. Sullivan, A., Broomfield, D., 1989. Cattlin Creek ML72/12 Annual report for the year ending 21/07/89. Tornatora, P., 2009. Mt Cattlin – Bulk Density Measurements, Internal Galaxy report dated 14/01/2009. Tornatora, P., 2011. Mt Cattlin – Bulk Density Measurements, Internal Galaxy report dated 26/05/2011. Tornatora, P., Hamdorf, D. 2010. Mt Cattlin Geology – Analysis QAQC Report, July 2010. USGS, 2010, Lithium, USGS Mineral Commodity Summaries. Wanless, R., 1991. Cattlin Creek Tantalum Resource, 20pp. Witt, W.K., 1998. Geology and mineral resources of the Ravensthorpe and Cocanarup 1:100,000 sheets: Western Australia Geological Survey, Report 54, 152pp. www.talisonlithium.com/media/9876/bda%20ni%2043- 101%20greenbushes%20report%2026%20july... (2011)
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27 Glossary of terms Term/Abbreviation Explanation º degree (angle) º C degrees Celsius $ Australian dollar currency $000 thousand dollars $US United States of America dollar currency $/t dollars per tonne $/t ore Cost in dollars per tonne of ore $M million dollars % percent % v/v Percentage volume per volume % w/w solids Percentage weight per weight solids 000s thousands 4X Whittle 4X Optimisation Software a annum A ampere AC Alternating current AFP Acid forming potential AHD Australian Height Datum AI Abrasion index – the mass lost by the impeller after impacting successive batches of rock AMD Acid Mine Drainage AMG Australian Map Grid (coordinates) AMMTEC AMMTEC Limited ARV Asset right-off value Av Average
Al2O3 Aluminium Oxide BCM Bank cubic metre Be Berylium CaO Calcium Oxide CoG Cut-off Grade Cut-off Grade A grade of mineralisation which is considered to have an economic value that supports the direct and indirect costs of production, excluding capital expenditure, interest and debt.
Cr2O3 Chromite Cs Cesium
D50 Product 50% passing size DC Direct current DCF Discounted cash flow DD Diamond Drilling Density Mass per unit volume (t/m3) DEP Department of Environmental Protection, Western Australia DFS Definitive Feasibility Study
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Term/Abbreviation Explanation DMP Department of Minerals and Petroleum DoW Department of Water dmt Dry metric tonne DTM Digital terrain model EGL Effective grinding length EPA Environmental Protection Authority, Western Australia ERMP Environmental Review and Management Program
F80 Feed 80% passing size Fe Iron
Fe2O3 Iron Oxide FOT Free on transport FR Fresh g gram G giga (denoting a factor of 109) Ga Gallium GPS Global positioning system GRL Galaxy Resources Limited gm/cc Density, grams per cubic centimetre GXY Galaxy Resources Limited (ASX company Code: GXY) h hour hpa Hours per annum
H2SO4 Hydrogen Sulphate h/d Hours per day Ha Hectare HV High voltage IRR Internal rate of return lbs pounds lbspa Pounds per annum ISDN International subscriber dialling network JORC Joint Ore Reserves Committee (Aus IMM) k Kilo or thousands kg Kilogram kg/h Kilograms per hour kg/m3 Kilogram per cubic metre km Kilometres km/h Kilometres per hour kt/month Thousands of tonnes per month kPa Kilopascals Kt Kilo tonnes kW Kilowatt kWh Kilowatt hour kWh/t Kilowatt hours per tonne L Litre
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Term/Abbreviation Explanation Li Lithium
Li2CO3 Lithium Carbonate
Li2O Lithium Oxide L/s Litre per second LOM Life of Mine m Metres MCC Motor control centre Ma Million years MgO Magnesium oxide ML/d Megalitres per day mm millimetres MMU Minimum Mining Unit m/s Metre per second MPa Mega Pascal MPR Department of Minerals & Petroleum Resources, Western Australia m2 Square metres m3 Cubic metres m RL Metres above Reduced Level mS/m milliSiemens per metre MnO Manganese Oxide Mt Million tonnes Mtpa Million tonnes per annum
Na2CO3 Sodium Carbonate
Na2SO4 Sodium Sulphate NaOH Sodium Hydroxide Nagrom Nagrom Minerals Processing facility, WA Nb Niobium No. Number NPV Net present value OH Open Hole
P2O5 Phosphorous Pentoxide P80 Product 80% passing size pa per annum PLC Programmable logic control ppm parts per million Rb Rubidium RC Reverse circulation (drilling) RAB Rotary Air Blast Reserve an inventory of mineralisation that, after applying appropriate mining and economic factors, meets predetermined cut-off grade criteria and is therefore deemed to be economic to exploit under JORC guidelines. Resource an inventory of target mineralisation, usually delineated by applying a grade that will provide a boundary to a volume of mineralisation, which may be of economic interest under JORC
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Term/Abbreviation Explanation RL Reduced level ROM Run of mine s Second SG Specific gravity (relative density – dimensionless) SGS SGS Laboratories
SO3 Sulphite
SiO2 Quartz Sn Tin t Tonnes
T80 Transfer 80% passing size Ta Tantulum
Ta2O5 Tantalum Pentoxide t/d tonnes per day t/h tonnes per hour TDS total dissolved solids TSF Tailings storage facility
TiO2 Titanium Oxide t/m3 tonnes per cubic metre (density) tpa tonnes per annum TPD Transported surficial material TSP Total suspended particulate UCS Unconfined compressive strength µm micrometers V Volt v/v Volume for volume W Watt (unit of power) WACC Weighted average cost of capital Wi Work index, expressed in kWh/t Wt Wet metric tonne w/w weight for weight yrs Years
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28 Dates and signatures
Name of Report: Galaxy Resources: Mt. Cattlin (Western Australia), NI43-101 Technical Report
2011
Issued by: Galaxy Resources Limited Effective as of December 31, 2011
April 30, 2012 Leendert Lorenzen Date
April 30, 2012 Robert Spiers Date
April 30, 2012
Jeremy Peters Date
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29 Certificate of author
This certificate applies to the technical report entitled “Galaxy Resources: Mt. Cattlin (Western Australia)” effective as of December 31, 2011 (the “Technical Report”). Leendert Lorenzen, PhD, MSc(Eng), BEng, CEng, CPEng, PrEng, FAusIMM, FSAIMM 87 Colin St West Perth 6000 WA, Australia Email: [email protected]
I, Leendert Lorenzen, PhD, am a Professional Engineer, Chartered Engineer, Chartered Professional Engineer employed as a Executive Consultant – Metallurgy by Snowden Mining Industry Consultants, 87 Colin Street, West Perth WA Australia. I graduated with a Bachelor of Engineering (Chemical), Master of Science in Engineering (Metallurgy), cum laude and Doctor of Philosophy (Metallurgical Engineering) from Stellenbosch University, Stellenbosch, South Africa. I completed an Executive Development Programme Diploma in Business Management from Stellenbosch University Business School in 1999. I am a fellow of the Australasian Institute of Mining and Metallurgy (FAusIMM), fellow of the Southern African Institute of Mining and Metallurgy (FSAIMM), fellow of the Institute for Chemical Engineers (FIChemE) and a Chartered Professional Engineer (Australia), Chartered Engineer (UK) and Professional Engineer (South Africa). I have worked as a chemical and metallurgical engineer for a total of 28 years since graduating with my bachelor‟s degree. I have read the definition of “qualified person” set out in National Instrument 43-101 (“NI 43-101”) and certify that by reason of my education, affiliation with a professional association (as defined in NI 43-101) and past relevant work experience, I fulfil the requirements of a “qualified person” for the purposes of NI 43-101. I am responsible for preparation of Sections 1, 2, 3, 4, 5, 6, 16, 18, 19, 20, 21, 22, 23, 24 and 25 and the compilation of the Technical Report. I have visited both sites on various occasions during February 2010 and May 2011 (altogether 6 days for Mt. Cattlin and 4 days for Jiangsu as independent engineer for the financiers). As of the date of this certificate, to the best of my knowledge, information and belief, the Technical Report contains all the scientific and technical information that is required to be disclosed to make the Technical Report not misleading. I am independent of the issuer applying all of the tests in Section 1.5 of NI 43-101. I have read National Instrument 43-101 and Form 43-101F1, and the Technical Report has been prepared in accordance with that instrument and form. Dated the 30th day of April 2012
______Leendert Lorenzen, PhD, FAusIMM, FSAIMM, CPEng, CEng, PrEng
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This certificate applies to the technical report entitled “Galaxy Resources: Mt. Cattlin (Western Australia)” effective as of December 31, 2011 (the “Technical Report”). Jeremy Peters, BSc Geology, BEng Mining, MAusIMM 87 Colin St West Perth 6000 WA, Australia Email: [email protected]
I, Jeremy Peters, Principal Consultant of Snowden Mining Industry Consultants Pty Ltd., 87 Colin Street, West Perth, Western Australia, Australia, do hereby certify that: I graduated with a Bachelor of Science, from the Australian National University, Canberra, in the Australian Capital Territory, Australia in 1991 and a Bachelor of Engineering, from the West Australian School of Mines, Kalgoorlie, Western Australia, Australia in 1996. I am a Member of the Australasian Institute of Mining and Metallurgy (MAusIMM). I have worked variously as a geologist for a total of 21 years since my graduation from the Australian National University, Sydney and as a mining engineer for a total of 15 years since my graduation from the West Australian School of Mines, Kalgoorlie. I am employed as a Principal Consultant by Snowden Mining Industry Consultants (2009 to present). I have read the definition of „qualified person‟ set out in National Instrument 43-101 („the Instrument‟) and certify that by reason of my education, affiliation with a professional association and past relevant work experience, I fulfil the requirements of a „qualified person‟ for the purposes of the Instrument. I have been involved in mining consulting practice for four years, including the preparation of Independent Technical reports and have been involved in the evaluation of gold deposits for at least five years. I am responsible for Sections 15, 19.1 and 20.1 as well as reviewing Section 14 of the Technical Report, which relate to the metallurgy of the Galaxy Mt. Cattlin operation. I have made a recent visit to Galaxy Resource‟s projects for one day on 24 February 2011. I am independent of the issuer as defined in Section 1.5 of the Instrument. I have not had prior involvement with the property that is the subject of the Technical Report. I have read the Instrument and Form 43-101F1, and the Technical Report has been prepared in compliance with that instrument and form. As of the date of this certificate, to the best of my knowledge, information and belief, the Technical Report contains all the scientific and technical information that is required to be disclosed to make the Technical Report not misleading. Dated the 30th day of April 2012
______Jeremy Peters BSc., BEng, MAusIMM
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This certificate applies to the technical report entitled “Galaxy Resources: Mt. Cattlin (Western Australia)” effective as of December 31, 2011 (the “Technical Report”). Robert Spiers, BSc Hons (Geology / Geophysics), MAIG(CP) 21 Birdrock Avenue Mount Martha, 3934 VIC, Australia Email: [email protected]
