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    Southern Ashanti Gold Project

    Ghana, West Africa 

    Technical Report

    Effective Date: 21 August 2008

    Prepared by:

    Ron Heeks

    Technical Manager

     Adamus Resources Limited

    On behalf of:

     Adamus Resources Limited

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    TABLE OF CONTENTS

    1.0 

    Summary ....................................................................................................................1 

    1.1 

    General..........................................................................................................................1 

    1.2 

    Ownership .....................................................................................................................2 1.3

     

    Mineral Resource Estimate............................................................................................4 

    1.4 

    Metallurgical Testing......................................................................................................6 

    1.4.1 

    General............................................................................................................6 

    1.4.2 

    Comminution Testing.......................................................................................6 

    1.4.3 

    Metallurgical Testing........................................................................................6 

    1.4.4 

    Testwork Summary..........................................................................................7 

    1.5 

    Mineral Processing........................................................................................................8 

    1.6 

    Open Pit Mining...........................................................................................................10 

    1.7 

    Ore Reserve Estimate .................................................................................................12 

    1.8 

    Financial Analysis Results ...........................................................................................15 

    1.9 

    Current Project Status .................................................................................................15 

    1.9.1 

    Mining Lease and License.............................................................................15 

    1.9.2 

    Project Implementation Plan..........................................................................15 

    1.10 

    Conclusion and Recommendations .............................................................................16 

    2.0  Introduction and Terms of Reference....................................................................17 

    2.1 

    Terms of Reference.....................................................................................................17 

    2.2 

    The Purpose of this Report..........................................................................................17 

    2.3 

    Qualifications and Experience .....................................................................................17 

    2.4 

    Principal Sources of Information..................................................................................18 

    3.0 

    Reliance on Other Experts .....................................................................................19 

    4.0  Property Description and Location........................................................................20 

    4.1 

    Project Area, Location and Access ..............................................................................20 

    4.2 

    Ownership ...................................................................................................................21 

    4.3 

    Description of Licences and Approvals........................................................................25 

    4.3.1 

     Anwia Deposit ...............................................................................................25 

    4.3.2 

    Salman Deposits ...........................................................................................25 

    4.3.3 

    Satellite Deposits...........................................................................................25 

    4.3.4 

    Royalties and Other Agreements...................................................................26 

    4.3.5 

    Environmental Liabilities................................................................................26 

    4.3.6 

    Extension Application ....................................................................................26 

    4.3.7 

    Grant of Mining Lease ...................................................................................26 

    4.3.8 

    Project Stability Agreement ...........................................................................27 

    5.0   Accessibi liTy, Cl imate, In frastructure and Physiography ................................... 27 

    5.1 

     Access.........................................................................................................................27 

    5.2 

    Climate ........................................................................................................................27 

    5.3 

    Topography, Elevation and Vegetation........................................................................27 

    5.4 

    Local Infrastructure......................................................................................................28 

    6.0  Exploration and Mining History .............................................................................28 

    6.1 

    Historical Mining Activity..............................................................................................28 

    6.2 

    Exploration and Ownership History of Salman Deposit Area .......................................29 

    6.3 

    Exploration and Ownership History of Anwia Deposit Area..........................................30 

    6.4 

     ARL Exploration...........................................................................................................31 

    6.5 

    Previous Resource Estimates......................................................................................31 

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    13.5 

    Salman Assay Accuracy ..............................................................................................72 

    13.6 

    Salman Sampling and Assaying Precision...................................................................84 

    13.7 

    Conclusion...................................................................................................................87 

    14.0   ADjacent Propert ies ................................................................................................ 88 

    14.1 

     Adjacent properties......................................................................................................88 

    15.0 

    Metallurgi cal Testing ...............................................................................................88 

    15.1 

    Introduction..................................................................................................................88 

    15.2 

    Composite Samples and Sample Preparation .............................................................89 

    15.2.1 

    General..........................................................................................................89 

    15.2.2 

    Comminution Composites..............................................................................89 

    15.2.3 

    Leach Master Composites.............................................................................91 

    15.2.4 

    Leach Variability Composites ........................................................................92 

    15.2.5 

    Head Assays .................................................................................................95 

    15.3 

    Comminution ...............................................................................................................97 

    15.3.1 

    General..........................................................................................................97 

    15.3.2 

    Crushing Work Index .....................................................................................97 

    15.3.3 

    Unconfined Compressive Strength Tests ......................................................98 

    15.3.4 

     Advanced Media Competency Tests ...........................................................100 

    15.3.5 

    JK Drop Weight Tests..................................................................................102 

    15.3.6 

    SMC Testing................................................................................................110 

    15.3.7 

    Bond Comminution Tests ............................................................................111 

    15.4 

    Mineralogy.................................................................................................................112 

    15.4.1 

    General........................................................................................................112 

    15.4.2 

     Anwia Oxide Master ....................................................................................112 

    15.4.3 

     Anwia Transition Master ..............................................................................113 

    15.4.4 

     Anwia Sulphide Master................................................................................113 

    15.4.5 

    Salman Oxide Master..................................................................................113 

    15.4.6 

    Salman Transition Master............................................................................113 

    15.4.7 

    Salman Central Upper Transition (Variability Composite 12).......................113 

    15.4.8 

    Salman Central Lower Transition (Variability Composite 8).........................114 

    15.4.9 

    Salman North Upper Transition (Variability Composite 13)..........................114 

    15.4.10 

    Salman North Lower Transition (Variability Composite 9)............................114 

    15.4.11 

    Salman North Upper Transition (Variability Composite 23) – Granite..........114 

    15.4.12 

    Salman North Lower Transition (Variability Composite 21) – Granite..........114 

    15.4.13 

    Salman Sulphide AMC Comminution Composite.........................................115 

    15.5 

    Thickening .................................................................................................................115 

    15.5.1 

    General........................................................................................................115 

    15.5.2 

    Flocculant Screening Tests .........................................................................115 

    15.5.3 

    Dynamic Thickening Tests...........................................................................115 

    15.6 

    Viscosity ....................................................................................................................117 

    15.6.1 

    General........................................................................................................117 

    15.6.2 

     Anwia Oxide Master ....................................................................................117 

    15.6.3 

     Anwia Transition Master ..............................................................................119 

    15.6.4 

     Anwia Sulphide Master................................................................................120 

    15.6.5 

    Salman Oxide Master..................................................................................120 

    15.6.6 

    Salman Transition Master............................................................................121 

    15.7 

    Gravity Recovery .......................................................................................................123 

    15.7.1 

    General........................................................................................................123 

    15.7.2 

    3kg Batch Gravity Tests...............................................................................123 

    15.7.3 

    Bulk Gravity Tests .......................................................................................126 

    15.8 

    Leaching....................................................................................................................127 

    15.8.1 

    General........................................................................................................127 

    15.8.2 

    Leach Optimisation Testing .........................................................................127 

    15.8.3 

    Leach Variability Testing..............................................................................141 

    15.8.4 

    Effect of Oxygen Addition ............................................................................141 

    15.9 

    Oxygen Uptake..........................................................................................................146 

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    15.9.1 

    General........................................................................................................146 

    15.10 

    Carbon Adsorption.....................................................................................................148 

    15.10.1 

    General........................................................................................................148 

    15.11 

    Cyanide Detoxification and Arsenic Precipitation.......................................................148 

    15.11.1 

    General........................................................................................................148 

    15.11.2 

    Cyanide Detoxification.................................................................................148 

