INDEPENDENT REPORT ON THE NICKEL LATERITE RESOURCE - AGATA SOUTH, PHILIPPINES, Agusan del Norte Province

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INDEPENDENT REPORT ON THE NICKEL LATERITE RESOURCE -
AGATA SOUTH, PHILIPPINES.

Agusan del Norte Province,
Philippines.

MINDORO RESOURCES LIMITED
Suite 104, 17707 – 105 Avenue
Edmonton, Alberta T5S 1T1
Canada

4th November 2011

Mark G Gifford MSc (Hons), FAusIMM

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  • 1. INDEPENDENT REPORT ON THE NICKEL LATERITE RESOURCE - AGATA SOUTH, PHILIPPINES. Agata Nickel Laterite Project, Agusan del Norte Province, Philippines.ForMINDORO RESOURCES LIMITEDSuite 104, 17707 – 105 AvenueEdmonton, Alberta T5S 1T1Canada4th November 2011Mark G Gifford MSc (Hons), FAusIMM
  • 2. Independent Report on the Nickel Laterite Resource – Agata South, Philippines 2011 TABLE OF CONTENTSExecutive Summary ................11.0 Introduction ................32.0 Reliance on other experts ................33.0 Property Description and Location ................4 3.1 Location 3.2 Property Description 3.3 Tenement Type4.0 Accessibility, Climate, Local Resources, Infrastructure and Physiography ..............11 4.1 Climate 4.2 Local Resources and Infrastructure 4.3 Physiography 4.4 Access5.0 History ..............136.0 Geological Setting ..............14 6.1 Regional Geology 6.2 Local Geology7.0 Deposit Types ……………18 7.1 Laterite Ni Deposit Type Geology 7.2 Other Deposit Type Geology - Agata8.0 Mineralization ..............219.0 Exploration ..............22 9.1 MRL Au-Cu Exploration (1997-2000) 9.2 MRL Au-Cu Exploration (2004-2009) 9.3 MRL Laterite Ni Exploration10.0 Drilling ……………25 10.1 Bolobolo / Karihatag Drilling Record 10.2 Drill Hole Collar Surveys11.0 Sampling Method and Approach ..............27 11.1 MRL Sampling Procedure 11.2 MRL Sampling Protocols12.0 Sample Preparation, Analyses and Security ……………28 12.1 MRL Core Sampling 12.2 Checking of Laboratory Performance 12.3 Laboratory Protocols 12.4 Internal Check Assays 12.5 External Check Assays 12.6 Summary13.0 Data Verification ..............3814.0 Adjacent Properties ..............4015.0 Mineral Processing and Metallurgical Testing ..............40 15.1 Bulk Density Determinations i
  • 3. Independent Report on the Nickel Laterite Resource – Agata South, Philippines 201116.0 Resource Estimate ..............42 16.1 Geological Interpretation 16.2 Exploratory Data Analysis 16.3 Variography and Estimation 16.4 Resource Classification 16.5 Results17.0 Other Relevant Data and Information …………..5418.0 Interpretation and Conclusions .............5419.0 Recommendations …………..5520.0 References .............5621.0 Date and Signature .............59 ii
  • 4. Independent Report on the Nickel Laterite Resource – Agata South, Philippines 2011 LIST OF FIGURESFigure 1: Map of the Philippines showing MRL Project Areas ................4Figure 2: MRL Tenements and Projects in the Surigao Mineral District ................5Figure 3: Map showing broad outline of ANLP and Agata Cu-Au Prospects ................6Figure 4: Compilation Map showing areas of mapped Ni Laterites within Surigao District ................7Figure 5: Panoramic view of Agata South showing the main area of laterite development..............12Figure 6: Geological Map of Surigao Mineral District ..............16Figure 7: Agata South Drillhole Location Map – All Drilling ..............26Figure 8: Graphs of Nickel Standards Assays. ..............33Figure 9: Comparison of Independent Checks and MRL Assays ..............39Figure 10: Agata North Bulk Density Test Pit Location Map ..............42Figure 11: Drillhole spacing, Agata South …….........43Figure 12: Wireframe surfaces and drilling, Agata South (Mg on LHS, Ni on RHS of drill trace).........45Figure 13: Block model coloured by laterite horizons, Agata South ..............45Figure 14: Example of a boulder within hole ASL-020 ..............46Figure 15: Raw sample lengths (left) and composite lengths (right). ..............47Figure 16: Swath plot, Ni by easting, Agata South. ..............50Figure 17: Mineral Resource classification for Agata South. Drill hole locations in yellow ..............52Figure 18: Ni grade-tonnage curves, Agata South limonite. ..............53Figure 19: Ni grade-tonnage curves, Agata South Saprolite. ..............54 iii