I, Robert Spiers, am a Geologist employed as a Senior Consultant – Geology by Hellman and Schofield Consultants, 102 Colin Street, West Perth WA Australia. I graduated with a Bachelor of Science (BSc) with Honours from Latrobe University, Melbourne, Victoria, Australia. I am a member of the Australian Institute of Geoscientists. I have worked as a Geologist for a total of 20 years since graduating. I have read the definition of “qualified person” set out in National Instrument 43-101 (“NI 43-101”) and certify that by reason of my education, affiliation with a professional association (as defined in NI 43-101) and past relevant work experience, I fulfil the requirements of a “qualified person” for the purposes of NI 43-101. I am responsible for Sections 7, 8, 9, 10, 11, 12, 13 and 17 of the Technical Report, which relate to the Resource Estimation and associated Geological study. I have visited Mt. Cattlin on various occasions over the period March 2010 to June 2010 (altogether 7 days as independent consultant for Galaxy). As of the date of this certificate, to the best of my knowledge, information and belief, the Technical Report contains all the scientific and technical information that is required to be disclosed to make the Technical Report not misleading with respect to the sections for which I am responsible. I am independent of the issuer applying all of the tests in Section 1.5 of NI 43-101. I have read National Instrument 43-101 and Form 43-101F1, and the Technical Report has been prepared in accordance with that instrument and form. Dated the 30th day of April 2012
______Robert Spiers, BSc Hons, MAIG
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Appendix A Mineral Resource and Mineral Reserve Estimates Reporting Codes
Reporting Codes The resource and Mineral Reserve estimates in this report were conducted in accordance with the JORC code (2004 Edition), specifically the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (The JORC Code). In Section 1.3 of NI 43-101, the description of Mineral Reserve is defined by the Canadian Institute of Mining, Metallurgy and Petroleum (CIM). However, Part 7 of NI 43-101 permits reporting of the mineral resources and Mineral Reserves under the JORC code provided that the JORC categories are reconciled with the categories set out in Sections 1.2 and 1.3 in the NI 43-101 instrument. The Resource category names used in the two standards (JORC and NI 43-101) are the same. The Reserve category names however vary slightly as summarized in the table below.
Comparison of the Reserve category names – JORC 2004 and CIM 2005
JORC, 2004 CIM definitions (2005) Ore Reserve Mineral Reserve Probable Reserve Probable Reserve Proved Reserve Proven Reserve
Snowden considers that in terms of the NI 43-101 requirements, the definitions and classification of Resources and Reserves in the JORC Code (JORC, 2004) and the CIM standards (CIM, 2000) are equivalent. A comparison of the Mineral Resource and Mineral Reserve definitions as specified in the JORC code and the CIM standards is listed in the tables below.
Comparison of Resource Category definitions - JORC code (2004 Edition) and the CIM standards (2005)
JORC, 2004 CIM definitions (2005) A ‘Mineral Resource’ is a concentration or occurrence of material of intrinsic Mineral Resources are sub-divided, in order of increasing geological confidence, into economic interest in or on the Earth‟s crust in such form, quality and quantity that Inferred, Indicated and Measured categories. there are reasonable prospects for eventual economic extraction. The location, A Mineral Resource is a concentration or occurrence of diamonds, natural solid quantity, grade, geological characteristics and continuity of a Mineral Resource are inorganic material, or natural solid fossilized organic material including base and known, estimated or Interpreted from specific geological evidence and knowledge. precious metals, coal and industrial minerals in or on the Earth‟s crust in such form and Mineral Resources are sub-divided, in order of increasing geological confidence, into quantity and of such a grade or quality that it has reasonable prospects for economic Inferred, Indicated and Measured categories. extraction. The location, quantity, grade, geological characteristics and continuity of a Mineral Resource are known, estimated or interpreted from specific geological evidence and knowledge. An „Inferred Mineral Resource‟ is that part of a Mineral Resource for which tonnage, An „Inferred Mineral Resource‟ is that part of a Mineral Resource for which quantity and grade and mineral content can be estimated with a low level of confidence. It is grade or quality can be estimated on the basis of geological evidence and limited inferred from geological evidence and assumed but not verified geological and/or sampling and reasonably assumed, but not verified, geological and grade continuity. The grade continuity. It is based on information gathered through appropriate techniques estimate is based on limited information and sampling gathered through appropriate from locations such as outcrops, trenches, pits, workings and drill holes which may techniques from locations such as outcrops, trenches, pits, workings and drill holes. be limited or of uncertain quality and reliability. An „Indicated Mineral Resource‟ is that part of a Mineral Resource for which An „Indicated Mineral Resource‟ is that part of a Mineral Resource for which quantity, tonnage, densities, shape, physical characteristics, grade and mineral content can be grade or quality, densities, shape and physical characteristics, can be estimated with a estimated with a reasonable level of confidence. It is based on exploration, sampling level of confidence sufficient to allow the appropriate application of technical and and testing information gathered through appropriate techniques from locations such economic parameters, to support mine planning and evaluation of the economic viability as outcrops, trenches, pits, workings and drill holes. The locations are too widely or of the deposit. The estimate is based on detailed and reliable exploration and testing inappropriately spaced to confirm geological and/or grade continuity but are spaced information gathered through appropriate techniques from locations such as outcrops, closely enough for continuity to be assumed. trenches, pits, workings and drill holes that are spaced closely enough for geological and grade continuity to be reasonably assumed. A „Measured Mineral Resource’ is that part of a Mineral Resource for which A „Measured Mineral Resource‟ is that part of a Mineral Resource for which quantity, tonnage, densities, shape, physical characteristics, grade and mineral content can be grade or quality, densities, shape and physical characteristics are so well established estimated with a high level of confidence. It is based on detailed and reliable that they can be estimated with confidence sufficient to allow the appropriate application exploration, sampling and testing information gathered through appropriate of technical and economic parameters, to support production planning and evaluation of techniques from locations such as outcrops, trenches, pits, workings and drill holes. the economic viability of the deposit. The estimate is based on detailed and reliable The locations are spaced closely enough to confirm geological and grade continuity. exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes that are spaced closely enough to confirm both geological and grade continuity.
Comparison of Reserve Category definitions - JORC code (2004 Edition) and the CIM standards (2005)
JORC, 2004 CIM definitions (2005) An „Ore Reserve‟ is the economically mineable part of a Measured and/or Indicated Mineral Reserves are sub-divided in order of increasing confidence into Probable Mineral Mineral Resource. It includes diluting materials and allowances for losses, which Reserves and Proven Mineral Reserves. A Probable Mineral Reserve has a lower level of may occur when the material is mined. Appropriate assessments and studies have confidence than a Proven Mineral Reserve. been carried out and include consideration of and modification by realistically A Mineral Reserve is the economically mineable part of a Measured or Indicated Mineral assumed mining, metallurgical, economic, marketing, legal, environmental, social Resource demonstrated by at least a Preliminary Feasibility Study. This Study must and governmental factors. These assessments demonstrate at the time of reporting include adequate information on mining, processing, metallurgical, economic and other that extraction could reasonably be justified. Ore Reserves are sub-divided in order relevant factors that demonstrate, at the time of reporting, that economic extraction can be of increasing confidence into Probable Ore Reserves and Proved Ore Reserves. justified. A Mineral Reserve includes diluting materials and allowances for losses that may occur when the material is mined. A „Probable Ore Reserve‟ is the economically mineable part of an Indicated and, in A „Probable Mineral Reserve‟ is the economically mineable part of an Indicated and, in some circumstances, a Measured Mineral Resource. It includes diluting materials some circumstances, a Measured Mineral Resource demonstrated by at least a and allowances for losses which may occur when the material is mined. Appropriate Preliminary Feasibility Study. This Study must include adequate information on mining, assessments and studies have been carried out and include consideration of and processing, metallurgical, economic and other relevant factors that demonstrate, at the modification by realistically assumed mining, metallurgical, economic, marketing, time of reporting, that economic extraction can be justified. legal, environmental, social and governmental factors These assessments demonstrate at the time of reporting that extraction could reasonably be justified. A Probable Ore Reserve has a lower level of confidence than a Proved Ore Reserve but is of sufficient quality to serve as the basis for a decision on the development of the deposit. A „Proved Ore Reserve‟ is the economically mineable part of a Measured Mineral A „Proven Mineral Reserve‟ is the economically mineable part of a Measured Mineral Resource. It includes diluting materials and allowances for losses which may occur Resource demonstrated by at least a Preliminary Feasibility Study. This Study must when the material is mined. Appropriate assessments and studies have been carried include adequate information on mining, processing, metallurgical, economic and other out and include consideration of and modification by realistically assumed mining, relevant factors that demonstrate, at the time of reporting, that economic extraction is metallurgical, economic, marketing, legal, environmental, social and governmental justified. factors. These assessments demonstrate at the time of reporting that extraction Application of the Proven Mineral Reserve category implies that the Qualified Person has could reasonably be justified. A Proved Ore Reserve represents the highest the highest degree of confidence in the estimate with the consequent expectation in the confidence category of reserve estimate. The style of mineralization or other factors minds of the readers of the report. The term should be restricted to that part of the deposit could mean that Proved Ore Reserves are not achievable in some deposits. where production planning is taking place and for which any variation in the estimate would not significantly affect potential economic viability.