    15.11.3 

     Arsenic Precipitation....................................................................................149 

    15.12 

    Flowsheet Selection ..................................................................................................154 

    15.13 

    Recovery Forecasts...................................................................................................155 

    16.0  Mineral Processing ...............................................................................................158 

    16.1 

    Engineering Design and Control Philosophy..............................................................158 

    16.2 

    Plant Configuration Options.......................................................................................158 

    16.3 

    Run of Mine (ROM) Pad ............................................................................................159 

    16.4 

    Crushing ....................................................................................................................161 

    16.5 

    Grinding and Classification ........................................................................................161 

    16.6 

    Gravity Concentration ................................................................................................162 

    16.7 

    Leach Feed Thickening .............................................................................................162 

    16.8 

    Leach and Adsorption Circuit.....................................................................................162 

    16.9 

    Elution and Gold Room Operations ...........................................................................163 

    16.9.1 

     Acid Wash ...................................................................................................164 

    16.9.2 

    Zadra Elution Circuit ....................................................................................164 

    16.9.3 

    Electrowinning and Gold Room ...................................................................164 

    16.9.4 

    Gold Barring ................................................................................................165 

    16.9.5 

    Gold Room Security ....................................................................................165 

    16.9.6 

    Carbon Regeneration ..................................................................................165 

    16.10 

    Cyanide Destruction and Tailings Disposal................................................................166 

    16.11 

    Reagents ...................................................................................................................167 

    16.11.1 

    Lime ............................................................................................................167 

    16.11.2 

    Cyanide .......................................................................................................167 

    16.11.3 

    Caustic ........................................................................................................167 

    16.11.4 

    Hydrochloric Acid.........................................................................................167 

    16.11.5 

     Activated Carbon.........................................................................................167 

    16.11.6 

    Sodium Metabisulphite ................................................................................168 

    16.11.7 

    Copper Sulphate..........................................................................................168 

    16.11.8 

    SAG Mill Balls..............................................................................................168 

    16.11.9 

    Flocculant....................................................................................................168 

    16.11.10 

    Ferric Sulphate ............................................................................................168 

    16.11.11 

    Sulphuric Acid .............................................................................................168 

    16.12 

    Services and Water ...................................................................................................169 

    16.12.1 

    Raw Water Supply.......................................................................................169 

    16.12.2 

    Process Water.............................................................................................169 

    16.12.3 

    Potable Water..............................................................................................169 

    16.12.4 

    Instrument Air ..............................................................................................169 

    16.12.5 

    Plant Air.......................................................................................................169 

    16.12.6 

    Low Pressure Air .........................................................................................169 16.12.7

     

    Oxygen........................................................................................................170 

    16.12.8 

    Diesel Fuel ..................................................................................................170 

    16.12.9 

    Emergency Power Supply ...........................................................................170 

    17.0  Mineral Resource Estimate ..................................................................................171 

    17.1 

    Data Preparation and Treatment ...............................................................................171 

    17.1.1 

     Anwia Modelling Domains ...........................................................................171 

    17.1.2 

    Salman Modelling Domains .........................................................................173 

    17.1.3 

    Satellite Deposit Modelling Domains ...........................................................177 

    17.1.4 

    Mine Voids...................................................................................................181 

    17.1.5 

    Derivation of Preferred Assay Values ..........................................................181 

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    17.1.6 

    Compositing ................................................................................................183 

    17.2 

    Exploratory Data Analysis..........................................................................................186 

    17.2.1 

     Anwia ..........................................................................................................186 

    17.2.2 

    Salman........................................................................................................186 

    17.2.3 

    Satellite Deposits.........................................................................................186 

    17.3 

    Spatial Continuity Analysis ........................................................................................187 

    17.3.1 

    Measures of Spatial Continuity ....................................................................187 

    17.3.2 

    Directional Controls on Gold Mineralisation.................................................187 

    17.4 

    Indicator Kriging.........................................................................................................196 

    17.4.1 

    Indicator Kriging for Recoverable Resource Estimation...............................196 

    17.4.2 

    Indicator Kriging Parameters .......................................................................197 

    17.5 

    Block Support Adjustment (Variance Adjustment) .....................................................200 

    17.5.1 

    General........................................................................................................200 

    17.5.2 

    The Variance Adjustment ............................................................................201 

    17.5.3 

    Shape of the Block Grade Distribution.........................................................201 

    17.5.4 

    The Information Effect .................................................................................201 

    17.5.5 

    Variance Adjustments Applied to the Resource Models ..............................202 

    17.6 

    Resource Classification .............................................................................................204 

    17.7 

     Anwia Resource Model..............................................................................................204 

    17.8 

    Salman Resource Model ...........................................................................................208 17.9

     

    Satellite Deposits Resource Models ..........................................................................211 

    17.10 

    Mineral Resource Statement .....................................................................................216 

    17.11 

    Other .........................................................................................................................216 

    18.0 

    ORE Reserve Estimate..........................................................................................217 

    18.1 

    Introduction................................................................................................................217 

    18.2 

    Mining Study Scope...................................................................................................218 

    18.3 

    Parameters................................................................................................................218 

    18.3.1 

    Parameters Summary..................................................................................219 

    18.3.2 

    Gold Price and Royalty ................................................................................219 

    18.3.3 

    Throughput Costs........................................................................................219 

    18.3.4 

    Contract Mining Costs .................................................................................219 

    18.3.5 

    Resource Model and Surfaces ....................................................................222 

    18.3.6 

    Other Parameters........................................................................................222 

    18.4 

    Pit Limit Optimisations ...............................................................................................222 

    18.5 

    Mine Design...............................................................................................................227 

    18.6 

    Mining Quantities and Reserves................................................................................233 

    18.6.1 

    Cut-off Grades.............................................................................................233 

    18.6.2 

    Open Pit Quantities .....................................................................................234 

    18.6.3 

    Ore Reserve Estimate .................................................................................234 

    19.0  Other Relevant Data and Information ..................................................................237 

    19.1 

    Production Schedules................................................................................................237 

    20.0  Interpretation and Conclusions ...........................................................................238 

    21.0  Recommendations ................................................................................................239 

    22.0  References and Bibl iography...............................................................................240 

    23.0 

    Date and Signature Page ......................................................................................244 

    24.0  cert if icate of qualif ication .....................................................................................245 

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    LIST OF TABLES

    Table 1-1 Summary of Southern Ashanti Gold Project Resources at 0.8g/t cut-off ...........................5 

    Table 1-2 Key Process Design Parameters ......................................................................................8 

    Table 1-3 Metallurgical Recoveries...................................................................................................8 Table 1-4 Mineral Reserve Estimate...............................................................................................14 

    Table 2-1 Principal Sources of Information .....................................................................................18 

    Table 3-1 Reliance on Consultants in Addition to the Authors ........................................................19 

    Table 4-1 Tenure Summary – Southern Ashanti Gold Project ........................................................22 

    Table 6-1 Southern Ashanti Gold Resources at 1g/t cut-off estimated by Ravensgate ...................31 

    Table 6-2 Southern Ashanti gold resources at 1g/t cut-off estimated by SRK.................................31 

    Table 6-3 Southern Ashanti Gold Project resources at 1g/t cut-off estimate, ARL, January 2006...32 

    Table 6-4: Southern Ashanti Gold Project Resources at 1g/t cut-off estimate ARL, January 2007 ..32 

    Table 12-1 

    Bulk densities applied to the Anwia resource model.......................................................54 

