| Wed 15 Apr 2009, 15:43 | | MMH - Miranda - Updated CPR Confirms 35.5 Mt Resource At Burnside Project |
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MMH
MMH
MMH - Miranda - Updated CPR Confirms 35.5 Mt Resource At Burnside Project
Miranda Mineral Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number: 1998/001940/06)
Share code: MMH & ISIN: ZAE000074019
("Miranda" or "the company" or "the group")
UPDATED CPR CONFIRMS 35.5 MT RESOURCE AT BURNSIDE PROJECT
1. Background
Miranda Coal`s 62%-held subsidiary, Street Spirit Trading 54 (Pty) Ltd, is
the owner of the coal prospecting license on the properties of Burnside 3287,
Davelsberg 3286, Izemfene A9146 and Izemfene B8802 in the Glencoe area of the
KwaZulu-Natal ("KZN") coal fields ("Burnside" or "the Burnside project"). The
Burnside project stretches 6 km`s from west to east and 9 km`s from north to
south bordering on Uithoek, another of Miranda Coal`s KZN coal projects.
Miranda recently announced that its mining right application on Uithoek was
accepted by the DME. Coal mining activity dating back to the 1970s is known
to have taken place on Burnside.
2. Updated CPR
Further to the SENS announcements dated 14 May 2008 and 7 April 2009,
the board is pleased to provide shareholders with the results of its
second phase drilling program on the Burnside project. PC Meyer
Consulting was appointed by Miranda in the fourth quarter of 2008 to
prepare an updated Independent Competent Person`s Report ("CPR") on
Burnside. The purpose of this updated CPR was threefold:
i) To incorporate the latest information from the 2008 drilling
program, which consisted of a further 10 in-fill boreholes, and
assessing the reliability of the information available for the
exploration area.
ii) To incorporate recently discovered information pertaining to
historical mining activities on Burnside - mine-layouts and plans
were for the first time discovered during the course of this latest
investigation. The extracted tonnage cannot be estimated as it is
unknown which seams were mined. For purposes of this exercise, the
estimated area of mining was excluded from the resource and
resulted in a reduction of some 16.5 million tons ("mt") in the in
situ resource compared to previous estimates.
iii) To provide a specific reference to the technical-economic status of
the project.
The CPR was prepared by Mr PC Meyer (Pr.Sci.Nat 400025/03) a SAMREC-
registered Competent Person. PC Meyer has more than 18 years experience in
the South African coal industry and is a member of the GSSA and Fossil Fuel
Foundation. The results of the CPR are summarised below.
2.1 Reserve and resource statement
The project area involves four separate blocks, one of which is open-castable
("OC") and three of which are underground ("UG1", "UG2" and "UG3"). There are
two economic coal seams, Top Seam and Bottom Seam, which are separated by
coarse grained sandstone, pebbly, cross-bedded and fining upwards to shale at
the top. The spacing between the Top Seam and Bottom Seam ranges from 18 to
25 meters. The area is undulated with a steep hill in the north west of the
farm. The average depths and widths of the Top Seam and Bottom Seam in the
resource areas are tabulated below:
2.2 Average seam depth and thickness
Top Seam
Project Area Ave Width (m) Depth (m)
Block OC 0.85 9.6
Block UG1 0.83 49.3
Block UG3 0.99 93.8
Bottom Seam
Project Area Ave Width (m) Depth (m)
Block OC 1.14 12.7
Block UG1 1.24 64.3
Block UG2 1.17 95.4
Block UG3 1.55 105.6
2.3 Resource statement
Top Seam
Project Area* Thick* RD* GIST* GL* IST*
Block
Block OC 3,129,708 0.85 1.61 4,283,005 15% 3,640,554
Block UG1 5,951,386 0.83 1.60 7,903,440 15% 6,717,924
Block UG3 2,672,198 0.99 1.60 4,232,761 15% 3,597,847
Total 11,753,291 16,419,206 13,956,325
Bottom Seam
Project Area* Thick* RD* GIST* GL* IST*
Block
Block OC 3,311,118 1.14 1.64 6,190,466 15% 5,261,896
Block UG1 5,850,910 1.24 1.60 11,608,206 15% 9,866,975
Block UG2 943,494 1.17 1.60 1,766,221 15% 1,501,288
Block UG3 2,320,839 1.55 1.60 5,755,681 15% 4,892,329
Total 12,426,361 25,320,573 21,522,487
*Notes:
Area = square meters; Thick = thickness in meters; RD = relative density;
GIST = gross in situ tons; GL = geological loss; IST = in situ tons
Assumptions and modifying factors:
i) As explained above, the previously mined areas have been excluded
in total. In addition, some of the pillars are extractable by open
pit means but were similarly not included as a resource.