  • 5. Independent Report on the Nickel Laterite Resource – Agata South, Philippines 2011 LIST OF TABLESTable 1: Agata South Project Tenements held by Mindoro ..........…...8Table 2: Climate Averages and Extremes 1961-2000 ……………11Table 3: NAMRIA Tie Points Technical Description ……………27Table 4: Ni Standards used at Agata South and frequency ..............30Table 5: Variance of Internal Laboratory Duplicate Analyses ……………32Table 6: Variance of Field Duplicate to Original Assays ……………34Table 7: Variance of Coarse Reject to Original Assays ..............35Table 8: Variance of Pulp Duplicate and Original Assays ..............36Table 9: Variance of Pulp Duplicate and Interlab Assays ..............37Table 10: Results of Independent Check on Agata South Drill Core Assays ..............39Table 11: Summary of Bulk Density Measurements ..............41Table 12: Block Model Properties .............44Table 13: Block model domain codes. .............44Table 14: Basic Statistics. .............47Table 15: Limonite variogram model parameters. .............48Table 16: Saprolite variogram model parameters. .............49Table 17: Search parameters. .............49Table 18: Proportion of model estimated for Ni per pass .............50Table 19: Input sample composites vs. model. .............51Table 20: Agata South Mineral Resource Estimate as at 13 September 2011. .............53Table 21: Mean grades for boulders. .............53 LIST OF APPENDICIESAppendix 1: Agata South - Cross-SectionsAppendix 2: MRL QA/QC ProceduresAppendix 3: Intertek Sample Preparation ProceduresAppendix 4: ANLP Bulk Density DataAppendix 5: Agata South - Resource Estimate – Statistics and Variography iv
  • 6. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011EXECUTIVE SUMMARYThis Ni Laterite Resource report was prepared at the request of Jon Dugdale, Managing Director ofMindoro Resources Ltd (MRL). It is the first total mineral resource estimate completed for the AgataSouth deposit which has been identified and delineated during this single program of exploration.The Agata South deposit is located about 30 km north-northwest of Butuan City and 64 kmsouthwest of Surigao City, Mindanao Island, Philippines. This deposit is part of the projects locatedwithin the overall Agata Project. The Agata South deposit is held by the approved MPSA of MinimaxMineral Exploiration Corp (Minimax), denominated as MPSA-134-99-XIII, which is comprised of 61.5blocks covering an area of 4,995 hectares (ha). The MPSA-134-99-XIII was approved on May 26 1999by the Department of the Environment and Natural Resources (DENR) and was registered on June17, 1999 with the Mines and Geosciences Bureau (MGB) Regional Office No. XIII in Surigao City. AMOA was signed by Mindoro and Minimax on January 19, 1997. Mindoro assigned all its rights in theMOA to MRL on June 27, 1997.The Agata South deposit is situated within the southern portion of the uplifted and fault-boundedWestern Range on the northern end of the east Mindanao Ridge. Greenschists, ultramafics,limestones, andesite and tuff, younger limestones, intrusive, and alluvium are present within thearea. The widespread occurrence of ultramafics and serpentinized ultramafics, especially along thebroad ridges characterized by peneplaned topography provide a favourable environment for thedevelopment of nickel laterites.The laterite profile in the Agata South deposit consists of the ferruginous laterite, limonite, saprolitegrading to the ultramafic rock, from surface to increasing depth. The limonite zone is iron oxide-rich,where the predominant minerals are hematite, goethite and clays, and with moderate nickel content(over 1%), while the saprolite zone has much less iron-oxide, is magnesium-rich, and has a slightlyhigher nickel content than the limonite horizon in its upper portion.This report is based on the exploration data that were produced and compiled by MRL. Dataverification performed by the author found no discrepancies. Hence the database is consideredadequate to meet industry standards to estimate mineral resources.The resource was estimated by Alastair Cornah and Mike Job, Principal Consultants, QuantitativeGroup Perth, using the Ordinary Kriging method. The data was domained into 3 ore types, Limonite,Saprolite and Bedrock and within each domain 6 individual elements were estimated and reportedupon. The resource estimate for the Agata South deposit is as below: 1