    Table 12-2 Bulk densities applied to the Salman resource model...................................................56 

    Table 12-3: Bulk densities applied to the Satellite Deposits resource models..................................58 

    Table 15-1 Anwia Comminution Transition Master Composite Sample...........................................89 

    Table 15-2 Anwia Comminution Sulphide Master Composite Sample ............................................90 

    Table 15-3 Anwia Comminution Variability Composite Samples.....................................................90 

    Table 15-4 Salman Comminution Oxide Master Composite Sample...............................................90 

    Table 15-5 Salman Comminution Transition Master Composite Sample ........................................90 

    Table 15-6 Salman Comminution Sulphide Master Composite Sample ..........................................91 

    Table 15-7 Salman Comminution Variability Composite Samples ..................................................91 

    Table 15-8 Leach Master Composite Samples ...............................................................................92 

    Table 15-9 Salman Leach Variability Composite Samples............................................................93 

    Table 15-10 Anwia Leach Variability Composite Samples ..............................................................95 

    Table 15-11 Leach Master Composite Sample Head Assays .........................................................95 

    Table 15-12 Salman Leach Variability Composite Head Assays...................................................................96 

    Table 15-13  Anwia Leach Variability Composite Head Assays.....................................................................97 

    Table 15-14 Crushing Work Index Test Results...............................................................................98 

    Table 15-15 Anwia Variability Composite Sample Unconfined Compressive Strength ....................98 

    Table 15-16 Salman Variability Composite Sample Unconfined Compressive Strength.................99 

    Table 15-17 Master Composite JK Drop Weight Test Parameters................................................102 

    Table 15-18 SMC Test Results.....................................................................................................110 

    Table 15-19 Bond Test Results ....................................................................................................111 

    Table 15-20 Levin Test Results ....................................................................................................112 

    Table 15-21 Anwia Oxide Master Dynamic Thickening Tests .......................................................116 

    Table 15-22 Anwia Transition Master Dynamic Thickening Tests.................................................116 

    Table 15-23 Anwia Sulphide Master Dynamic Thickening Tests...................................................116 

    Table 15-24 Salman Oxide Master Dynamic Thickening Tests.....................................................117 

    Table 15-25 Salman Transition Master Dynamic Thickening Tests.............................................117 

    Table 15-26 Anwia Oxide Master Viscosity Test Summary...........................................................118 

    Table 15-27 Anwia Transition Master Viscosity Test Summary ....................................................119 

    Table 15-28 Anwia Sulphide Master Viscosity Test Summary ......................................................120 

    Table 15-29 Salman Oxide Viscosity Test Summary ....................................................................121 

    Table 15-30 Salman Transition Viscosity Test Summary..............................................................122 

    Table 15-31 Average 3kg Batch Gravity Test Results – Anwia .....................................................123 

    Table 15-32 3kg Batch Gravity Test Results – Anwia Oxide Variability Samples..........................124 

    Table 15-33 3kg Batch Gravity Test Results – Anwia Transition Variability Samples ...................124 

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    Table 15-34 3kg Batch Gravity Test Results – Anwia Sulphide Variability Samples .....................124 

    Table 15-35 Average 3kg Batch Gravity Test Results – Salman...................................................125 

    Table 15-36 3kg Batch Gravity Test Results – Salman Oxide Variability Samples .......................125 

    Table 15-37 3kg Batch Gravity Test Results – Salman Transition Variability Samples.................125 

    Table 15-38 3kg Batch Gravity Test Results – Salman Sulphide Variability Samples...................126 

    Table 15-39 Anwia Bulk Gravity Test Results ...............................................................................126 

    Table 15-40 Salman Bulk Gravity Test Results.............................................................................127 

    Table 15-41 Anwia Oxide Leach Optimisation Test Results..........................................................128 

    Table 15-42 Anwia Transition Leach Optimisation Test Results ...................................................129 

    Table 15-43 Anwia Sulphide Leach Optimisation Test Results .....................................................130 

    Table 15-44 Salman Oxide Leach Optimisation Test Results .......................................................131 

    Table 15-45 Salman Transition Leach Optimisation Test Results.................................................132 

    Table 15-46 Gravity Circuit Economic Analysis Parameters .........................................................137 

    Table 15-47 Economic Analysis Parameters ................................................................................139 

    Table 15-48 Anwia Leach Variability Test Results ........................................................................142 

    Table 15-49 Salman Leach Variability Test Results – Oxide and Transition .................................143 

    Table 15-50 Salman Leach Variability Test Results – Sulphide ....................................................144 

    Table 15-51 Effect of Varying Oxygen/Aeration ............................................................................145 

    Table 15-52 Summary of Oxygen Uptake Test Results ................................................................147 

    Table 15-53 Summary of Carbon Adsorption Test Results ...........................................................148 

    Table 15-54 Summary of Cyanide Detoxification Test Results - Anwia.........................................150 

    Table 15-55 Summary of Cyanide Detoxification Test Results – Salman .....................................151 

    Table 15-56 Arsenic Precipitation Sighter Tests ...........................................................................152 

    Table 15-57 Summary of Arsenic Precipitation Optimisation Test Results....................................152 

    Table 15-58 Recommended Cyanide Detoxification and Arsenic Precipitation Parameters..........153 

    Table 15-59 Summary of Mill Feed and Operating Parameters ....................................................156 

    Table 15-60 Predicted Tailings Grades.........................................................................................157 

    Table 17-1: Anwia grid transformation parameters ........................................................................171 

    Table 17-2: Anwia resource modelling domains ............................................................................171 

    Table 17-3: Salman-Akanko resource modelling domains .............................................................173 

    Table 17-4: Satellite Deposits resource modelling domains...........................................................177 

    Table 17-5: Aliva grid transformation parameters ..........................................................................178 

    Table 17-6: Nfutu grid transformation parameters .........................................................................180 

    Table 17-7: Anwia drill holes preferred gold assay sources ...........................................................182 

    Table 17-8: Salman drill holes preferred gold assay sources.........................................................183 

    Table 17-9: Numbers of sample composites contained in Anwia modelling domains ....................185 

    Table 17-10: Numbers of sample composites contained in Salman modelling domains ................185 

    Table 17-11: Numbers of sample composites contained in Satellite Deposits modelling domains.185 

    Table 17-12: Anwia Model Framework & Kriging Search Parameters (Rotated Space).................198 

    Table 17-13: Salman Model Framework and Kriging Search Parameters......................................198 

    Table 17-14: Bokrobo Model Framework and Kriging Search Parameters ....................................199 

    Table 17-15: Aliva Model Framework and Kriging Search Parameters..........................................199 Table 17-16: Avrebo Model Framework and Kriging Search Parameters ......................................199 

    Table 17-17: Nfutu Model Framework and Kriging Search Parameters .........................................200 

    Table 17-18: Variance adjustments applied to the Anwia resource model .....................................202 

    Table 17-19: Variance adjustments applied to the Salman resource model...................................203 

    Table 17-20: Variance adjustments applied to the Satellite Deposits resource models..................203 

    Table 17-21: Summary of Southern Ashanti Gold Project Resources at 0.8g/t cut-off ...................216 

    Table 18-1 Salman Pit Optimisation Parameters Summary ..........................................................220 

    Table 18-2 Anwia Pit Optimisation Parameters Summary ............................................................220 

    Table 18-3 Resultant Average Process Recoveries for Resource Areas ......................................222 

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    Table 18-4: Salman Pit Optimisation Results.................................................................................224 