Appendix B Mt. Cattlin Significant Drill Intercepts
Mt Cattlin ‐ Significant Drill Intercepts to May 2011
COMPANY PROGRAM HOLE EASTING NORTHING DEPTH DEPTH TO WIDTH Li2O %Ta2O5 Nb2O5 FROM PPM PPM PML PCN 1988 CCP200/000 225272 6282064 4.0 7.0 3.0 0.81 79 69 PML PCN 1988 CCP240/000 225252 6282098 1.0 11.0 10.0 1.37 76 80 PML PCN 1988 CCP320/000 225210 6282166 3.0 13.0 10.0 1.26 135 86 PML PCN 1988 CCP320/040 225245 6282187 5.0 19.0 14.0 1.42 74 66 PML PCN 1988 CCP360/040 225224 6282221 9.0 11.0 2.0 0.45 293 86 PML PCN 1988 CCP400/000 225171 6282230 5.0 11.0 6.0 1.02 499 72 PML PCN 1988 CCP400/040 225204 6282256 6.0 11.0 5.0 0.74 64 74 PML PCN 1988 CCP400/040 225204 6282256 14.0 16.0 2.0 0.59 196 43 PML PCN 1988 CCP400/080 225238 6282277 13.0 24.0 11.0 0.83 71 52 PML PCN 1988 CCP400/120 225273 6282297 7.0 13.0 6.0 0.93 207 57 PML PCN 1988 CCP440/020 225164 6282282 5.0 15.0 10.0 1.50 90 66 PML PCN 1988 CCP440/020 225164 6282282 19.0 23.0 4.0 1.18 61 52 PML PCN 1988 CCP440/040 225181 6282290 13.0 25.0 12.0 1.03 111 66 PML PCN 1988 CCP440/080 225215 6282311 18.0 20.0 2.0 1.14 1233 79 PML PCN 1988 CCP440/120 225251 6282331 14.0 18.0 4.0 1.41 256 31 PML PCN 1988 CCP440/980 225131 6282259 2.0 10.0 8.0 1.05 273 71 PML PCN 1988 CCP460/000 225138 6282285 4.0 8.0 4.0 0.58 495 55 PML PCN 1988 CCP460/010 225148 6282292 3.0 12.0 9.0 1.11 522 71 PML PCN 1988 CCP460/020 225155 6282295 5.0 17.0 12.0 0.76 384 86 PML PCN 1988 CCP460/030 225162 6282301 2.0 24.0 22.0 1.97 102 52 PML PCN 1988 CCP460/040 225172 6282307 7.0 25.0 18.0 1.66 108 55 PML PCN 1988 CCP460/980 225121 6282275 2.0 11.0 9.0 0.81 541 34 PML PCN 1988 CCP480/000 225127 6282303 3.0 7.0 4.0 0.87 559 47 PML PCN 1988 CCP480/000 225127 6282303 8.0 10.0 2.0 0.46 86 57 PML PCN 1988 CCP480/010 225132 6282307 5.0 9.0 4.0 1.27 940 63 PML PCN 1988 CCP480/020 225145 6282313 0.0 12.0 12.0 0.66 559 76 PML PCN 1988 CCP480/980 225110 6282293 1.0 3.0 2.0 0.57 739 172 PML PCN 1988 CCP680/380 225349 6282670 3.0 5.0 2.0 0.71 1490 161 PML PCN 1989 CCP120/040 225342 6282013 0.0 2.0 2.0 0.85 55 75 PML PCN 1989 CCP200/040 225305 6282094 5.0 7.0 2.0 1.06 122 157 PML PCN 1989 CCP200/080 225332 6282102 3.0 10.0 7.0 1.74 165 110 PML PCN 1989 CCP200/120 225375 6282126 10.0 14.0 4.0 0.70 124 91 PML PCN 1989 CCP200/160 225409 6282148 12.0 21.0 9.0 1.61 120 84 PML PCN 1989 CCP240/040 225285 6282119 6.0 17.0 11.0 1.37 82 84 PML PCN 1989 CCP240/080 225319 6282138 9.0 16.0 7.0 1.00 141 103 PML PCN 1989 CCP240/120 225352 6282160 7.0 17.0 10.0 1.14 77 65 PML PCN 1989 CCP240/160 225387 6282181 16.0 24.0 8.0 1.23 64 66 PML PCN 1989 CCP280/080 225298 6282173 11.0 19.0 8.0 1.88 115 76 PML PCN 1989 CCP280/120 225332 6282194 8.0 19.0 11.0 1.79 95 64 PML PCN 1989 CCP280/160 225366 6282216 15.0 26.0 11.0 1.15 83 69 PML PCN 1989 CCP280/200 225400 6282237 20.0 29.0 9.0 1.37 69 56 PML PCN 1989 CCP320/080 225278 6282207 15.0 26.0 11.0 1.60 63 52 PML PCN 1989 CCP320/120 225310 6282234 11.0 20.0 9.0 1.41 115 52 PML PCN 1989 CCP320/160 225348 6282250 12.0 24.0 12.0 1.61 91 80 PML PCN 1989 CCP320/200 225381 6282270 19.0 25.0 6.0 1.14 161 100 PML PCN 1989 CCP360/120 225293 6282263 15.0 20.0 5.0 0.84 98 44 PML PCN 1989 CCP360/160 225327 6282283 18.0 20.0 2.0 0.42 58 35 PML PCN 1989 CCP400/160 225306 6282318 5.0 17.0 12.0 1.84 233 65 PML PCN 1989 CCP400/200 225341 6282339 7.0 15.0 8.0 1.46 163 66 PML PCN 1989 CCP400/240 225375 6282361 7.0 15.0 8.0 2.07 112 48 PML PCN 1989 CCP460/944 225089 6282257 12.0 14.0 2.0 0.42 104 90 PML PCN 1989 CCP480/040A 225161 6282326 12.0 15.0 3.0 0.59 338 50 PML PCN 1989 CCP480/040A 225161 6282326 19.0 23.0 4.0 0.49 104 49 PML PCN 1989 CCP600/000 225065 6282406 16.0 20.0 4.0 1.48 70 68 PML PCN 1989 CCP600/940 225008 6282373 202.0 11.0 909.0 0900.90 223 53 PML PCN 1989 CCP600/960 225034 6282380 12.0 29.0 17.0 1.21 218 44 PML PCN 1989 CCP640/000 225044 6282440 25.0 44.0 19.0 1.74 164 38 PML PCN 1989 CCP640/880 224940 6282375 1.0 11.0 10.0 0.57 248 60 PML PCN 1989 CCP640/900 224962 6282384 3.0 14.0 11.0 0.68 1397 520 PML PCN 1989 CCP640/920 224976 6282399 9.0 12.0 3.0 1.23 49 34 PML PCN 1989 CCP640/940 224989 6282405 2.0 6.0 4.0 0.96 46 44 PML PCN 1989 CCP640/940 224989 6282405 9.0 20.0 11.0 1.15 370 68 1 Mt Cattlin ‐ Significant Drill Intercepts to May 2011
COMPANY PROGRAM HOLE EASTING NORTHING DEPTH DEPTH TO WIDTH Li2O %Ta2O5 Nb2O5 FROM PPM PPM PML PCN 1989 CCP640/960 225010 6282419 20.0 35.0 15.0 1.53 138 40 PML PCN 1989 CCP680/000 225023 6282473 29.0 34.0 5.0 0.99 34 32 PML PCN 1989 CCP680/000 225023 6282473 37.0 45.0 8.0 3.39 250 27 PML PCN 1989 CCP680/900 224939 6282422 12.0 20.0 8.0 0.75 115 64 PML PCN 1989 CCP680/940 224968 6282441 24.0 34.0 10.0 1.12 458 47 PML PCN 1989 CCP680/960 224990 6282454 25.0 44.0 19.0 1.77 207 46 GXY GXY 2001 GXD02 225027 6282550 39.1 55.5 16.4 2.27 442 98 GXY GXY 2001 GXD05 224983 6282588 31.1 45.9 14.8 1.83 280 72 GXY GXY 2007 GX450 224919 6282499 24.0 39.0 15.0 1.75 284 56 GXY GXY 2007 GX451 224880 6282499 33.0 37.0 4.0 0.88 126 36 GXY GXY 2007 GX451 224880 6282499 41.0 44.0 3.0 1.39 216 48 GXY GXY 2007 GX452 224799 6282580 30.0 35.0 5.0 1.21 923 67 GXY GXY 2007 GX453 224799 6282620 27.0 31.0 4.0 0.59 47 36 GXY GXY 2007 GX454 224842 6282620 35.0 45.0 10.0 2.11 291 52 GXY GXY 2007 GX455 224881 6282540 46.0 48.0 2.0 0.76 183 36 GXY GXY 2007 GX456 224841 6282580 35.0 42.0 7.0 1.65 454 43 GXY GXY 2007 GX457 224842 6282540 39.0 44.0 5.0 0.68 145 52 GXY GXY 2007 GX458 224841 6282501 31.0 36.0 5.0 1.16 222 43 GXY GXY 2007 GX459 224882 6282460 29.0 36.0 7.0 0.72 429 65 GXY GXY 2007 GX460 224841 6282461 20.0 31.0 11.0 2.10 151 50 GXY GXY 2007 GX461 224841 6282420 26.0 38.0 12.0 1.82 239 84 GXY GXY 2007 GX462 224802 6282461 27.0 35.0 8.0 1.68 340 173 GXY GXY 2007 GX463 224802 6282420 24.0 29.0 5.0 1.35 203 163 GXY GXY 2007 GX464 224842 6282380 21.0 26.0 5.0 1.62 161 67 GXY GXY 2007 GX465 224802 6282379 21.0 26.0 5.0 1.59 178 62 