  • 7. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011Classification Horizon kTonnes Ni Co Fe Al Mg SiO2Indicated Limonite 1,566 0.66 0.09 42 5.7 1.4 11 Saprolite 3,474 0.95 0.02 13 1.5 16.6 37 Total 5,040 0.86 0.04 22 2.8 11.9 29Inferred Limonite 217 0.70 0.08 40 5.4 1.7 14 Saprolite 232 0.95 0.02 14 1.4 16.1 37 Total 449 0.83 0.05 26 3.3 9.2 26The cut-offs applied to the resource were 0.5%Ni for Limonite and 0.8%Ni for Saprolite (as per theprevious estimates completed upon the Agata North Laterite Project, (Cox, 2008 2009a 2009b;Gifford 2010)). 2
  • 8. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 20111.0 INTRODUCTIONThe Agata South Lateritic Nickel resources in the Philippines forms part of the resource base ofMindoro Resources Limited (MRL). MRL have been actively exploring in the Philippines archipelagosince 1997, with the first lateritic Nickel resource drilling program completed in 2007 at Agata NorthLaterite Project. Since lateritic Nickel resource drilling has commenced there have been numerousdrill programs completed so as to develop and build a significant resource for planning purposesassociated with the potential development of processing facilities in northern Mindanao.This technical report was prepared at the request of Mr J Dugdale, CEO of Mindoro ResourcesLimited of Canada [TSX – Venture Exchange]. This is the second completed drilling program upon theAgata South resource after Delta Earthmoving Inc. completed a simple preliminary resource in 2008,however, the standard of the drilling and the potential issues of sample quality meant that thedeposit was re-drilled by experienced MRL operatives. The MRL drill program has been completed ina single drilling pass utilising the extensive knowledge built up through lateritic nickel exploration fordrill spacing and resource development methodology from the Agata North resource.The resource estimate presented in this report has been completed by Alastair Cornah and Mike Job,both qualified geological statisticians and Principal Consultants for Quantitative Group (QG) – ageological consulting firm based in Perth, West Australia. The estimation methodology andgeochemical modelling used on the resource was defined by discussions with the author and QG soas to provide the most comprehensive and accurate resource estimate possible considering the dataspacing and continuity.The author has visited site on two occasions, and has seen the exploration drilling in progress andhas been able to review all aspects of the operation. Tony Climie, the managing MRL explorationgeologist based in Manila has visited site on numerous occasions and has been in charge of all MRLdrill programs completed upon the Mindoro Ni Laterite projects since 1997.2.0 RELIANCE ON OTHER EXPERTSThis report was compiled by the author with the assistance of Alastair Cornah and Mike Job of QGConsulting Perth, with regards to the completion of the resource estimate and geostatisticalinformation, Tony Climie of MRL Gold, with regards to discussion and review, and Jean Ravelo andMaya Arguelles of MRL Gold with regards to all aspects of field services from drilling, assayingthrough to density determinations and selected sample and assay collations. Numerous otherPhilippine staff were critical in the development of this report with regards to geology, survey,tenement information, diagrams and field access. 3
  • 9. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 20113.0 PROPERTY DESCRIPTION AND LOCATION 3.1 LocationThe Agata South Project is located within the northern part of Agusan del Norte province inNortheastern Mindanao, Republic of the Philippines. It lies within the Western Range approximately22 kilometers south of the southern portion of Lake Mainit (Figures 1-2). The Agata South depositfall within the political jurisdiction of the municipality of Tubay. The Mineral Production SharingAgreement (MPSA), Agata MPSA-134-99-XIII, encompasses the deposit, and is bounded bygeographical coordinates 9010’30” and 9019’30” north latitudes and 125029’30” to 125033’30” eastlongitudes. Figure 1: Map of the Philippines showing MRL Project AreasThe Agata South deposit ASLP is located in barangays Binuangan, Tagpangahoy, and Tinigbasan, all inthe municipality of Tubay, province of Agusan del Norte. It lies about 64 km south of Surigao City and30 km north-northwest of Butuan City. The majority of MRL’s exploration activities on the projectarea are located in the province of Agusan del Norte.The locations of the known mineralized zones on the Western Range in the Agusan del Norte (andSurigao del Norte) exploration areas relative to the property boundaries are illustrated in Figure 3and Figure 4. The Agata South mineralized zones, as defined by drilling and mapping 4