    Table 18-5: Anwia pit Optimisation Results....................................................................................225 

    Table 18-6: Project Total Pit Optimisation Results.........................................................................226 

    Table 18-7: Cut-off Grades for Ore Reserves ................................................................................233 

    Table 18-8: Open Pit Quantities and Economics ...........................................................................235 

    Table 18-9: Ore Reserves by Mining Areas and Ore Types...........................................................236 

    Table 19-1 Production Schedule Results Summary......................................................................237 

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    LIST OF FIGUR S

    Figure 1-1 ARL Corporate Structure .................................................................................................3 

    Figure 1-2 Mineral Processing Flowsheet Summary.......................................................................11 

    Figure 1-3 Salman Mine Design .....................................................................................................13 Figure 1-4 Anwia Mine Design........................................................................................................14 

    Figure 4-1 Project Location.............................................................................................................20 

    Figure 4-2: ARL Corporate Structure ...............................................................................................21 

    Figure 4-3: Tenure Perimeter, Geology and Deposit Locations .......................................................24 

    Figure 7-1 Regional Geology ..........................................................................................................33 

    Figure 7-2 Salman Deposit Geology (Including Akanko).................................................................38 

    Figure 8-1 Anwia Deposit Geology and Mineralisation....................................................................43 

    Figure 12-1 Bulk densities of Anwia very weathered drill core ........................................................54 

    Figure 12-2 Bulk densities of Anwia moderately weathered drill core .............................................54 

    Figure 12-3 Bulk densities of Anwia weakly weathered drill core....................................................55 

    Figure 12-4 Bulk densities of Anwia fresh rock drill core.................................................................55 

    Figure 12-5 Bulk densities of Salman very weathered drill core......................................................56 

    Figure 12-6 Bulk densities of Salman moderately weathered drill core...........................................57 

    Figure 12-7 Bulk densities of Salman weakly weathered drill core..................................................57 

    Figure 12-8 Bulk densities of Salman fresh rock drill core ..............................................................58 

    Figure 13-1 Assays of Samax/AGC blanks submitted with Anwia drill samples..............................60 

    Figure 13-2 Assays of Adamus blanks submitted with Anwia drill samples.....................................60 

    Figure 13-3 Assays of STD4B submitted with Adamus Anwia samples ..........................................61 

    Figure 13-4 Assays of STD5B submitted with Adamus Anwia samples ..........................................61 

    Figure 13-5 Assays of STD6B submitted with Adamus Anwia samples ..........................................61 

    Figure 13-6 Assays of STD7B submitted with Adamus Anwia samples ..........................................62 

    Figure 13-7 Assays of STD8B submitted with Adamus Anwia samples ..........................................62 

    Figure 13-8 Assays of STD9B submitted with Adamus Anwia samples ..........................................62 

    Figure 13-9 Assays of STD10B submitted with Adamus Anwia samples ........................................63 

    Figure 13-10 Scatter plot of nearest neighbour sample pairs..........................................................64 

    Figure 13-11 Q-Q plot of nearest neighbour sample pairs ..............................................................64 

    Figure 13-12 Scatter plot: Samax/AGC Anwia field re-splits ...........................................................65 

    Figure 13-13 Precision plot: Samax/AGC field re-splits ..................................................................65 

    Figure 13-14 Scatter plot: Adamus Anwia field re-splits ..................................................................67 

    Figure 13-15 Precision plot: Adamus Anwia field re-splits...............................................................67 

    Figure 13-16 Sample recoveries in 2002-2003 RC drilling, very weathered material ......................68 

    Figure 13-17 Sample recoveries in 2002-2003 RC drilling, moderately weathered material ...........69 

    Figure 13-18 Sample recoveries in 2002-2003 RC drilling, weakly weathered material..................69 

    Figure 13-19 Sample recoveries in 2002-2003 RC drilling, fresh rock ............................................70 

    Figure 13-20 Sample recoveries in 2006 RC drilling, very weathered material ...............................70 

    Figure 13-21 Sample recoveries in 2006 RC drilling, moderately weathered material ....................71 

    Figure 13-22 Sample recoveries in 2006 RC drilling, weakly weathered material...........................71 

    Figure 13-23 Sample recoveries in 2006 RC drilling, fresh rock .....................................................72 

    Figure 13-24 Adamus blanks submitted for SGS fire assay with Salman drill samples...................73 

    Figure 13-25 Adamus blanks submitted for Transworld CN leach assay with Salman drill samples73 

    Figure 13-26 Adamus blanks submitted for Transworld fire assay with 2002 drill samples .............73 

    Figure 13-27 Adamus blanks submitted for Transworld fire assay with 2003 drill samples .............74 

    Figure 13-28 Adamus blanks submitted for Transworld fire assay with 2004 drill samples .............74 

    Figure 13-29 Adamus blanks submitted for Transworld fire assay with 2005 drill samples .............74 

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    Figure 13-30 Adamus blanks submitted for Transworld fire assay with 2006 drill samples .............75 

    Figure 13-31 Adamus blanks submitted for Transworld fire assay with 2007 drill samples .............75 

    Figure 13-32: Adamus blanks submitted for Genalysis fire assay with Salman drill samples...........75 

    Figure 13-33: Assays of STD1 submitted to SGS with Salman samples..........................................76 

    Figure 13-34: Assays of STD4B submitted to SGS with Salman samples .......................................76 

    Figure 13-35: Assays of STD5B submitted to SGS with Salman samples .......................................77 

    Figure 13-36: Assays of STD6B submitted to SGS with Salman samples .......................................77 

    Figure 13-37: Assays of STD7B submitted to SGS with Salman samples .......................................77 

    Figure 13-38: Assays of STD8B submitted to SGS with Salman samples .......................................78 

    Figure 13-39: Assays of STD9B submitted to SGS with Salman samples .......................................78 

    Figure 13-40: Assays of STD10B submitted to SGS with Salman samples .....................................78 

    Figure 13-41: Assays of STD11 submitted to SGS with Salman samples........................................79 

    Figure 13-42: Assays of STD12 submitted to SGS with Salman samples........................................79 

    Figure 13-43: Assays of STD1 submitted to Transworld with Salman samples................................79 

    Figure 13-44: Assays of STD02 submitted to Transworld with Salman samples..............................80 

    Figure 13-45: Assays of STD3 submitted to Transworld with Salman samples................................80 

    Figure 13-46: Assays of STD4 submitted to Transworld with Salman samples................................80 

    Figure 13-47: Assays of STD4B submitted to Transworld with Salman samples .............................81 

    Figure 13-48: Assays of STD5 submitted to Transworld with Salman samples................................81 

    Figure 13-49: Assays of STD5B submitted to Transworld with Salman samples .............................81 

    Figure 13-50: Assays of STD6 submitted to Transworld with Salman samples................................82 

    Figure 13-51: Assays of STD6B submitted to Transworld with Salman samples .............................82 

    Figure 13-52: Assays of STD7B submitted to Transworld with Salman samples .............................82 

    Figure 13-53: Assays of STD8B submitted to Transworld with Salman samples .............................83 

    Figure 13-54: Assays of STD9B submitted to Transworld with Salman samples .............................83 

    Figure 13-55: Assays of STD10B submitted to Transworld with Salman samples ...........................83 

    Figure 13-56: Assays of STD11 submitted to Transworld with Salman samples..............................84 

    Figure 13-57: Assays of STD13B submitted to Transworld with Salman samples ...........................84 