GXY GXY 2007 GX466 224801 6282541 31.0 39.0 8.0 2.00 230 80 GXY GXY 2007 GX467 224801 6282501 32.0 39.0 7.0 1.98 405 56 GXY GXY 2007 GX469 224762 6282621 15.0 23.0 8.0 1.24 133 65 GXY GXY 2007 GX470 224761 6282582 13.0 18.0 5.0 1.38 467 119 GXY GXY 2007 GX471 224761 6282540 27.0 34.0 7.0 1.69 265 113 GXY GXY 2007 GX472 224762 6282500 23.0 31.0 8.0 2.08 126 49 GXY GXY 2007 GX473 224761 6282462 25.0 33.0 8.0 1.87 118 82 GXY GXY 2007 GX474 224761 6282421 29.0 32.0 3.0 0.69 675 448 GXY GXY 2007 GX474 224761 6282421 45.0 55.0 10.0 1.76 104 73 GXY GXY 2007 GX476 224721 6282661 18.0 20.0 2.0 1.01 150 54 GXY GXY 2007 GX477 224721 6282621 11.0 17.0 6.0 2.07 132 61 GXY GXY 2007 GX478 224722 6282580 6.0 8.0 2.0 0.80 299 54 GXY GXY 2007 GX479 224721 6282540 18.0 24.0 6.0 1.80 535 99 GXY GXY 2007 GX480 224721 6282500 22.0 26.0 4.0 1.31 55 84 GXY GXY 2007 GX484 224681 6282661 15.0 17.0 2.0 0.55 67 79 GXY GXY 2007 GX485 224681 6282620 8.0 11.0 3.0 1.20 108 105 GXY GXY 2007 GX486 224681 6282580 1.0 3.0 2.0 1.76 159 143 GXY GXY 2007 GX492 224641 6282501 34.0 42.0 8.0 1.59 104 121 GXY GXY 2007 GX493 224641 6282461 30.0 49.0 19.0 1.14 134 163 GXY GXY 2007 GX494 224642 6282420 33.0 54.0 21.0 1.80 68 89 GXY GXY 2007 GX496 224641 6282340 24.0 35.0 11.0 1.71 109 96 GXY GXY 2007 GX496 224641 6282340 38.0 41.0 3.0 1.41 140 122 GXY GXY 2007 GX497 224641 6282260 22.0 32.0 10.0 1.29 225 137 GXY GXY 2007 GX500 224559 6282339 33.0 37.0 4.0 1.45 84 95 GXY GXY 2007 GX500 224559 6282339 41.0 46.0 5.0 0.98 46 62 GXY GXY 2007 GX501 224559 6282419 16.0 39.0 23.0 1.40 46 69 GXY GXY 2007 GX502 224559 6282460 31.0 33.0 2.0 1.66 76 136 GXY GXY 2007 GX502 224559 6282460 37.0 58.0 21.0 1.89 63 81 GXY GXY 2007 GX503 224559 6282540 49.0 63.0 14.0 1.83 78 76 GXY GXY 2007 GX507 224519 6282419 32.0 34.0 202.0 0480.48 92 93 GXY GXY 2007 GX507 224519 6282419 35.0 52.0 17.0 0.94 83 92 GXY GXY 2007 GX508 224601 6282341 21.0 34.0 13.0 1.49 108 110 GXY GXY 2007 GX508 224601 6282341 37.0 41.0 4.0 1.24 185 177 GXY GXY 2007 GX509 224601 6282260 16.0 19.0 3.0 1.04 83 76 GXY GXY 2007 GX509 224601 6282260 26.0 31.0 5.0 0.78 230 137 GXY GXY 2007 GX513 224601 6282421 37.0 46.0 9.0 1.44 54 68 GXY GXY 2007 GX513 224601 6282421 50.0 56.0 6.0 1.21 174 182 2 Mt Cattlin ‐ Significant Drill Intercepts to May 2011
COMPANY PROGRAM HOLE EASTING NORTHING DEPTH DEPTH TO WIDTH Li2O %Ta2O5 Nb2O5 FROM PPM PPM GXY GXY 2007 GX514 224601 6282381 31.0 52.0 21.0 1.57 73 104 GXY GXY 2007 GX515 224602 6282301 23.0 35.0 12.0 0.89 84 85 GXY GXY 2007 GX522 224520 6281699 0.0 3.0 3.0 1.12 183 65 GXY GXY 2007 GX527 224479 6281940 6.0 8.0 2.0 1.12 202 54 GXY GXY 2007 GX528 225042 6282219 4.0 8.0 4.0 1.15 119 143 GXY GXY 2007 GX531 224801 6282341 15.0 17.0 2.0 1.98 92 101 GXY GXY 2007 GX533 224843 6282301 9.0 16.0 7.0 2.26 162 117 GXY GXY 2007 GX534 224881 6282301 4.0 8.0 4.0 1.88 238 188 GXY GXY 2007 GX536 224881 6282341 9.0 11.0 2.0 2.26 46 54 GXY GXY 2007 GX537 224842 6282340 21.0 31.0 10.0 1.25 109 101 GXY GXY 2007 GX539 224721 6282421 40.0 55.0 15.0 1.04 66 82 GXY GXY 2007 GX540 224718 6282377 35.0 42.0 7.0 2.46 118 114 GXY GXY 2007 GX541 224722 6282340 27.0 29.0 2.0 0.78 116 108 GXY GXY 2007 GX541 224722 6282340 33.0 44.0 11.0 1.60 119 120 GXY GXY 2007 GX542 224761 6282302 29.0 37.0 8.0 1.97 188 120 GXY GXY 2007 GX543 224761 6282261 22.0 31.0 9.0 1.60 166 103 GXY GXY 2007 GX548 224802 6282019 15.0 17.0 2.0 1.19 360 114 GXY GXY 2007 GX550 224641 6282302 22.0 24.0 2.0 1.55 92 122 GXY GXY 2007 GX550 224641 6282302 28.0 30.0 2.0 0.82 110 122 GXY GXY 2007 GX550 224641 6282302 34.0 38.0 4.0 1.49 119 106 GXY GXY 2007 GX551 224679 6282300 22.0 39.0 17.0 1.69 159 119 GXY GXY 2007 GX552 224681 6282261 17.0 24.0 7.0 1.10 214 130 GXY GXY 2007 GX552 224681 6282261 34.0 40.0 6.0 1.22 210 148 GXY GXY 2007 GX554 224560 6282500 41.0 61.0 20.0 1.80 88 100 GXY GXY 2007 GX555 224601 6282498 28.0 33.0 5.0 0.77 138 142 GXY GXY 2007 GX555 224601 6282498 48.0 57.0 9.0 2.68 103 99 GXY GXY 2007 GX556 224600 6282461 35.0 59.0 24.0 1.44 81 90 GXY GXY 2007 GX557 224680 6282500 30.0 45.0 15.0 0.93 152 186 GXY GXY 2007 GX558 224682 6282461 35.0 44.0 9.0 2.46 104 110 GXY GXY 2007 GX558 224682 6282461 49.0 51.0 2.0 1.12 110 54 GXY GXY 2007 GX559 224521 6282501 34.0 58.0 24.0 1.58 76 76 GXY GXY 2007 GX560 224521 6282461 32.0 52.0 20.0 1.82 127 133 GXY GXY 2007 GX561 224522 6282381 44.0 50.0 6.0 1.05 139 133 GXY GXY 2007 GX563 224560 6282379 19.0 34.0 15.0 1.46 49 75 GXY GXY 2007 GX563 224560 6282379 39.0 44.0 5.0 1.26 112 97 GXY GXY 2007 GX567 224519 6282540 43.0 60.0 17.0 1.41 70 101 GXY GXY 2007 GX568 224681 6282420 33.0 53.0 20.0 1.63 141 151 GXY GXY 2007 GX569 224681 6282380 37.0 48.0 11.0 2.48 99 141 GXY GXY 2007 GX569 224681 6282380 51.0 55.0 4.0 1.21 145 127 GXY GXY 2007 GX570 224680 6282338 29.0 40.0 11.0 1.18 81 114 GXY GXY 2007 GX570 224680 6282338 45.0 48.0 3.0 1.64 171 152 GXY GXY 2007 GX571 224639 6282378 30.0 51.0 21.0 1.36 106 110 GXY GXY 2007 GX572 224561 6282582 55.0 58.0 3.0 2.16 44 74 GXY GXY 2007 GX574 224479 6282582 54.0 61.0 7.0 0.98 73 87 GXY GXY 2007 GX575 224522 6282580 40.0 47.0 7.0 1.55 132 90 GXY GXY 2007 GX575 224522 6282580 50.0 53.0 3.0 0.73 102 110 GXY GXY 2007 GX576 224482 6282538 47.0 53.0 6.0 1.96 95 105 GXY GXY 2007 GX576 224482 6282538 57.0 66.0 9.0 1.24 231 79 GXY GXY 2007 GX579 224481 6282619 56.0 64.0 8.0 1.01 99 69 GXY GXY 2007 GX581 224519 6282619 57.0 61.0 4.0 1.91 163 163 GXY GXY 2007 GX583 224882 6282379 16.0 23.0 7.0 1.13 228 90 GXY GXY 2007 GX585 224918 6282340 19.0 21.0 2.0 1.01 190 61 GXY GXY 2007 GX586 224875 6282580 33.0 44.0 11.0 1.46 110 46 GXY GXY 2007 GX594 224758 6282377 30.0 32.0 2.0 0.99 61 36 GXY GXY 2007 GX594 224758 6282377 37.0 49.0 12.0 1281.28 97 91 GXY GXY 2007 GX595 224760 6282340 27.0 32.0 5.0 1.70 115 106 GXY GXY 2007 GX595 224760 6282340 37.0 39.0 2.0 2.20 147 100 GXY GXY 2007 GX595 224760 6282340 40.0 50.0 10.0 1.51 155 130 GXY GXY 2007 GX596 224718 6282301 27.0 32.0 5.0 1.38 54 56 GXY GXY 2007 GX596 224718 6282301 35.0 40.0 5.0 1.54 178 140 GXY GXY 2007 GX597 224721 6282260 20.0 28.0 8.0 1.28 149 116 GXY GXY 2007 GX599 224799 6282299 16.0 23.0 7.0 1.76 83 76 3 Mt Cattlin ‐ Significant Drill Intercepts to May 2011