  • 10. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011 Figure 2: MRL Tenements and Projects in the Surigao Mineral District 5
  • 11. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011to date, lies entirely within the MPSA-134-99-XIII. Other known nickel laterite zones exist near thenorthern boundary and central regions of the property. Artisanal copper and gold mining is active inthe Agata area and are shown in Figure 3. These are outside the delineated nickel lateritemineralized zones at Agata South. Figure 3: Map showing broad outline of ANLP and Agata Cu-Au ProspectsThere are no existing reported Cu/Au resources within or near the Agata South resource boundaries.The nearest mine infrastructures, including settling ponds, are those of the SRMI Mine located inbetween the parcels of the Agata MPSA at the southern boundaries (Figure 4). The National Highwayruns parallel to the MPSA-134-99-XIII. 3.2 Property DescriptionThe Agata South area is part of the Agata Projects and is covered by the approved MPSA of MinimaxMineral Exploiration Corp (Minimax), denominated as MPSA-134-99-XIII, which is comprised of 61.5blocks covering an area of 4,995 hectares (ha) (Figure 2). To the south of the Agata South resourceareas is the SRMI mine site that is currently mining Direct Shipping Ore (DSO) from their lateritic Niresource. 6
  • 12. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011Figure 4: Compilation Map showing areas of mapped Ni Laterites within Surigao District 7
  • 13. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011To the north of the tenement is the Tapian Extension Exploration Permit (EP) Area denominated asEP 042-XIII, covering 6,842.28 ha. All of this EP area is located within the Western Range in thenorthern portion of the Agusan del Norte province.The MPSA-134-99-XIII was approved on May 26 1999 by the Department of the Environment andNatural Resources (DENR) and was registered on June 17, 1999 with the Mines and GeosciencesBureau (MGB) Regional Office No. XIII in Surigao City. A MOA was signed by Mindoro and Minimaxon January 19, 1997. Mindoro assigned all its rights in the MOA to MRL on June 27, 1997. The MOAgranted MRL the exclusive and irrevocable right to earn the Option Interests in the project. Atpresent, MRL has earned a 75% interests in the Agata Tapian Main, and Tapian San Francisco and theExtension Projects (tenements acquired after the finalization of the MOA) in the Surigao MineralDistrict. It also has a further option to acquire an additional 25% direct and indirect participatinginterest. The 2nd and 3rd exploration periods for the MPSA were July 23, 2004 to July 22, 2006 andFebruary 7, 2007 to February 6, 2009, respectively. The fourth exploration was granted on June 19,2009. The Agata-Bautista-EP was approved on October 2, 2006 and the first renewal was applied foron September 29, 2008.Both tenements are in good standing. Since the first Exploration Period in 1999, submission of allquarterly and annual accomplishment reports, and quarterly drilling reports; and the payment of themandated occupation fees were accomplished by MRL, on behalf of Minimax. The same was donefor the Agata-Bautista EP.Table 1: Agata Tenements held by Mindoro:TENEMENT ID AGATA AGATA-BAUTISTAPERMIT NUMBER MPSA-134-99-XIII EP-21-XIIIAPPLICATION NUMBER APSA-XIII-007 EPA-00080-XIIIDATE FILED (MGB XIII) 4-Jul-97DATE APPROVED 26-May-99 2-Oct-06PERMITTEE/ APPLICANT MINIMAX BAUTISTALOCATION Jabonga, Santiago, & Tubay, Agusan del Norte Santiago, Agusan del NorteAREA (ha**) 4,995.00 84.39 st - 4th Exploration Pd. approved-June 19, 2009 1 renewal of EP filed on 29-Sep-08STATUS -ECC granted May 20, 2008MPSA - Mineral Production Sharing Agreement EP - Exploration PermitAPSA - Application for Mineral Production Sharing Agreement EPA - Exploration Permit Application 8