    Figure 13-58: Scatter plot: SGS fire assays of Salman field re-splits ...............................................85 

    Figure 13-59: Precision plot: SGS fire assays of Salman field re-splits............................................85 

    Figure 13-60: Scatter plot: Transworld fire assays of Salman field re-splits .....................................86 

    Figure 13-61: Precision plot: Transworld fire assays of Salman field re-splits..................................86 

    Figure 13-62: Scatter plot: Transworld CN leach assays of Salman field re-splits ...........................87 

    Figure 13-63: Precision plot: Transworld CN leach assays of Salman field re-splits ........................87 

    Figure 15-1 Unconfined Compressive Strength of Anwia Ore Variability Samples..........................99 

    Figure 15-2 Unconfined Compressive Strength of Salman Ore Variability Samples .....................100 

    Figure 15-3 Media Competency Test Product Sizing ....................................................................101 

    Figure 15-4 Impact Work Index Testing of AMC Test Survivors....................................................101 

    Figure 15-5 Variation of Impact Resistance with Particle Size – Anwia Transition........................103 

    Figure 15-6 Variation of Crushing Energy with Particle Size – Anwia Transition.........................103 

    Figure 15-7 Variation of Impact Resistance with Particle Size – Anwia Sulphide..........................105 

    Figure 15-8 Variation of Crushing Energy with Particle Size – Anwia Sulphide.............................105 Figure 15-9 Variation of Impact Resistance with Particle Size – Salman Oxide............................106 

    Figure 15-10 Variation of Crushing Energy with Particle Size – Salman Oxide.............................106 

    Figure 15-11 Variation of Impact Resistance with Particle Size – Salman Transition....................108 

    Figure 15-12 Variation of Crushing Energy with Particle Size – Salman Transition ......................108 

    Figure 15-13 Variation of Impact Resistance with Particle Size – Salman Sulphide .....................109 

    Figure 15-14 Variation of Crushing Energy with Particle Size – Salman Sulphide ........................109 

    Figure 15-15 Variation in Viscosity with Shear Rate and Pulp Density – Anwia Oxide................119 

    Figure 15-16 Variation in Viscosity with Shear Rate and Pulp Density – Salman Oxide ...............122 

    Figure 15-17 Effect of Cyanide Concentration on Cyanide Consumption – Salman .....................134 

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    Figure 15-18 Effect of Cyanide Concentration on Cyanide Consumption – Anwia........................134 

    Figure 15-19 Effect of Gravity Gold Recovery – Salman Oxide ....................................................135 

    Figure 15-20 Effect of Gravity Gold Recovery – Anwia Oxide.......................................................136 

    Figure 15-21 Effect of Gravity Gold Recovery – Anwia Transition ................................................136 

    Figure 15-22 Effect of Gravity Gold Recovery – Anwia Sulphide ..................................................137 

    Figure 15-23 Effect of Varying Grind Size and Leach Time – Anwia Sulphide..............................140 

    Figure 15-24 Effect of Varying Grind Size and Leach Time – Salman Oxide................................140 

    Figure 15-25 Effect of Oxygen Addition – Anwia Sulphide ............................................................146 

    Figure 15-26 Oxygen Demand - Anwia and Salman Ores ............................................................147 

    Figure 15-27 Final Arsenic Concentration Variation with pH and Fe:As Molar Ratio.....................153 

    Figure 15-28 Recovery Variation with P80 and Leach Time .........................................................155 

    Figure 16-1 Summary Process Flowsheet Option 5.......................................................................160 

    Figure 17-1 Plan view of Anwia model domain wireframes...........................................................172 

    Figure 17-2 Interpreted geology, weathering and mineralisation, Anwia section 550350N ...........172 

    Figure 17-3: Plan view of the Salman-Akanko mineralisation wireframes......................................174 

    Figure 17-4: Interpreted geology and mineralisation on Salman South section 551850N ..............175 

    Figure 17-5: Interpreted geology and mineralisation on Salman Central section 552200N ............175 

    Figure 17-6: Interpreted geology and mineralisation on Teberu section 553800N .........................176 

    Figure 17-7: Interpreted geology and mineralisation on Salman North skewed section 554300N..176 

    Figure 17-8 Pseudo 3D view of Bokrobo model domain wireframes..............................................178 

    Figure 17-9: Pseudo 3D view of Aliva model domain wireframes in rotated grid............................179 

    Figure 17-10: Pseudo 3D view of Avrebo model domain wireframe...............................................180 

    Figure 17-11: Pseudo 3D view of Nfutu drill holes and trenches....................................................181 

    Figure 17-12: 3D variogram map,Indicator Threshold P 0.5, Anwia, Domain 1..............................188 

    Figure 17-13: 3D variogram map, Indicator Threshold P 0.5, Anwia, Domain 2.............................188 

    Figure 17-14 3D variogram map, Indicator Threshold P 0.5, Salman South Model, Domain 1 .....189 

    Figure 17-15 3D variogram map, Indicator Thresold P 0.5, Salman South Model, Domain 3 .......190 

    Figure 17-16 3D variogram map, Indicator Thresold P 0.5, Salman South Model, Domain 5 .......190 

    Figure 17-17 3D variogram map, Indicator Threshold P 0.5, Salman Central Model, Domain 1 ..191 

    Figure 17-18 3D variogram map, Indicator Threshold P 0.5, Salman Central Model, Domain 2 ..191 

    Figure 17-19 3D variogram map, Indicator Threshold P 0.5, Salman North Model, Domain 2......192 

    Figure 17-20: 3D variogram map, Indicator Threshold P 0.5, Salman North Model, Domain 3 ......192 

    Figure 17-21: 3D variogram map, Indicator Threshold P 0.5, Salman North Model, Domain 4, 5 and 6

      193 

    Figure 17-22: 3D variogram map, Indicator Threshold P 0.5, Salman all models and all Primary

    Domains, Sub Domain 1 ........................................................................................................193 

    Figure 17-23 3D variogram surface for the median indicator variogram model, Bokrobo Main Zone

    (used for all domains) ............................................................................................................194 

    Figure 17-24: 3D variogram surface for the median indicator variogram model, Aliva Domain 1 ...194 

    Figure 17-25: 3D variogram surface for the median indicator variogram model, Aliva Domain 2 and 3

    (also Domain 0)......................................................................................................................195 

    Figure 17-26: 3D variogram surface for the median indicator variogram model, ............................195 Figure 17-27: Anwia Panel Mean Grade Estimates, Section 550400N ..........................................205 

    Figure 17-28: Anwia Panel Recoverable Proportions at 1 g/t Cut-off, Section 550400N................205 

    Figure 17-29: Anwia Panel Confidence Categories, Section 550400N ..........................................206 

    Figure 17-30: Anwia Panel Mean Grade Estimates, Plan at 1.5RL................................................206 

    Figure 17-31: Anwia Panel Recoverable Proportions at 1 g/t Cut-off, Plan at 1.5RL......................207 

    Figure 17-32: Anwia Panel Confidence Categories, Plan at 1.5RL ................................................207 

    Figure 17-33: Salman Panel Mean Grade Estimates, Section 552137.5N.....................................208 

    Figure 17-34: Salman Panel Recoverable Proportions at 1 g/t Cut-off, Section 552137.5N...........209 

    Figure 17-35: Salman Panel Confidence Categories, Section 552137.5N.....................................209 

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    Figure 17-36: Salman Central Panel Mean Grade Estimates, Plan at 1001.5RL ...........................210 