COMPANY PROGRAM HOLE EASTING NORTHING DEPTH DEPTH TO WIDTH Li2O %Ta2O5 Nb2O5 FROM PPM PPM GXY GXY 2007 GX599 224799 6282299 41.0 46.0 5.0 1.13 220 146 GXY GXY 2007 GX600 224799 6282340 37.0 44.0 7.0 2.19 291 97 GXY GXY 2007 GX601 224719 6282375 34.0 50.0 16.0 1.70 300 89 GXY GXY 2007 GX604 224598 6282218 2.0 7.0 5.0 0.91 169 82 GXY GXY 2007 GX604 224598 6282218 21.0 23.0 2.0 1.20 177 104 GXY GXY 2007 GX608 224559 6282099 29.0 31.0 2.0 0.72 654 286 GXY GXY 2007 GX609 224519 6282099 9.0 12.0 3.0 1.90 382 148 GXY GXY 2007 GX612 224399 6282098 4.0 7.0 3.0 1.08 228 77 GXY GXY 2007 GX614 224320 6282098 16.0 18.0 2.0 1.16 599 129 GXY GXY 2007 GX615 224281 6282099 17.0 20.0 3.0 1.64 212 114 GXY GXY 2007 GX616 224242 6282099 15.0 22.0 7.0 1.23 239 119 GXY GXY 2007 GX617 224240 6282022 12.0 16.0 4.0 1.64 260 136 GXY GXY 2007 GX618 224279 6282021 10.0 13.0 3.0 1.06 322 114 GXY GXY 2007 GX624 224481 6282021 10.0 12.0 2.0 1.59 391 90 GXY GXY 2007 GX624 224481 6282021 27.0 29.0 2.0 0.72 165 36 GXY GXY 2007 GX625 224520 6282021 18.0 20.0 2.0 1.05 263 72 GXY GXY 2007 GX631 224601 6281939 27.0 29.0 2.0 0.96 403 107 GXY GXY 2007 GX634 224441 6281939 0.0 3.0 3.0 0.46 30 36 GXY GXY 2007 GX650 224280 6282180 22.0 28.0 6.0 1.96 103 103 GXY GXY 2007 GX653 224400 6282180 7.0 11.0 4.0 0.72 208 107 GXY GXY 2007 GX653 224400 6282180 27.0 30.0 3.0 0.88 236 133 GXY GXY 2007 GX656 224520 6282180 21.0 26.0 5.0 1.80 269 143 GXY GXY 2007 GX664 224800 6282140 7.0 9.0 2.0 1.43 190 108 GXY GXY 2007 GX668 224720 6282020 2.0 4.0 2.0 1.50 342 129 GXY GXY 2007 GX669 224720 6282060 0.0 5.0 5.0 1.19 537 126 GXY GXY 2007 GX674 224760 6282020 10.0 12.0 2.0 1.38 318 115 GXY GXY 2007 GX678 224280 6281780 30.0 32.0 2.0 1.51 147 54 GXY GXY 2007 GX681 224400 6281780 11.0 14.0 3.0 0.58 253 69 GXY GXY 2007 GX682 224440 6281780 15.0 18.0 3.0 0.75 322 83 GXY GXY 2007 GX689 225080 6282500 47.0 63.0 16.0 2.17 305 65 GXY GXY 2007 GX690 225120 6282460 41.0 54.0 13.0 1.61 185 59 GXY GXY 2007 GX691 225166 6282462 39.0 53.0 14.0 1.89 383 81 GXY GXY 2007 GX697 225159 6282504 56.0 63.0 7.0 1.19 201 53 GXY GXY 2007 GX698 225241 6282504 53.0 56.0 3.0 0.78 724 69 GXY GXY 2007 GX699 225277 6282500 45.0 47.0 2.0 1.59 153 86 GXY GXY 2007 GX699 225277 6282500 48.0 53.0 5.0 1.64 283 169 GXY GXY 2007 GX702 225480 6282300 32.0 42.0 10.0 1.06 80 69 GXY GXY 2007 GX704 225526 6282337 24.0 30.0 6.0 1.32 30 50 GXY GXY 2007 GX705 225555 6282332 27.0 35.0 8.0 1.75 88 113 GXY GXY 2007 GX706 225436 6282307 18.0 21.0 3.0 0.80 200 257 GXY GXY 2007 GX706 225436 6282307 25.0 31.0 6.0 1.17 94 107 GXY GXY 2007 GX707 225440 6282333 27.0 30.0 3.0 1.30 82 100 GXY GXY 2007 GX707 225440 6282333 32.0 34.0 2.0 1.41 67 86 GXY GXY 2007 GX708 225398 6282298 17.0 28.0 11.0 0.99 75 91 GXY GXY 2007 GX709 225440 6282179 18.0 20.0 2.0 0.74 196 200 GXY GXY 2007 GX710 225557 6282141 46.0 50.0 4.0 1.23 246 140 GXY GXY 2007 GX711 225523 6282211 31.0 46.0 15.0 1.60 167 133 GXY GXY 2007 GX712 225562 6282257 52.0 62.0 10.0 1.22 112 97 GXY GXY 2007 GX713 225639 6282187 66.0 75.0 9.0 1.74 133 100 GXY GXY 2007 GX718 225558 6282058 44.0 47.0 3.0 1.32 90 110 GXY GXY 2007 GX723 225480 6282100 15.0 20.0 5.0 0.68 114 150 GXY GXY 2007 GX726 225438 6282215 23.0 26.0 3.0 0.81 65 105 GXY GXY 2007 GX727 225358 6282527 22.0 27.0 5.0 1.47 1121 217 GXY GXY 2007 GX734 224840 6282140 18.0 21.0 3.0 1.79 204 79 GXY GXY 2007 GX735 224764 6282058 202.0 505.0 303.0 0840.84 252 114 GXY GXY 2007 GX748 224243 6282183 21.0 23.0 2.0 1.31 458 494 GXY GXY 2007 GX749 224184 6282085 25.0 30.0 5.0 1.44 142 74 GXY GXY 2007 GX750 224147 6282093 29.0 37.0 8.0 2.07 114 79 GXY GXY 2007 GX752 224522 6281660 8.0 10.0 2.0 0.79 385 36 GXY GXY 2007 GX754 224601 6281661 2.0 5.0 3.0 0.98 261 69 GXY GXY 2007 GX755 224559 6281620 16.0 18.0 2.0 0.94 318 36 GXY GXY 2007 GX760 224680 6281580 29.0 35.0 6.0 0.51 196 67 4 Mt Cattlin ‐ Significant Drill Intercepts to May 2011
COMPANY PROGRAM HOLE EASTING NORTHING DEPTH DEPTH TO WIDTH Li2O %Ta2O5 Nb2O5 FROM PPM PPM GXY GXY 2007 GX769 225236 6282061 1.0 7.0 6.0 1.91 99 69 GXY GXY 2007 GX770 225192 6282056 0.0 6.0 6.0 0.72 63 60 GXY GXY 2007 GX773 225113 6282189 1.0 3.0 2.0 0.55 64 93 GXY GXY 2007 GX774 224889 6282622 31.0 40.0 9.0 2.24 357 88 GXY GXY 2007 GX776 225081 6282248 9.0 13.0 4.0 1.11 132 77 GXY GXY 2007 GX779 225232 6282464 42.0 47.0 5.0 1.03 203 90 GXY GXY 2007 GX780 225276 6282459 34.0 42.0 8.0 1.43 308 99 GXY GXY 2007 GX781 225204 6282495 47.0 53.0 6.0 1.60 582 93 GXY GXY 2007 GX782 225237 6282546 37.0 39.0 2.0 1.02 653 79 GXY GXY 2007 GX784 225238 6282623 55.0 60.0 5.0 0.80 382 123 GXY GXY 2007 GX792 225281 6282544 31.0 36.0 5.0 1.81 176 49 GXY GXY 2007 GX794 225279 6282587 42.0 46.0 4.0 2.21 806 74 GXY GXY 2007 GX799 225316 6282483 32.0 34.0 2.0 1.11 275 118 GXY GXY 2007 GXD009 224721 6282421 45.6 47.6 2.0 1.66 129 150 GXY GXY 2007 GXD011 224921 6282495 27.2 30.0 2.8 0.61 198 98 GXY GXY 2007 GXD011 224921 6282495 33.6 36.4 2.8 1.28 231 298 GXY GXY 2007 GXD013 224523 6281698 1.2 4.0 2.8 1.82 284 215 GXY GXY 2008 GX831 224439 6282140 3.0 5.0 2.0 1.38 373 86 GXY GXY 2008 GX832 224397 6282141 6.0 8.0 2.0 0.96 281 114 GXY GXY 2008 GX833 224360 6282141 9.0 11.0 2.0 0.88 379 72 GXY GXY 2008 GX833 224360 6282141 13.0 16.0 3.0 1.48 315 103 GXY GXY 2008 GX833 224360 6282141 24.0 26.0 2.0 0.92 131 83 GXY GXY 2008 GX834 224320 6282129 15.0 18.0 3.0 2.13 155 57 GXY GXY 2008 GX835 224280 6282140 17.0 19.0 2.0 1.24 128 136 GXY GXY 2008 GX835 224280 6282140 22.0 24.0 2.0 1.41 183 122 GXY GXY 2008 GX836 224243 6282140 19.0 28.0 9.0 1.27 203 204 GXY GXY 2008 GX839 224561 6282059 22.0 24.0 