Salares Norte, Chile
Increased confidence in the Mineral Resource underpins the Pre-feasibility study scheduled for completion in 2017
The Salares Norte Project is located in the Atacama region of Northern Chile. The nearest town is Diego de Almagro, about 190km by road to the west of the project. The project is centred on latitude of 26° 0’ 42” S and longitude of 68° 53’ 35” W, with elevations between 4,200m and 4,900m AMSL.
Project history and ownership
Gold Fields discovered the mineralisation at Salares Norte in March 2011 with reverse circulation drilling. To date, 95,303m have been drilled in 319 holes on the project (79 reverse circulation holes and 240 diamond drill holes).
The project is owned by Minera Gold Fields Salares Norte Ltda (MGFSNL), which holds 1,800ha of exploitation concessions (mining rights), with definitive title granted. MGFSNL also has an option to purchase agreement for an additional 1,200 hectare property attached to the project. Gold Fields Limited indirectly holds a 100% interest in MGFSNL. Access rights to the property have been granted by the government and applications for water rights have also been approved.
Geology and mineralisation
The Salares Norte Project is located in the northern part of the Maricunga Belt, an area with a predominance of Cenozoic volcanic rocks, comprising eroded strato-volcanos, volcanic domes and pyroclastic rocks. Mineralisation at Salares Norte is contained in a high-sulphidation epithermal system, hosted mainly by a breccia complex along the contact of two volcanic domes of andesitic and dacitic composition. Mineral Resources have been delineated by drilling in two separate deposits, Brecha Principal and Agua Amarga, which are located about 500m apart. Most of the mineralisation known to date is oxidised. The sulphide mineralisation contains mainly pyrite. Preliminary metallurgical test results indicate gold extraction in the order of 90% using a conventional CIL process on samples of oxidised material.
Level of study, processing methodology, sustainability and permits
An interim scoping study was completed on the project in 2014, which showed positive results. The scoping study was updated in 2015 after additional drilling, metallurgical testing and cost analysis. Further drilling is in progress and a prefeasibility study will be completed in H2 2017. The environmental impact declaration that was approved in January 2014 has been amended in 2016 to permit continued exploration drilling.
As at all the Gold Fields operations and projects, a comprehensive sampling and assay QA/QC protocol is in place for Salares Norte using leading industry practice in data acquisition, reputable certified laboratories and analytical controls.
Key development at Salares Norte include
- Salares Norte has benefited from additional resource definition drilling driving significant improvements to the Mineral Resource size and confidence levels in 2016
- The Mineral Resource reflects a significant improvement in confidence level comprising 52% Indicated and 48% Inferred with the average grade for Brecha Principal at 5.0g/t Au and for Agua Amarga 4.0g/t Au
- The gold Mineral Resource increased from 3.3Moz to 3.8Moz and comprises 96% oxide material
- The silver Mineral Resource increased from 42.1Moz to 43.8Moz
- All geological domains have been updated with a better understanding of mineralisation controls
- Ongoing infill drilling at Brecha Principal (79% Indicated) and Agua Amarga (100% Inferred)
- Environmental baseline study commenced in October 2015
The PFS for Brecha Principal and scoping study for Agua Amarga are scheduled for completion in 2017 and will benefit from the latest drill season campaign and updated resource and reserve modelling that is planned to support reporting a maiden Mineral Reserve for Brecha Principal in the latter half of 2017.
Salares Norte Classified Mineral Resource
|Agua Amarga (Inferred only)||Sub-total||10.1||4.0||39.0||1.31||12.67|
|Total Mineral Resource||Tonnes (Mt)||Grade Au and Ag = g/t||Content Au and Ag = Moz|
|Indicated – Gold||12.1||6.8||—||5.1||4.5||—||1.96||0.98||—|
|Inferred – Gold||13.5||20.0||23.3||4.2||3.7||4.1||1.83||2.37||3.10|
|Total - Gold||25.6||26.8||23.3||4.6||3.9||4.1||3.79||3.35||3.10|
|Indicated – Silver||12.1||6.8||—||69.6||82.7||—||27.08||18.13||—|
|Inferred – Silver||13.5||20.0||23.3||38.4||37.4||44.8||16.69||24.00||33.60|
|Total – Silver||25.6||26.8||23.3||53.1||48.9||44.8||43.76||42.13||33.60|
- Mineral Resources are reported under the South African Code for the Reporting of Exploration Results, Mineral Resources, and Mineral Reserves, 2016 Edition.
- Confidence classification assumes annual production-scale, bulk open pit mining scenario.
- These Mineral Resources are classified as Indicated and Inferred. The Competent Person has reasonable confidence in the Resources, but future drilling may materially change the Resource evaluation.
- Attributable metal to Gold Fields is 100%.
- Mineral Resources are constrained within an optimised open pit shell using scoping study parameters for Brecha Principal and conceptual study parameters at Agua Amarga including mining, processing, and administration cost estimates and process recovery estimates.
- Mineral Resources are reported for material within an open pit shell having positive value after process recoveries and costs, refining, royalty (1%) and overhead have been applied. A variable cut-off is applied since the process costs and recoveries are dependent on the head grade. This resulted in an average economic cut-off of US$47.80/tonne-processed, which is equivalent to an average cut-off grade of 1.18g/t Au.
- Mineral Resources are reported without dilution and ore loss (ie, in-situ). Mining dilution and loss were included as a constraint for pit shell generation.
- Commodity prices used in this study are US$1,400/oz gold and US$20/oz silver.
- Figures are rounded to reflect confidence. Some grades may not average exactly due to rounding. The Competent Person deems these small discrepancies to be immaterial.
Internal technical reviews have been conducted by the Competent Persons as listed, who are full-time employees of Gold Fields Limited working for the Americas region, except for S Poos who is an external consultant.
Vice-President Exploration– Americas region
BA Geology. American Institute of Professional Geologists (AIPG CPG-7042)
41 years' experience in greenfields and brownfields exploration worldwide (25 countries). Commodities: gold, silver and copper – 31 years; base metals – eight years; uranium – two years. He is the lead Competent Person and is responsible for the overall accuracy, standard and compliance of the declaration.
Chief Resource Geologist – Americas region
BSc Geology (Hons). PGeo, APEGBC 149753 and MAusIMM CP 110730
25 years' in mining, exploration and resource evaluation on projects in Africa, Asia, Australia, Europe, South America and North America. Commodities: Gold, copper, silver, coal, bauxite, PGEs and uranium. He is responsible for Mineral Resource estimation and reporting.
Principal Consultant - BWF Mining Consultants, P.C.
BSc Mining Engineering, MSc Industrial Engineering. State of Colorado Professional Engineers (PE 0030975); Society for Mining, Metallurgy and Exploration (Registered Member SME 2571200)
25 years' in mine design, planning and operations worldwide in over 10 countries. Commodities: gold, silver, copper, base metals and coal. As a consultant to Gold Fields, she is responsible for the mining section and constraining the Mineral Resource within a relevant pit shell.