    Figure 17-37: Salman Central Panel Recoverable Proportions at 1g/t Cut-off, Plan at 1001.5RL..210 

    Figure 17-38: Salman Central Panel Confidence Categories, Plan at 1001.5RL ...........................211 

    Figure 17-39: Bokrobo MIK Model showing 1.0g/t cut-off resource (model panels scaled in the east

    dimension by the proportion of contained resource)...............................................................212 

    Figure 17-40: Aliva MIK Model showing 1.0g/t cut-off resource (model panels scaled in the east

    dimension by the proportion of contained resource)...............................................................213 

    Figure 17-41: Avrebo MIK Model showing 1.0g/t cut-off resource (model panels scaled in the east

    dimension by the proportion of contained resource)...............................................................214 

    Figure 17-42: Nfutu MIK Model showing 1.0g/t cut-off resource (model panels scaled in the east

    dimension by the proportion of contained resource)...............................................................215 

    Figure 18-1: Salman Central and South Pit Designs......................................................................228 

    Figure 18-2: Salman North Pit Designs..........................................................................................229 

    Figure 18-3: Akanko Pit Designs ...................................................................................................230 

    Figure 18-4: Anwia Ultimate Pit Design (Local Grid)......................................................................231 

    Figure 18-5: Anwia Pit Stage Designs (Local Grid)........................................................................232 

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    1.0   SUMMARY

    1.1  General

    The Southern Ashanti Gold Project (the Project) comprises the greenfields development of an opencut mining operation, a process plant and related infrastructure to mine and process ore from the

    defined reserves of the Salman, Akanko and Anwia deposits. The Project is located in the Western

    Region of Ghana, approximately 280 km west of the capital, Accra, and less than 20 kilometres from

    the coast at Essiama. The Project area is accessed from Accra via the main coast highway to

    Takoradi and from there by sealed road to the village of Teleku Bokazo and then by 10 kilometres of

    gravel road.

    In 2006 Adamus Resources Limited (ARL or Adamus) commissioned a feasibility study (Study) as part

    of the technical and economic evaluation of the Project from experienced consultants including

    Lycopodium Engineering Pty Ltd, Mining Solutions Consultancy Pty Ltd, SGS Environment (Ghana)

    and Knight Piesold Consulting.

    The Study had as its basis a treatment plant with a processing capacity of 1.3 million tonnes per

    annum (Mtpa), which gave an approximate six and half year mine life based on the current reserve.

    Following release of the Study results in June 2007, including the initial ore reserve estimate for the

    Project, a NI43-101 compliant Technical Report of the Study was released in November 2007 with a

    further revised report released in December 2007.

    This report follows the release in February 2008 of the updated ore reserve and mineral resource

    estimates for the Project and incorporates new data into both the mining and resource sections of the

    previously published Technical Report. It incorporates new resource calculations for the Anwia and

    Salman deposits and the inclusion of resources from Bokrobo, Aliva, Avrebo and Nfutu (the “Satellite

    Deposits”) not previously included in the Study. It also updates the previous mining study to reflect

    changes in the economics of mining and processing parameters since preparation of the December

    2007 Technical Report.

    The main changes are:

    •   Gold price increase of approximately 35%

    •   Contract mining cost increase of approximately 15%

    •   Processing cost increase of approximately 15%

    •   A reduction of the cut off grade from 1.0 to 0.8 g\t as the lower figure better reflects results

    from the previous pit optimisations.

    The updated reserve estimate is based on a gold price of $800/oz, a royalty of 3.6%, the escalation in

    input 

    costs from December 2006 and a change in cut-off grade to 0.8 g/t,

    Changes to the resource estimate reflect the addition of data from drill programs undertaken between

    March 2007 and December 2007. The main changes are:

    •   An update of the Salman and Anwia resource models by Hellman and Schofield (H & S,

    March 2008) as a result of further drilling

    •   The inclusion of four satellite deposits contributing 2.5 Million tonnes @ 1.78 g/t measured

    and indicated resources at 0.8g/t cut off.

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     A significant change has been the conversion of inferred resources to indicated resources allowing

    this material to be incorporated into the pit optimisations.

    With the change in parameters, new pit optimisation tables have been produced. Total reserve

    estimate has increased to 10.46 M tonnes

    Gold has been mined on a small scale from southwestern Ghana for centuries and the Gold Coast

    Geological Survey recorded widespread bedrock and alluvial workings at many locations within the

    area now covered by the Project. Historic production from the small Akanko gold mine (Salman north)

    may have amounted to a few thousand ounces but otherwise there are no historic production

    estimates. Small-scale artisanal gold mining activities (both alluvial and reef) continue to occur at a

    few localities within the Project area.

    The Project has a history of exploration going back to the late 1980’s. Exploration efforts in the 1990s

    by various companies including Tropical Exploration and Mining Company, BHP Minerals, SEMAFO

    Inc, SAMAX Gold Inc, and Ashanti Goldfields Corporation led to the identification of a significant

    northerly trending zone of gold mineralisation in the eastern part of the Project, termed the Salman

    Trend, and several discrete mineralised zones, including the Anwia Deposit, in the western part.Considerable drilling was undertaken at the Anwia Deposit by SEMAFO and SAMAX and a number of

    resource estimates were subsequently made but the deposit was never progressed to mine.

     ARL acquired the Salman deposit in 2002, the Anwia deposit in 2004 and the Akanko (Salman north)

    deposit in 2005. Since acquisition ARL has continued exploration with both RC and diamond core

    drilling campaigns, soil sampling and trenching over the three areas. The current resource has been

    delineated by several phases of drilling from 1995 to 2007 by the various owners.

    The Salman and Akanko deposits contain broad, near-surface zones of gold mineralisation extending

    over several kilometres of strike. Approximately 8 kilometres of strike extent has been drill tested to

    date indicating the presence of several discrete, multi-lode gold deposits, scattered along the shear

    zone.

    The Anwia deposit is located approximately 9 kilometres west of the Salman deposit. The surface

    expression of the deposit consists of extensive, shallow dipping quartz veining, extending over several

    hundred metres of strike. The deposit is hosted by a northeast dipping package of greywacke

    (footwall) and interbedded greywacke-phyllite (hanging-wall).

    Throughout this report resources and reserves are quoted relative to the JORC (2004) code, these

    resource and reserve terms are equivalent to those referred to in the CIM Standards on Mineral

    Resources and Reserves – Definitions and Guidelines, August 2000. Additionally all Mineral

    Resources are quoted inclusive of Mineral Reserves.

    This report has been compiled based on information available up to and including 31 December 2007.

     All the currency reported in this document is in US dollars unless stated otherwise.

    1.2  Ownership

     ARL holds an interest in three granted prospecting licences, four granted mining licence and five

    prospecting licence renewal applications currently covering a combined Project area of approximately

    464 km2. A detailed description of these licenses is included in Table 4.1 of Section 4.2 below.

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     Adamus Resources Limited

     Adamus Investment

    Enterprises Pty Ltd

     African Gold

    Properties Ltd

    Castlegem

    Pty Ltd

     Adamus Holdings

    Pty Ltd

     Adamus Resources

    Limited (Ghana) (1) 

    Semafo (Ghana)

    Ltd(1) 

    Nkroful Mining

    Limited(1) 

     Akanko Mining

    Limited(2) 

    Ghana

    BVI Australia

     ARL owns those tenements comprising the Project area by way of the company structure shown on

    Figure 1-1. The tenements comprising the Project area are subject to the statutory 10 per cent

    interest retained by the Government of Ghana.

