TECHNICAL REPORT AND RESOURCE ESTIMATE ON THE KOMBAT COPPER PROJECT, GROOTFONTEIN DISTRICT, OTJOZONDJUPA REGION, NAMIBIA LATITUDE 19o 42’ 35”S LONGITUDE 17o 42’ 09”E UTM Zone 33K 783301 m E 7818395 m S FOR KOMBAT COPPER INC. NI-43-101 & 43-101F1 TECHNICAL REPORT Eugene Puritch, P.Eng. Richard Routledge, P.Geo. Richard Sutcliffe, P.Geo., Ph.D. David Burga, P.Geo. Alfred Hayden, P.Eng. P&E Mining Consultants Inc., Report 287 Effective Date: May 20, 2014 Signing Date: July 4, 2014 TABLE OF CONTENTS 1.0 SUMMARY ............................................................................................................................1 2.0 INTRODUCTION AND TERMS OF REFERENCE ............................................................5 2.1 TERMS OF REFERENCE .........................................................................................5 2.2 SOURCES OF INFORMATION ...............................................................................5 2.3 UNITS AND CURRENCY ........................................................................................6 3.0 RELIANCE ON OTHER EXPERTS .....................................................................................8 4.0 PROPERTY DESCRIPTION AND LOCATION ..................................................................9 4.1 PROPERTY LOCATION ...........................................................................................9 4.2 PROPERTY DESCRIPTION AND TENURE .........................................................10 4.3 NAMIBIAN MINING REGULATIONS .................................................................12 4.3.1 Nature of Kombat Copper’s Interest ..........................................................13 4.4 ENVIRONMENTAL LIABILITIES AND PERMITTING .....................................13 5.0 ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND PHYSIOGRAPHY .............................................................................................................14 5.1 ACCESSIBILITY .....................................................................................................14 5.2 CLIMATE AND PHYSIOGRAPHY .......................................................................14 5.3 LOCAL RESOURCES AND INFRASTRUCTURE ...............................................14 6.0 HISTORY .............................................................................................................................16 7.0 GEOLOGICAL SETTING AND MINERALIZATION ......................................................19 7.1 REGIONAL GEOLOGY ..........................................................................................19 7.2 LOCAL GEOLOGY .................................................................................................20 7.3 PROPERTY GEOLOGY ..........................................................................................21 7.4 MINERALIZATION ................................................................................................23 8.0 DEPOSIT TYPES .................................................................................................................28 9.0 EXPLORATION...................................................................................................................30 10.0 DRILLING ..........................................................................................................................31 10.1 2013 SRK DRILLING AT ASIS FAR WEST DEPOSIT ......................................31 10.2 2013 DRILL CORE RESAMPLING PROGRAM AT ASIS FAR WEST DEPOSIT ...............................................................................................................31 10.3 2014 DRILL CORE RESAMPLING PROGRAM FROM ASIS FAR WEST TO EAST OF THE ASIS WEST AREA ...............................................................32 10.4 2012 GROSS OTAVI DRILLING .........................................................................33 11.0 SAMPLE PREPARATION, ANALYSES AND SECURITY ...........................................35 11.1 HISTORIC CORE SAMPLE PREPARATION AND ANALYSIS AT KOMBAT MINE LABORATORY .......................................................................35 11.2 SAMPLE RECEIVING ..........................................................................................35 11.3 SAMPLE PREPARATION ....................................................................................35 11.4 SAMPLE ANALYSIS ............................................................................................36 11.5 SRK 2013 CAMPAIGN .........................................................................................37 12.0 DATA VERIFICATION ....................................................................................................38 12.2 QUALITY ASSURANCE/QUALITY CONTROL PROGRAM ..........................41 12.2.1 Performance of Certified Reference Materials ..........................................41 12.3 PERFORMANCE OF BLANK MATERIAL ........................................................44 12.4 PERFORMANCE OF CORE DUPLICATES ........................................................45 12.5 QAQC FOR SRK DRILL HOLE ASSAYING ......................................................49 12.6 PERFORMANCE OF THE SRK BLANKS ..........................................................50 12.7 PERFORMANCE OF THE SRK REFERENCE STANDARDS ..........................51 12.8 PERFORMANCE OF PULP REPLICATES .........................................................53 13.0 MINERAL PROCESSING AND METALLURGICAL TESTING ..................................57 14.0 RESOURCE ESTIMATE ...................................................................................................59 14.1 AFW HISTORIC TONNAGE GRADE ESTIMATES ..........................................60 14.2 AFW DIAMOND DRILL HOLE DATABASE.....................................................60 14.3 DRILL HOLE SURVEYS ......................................................................................62 14.4 DOWN HOLE SURVEYS .....................................................................................62 14.5 ASSAY/ANALYTICAL DATABASE ..................................................................63 14.6 WIREFRAMES ......................................................................................................66 14.7 ASSAYS AND GRADE DISTRIBUTIONS .........................................................69 14.8 GRADE CAPPING .................................................................................................70 14.9 BULK DENSITY....................................................................................................75 14.10 SAMPLE LENGTHS AND ASSAY COMPOSITING ........................................76 14.11 VARIOGRAPHY ..................................................................................................77 14.12 BLOCK MODEL ...................................................................................................80 14.13 BLOCK MODEL GRADE INTERPOLATION ...................................................80 14.13.1 Search Strategy and Grade Interpolation ...............................................80 14.14 MINERAL RESOURCE CLASSIFICATION ......................................................83 14.15 MINERAL RESOURCE ESTIMATE ...................................................................84 14.16 BLOCK MODEL VALIDATION .........................................................................84 15.0 MINERAL RESERVE ESTIMATES.................................................................................86 16.0 MINING METHODS .........................................................................................................87 17.0 RECOVERY METHODS ...................................................................................................88 18.0 PROJECT INFRASTRUCTURE .......................................................................................89 19.0 MARKET STUDIES AND CONTRACTS ........................................................................90 20.0 ENVIRONMENTAL STUDIES, PERMITTING AND SOCIAL OR COMMUNITY IMPACT ............................................................................................................................91 21.0 CAPITAL AND OPERATING COSTS .............................................................................91 22.0 ECONOMIC ANALYSIS ..................................................................................................92 23.0 ADJACENT PROPERTIES ...............................................................................................93 24.0 OTHER RELEVANT DATA AND INFORMATION ......................................................94 25.0 INTERPRETATION AND CONCLUSIONS ....................................................................95 26.0 RECOMMENDATIONS ....................................................................................................97 26.1 RECOMMENDATIONS AND PROPOSED BUDGET........................................97 27.0 REFERENCES ...................................................................................................................99 28.0 CERTIFICATES ...............................................................................................................101 APPENDIX I. PRELIMINARY VARIOGRAPHY .................................................................106 LIST OF TABLES Table 1.1 AFW Inferred Resources at Various Copper Cut-Off Grades ................................ 4 Table 4.1 Licence Data .........................................................................................................