2.0 0.73 324 115 GXY GXY 2008 GX840 224521 6282060 13.0 15.0 2.0 1.62 440 129 GXY GXY 2008 GX842 224400 6282061 2.0 4.0 2.0 1.34 360 86 GXY GXY 2008 GX843 224360 6282061 12.0 14.0 2.0 0.97 324 143 GXY GXY 2008 GX845 224279 6282060 10.0 13.0 3.0 0.93 256 74 GXY GXY 2008 GX846 224240 6282060 15.0 17.0 2.0 0.49 257 143 GXY GXY 2008 GX849 224320 6282220 50.0 64.0 14.0 1.70 202 127 GXY GXY 2008 GX850 224360 6282220 53.0 63.0 10.0 1.77 189 122 GXY GXY 2008 GX851 224400 6282220 41.0 43.0 2.0 0.52 269 114 GXY GXY 2008 GX851 224400 6282220 52.0 54.0 2.0 1.60 183 122 GXY GXY 2008 GX852 224439 6282220 43.0 47.0 4.0 1.36 208 114 GXY GXY 2008 GX853 224480 6282219 40.0 43.0 3.0 0.93 232 129 GXY GXY 2008 GX854 224361 6282262 51.0 59.0 8.0 0.78 188 131 GXY GXY 2008 GX854 224361 6282262 77.0 79.0 2.0 1.67 159 122 GXY GXY 2008 GX856 224440 6282260 42.0 46.0 4.0 1.60 217 100 GXY GXY 2008 GX856 224440 6282260 71.0 76.0 5.0 0.74 165 78 GXY GXY 2008 GX857 224398 6282261 43.0 49.0 6.0 1.33 172 86 GXY GXY 2008 GX857 224398 6282261 77.0 81.0 4.0 1.04 182 68 GXY GXY 2008 GX858 224318 6282263 55.0 59.0 4.0 1.44 162 115 GXY GXY 2008 GX858 224318 6282263 60.0 62.0 2.0 0.49 159 86 GXY GXY 2008 GX858 224318 6282263 70.0 79.0 9.0 1.57 185 153 GXY GXY 2008 GX860 224664 6282260 9.0 12.0 3.0 1.54 211 105 GXY GXY 2008 GX860 224664 6282260 20.0 31.0 11.0 1.04 161 92 GXY GXY 2008 GX860 224664 6282260 95.0 97.0 2.0 1.24 336 215 GXY GXY 2008 GX861 224479 6282340 74.0 77.0 3.0 1.27 301 305 GXY GXY 2008 GX861 224479 6282340 84.0 97.0 13.0 0.99 71 59 GXY GXY 2008 GX863 224440 6282420 84.0 91.0 7.0 1.15 127 110 GXY GXY 2008 GX863 224440 6282420 95.0 97.0 2.0 0.56 104 86 GXY GXY 2008 GX863 224440 6282420 100.0 105.0 505.0 2352.35 125 152 GXY GXY 2008 GX864 224479 6282263 38.0 40.0 2.0 1.04 46 36 GXY GXY 2008 GX864 224479 6282263 72.0 76.0 4.0 0.88 138 115 GXY GXY 2008 GX864 224479 6282263 136.0 138.0 2.0 1.59 171 115 GXY GXY 2008 GX865 224722 6282456 44.0 51.0 7.0 1.61 206 282 GXY GXY 2008 GX865 224722 6282456 54.0 56.0 2.0 0.93 110 83 GXY GXY 2008 GX867 224781 6282461 26.0 34.0 8.0 1.43 51 61 GXY GXY 2008 GX867 224781 6282461 53.0 58.0 5.0 1.38 223 330 5 Mt Cattlin ‐ Significant Drill Intercepts to May 2011
COMPANY PROGRAM HOLE EASTING NORTHING DEPTH DEPTH TO WIDTH Li2O %Ta2O5 Nb2O5 FROM PPM PPM GXY GXY 2008 GX868 224850 6282458 18.0 32.0 14.0 2.61 464 237 GXY GXY 2008 GX868 224850 6282458 57.0 64.0 7.0 0.48 88 65 GXY GXY 2008 GX869 224908 6282457 11.0 23.0 12.0 1.81 137 58 GXY GXY 2008 GX869 224908 6282457 27.0 33.0 6.0 1.69 104 55 GXY GXY 2008 GX869 224908 6282457 47.0 52.0 5.0 1.19 78 97 GXY GXY 2008 GX870 224739 6282499 18.0 23.0 5.0 1.79 56 85 GXY GXY 2008 GX870 224739 6282499 51.0 62.0 11.0 0.75 77 81 GXY GXY 2008 GX871 224658 6282501 30.0 40.0 10.0 1.28 108 107 GXY GXY 2008 GX871 224658 6282501 47.0 50.0 3.0 1.84 171 157 GXY GXY 2008 GX872 224817 6282501 27.0 36.0 9.0 1.86 319 123 GXY GXY 2008 GX872 224817 6282501 59.0 63.0 4.0 1.19 116 97 GXY GXY 2008 GX873 224820 6282421 23.0 31.0 8.0 1.76 465 375 GXY GXY 2008 GX873 224820 6282421 68.0 70.0 2.0 1.01 70 61 GXY GXY 2008 GX874 224915 6282418 12.0 25.0 13.0 1.92 345 71 GXY GXY 2008 GX874 224915 6282418 26.0 29.0 3.0 0.46 71 36 GXY GXY 2008 GX875 224911 6282379 3.0 6.0 3.0 0.88 1058 67 GXY GXY 2008 GX876 224948 6282339 3.0 7.0 4.0 0.86 238 77 GXY GXY 2008 GX878 224860 6282302 13.0 17.0 4.0 1.29 115 138 GXY GXY 2008 GX879 224899 6282300 17.0 21.0 4.0 0.76 67 58 GXY GXY 2008 GX884 224241 6281979 16.0 19.0 3.0 0.64 207 81 GXY GXY 2008 GX884 224241 6281979 74.0 81.0 7.0 1.12 133 100 GXY GXY 2008 GX884 224241 6281979 107.0 109.0 2.0 1.17 214 136 GXY GXY 2008 GX888 224400 6281980 71.0 74.0 3.0 0.73 114 60 GXY GXY 2008 GX888 224400 6281980 81.0 87.0 6.0 0.72 287 141 GXY GXY 2008 GX889 224440 6281980 21.0 23.0 2.0 0.52 410 136 GXY GXY 2008 GX890 224480 6281980 11.0 14.0 3.0 0.70 364 98 GXY GXY 2008 GX892 224560 6281980 6.0 9.0 3.0 0.80 193 62 GXY GXY 2008 GX892 224560 6281980 19.0 21.0 2.0 0.41 354 122 GXY GXY 2008 GX894 224640 6281981 32.0 35.0 3.0 0.67 185 72 GXY GXY 2008 GX896 224201 6281980 12.0 15.0 3.0 1.36 289 131 GXY GXY 2008 GX900 224200 6282060 20.0 22.0 2.0 1.71 214 86 GXY GXY 2008 GX901 224160 6282059 18.0 20.0 2.0 1.23 171 86 GXY GXY 2008 GX901 224160 6282059 30.0 34.0 4.0 1.01 159 104 GXY GXY 2008 GX902 224162 6282139 26.0 36.0 10.0 1.88 119 76 GXY GXY 2008 GX903 224198 6282140 22.0 35.0 13.0 1.55 144 114 GXY GXY 2008 GXMCGTD01 224259 6282105 23.1 25.7 2.6 0.99 199 121 GXY GXY 2008 GXMCGTD02 224503 6282414 93.4 109.5 16.1 1.55 110 112 GXY GXY 2008 GXMCGTD02 224503 6282414 110.7 114.0 3.3 0.44 191 185 GXY GXY 2008 GXMCGTD03 224685 6282612 10.6 14.2 3.6 0.99 30 86 GXY GXY 2008 GXMCMTD01 224242 6282020 12.5 16.7 4.2 1.65 281 139 GXY GXY 2008 GXMCMTD03 224557 6282380 19.2 23.6 4.4 1.42 154 157 GXY GXY 2008 GXMCMTD03 224557 6282380 28.0 30.1 2.1 0.97 128 236 GXY GXY 2008 GXMCMTD03 224557 6282380 34.6 39.6 5.0 1.31 86 256 GXY GXY 2008 GXMCMTD03 224557 6282380 42.4 44.5 2.1 0.86 78 317 GXY GXY 2008 GXMCMTD04 224756 6282578 10.1 17.1 7.0 0.92 203 306 GXY GXY 2008 GXMCMTD05 224877 6282341 13.2 16.6 3.4 0.85 91 177 GXY GXY 2008 GXMCMTD06 225150 6282316 12.3 14.6 2.3 0.89 531 221 GXY GXY 2009 GX1001 224860 6282510 36.0 45.0 9.0 1.52 123 58 GXY GXY 2009 GX1002 224850 6282450 22.0 32.0 10.0 2.42 197 65 GXY GXY 2009 GX1003 224850 6282470 21.0 27.0 6.0 1.40 60 71 GXY GXY 2009 GX1005 225275 6282055 0.0 8.0 8.0 1.34 101 124 GXY GXY 2009 GX1007 224959 6282501 29.0 43.0 14.0 2.06 76 47 GXY GXY 2009 GX1008 224992 6282499 40.0 61.0 21.0 1.88 206 39 GXY GXY 2009 GX1009 224967 6282546 34.0 47.0 13.0 2.10 205 70 GXY GXY 2009 GX1010 224928 6282585 25.0 37.0 12.0 1311.31 368 58 GXY GXY 2009 GX1011 224926 6282625 36.0 44.0 8.0 1.69 269 135 GXY GXY 2009 GX1012 224925 6282661 35.0 37.0 2.0 1.09 52 36 GXY GXY 2009 GX1014 224910 6282699 58.0 61.0 3.0 0.95 688 310 GXY GXY 2009 GX1015 224881 6282699 38.0 40.0 2.0 0.54 1374 344 GXY GXY 2009 GX1021 225110 6282700 71.0 73.0 2.0 0.55 367 197 GXY GXY 2009 GX1026 224810 6282450 24.0 35.0 11.0 1.38 284 61 GXY GXY 2009 GX1027 224810 6282460 25.0 29.0 4.0 1.96 125 79 6 Mt Cattlin ‐ Significant Drill Intercepts to May 2011