    Figure 1-1 ARL Corporate Structure

    Notes:

    1. Ghanaian government holds statutory right to a 10% interest in the Ghanaian subsidiaries upon commencement of

    production.

    2. A third party holds 1,000 shares in Akanko Mining Limited representing 11% of the outstanding shares, so that ARL

    has an 89% interest (8,000 shares) in Akanko Mining Limited which will be reduced to 80% on conversion of the

    Ghanaian government’s 10% interest.

    The Anwia deposit lies on the Ebi-Teleku Bokazo mining licence ML2/192 held by ARL. The currentlicence was granted on 11 April 2008 and has a ten year, extendable term. A royalty of 3 per cent of

    net profit or 1 per cent of production (in each case, in relation to ore derived from the area of the

    original Teleku Bokazo prospecting licence), whichever is greater, is payable by Adamus to Super

    Paper Products Company, a previous holder of the original prospecting licence.

    The Salman deposit lies on the Salman mining licencewhich was granted to Adamus Resources

    Limited (Ghana) for a period of ten years commencing 11 April 2008 for a ten year, extendable term

    The Akanko deposit lies on the Akanko mining licence granted under the same terms as the Salman

    mining licence. Hereafter throughout this report, the Salman deposit and Akanko deposit are

    collectively referred to as the Salman deposit.

    The Akanko mining licence ML2/128 is held by Akanko Mining Limited, a company 89 per cent owned

    by Adamus Holdings Pty Limited (a wholly owned subsidiary of ARL) and 11 per cent by Tropical

    Mining and Exploration Ltd (TEMCO). Upon conversion of the Ghana government’s 10% statutory

    interest, ARL’s interest will be reduced to 80 per cent.

    Parts of both the Salman consolidated and Ebi-Teleku Bokazo prospecting licences are subject to

    concessions in favour of Super Paper Products Company that permit the extraction of kaolin clays and

    small-scale mining of kaolin near the village of New Aluku. To ARL’s knowledge the kaolin

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    concessions do not impinge on any area proposed for the development of the gold mine or its

    associated infrastructure.

    1.3  Mineral Resource Estimate

    Several discrete gold deposits (including the Salman and Akanko deposits), collectively referred to asthe Salman Trend, have now been delineated along the Salman Shear Zone within the Project area.

    The Salman Shear Zone comprises a ductile shear between 10 and 50 metres thick separating a

    western hanging-wall of deformed, graphitic phyllite and thin-bedded greywacke from an eastern

    footwall of thick-bedded greywacke. The shear zone dips moderately to steeply west over much of

    the 8 kilometres drilled extent but locally it rolls over to dip steeply to the east. An altered biotite

    granitoid intrudes the shear zone in the northern portion of the resource area. Gold mineralisation

    occurs predominantly in vertical to west-dipping lodes approximately parallel to and splaying out into

    the footwall of the main shear zone, in quartz-veined silica-sericite-carbonate-arsenopyrite altered

    greywacke and/or granite. Below the base of oxidation, most gold is associated with fine-grained

    arsenopyrite and is partially refractory.

    The Anwia deposit is a discrete zone of gold mineralisation located approximately 9 kilometres west ofthe Salman Trend. The deposit is hosted by a northeast dipping package of greywacke (footwall) and

    interbedded greywacke-phyllite (hanging-wall). In the western (footwall) part of the deposit gold

    mineralisation is also hosted by a steeply northeast dipping granite dyke that gradually converges on

    the hanging-wall in the northwest of the resource area. The few facing indicators apparent suggest

    the metasedimentary package is overturned. Gold mineralisation is intimately associated with pyrite

    disseminated within and around a complex array of deformed pale grey to dark blue-grey quartz-

    carbonate-sericite±albite veins. A broad sericite-carbonate alteration zone about 200 metres thick and

    450 metres long is developed in the footwall greywacke. The silica-sericite alteration zone is more

    extensive than the gold-pyrite mineralisation. Unlike the Salman Shear Zone, there is no significant

    component of refractory gold in the sulphide zone at Anwia.

    Estimates of resources at the Salman deposit rely predominantly on sampling by ARL. Since

    commencement of drilling at the Salman deposit, Adamus has maintained a quality control protocol

    that allows routine monitoring of sampling precision and assay accuracy. An examination of QAQC

    sample data indicates satisfactory performance of f ield sampling protocols and of assay laboratories.

    Estimates of resources for the Anwia deposit rely substantially on drill sample assays generated by

    previous owners for which little QAQC information is available. A nearest-neighbour comparison of

    gold grades in ARL’s drill samples with those in samples from previous drilling demonstrates that the

    two sample populations are equally representative of mineralisation grades at Anwia.

    Two previous resource estimates have been completed for the Project at earlier stages of exploration

    by independent resource consultants Ravensgate Pty Ltd (August 2004) and SRK Consulting

    (February 2005). Additionally, to fulfil listing requirements for the TSXV, the Project was the subject of

    an independent technical report by RSG Global Pty Ltd dated February 2004. An internal resource

    estimate update was undertaken in January 2006 and a report detailing that work was filed with the

    appropriate Canadian securities regulatory authorities in March 2006.

    Recoverable resources at the Anwia and Salman deposits have been estimated using the method of

    Multiple Indicator Kriging (MIK) with block support adjustment. Geological and weathering domains

    were imposed to define domains of similar grade tenor and directional trends. The models estimate

    resources into panels with dimensions of 20mE x 25mN x 3mRL. MIK of gold grades used indicator

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    variography based on the resource sample grades, with continuity of gold grades characterised by

    indicator variograms at 14 indicator thresholds. A block support adjustment, incorporating an

    adjustment for Information Effect, was used to estimate the recoverable gold resources assuming a

    selective mining unit of 5mE x 8mN x 3mRL and grade control sampling at 5mE x 8mN x 1.5mRL.

    The shape of the local block gold grade distribution has been assumed lognormal or normal

    depending on the skewness of the local histogram of gold grades at sample support within each panelas estimated by Indicator Kriging. The estimates are considered recoverable by open pit mining and

    application of ore loss and dilution factors in quantifying ore reserves is not recommended.

    The recoverable resource estimates within each panel have been classified according to the

    distribution of sampling in the kriging neighbourhood. This classification scheme takes into account

    the uncertainty in the estimates related to the proximity and spatial distribution of the informing sample

    composites. A summary of the mineral resource estimates for the Anwia, Salman and Satellite

    deposits at 0.8g/t Au cut-off grade is set out below in Table 1-1.

    Table 1-1 Summary of Southern Ashanti Gold Project Resources at 0.8g/t cut-off

    Category Measured Indicated Inferred

    Deposit Cut offgrade(g/t)

    Mtonnes g/t Au

    k oz Au

    Mtonnes

    g/t Au

    k oz Au

    Mtonnes g/t Au

    k oz Au

     Anwia 0.8 6.2 2.01 400 2.8 2.00 180 2.6 1.7 140

    Salman 0.8 11.4 1.73 630 5.6 1.54 280 2.5 1.5 125

    SatelliteDeposits 0.8 1.0 2.10 70 1.5 1.57 70 1.3 1.8 75

    Total 0.8 18.6 1.84 1,100 9.8 1.67 530 6.4 1.6 340

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      Variograms at both the Anwia and Salman deposits show short ranges along strike and down-dip.

