for personal use only - asxnov 07, 2012 · geostatistics were performed for copper, silver and...

Kentor Gold Ltd ACN 082 658 080

7 November 2012

Australian-based Kentor Gold Limited

(ASX: KGL )has entered the ranks of

operating gold mining companies in 2012.

The Company is progressing a pipeline of

advanced projects in Australia and the

Kyrgyz Republic.

The Murchison Gold Project in Western

Australia - commenced production in mid-

2012, with the potential to add gold-copper

production from the neighbouring

Gabanintha deposit.

The high grade, very low cost Andash

Gold-Copper Project in the Kyrgyz

Republic – development-ready, awaiting site

access and targeting production at 70,000

oz gold and 7,400 tonnes copper pa for an

initial six years, with high potential for

expansion.

The Jervois Copper-Silver-Gold Project

in the Northern Territory – targeting 2014

start-up following current studies into

developing the high grade copper-silver

resource with potential for gold, magnetite

and other base metals.

Issued capital: 140.04 million ordinary shares

5.8 million unlisted options

Market Capitalisation $71 million (at 6/11/2012)

Kentor Gold increases and upgrades Jervois Copper-Silver-Gold Resource

13% increase in contained copper to 170,000 tonnes

20% increase in contained silver to 11.6Moz

60% of copper now in Indicated category

Additional Exploration Target of 50,000 to 100,000 tonnes copper

Maiden gold Inferred Resource of 69,000 oz for Marshall-Reward & Bellbird

Kentor Gold Limited (“Kentor Gold” or “the Company”) is pleased to announce an updated resource estimate at the Jervois Copper-Silver-Gold Project in the Northern Territory. This follows completion of the recent drilling campaign at the Reward and Bellbird prospects.

The total Resource has increased to

13.5 Mt @ 1.3% copper and 25.8 g/t silver containing 170,416 tonnes of copper and 11.6 million ounces of silver, a 13% increase in copper and 20% increase in silver, based on a cut-off grade of 0.5% copper (Table 1).

Including a maiden gold Resource of 69,000 oz

Exploration Potential for the Reward and Bellbird deposits in areas adjoining the current Inferred Resources is 5 – 10Mt @ 1 to 1.3% copper and 10 to 25g/t silver at a 0.5% copper cut off (for 50,000 to 100,000 tonnes copper and 3 to 5Mozs silver). The deposits are open at depth and there are additional possibilities along strike from the deposits based on interpretation of the recently completed detailed conductivity survey.

The potential quantity and grade of the Exploration Potential is conceptual in nature and there has been insufficient exploration to define a Mineral Resource. It is uncertain if further exploration will result in the determination of a Mineral Resource

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Kentor Gold Limited www.kentorgold.com.au

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Kentor Gold Managing Director Simon Milroy commented:

“These increased and upgraded Resource Estimates represent a major advance in the bankable feasibility study now being prepared towards mine development at Jervois.

“Most of the Resources are now in the Indicated Category, increasing our confidence in the Project.

“During the drilling programme a number of parallel zones of mineralisation to the main mineral body were encountered which require further drilling to establish if additional resources can be delineated.

“All mineralised zones remain open along strike and down dip.

“At the same time, the increased Resource Estimate 6km away at Bellbird highlights the potential scale of Jervois - its extensive strike length as well as new areas of mineralisation still yet to be explored. “

Table 1 Jervois Contained Copper (details of resource estimates provided in Tables 4,5 and 6.)

Indicated Inferred TOTAL

Marshall/Reward 68,166 43,613 111,779

Bellbird 33,073 16,564 49,637

Green Parrot 7,000 7,000

Bellbird North 2,000 2,000

TOTAL 101,239 69,177 170,416

The above figures include a sub-section of lead/zinc mineralisation coincident with the copper mineralisation at Green Parrot and Bellbird North comprising 1Mt @ 2.6% lead, and 2.2% zinc.

A comparison of the current resource estimate with the previous estimate in January 2012 is shown in Table 2.

Table 2 Jervois Contained Copper and Silver comparison (Indicated and Inferred) (details of resource estimates provided Tables 4,5 and 6.))

COPPER Contained SILVER Contained

Nov 2012 Jan 2012 Increase Nov 2012 Jan 2012 Increase

t t t % Moz Moz Moz %

Marshall/Reward 111,779 95,000 16,779 18% 8.1 6.3 1.8 29%

Bellbird 49,637 46,500 3,137 7% 1.1 1.0 0.1 10%

Green Parrot 7,000 7,000 0 0% 2.1 2.1 0.0 0%

Bellbird North 2,000 2,000 0 0% 0.3 0.3 0.0 0%

TOTAL 170,416 150,500 19,916 13% 11.6 9.7 1.9 20%

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The Jervois project was acquired in May last year and since this time Kentor Gold has successfully increased the resource estimate in three stages as shown in Figure 1.