COMPANY PROGRAM HOLE EASTING NORTHING DEPTH DEPTH TO WIDTH Li2O %Ta2O5 Nb2O5 FROM PPM PPM GXY GXY 2009 GX1027 224810 6282460 32.0 36.0 4.0 1.16 183 74 GXY GXY 2009 GX1028 224810 6282470 35.0 37.0 2.0 1.41 318 129 GXY GXY 2009 GX1029 224810 6282480 29.0 34.0 5.0 1.33 161 65 GXY GXY 2009 GX1030 224820 6282450 25.0 35.0 10.0 1.18 192 80 GXY GXY 2009 GX1033 225006 6282660 61.0 66.0 5.0 1.02 369 80 GXY GXY 2009 GX1034 225061 6282662 58.0 60.0 2.0 0.84 110 61 GXY GXY 2009 GX1037 225234 6282659 72.0 74.0 2.0 0.76 5514 301 GXY GXY 2009 GX1038 225122 6282624 64.0 70.0 6.0 1.58 495 117 GXY GXY 2009 GX1039 225107 6282624 54.0 64.0 10.0 1.59 249 53 GXY GXY 2009 GX1040 224984 6282626 48.0 57.0 9.0 1.45 146 57 GXY GXY 2009 GX1041 225028 6282624 53.0 64.0 11.0 1.60 365 89 GXY GXY 2009 GX1042 225070 6282626 51.0 62.0 11.0 0.99 177 113 GXY GXY 2009 GX1043 225123 6282586 57.0 62.0 5.0 1.02 107 99 GXY GXY 2009 GX1044 225107 6282584 49.0 60.0 11.0 1.57 155 82 GXY GXY 2009 GX1045 225070 6282584 48.0 58.0 10.0 1.55 156 99 GXY GXY 2009 GX1046 225029 6282585 48.0 58.0 10.0 1.67 271 90 GXY GXY 2009 GX1047 225042 6282499 45.0 60.0 15.0 1.51 299 44 GXY GXY 2009 GX1048 225068 6282540 43.0 50.0 7.0 1.82 283 41 GXY GXY 2009 GX1049 225108 6282543 43.0 54.0 11.0 1.62 198 71 GXY GXY 2009 GX1050 225122 6282499 45.0 50.0 5.0 1.27 113 57 GXY GXY 2009 GX1050 225122 6282499 52.0 54.0 2.0 0.44 745 36 GXY GXY 2009 GX1051 225122 6282428 29.0 45.0 16.0 1.69 198 59 GXY GXY 2009 GX1052 225083 6282461 34.0 48.0 14.0 1.40 82 39 GXY GXY 2009 GX1053 224824 6282661 50.0 52.0 2.0 0.57 232 186 GXY GXY 2009 GX1054 224315 6282497 95.0 111.0 16.0 1.35 68 87 GXY GXY 2009 GX1055 224158 6282500 110.0 116.0 6.0 1.49 37 50 GXY GXY 2009 GX1056 224830 6282510 27.0 29.0 2.0 1.10 116 61 GXY GXY 2009 GX1056 224830 6282510 32.0 37.0 5.0 0.50 140 49 GXY GXY 2009 GX1057 224840 6282510 37.0 41.0 4.0 1.43 383 231 GXY GXY 2009 GX1058 224849 6282490 28.0 40.0 12.0 1.92 105 72 GXY GXY 2009 GX1059 224850 6282500 33.0 41.0 8.0 1.46 1075 187 GXY GXY 2009 GX1060 224850 6282509 37.0 44.0 7.0 1.87 331 66 GXY GXY 2009 GX1061 224870 6282451 23.0 36.0 13.0 1.62 518 73 GXY GXY 2009 GX1062 224870 6282470 27.0 39.0 12.0 1.61 180 58 GXY GXY 2009 GX1063 224830 6282460 21.0 31.0 10.0 2.60 373 107 GXY GXY 2009 GX1064 224838 6282469 22.0 33.0 11.0 1.35 236 173 GXY GXY 2009 GX1065 224840 6282480 21.0 23.0 2.0 0.60 30 36 GXY GXY 2009 GX1065 224840 6282480 28.0 38.0 10.0 1.67 69 59 GXY GXY 2009 GX910 224810 6282510 32.0 37.0 5.0 1.99 405 347 GXY GXY 2009 GX911 224820 6282491 30.0 35.0 5.0 1.34 177 119 GXY GXY 2009 GX912 224830 6282470 23.0 33.0 10.0 1.44 839 89 GXY GXY 2009 GX913 224840 6282450 22.0 33.0 11.0 1.64 233 19 GXY GXY 2009 GX913 224840 6282450 38.0 40.0 2.0 0.89 116 75 GXY GXY 2009 GX914 224810 6282500 31.0 36.0 5.0 1.21 459 7 GXY GXY 2009 GX915 224820 6282480 26.0 33.0 7.0 1.56 170 7 GXY GXY 2009 GX916 224041 6282338 88.0 94.0 6.0 1.00 105 7 GXY GXY 2009 GX919 224811 6282490 30.0 35.0 5.0 2.68 222 172 GXY GXY 2009 GX920 224821 6282470 23.0 32.0 9.0 1.43 125 135 GXY GXY 2009 GX921 224830 6282450 20.0 30.0 10.0 3.43 152 93 GXY GXY 2009 GX922 224121 6282139 23.0 29.0 6.0 0.93 225 215 GXY GXY 2009 GX924 224081 6282059 51.0 55.0 4.0 1.30 64 72 GXY GXY 2009 GX925 224119 6282059 45.0 49.0 4.0 1.82 70 72 GXY GXY 2009 GX926 224108 6282099 45.0 50.0 5.0 1.93 62 72 GXY GXY 2009 GX933 224821 6282511 28.0 36.0 8.0 1.35 192 57 GXY GXY 2009 GX934 224830 6282500 28.0 34.0 606.0 1991.99 163 114 GXY GXY 2009 GX935 224840 6282490 28.0 36.0 8.0 2.17 486 59 GXY GXY 2009 GX936 224850 6282480 25.0 36.0 11.0 1.98 113 58 GXY GXY 2009 GX937 224860 6282470 25.0 37.0 12.0 1.38 88 58 GXY GXY 2009 GX938 224870 6282460 23.0 36.0 13.0 1.32 125 97 GXY GXY 2009 GX939 224871 6282510 37.0 46.0 9.0 1.31 233 89 GXY GXY 2009 GX940 224870 6282501 38.0 43.0 5.0 1.37 79 80 GXY GXY 2009 GX943 224871 6282490 33.0 42.0 9.0 0.94 71 80 7 Mt Cattlin ‐ Significant Drill Intercepts to May 2011
COMPANY PROGRAM HOLE EASTING NORTHING DEPTH DEPTH TO WIDTH Li2O %Ta2O5 Nb2O5 FROM PPM PPM GXY GXY 2009 GX944 224871 6282480 30.0 40.0 10.0 1.40 106 54 GXY GXY 2009 GX945 224120 6282419 92.0 99.0 7.0 1.25 64 41 GXY GXY 2009 GX946 224199 6282340 76.0 82.0 6.0 1.63 43 78 GXY GXY 2009 GX947 224240 6282419 96.0 105.0 9.0 2.01 72 73 GXY GXY 2009 GX949 224318 6282578 120.0 129.0 9.0 1.40 70 58 GXY GXY 2009 GX950 224162 6282579 133.0 136.0 3.0 1.12 59 83 GXY GXY 2009 GX956 224830 6282480 24.0 35.0 11.0 1.34 239 222 GXY GXY 2009 GX957 224830 6282490 25.0 34.0 9.0 0.95 182 81 GXY GXY 2009 GX962 225478 6282421 6.0 12.0 6.0 1.23 74 81 GXY GXY 2009 GX965 225599 6282338 9.0 14.0 5.0 1.46 82 102 GXY GXY 2009 GX966 225481 6282338 29.0 32.0 3.0 1.06 59 74 GXY GXY 2009 GX967 225398 6282340 8.0 15.0 7.0 1.55 119 61 GXY GXY 2009 GX968 225439 6282261 24.0 33.0 9.0 1.72 126 80 GXY GXY 2009 GX969 225480 6282260 27.0 36.0 9.0 1.43 68 80 GXY GXY 2009 GX970 225600 6282180 58.0 60.0 2.0 1.94 116 61 GXY GXY 2009 GX972 225601 6282260 60.0 63.0 3.0 1.32 79 48 GXY GXY 2009 GX973 225520 6282261 48.0 56.0 8.0 0.91 146 70 GXY GXY 2009 GX974 225560 6282180 52.0 57.0 5.0 1.10 215 89 GXY GXY 2009 GX975 225534 6282181 34.0 37.0 3.0 1.90 387 415 GXY GXY 2009 GX975 225534 6282181 41.0 46.0 5.0 1.01 63 82 GXY GXY 2009 GX977 225561 6282100 44.0 49.0 5.0 1.34 249 53 GXY GXY 2009 GX978 225531 6282100 28.0 30.0 2.0 0.48 52 54 GXY GXY 2009 GX978 225531 6282100 34.0 37.0 3.0 0.49 79 117 GXY GXY 2009 GX979 225272 6282094 4.0 14.0 10.0 0.82 48 57 GXY GXY 2009 GX981 225219 6282099 2.0 11.0 9.0 1.06 51 60 GXY GXY 2009 GX982 225229 6282140 1.0 6.0 5.0 1.35 45 63 GXY GXY 2009 GX983 225190 