    This is typical of hydrothermal gold deposits and there is nothing to indicate that a sensible grade

    control sampling strategy in future open pit mining operations could not outline ore parcels at an

    economic cut-off grade.

    1.4  Metallurgical Testing

    1.4.1 General

    The Anwia and Salman orebodies have been the subject of previous metallurgical testwork campaigns

    by the present and former owners of the Project.

    The most recent testwork programme was carried out from June 2006 through to May 2007 under the

    direction of ARL and Ozmet. This testwork was primarily performed at Ammtec laboratories in

     Australia on samples selected to be representative of the Project deposits.

     A conventional cyanidation treatment route was assumed for the ores, based on assessment of the

    earlier testwork.

    The testwork programme had four objectives:

    •   Establish (confirm) the processing route;

    •   Determine the optimum plant operating parameters for the ores to be processed;

    •   Evaluate the variability in metallurgical performance for the different deposits; and

    •   Define parameters required for the engineering and design of the plant.

    1.4.2 Comminut ion Testing

     A full series of comminution testwork was completed on the Anwia and Salman primary orebodies.

    The primary ore samples are classified as having low to moderate competency behaviour and

    compressive strength testing classified the samples as weak.

    Rod mill and ball mill work indices are moderate. The rod:ball ratio is low (1.13) suggesting there is a

    low potential the ore will form critical sized material in a SAG mill.

    The abrasiveness of all ore types is classified as moderate and indicates that liner and media

    consumption will not be excessive.

    Pebble crushing is not included although an allowance has been made in layouts and electrical design

    for installation should any significant quantity of Salman primary ore be treated.

    1.4.3 Metallurgical Testing

    The approach taken to the metallurgical testwork was to compile master composite samples,

    representing the majority of the known in pit resource established in the previously prepared Scoping

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    Study (2006). Variability composite samples were also compiled from appropriate combinations of

    sample reserves used to form the master composite samples.

    Each of the master composite samples was subjected to gravity/leach testing to assess the potential

    for gravity concentration and determine the optimum leach conditions. The variability composite

    samples were then subjected to testwork using the optimum conditions established from the mastercomposite sample testwork. The rationale was that the results obtained on the master composite

    samples, rather than any of the minor components of the total resource, should dictate the process

    design parameters.

    The complete testwork programme comprised the following:

    •   Unconfined compressive strength (UCS) determinations. 

    •   SMC Drop-Weight Testwork. 

    •   JK Drop Weight Testwork (for SAG mill amenability). 

    •   Bond Abrasion Index (Ai) Determinations. 

    •   Bond Rod Work Index (RWi) Determinations.

    •   Bond Ball Work Index (BWi) Determinations.  

    •   Head Assay Analysis.  

    •   Cyanidation Optimisation Testwork.  

    •   Carbon Adsorption Testwork. 

    •   Cyanide Destruction Testwork. 

    •   Thickening and Viscosity Testwork on Slurries. 

    •   Arsenic precipitation. 

    •   Tailings Consolidation.  

      Tailings Geochemistry.

    1.4.4 Testwork Summary

    The metallurgical treatment route selected based on the results of the testwork can be summarised as

    follows:

    •   Primary crushing using a jaw crusher;  

    •   Single stage SAG milling;  

    •   Gravity concentration of a portion of cyclone feed using a centrifugal concentrator; 

      A thickening stage capable of being run in a leach feed or leach tail configuration;•   Carbon in leach (CIL); and

     

    •   Zadra stripping plant. 

    The key process design parameters derived from the testwork are set out below in Table 1-2. Plant

    design has been based on design maximum recoveries for each of the ore deposits based on the

    selected treatment route, as set out in Table 1-3.

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    Table 1-2 Key Process Design Parameters

    Mill Circuit Design

    UCS MPa 90% CaO) kg/t 2.0

    Table 1-3 Metallurgical Recoveries

    Deposit Ore Type Option 5

    Recoveries %

     Anwia Oxide 95.8

    Transitional 93.3

    Primary 91.8

    Salman Oxide 86.8

    Transitional 74.7

    Primary 54.7

    1.5  Mineral Processing

    Since the Anwia primary ore will be the hardest ore type encountered it was initially agreed that the

    front end plant design would be configured to achieve a 1.3 Mtpa throughput, at a grind of 80%

    passing 75 micron, of this type of ore.

    Project optimisation following the development of capital and operating costs for the Project resulted in

    a series of plant options being considered which examined the effect of coarsening the target grind

    size and determining the impact on Project capital costs, operating costs and gold recovery.

    The five options reviewed are as follows:

    Option 1: Deletion of the two stage grinding circuit and insertion of a 5.5m dia. x 6.0m EGL SAG mill

    (based on Golden Pride mill size such that design time can be minimised), deletion of the

    Intensive Cyanidation Reactor and insertion of a Gemini Table to treat gravity circuit

    concentrates, deletion of leach feed thickening, deletion of one CIL tank, deletion of the

    PSA plant, treatment of tails slurry via decant return dilution to meet

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    Option 2: Deletion of the surge bin and dead stockpile and insertion of direct feed from the jaw

    crusher to the SAG mill deletion of the two stage grinding circuit and insertion of a 5.5m dia

    x 7.32m EGL SAG mill ( correct size to meet required 1.3 Mtpa throughput), deletion of the

    Intensive Cyanidation Reactor and insertion of a Gemini Table to treat gravity circuit

    concentrates, deletion of leach feed thickening, deletion of one CIL tank, deletion of the

    PSA plant, treatment of tails slurry via thickening and decant return dilution to meet

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    •   Inclusion of single stage SAG milling to achieve 80% passing 106 micron in leach feeds for the

    average mill feed blend at 1.3 Mtpa.

    •   Inclusion of a gravity circuit based on testwork results indicating high gravity gold recoveries

    for Anwia ores. 

    •   Inclusion of a cyanide detoxification circuit to meet International Cyanide Code standards.

    •   Inclusion of an arsenic precipitation stage due to elevated arsenic levels in Salman transitional

    and Anwia transition and primary ores. 

    The summary process flow sheet is set out in Figure 1-2. The general control philosophy is for a plant

    with minimal automation. The plant will have a crusher control panel and a central mill control room

    from which the status of the major electrical equipment can be monitored, and from which some of the

    regulatory control loops can be monitored and adjusted. The starting and stopping of most electrical

    drives will be performed at the stop/start control stations located adjacent to each drive or in the case

    of major equipment, started locally or by remote from the control room.

    1.6  Open Pit Mining

    The selected mining method for the Project is conventional open pit mining including drilling, blasting,

    loading and hauling operations carried out by a qualified mining contractor with experience in Ghana.

    The Salman (including Akanko) and Anwia deposits were the subjects of an open pit mining study.

    The construction of the processing plant is currently planned close to the Salman deposit. The mining

    contractor will also be responsible for hauling the ore from the Anwia pit to the plant site by way of a

    public road.

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      Tail

    Conc

    Underflow

     Overflow

    ROM Ore Stockpile

    Primary Crusher 

    Surge BinCrushed OreStockpile

    SAG Mill

    Cyclones

    Gravity Concentrator 

    Cyanide Leach

    Leach/Carbon Adsorption (CIL)

    Carbon Stripping

    Carbon Regeneration

    Thickener 

    Cyanide Destruction

     Arsenic Precipitation

    Tailings StorageFacility

    Gold Room

    Gold Bullion

     

    Figure 1-2 Mineral Processing Flowsheet Summary

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