ii) Raw RD for the seams in the openpit were laboratory determined and
assumed to be closely the same for the underground areas.
iii) Quality cut-off parameters for resource calculation was applied as
low volatile areas (vols < 5%) were excluded.
iv) Areas where the seam thickness is below 0.6m were omitted.
v) Geological and modeling losses of 15% were applied.
vi) All tonnages and qualities are quoted air dry.
The total resource area for the Top Seam is 1,175 ha with 37 boreholes
covering the area, and 1,243 ha for the Bottom Seam with 59 boreholes
covering the area. All of these boreholes have some raw quality data and the
2008 holes in the openpit have washability data.
The total resource is 35.5 mt of which 8.9 mt is openpitable. The openpit
area has washability and additional physical data and has been upgraded to an
"Indicated Resource" for both seams. The underground blocks remain unchanged
as an "Indicated Resource", except Block 1 which has an "Inferred Resource"
status due to the lack of washability data. As detailed below, Burnside`s
Indicated Resources amount to 18.9 mt and its Inferred Resources to 16.6 mt.
2.4 Resource summary table
Project Area Indicated Inferred Total
Resource Resource Resource
Top Seam
Block OC 3.64 mt - 3.64 mt
Block UG1 - 6.72 mt 6.72 mt
Block UG3 3.60 mt - 3.60 mt
Top Seam subtotal 7.24 mt 6.72 mt 13.96 mt
Bottom Seam
Block OC 5.26 mt - 5.26 mt
Block UG1 - 9.87 mt 9.87 mt
Block UG2 1.50 mt - 1.50 mt
Block UG3 4.89 mt - 4.89 mt
Bottom Seam subtotal 11.65 mt 9.87 mt 21.52 mt
Total 18.89 mt 16.59 mt 35.48 mt
The resource classification is as defined by the current SAMREC
classification for multi-seam coal deposits.
2.5 Coal qualities
Given the available data, the most probable scenario is for Miranda to
produce an export quality 12%-ash coal with coking properties, and a
concomitant 22 Mj/kg local powerstation coal. There is a good coking coal
product in the Bottom Seam which can be either exported or sent to local
steel producers. More detailed work and drilling is needed to determine the
specific markets for the coal.
3. Further exploration
Future planned explorations include an additional 6 percussion boreholes,
with wireline logging, and a further 4 cored boreholes. These holes need to
be drilled to increase the resource status to "Measured".
4. Project feasibility
Operationally, Burnside is contiguous to Uithoek, where the board expects a
mining right to be granted to the group by the end of 2009. Miranda`s initial
in-house investigations have indicated the economic viability of the Burnside
project. Miranda`s business model is to build the group`s Net Asset Value by
developing and moving its assets forward along the value curve. Consequently,
further analysis on the mining, processing and economic factors by a SAMREC
registered specialist consulting mining engineer will now be initiated.
The full version of the CPR can be found on Miranda`s website at
www.mirandaminerals.com.
Centurion
15 April 2009
Sponsor:
PricewaterhouseCoopers Corporate Finance (Pty) Ltd
Corporate Advisor:
Touchstone Capital (Pty) Ltd
Date: 15/04/2009 15:43:01 Produced by the JSE SENS Department.
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