6282139 1.0 7.0 6.0 0.91 122 114 GXY GXY 2009 GX984 225236 6282177 5.0 20.0 15.0 1.66 76 60 GXY GXY 2009 GX986 225198 6282219 0.0 14.0 14.0 1.85 193 78 GXY GXY 2009 GX987 225201 6282180 0.0 3.0 3.0 1.32 59 65 GXY GXY 2009 GX987 225201 6282180 7.0 14.0 7.0 0.98 36 57 GXY GXY 2009 GX988 225221 6282260 12.0 27.0 15.0 1.28 105 52 GXY GXY 2009 GX989 225162 6282222 3.0 11.0 8.0 1.20 958 86 GXY GXY 2009 GX990 225173 6282256 8.0 21.0 13.0 0.75 74 61 GXY GXY 2009 GX991 225268 6282306 6.0 18.0 12.0 1.55 428 97 GXY GXY 2009 GX992 225235 6282298 9.0 22.0 13.0 1.63 147 61 GXY GXY 2009 GX993 225203 6282300 10.0 13.0 3.0 1.62 281 74 GXY GXY 2009 GX993 225203 6282300 20.0 23.0 3.0 0.83 75 62 GXY GXY 2009 GX994 225142 6282260 1.0 4.0 3.0 0.70 55 53 GXY GXY 2009 GX994 225142 6282260 7.0 13.0 6.0 1.22 701 74 GXY GXY 2009 GX995 225124 6282304 5.0 10.0 5.0 0.64 674 77 GXY GXY 2009 GX996 224860 6282450 21.0 35.0 14.0 2.07 562 66 GXY GXY 2009 GX997 224860 6282460 21.0 36.0 15.0 1.76 127 101 GXY GXY 2009 GX998 224860 6282480 27.0 38.0 11.0 1.81 99 88 GXY GXY 2009 GX999 224860 6282490 29.0 41.0 12.0 1.82 146 65 GXY GXY 2010 GX1000 224860 6282500 34.0 42.0 8.0 1.08 104 52 GXY GXY 2010 GX1031 224820 6282460 22.0 27.0 5.0 2.00 686 723 GXY GXY 2010 GX1031 224820 6282460 51.0 53.0 2.0 0.43 52 61 GXY GXY 2010 GX1031 224820 6282460 57.0 61.0 4.0 1.63 107 120 GXY GXY 2010 GX1071 224018 6283711 3.0 6.0 3.0 0.94 67 143 GXY GXY 2010 GX1076 225198 6282623 55.0 59.0 4.0 0.55 151 68 GXY GXY 2010 GX1077 225194 6282585 48.0 54.0 6.0 1.11 154 107 GXY GXY 2010 GX1078 225195 6282542 41.0 48.0 7.0 0.62 350 59 GXY GXY 2010 GX1079 225148 6282543 44.0 53.0 9.0 1.03 271 54 GXY GXY 2010 GX1081 224882 6282379 15.0 23.0 808.0 1631.63 270 59 GXY GXY 2010 GX1081 224882 6282379 36.0 38.0 2.0 1.08 86 86 GXY GXY 2010 GX1082 224820 6282378 21.0 24.0 3.0 1.34 411 53 GXY GXY 2010 GX1082 224820 6282378 27.0 31.0 4.0 1.74 119 74 GXY GXY 2010 GX1082 224820 6282378 41.0 44.0 3.0 0.71 132 48 GXY GXY 2010 GX1082 224820 6282378 51.0 54.0 3.0 1.71 436 391 GXY GXY 2010 GX1083 224866 6282422 23.0 32.0 9.0 1.15 176 137 GXY GXY 2010 GX1083 224866 6282422 37.0 42.0 5.0 0.74 213 63 8 Mt Cattlin ‐ Significant Drill Intercepts to May 2011
COMPANY PROGRAM HOLE EASTING NORTHING DEPTH DEPTH TO WIDTH Li2O %Ta2O5 Nb2O5 FROM PPM PPM GXY GXY 2010 GX1084 224899 6282497 27.0 37.0 10.0 1.08 118 45 GXY GXY 2010 GX1084 224899 6282497 49.0 52.0 3.0 1.58 161 234 GXY GXY 2010 GX1085 224820 6282340 29.0 32.0 3.0 1.68 962 579 GXY GXY 2010 GX1086 224859 6282340 15.0 26.0 11.0 1.37 78 93 GXY GXY 2010 GX1087 224644 6282541 46.0 48.0 2.0 1.18 104 115 GXY GXY 2010 GX1088 224781 6282537 30.0 35.0 5.0 2.33 818 75 GXY GXY 2010 GX1089 224783 6282496 28.0 35.0 7.0 2.00 231 166 GXY GXY 2010 GX1089 224783 6282496 57.0 61.0 4.0 0.48 55 45 GXY GXY 2010 GX1090 224080 6282580 148.0 150.0 2.0 0.76 107 75 GXY GXY 2010 GX1092 224039 6282420 114.0 116.0 2.0 2.18 76 97 GXY GXY 2010 GX1093 224119 6282342 78.0 88.0 10.0 1.10 60 64 GXY GXY 2010 GX1094 224161 6282658 161.0 166.0 5.0 0.77 84 97 GXY GXY 2010 GX1095 224178 6282419 99.0 103.0 4.0 2.23 66 104 GXY GXY 2010 GX1096 224462 6282462 124.0 126.0 2.0 1.39 64 75 GXY GXY 2010 GX1097 224463 6282500 96.0 98.0 2.0 0.99 64 93 GXY GXY 2010 GX1097 224463 6282500 102.0 109.0 7.0 1.14 223 90 GXY GXY 2010 GX1097 224463 6282500 114.0 116.0 2.0 1.03 58 93 GXY GXY 2010 GX1097 224463 6282500 121.0 125.0 4.0 0.93 67 77 GXY GXY 2010 GX1098 224280 6282339 73.0 89.0 16.0 1.63 114 138 GXY GXY 2010 GX1099 224240 6282499 107.0 116.0 9.0 2.23 81 110 GXY GXY 2010 GX1100 224242 6282580 135.0 141.0 6.0 1.64 35 67 GXY GXY 2010 GX1102 224235 6282660 154.0 160.0 6.0 1.35 41 69 GXY GXY 2010 GX1103 224323 6282419 86.0 98.0 12.0 1.66 46 89 GXY GXY 2010 GX1103 224323 6282419 101.0 103.0 2.0 0.56 98 115 GXY GXY 2010 GX1104 224350 6282339 77.0 83.0 6.0 0.64 77 84 GXY GXY 2010 GX1104 224350 6282339 86.0 94.0 8.0 1.45 75 56 GXY GXY 2010 GX1105 224320 6282661 139.0 148.0 9.0 1.78 83 81 GXY GXY 2010 GX1106 224402 6282659 118.0 130.0 12.0 1.46 110 74 GXY GXY 2010 GX1107 224402 6282580 114.0 121.0 7.0 1.04 112 73 GXY GXY 2010 GX1108 224383 6282499 100.0 114.0 14.0 1.47 123 84 GXY GXY 2010 GX1108 224383 6282499 117.0 120.0 3.0 1.15 30 36 GXY GXY 2010 GX1109 224421 6282300 86.0 96.0 10.0 1.30 145 73 GXY GXY 2010 GX1110 224500 6282300 70.0 73.0 3.0 1.29 167 114 GXY GXY 2010 GX1110 224500 6282300 79.0 86.0 7.0 1.51 119 74 GXY GXY 2010 GX1111 224439 6282380 94.0 112.0 18.0 1.22 135 75 GXY GXY 2010 GX1112 224458 6282300 71.0 76.0 5.0 1.12 247 74 GXY GXY 2010 GX1112 224458 6282300 88.0 99.0 11.0 1.40 107 51 GXY GXY 2010 GX1113 224440 6282340 82.0 102.0 20.0 1.23 95 53 GXY GXY 2010 GX1113 224440 6282340 113.0 115.0 2.0 1.09 177 61 GXY GXY 2010 GX1114 224455 6282373 84.0 110.0 26.0 1.36 84 48 GXY GXY 2010 GX1119 224640 6281580 13.0 15.0 2.0 1.50 375 38 GXY GXY 2010 GX1125 224637 6281654 10.0 13.0 3.0 0.69 390 40 GXY GXY 2010 GX1128 224600 6281580 17.0 19.0 2.0 0.52 205 25 GXY GXY 2010 GXD014 224551 6282458 37.0 53.9 17.0 1.42 143 60 GXY GXY 2010 GXD014 224551 6282458 58.4 63.8 5.4 1.10 99 61 GXY GXY 2010 GXD015 224702 6282297 26.5 43.9 17.5 1.55 163 93 GXY GXY 2010 GXD017 224841 6282448 24.0 42.3 18.3 2.38 568 134 GXY GXY 2010 GXD018 224662 6282418 36.6 40.5 3.9 2.14 76 57 GXY GXY 2010 GXD018 224662 6282418 43.3 45.9 2.6 1.16 93 51 GXY GXY 2010 GXD018 224662 6282418 48.6 53.6 5.1 1.07 80 63
Note: Coordinates are in projection GDA 94, Zone 51 to an accuracy of <1m. Most holes are vertical and since the mineralised pegmatite is sub-horizontal, intercept widths approximate true thickness. Intercepts are weighted averages calculated using a lower
cut of 0.4% Li2O and a maximum of 2m internal waste. No toppp cut has been apppyyyglied. Analysis by SGS Australia Pty Ltd using AAS for Li (converted to Li2O) and XRF for Ta (converted to Ta2O5). Sampling methods are described in Section 11.
9