Figure 1 Growth in Copper and Silver contained metal in resource

The Jervois Base Metal Project comprises four main areas of economic interest, namely Marshall-Reward, Green Parrot, Bellbird and Bellbird North. Each area has sufficient drilling for the identification of a mineral resource. Marshall-Reward (Cu-Ag) and Bellbird (Cu) are essentially copper (+silver) deposits with a more polymetallic nature to the Green Parrot and Bellbird North deposits. A location map of the deposits with the regional geology is included as Figure 2.

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Figure 2 Location and Regional Geology Map

Chubko

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Table 3 Marshall-Reward and Bellbird Resource Estimates (Oct 2012)

Reward Ave Density 3.1/m3 Cu Cut off

0.5% Category MTonnes Cu % Ag g/t Cu Tonnes Ag Mozs

Indicated 5.1 1.34 31.5 68,000 5.1

Inferred 3.2 1.36 25.9 44,000 2.7

Total 8.3 1.35 29.3 112,000 7.8

Bellbird Ave Density 2.91/m3 Category MTonnes Cu % Ag g/t Cu Tonnes Ag Mozs

Indicated 2.8 1.18 7.5 33,000 0.7

Inferred 1.6 1.05 7.1 17,000 0.4

Total 4.4 1.13 7.3 50,000 1.1

Combined Ave Density 3.0t/m3 Category MTonnes Cu % Ag g/t Cu Tonnes Ag Mozs

Indicated 7.9 1.29 22.9 101,000 5.8

Inferred 4.8 1.26 19.7 60,000 3.0

Total 12.7 1.27 21.7 161,000 8.8

(minor rounding errors)

Table 4 Gold Mineralisation Resource Estimate (Oct 2012)

Area Category MTonnes Au g/t Au ozs Reward Above 165mRL Inferred 4.9 0.20 31,000

Below 165m RL Inferred 3.4 0.25 27,000

Combined Inferred 8.3 0.22 58,000

Bellbird Above 165mRL Inferred 4.2 0.08 11,000

Below 165m RL Inferred 0.2 0.08 500

Combined Inferred 4.4 0.08 11,500

Total Inferred 12.7 0.17 69,500

(0.5% Cu cut off; minor rounding errors)

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Table 5 Green Parrot and Bellbird North Resource Estimates (July 2011)

Deposit MTonnes Cu % Pb % Zn % Ag ppm Cu

Tonnes Pb

Tonnes Zn

Tonnes Ag Mozs Green Parrot 0.7 0.97 2.52 1.18 93.5 6,700 17,400 8,100 2.1

Bellbird North 0.3 0.72 2.71 4.53 27.4 2,200 8,300 13,800 0.3

Total 1.0 0.89 2.58 2.21 73.22 8,900 25,700 21,900 2.4

(copper cut off 0.3% for Green Parrot and 0.2% for Bellbird North)(minor rounding errors)

Gold grades for Marshall-Reward and Bellbird have been included in the resource estimates for the first time. The amount of historical gold data is limited and as a result the gold resource estimate is classed as Inferred. A combined resource estimate for the two areas amounts to 12.7Mt @ 0.17g/t for 69,000ozs at a copper cut off of 0.5%.

A long section through Marshall and Reward is shown in Figure 3 and includes all the holes used in the resource estimate.

Figure 3 Marshall-Reward Copper Block Model Distribution Long Section of Indicated & Inferred Resource

(green circles = pierce points of drill holes)

Exploration Potential for both deposits has been defined as interpolated block grades within the interpreted mineral wireframe using a larger search strategy. It consists of areas peripheral to the current Inferred estimates within the interpreted mineral wireframes, unconstrained by depth. This is interpreted to be a combined total for Reward and Bellbird of 5.0 – 10.0Mt @ 1 to 1.3% Cu and 10 to 25g/t Ag at a 0.5% Cu cut off (50,000 to 100,000 tonnes Cu and 3 to 5Mozs Ag). The deposits are open at depth and there are additional possibilities along strike from the deposits based on interpretation of the detailed SAM geophysical survey.

The potential quantity and grade of the Exploration Potential is conceptual in nature and there has been insufficient exploration to define a Mineral Resource. It is uncertain if further exploration will result in the determination of a Mineral Resource.

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Estimation Checklist (JORC Code and Guidelines)

Estimating and Reporting of Mineral Resources for Marshall-Reward & Bellbird

Database integrity All relevant data were entered into a DataShed database where various validation checks were performed.

