J2225 NI 43−101 Technical Report on the Blanket Gold Mine, Zimbabwe Prepared by The MSA Group on behalf of: Caledonia Mining Corporation J2225 NI 43−101 Technical Report on the Blanket Gold Mine, Zimbabwe Prepared by The MSA Group on behalf of: Caledonia Mining Corporation Authors: Bruno Bvirakare Senior Project Geologist BSc, PrSciNat Justin Glanvill Associate Consultant BSc (Hons), GDE, MGSSA, PrSciNat Joel Mungoshi Associate Consultant HND, BSc (Hons) Met Eng, MDP, MBL, MSAIMM John Sexton Associate Consultant BSc, BCom, MBL Vaughn Duke Associate Consultant PrEng, PMP, BSc Min Eng (Hons), MBA, FSAIMM, MECSA, MPMI, MMASA Date: 28 June 2011 Project Code: J2225 Copies: Caledonia Mining Corporation (2) The MSA Group (1) Primary Author Supervising Principal Bruno Bvirakare Mike Robertson This document has been prepared for the exclusive use of Blanket Mine (1983) (Private) Limited for and on behalf of its parent company Caledonia Mining Corporation (Caledonia) on the basis of instructions, information and data supplied by them. Table of Contents 1 Summary ............................................................................................................................................ 1 2 Introduction ....................................................................................................................................... 4 2.1 Scope of Work .......................................................................................................................... 4 2.2 Principal Sources of Information ............................................................................................... 4 2.3 Qualifications, Experience and Independence ......................................................................... 5 2.4 Current Personal Inspection ..................................................................................................... 6 2.5 Purpose of the Technical Report .............................................................................................. 6 3 Reliance on Other Experts ............................................................................................................... 7 4 Property Description and Location ................................................................................................. 8 5 Accessibility, Climate, Local Resources, Infrastructure and Physiography ............................. 16 5.1 Physiography and Vegetation ................................................................................................. 16 5.2 Access .................................................................................................................................... 17 5.3 Climate .................................................................................................................................... 17 5.4 Local Resources and Infrastructure ........................................................................................ 17 6 History .............................................................................................................................................. 19 7 Geological Setting .......................................................................................................................... 23 7.1 Regional Geology ................................................................................................................... 23 7.2 Local Geology ......................................................................................................................... 24 7.3 Property Geology .................................................................................................................... 27 8 Deposit Types ................................................................................................................................. 30 8.1 Characteristics of the Blanket Mine Deposits ......................................................................... 30 8.2 Orogenic Gold Deposits.......................................................................................................... 33 9 Mineralisation .................................................................................................................................. 36 9.1 Development and Style of Mineralisation ............................................................................... 36 9.1.1 Disseminated Sulphide Replacement Type Mineralisation ....................................... 36 9.1.2 Quartz Reef Mineralisation ........................................................................................ 37 9.1.3 Jethro ......................................................................................................................... 38 9.1.4 Blanket Section .......................................................................................................... 38 9.1.5 AR Orebodies ............................................................................................................ 40 9.1.6 Eroica ......................................................................................................................... 41 9.1.7 Lima ........................................................................................................................... 42 10 Exploration ...................................................................................................................................... 44 11 Drilling .............................................................................................................................................. 45 11.1 On-Mine Drilling ...................................................................................................................... 45 12 Sampling Method and Approach ................................................................................................... 47 12.1 Channel and Percussion Drill Sludge Samples ...................................................................... 47 12.2 Diamond Drill Core Sampling ................................................................................................. 48 12.3 Sample Handling and Monitoring ............................................................................................ 48 J2225 Blanket Mine NI 43-101 Technical Report – June 2011 Page: i 13 Sample Preparation, Analyses and Security ................................................................................ 50 13.1 Sample Preparation, Analyses and Security........................................................................... 50 13.2 Statement of Opinion on the Sample Preparation, Security and Analysis .............................. 50 14 Data Verification .............................................................................................................................. 52 15 Adjacent Properties ........................................................................................................................ 54 15.1 Vubachikwe ............................................................................................................................ 54 16 Mineral Processing and Metallurgical Testing............................................................................. 56 16.1 Metallurgical Processing ......................................................................................................... 56 16.2 Metallurgical Testing ............................................................................................................... 57 17 Mineral Resource and Mineral Reserve Estimates ...................................................................... 59 17.1 Grade Data ............................................................................................................................. 59 17.2 Grade analysis ........................................................................................................................ 59 17.3 Density data and Analysis ....................................................................................................... 61 17.4 Recovery and Modifying Factors ............................................................................................ 62 17.4.1 Mining Dilution ........................................................................................................... 62 17.4.2 Recovery .................................................................................................................... 62 17.4.3 Summary of Cut-offs and Recovery Factors ............................................................. 63 17.5 Resource Classification .......................................................................................................... 64 17.5.1 Inferred Mineral Resources ....................................................................................... 64 17.5.2 Indicated Mineral Resources ..................................................................................... 64 17.5.3 Measured Mineral Resources .................................................................................... 65 17.6 Mineral Resource Statement .................................................................................................. 65 17.6.1 2009 Mineral Resources ............................................................................................ 65 17.6.2 2010 Mineral Resources ............................................................................................ 68 17.7 Mineral Reserve Estimate......................................................................................................