Data was exported into an Access Database and linked to Surpac for wireframing and resource estimation. Surpac database audit run to check for errors

Visual reviews were conducted to confirm consistency in logging and drill hole trajectories.

Assessment of the data confirms that it is suitable for resource estimation. Geological interpretation

The Jervois Project is characterised by several elongate structural zones of disseminated copper sulphide mineralisation

Primary copper/silver/gold mineralisation is hosted in arrays of steep/sub-vertical dipping structural zones associated with sulphides and magnetite in the primary zone. Sulphide becomes variably degraded in the oxide zone.

Separate mineral lodes for Reward and Marshall with some 75-100m of overlap suggesting an en echelon structural array.

Bellbird comprises a higher grade Main Lode and a lower grade Hangingwall Lode. Mineralisation envelopes were domained on a 0.1% Cu cut-off grade with some

geological criteria. Polygons and hence triangulations are based on interpretations completed on sections

with strings snapped to drill holes. Oxidation interpretation based on drillhole logging information

Estimation and modelling techniques

1 metre assay composites were used based on mineral wireframes; residual composites <0.5m wide were discarded; 3,481 composites for Reward, 1,879 for Bellbird

Summary statistics indicated moderate coefficients of variations; modest correlation between silver and copper

Top cutting determined from log-probability plots were used; top cuts for gold at Bellbird and silver at Marshall-Reward

Geostatistics were performed for copper, silver and gold within individual mineralised lenses

Variography poor to moderate with low nuggets Ordinary Kriged estimation was used for the mineral zones. Parent block sizes were 2 metres in the X (east) direction, 10 metres in the Y (north)

direction and 10 metres in the Z (RL) direction with no sub-blocking A 3 estimation pass strategy was used with an increasing search radius and decreasing

number of data points for all domains. A second 2 pass search strategy was used to identify exploration potential

The first and second estimation runs used an octant based search where at least 4 octants had to be estimated

Search ellipses were orientated to follow the trends of the individual domains Search distances were 5m by 30m by 30m increasing to 10m by 60m by 60m with the

minimum number of data points of 12 decreasing to 6 and 2 octants. Cut-off parameters Resources have been estimated at a cut-off grade of 0.5% Cu with a partial percent

volume adjustment within the mineral wireframe. The cut-off grade at which the resource is quoted reflects the intended bulk-mining approach.

Bulk density Density based on 1,363 core samples where SG values were determined using the “Archimedes Principle”. Density was modelled using inverse distance squared technique.

Default density values for the oxide and partial oxide zones were generated from collected data and inserted into the block model

Classification Mineral resources have been classified on the search pass category Pass 1 & 2 = Indicated Pass 3 = Inferred.

Gold mineralisation is classed as Inferred based on fewer data points than Cu & Ag, no correlation with Cu & Ag and high variability with low grade standards.

Positive factors for classification include drill spacing, robustness of resource estimates from earlier models, surface mapping for geological continuity, moderate success with twinned holes confirming some of historical assays

Negative factors are accuracy of historical hole locations, different analytical methods over a 40 year period, missing assays values and unsampled sections of historic holes, No QAQC data for historical work, weak variography, no recoveries for RC drilling.

Reviews Results are comparable with previous H&SC resource estimates

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For further information contact:

Mr Simon Milroy Managing Director Phone: (07) 3121 3206 Email: [email protected] Mr. David Waterhouse Investor Relations Phone (03) 9670 5008 Email: [email protected]

Competent Person Statement

The data in this report that relates to Exploration Results is based on information evaluated by Mr Rudy Lennartz who is a Member of The Australasian Institute of Mining and Metallurgy (MAusIMM) and who has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the “JORC Code”). Mr Lennartz is a full-time employee of Jinka Minerals Limited and he consents to the inclusion in the report of the Exploration Results in the form and context in which they appear.

The data in this report that relates to Mineral Resource Estimates is based on information evaluated by Mr Simon Tear who is a Member of The Australasian Institute of Mining and Metallurgy (MAusIMM) and who has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the “JORC Code”). Mr Tear is a Director of H&S Consultants Pty Ltd and he consents to the inclusion in the report of the Mineral Resource in the form and context in which they appear.

The data in this report that relates to cut off grades and mining assumptions is based on information evaluated by Mr Simon Milroy who is a The Australasian Institute of Mining and Metallurgy (MAusIMM) and who has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the “JORC Code”). Mr Milroy is a full-time employee of Kentor Gold Limited and he consents to the inclusion in the report of the cut off grades and mining assumptions in the form and context in which they appear.

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for personal use only - asxnov 07, 2012 · geostatistics were performed for copper, silver and...

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