  • 14. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011The boundaries of these tenements were located by the claim owners on a topographic map andsubmitted to the MGB-DEMR for approval. A tenement boundary survey approved by the MGB willbe required through an “Order to Survey” once a mining project feasibility study has been submittedby the proponent. The coordinates used by Mindoro are those indicated in the Exploration Permitdocument issued by the MGB. The surveyed drillhole collars are tied to a local grid, which in turn istied to National Mapping and Resource Information Authority (NAMRIA) satellite/GPS points andbenchmarks.The original area of the MPSA was 7,679 ha comprising 99 blocks, but 32 claim blocks with anapproximate area of 2,700 ha were later relinquished. This leaves 4,995 ha of the approved Contractarea as of May 18, 2000. The details of the original 99 claim blocks may be referenced on Item 6.2,pages 11-13 of the January 22, 2009 NI 43-101 Report on the Agata North Nickel Laterite Projectavailable on sedar.com and Mindoro’s website.With the issuance of an MPSA covering the Agata Projects, the landuse classification of the area istherefore for mineral production. Those outside the Contract area are essentially classified astimberland. There are no dwellers within the ANLP and ASLP drilling areas. The author is not awareof any environmental liabilities to which the property is subject other than those that fall under thePhilippine Mining Act of 1995.On May 20, 2008, an Environmental Compliance Certificate (ECC) was issued by the DENR to MRL fornickel laterite mineral production covering 600 ha within the Agata MPSA Contract area, includingboth the Agata North and Agata South projects.The barangay (village) centers where the projects are located, are mostly populated by Christians.There are some indigenous peoples (IP) that live in the surrounding areas within and outside theMinimax MPSA Contract area. Sitio Coro, Bgy. Colorado is almost entirely populated by IPs whileother IP groups have merged with the non-IP inhabitants in barangays E. Morgado and La Paz,municipality of Santiago, and Bgy. Tagmamarkay, Tubay.MRL, through the assistance of the National Commission on Indigenous Peoples (NCIP) - RegionalOffice No. XIII, has signed a Memorandum of Agreement with the IPs living within the MPSAContract Area in 2008 albeit the latter have neither Certificate of Ancestral Domains Claim (CADC)nor Certificate of Ancestral Domains Title (CADT) within the Contract area. The MOA calls for a 1%royalty on gross sales of mineral products to be given to the IPs as provided for in the IndigenousPeoples Reform Act (IPRA) of the Republic of the Philippines.Areas of nickel laterite mineralization have been mapped at a regional scale in the ASLP located inthe southern part of the Agata Projects and are the subject of a Mining Services Agreement betweenMRL, Minimax and Delta. No drilling or sampling has been carried out in this area prior to thenegotiations with Delta. Delta, at its sole cost and risk, may carry out exploration of the ASLP andmay select an area of up to 250 ha to advance to production if warranted. 9
  • 15. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011 3.3 Tenement TypeAn MPSA is a form of Mineral Agreement, for which the government grants the contractor theexclusive right to conduct mining operations within, but not title over, the contract area during adefined period. Under this agreement, the Government shares in the production of the Contractor,whether in kind or in value, as owner of the minerals. The total government share in a mineralproduction sharing agreement shall be the excise tax on mineral products. The excise tax is 2% of theactual market value of the gross output at the time of extraction. In return, the Contractor shallprovide the necessary financing, technology, management and personnel for the mining project.Allowable mining operations include exploration, development and utilization of mineral resources.The approved MPSA has a term not exceeding 25 years from the date of the execution thereof andrenewable for another term not exceeding 25 years. It gives the right to the Contractor to explorethe MPSA area for a period of 2 years renewable for like periods but not to exceed a total term of 8years, subject to annual review by the Director to evaluate compliance with the terms andconditions of the MPSA.The Contractor is required to strictly comply with the approved Exploration and Environmental WorkPrograms together with their corresponding budgets. These work programs are submitted by theContractor as requirements in securing the renewal of the Exploration Period within the MPSA term.The Contractor is likewise required to submit quarterly and annual accomplishment reports underoath on all activities conducted in the Contract Area. All the reports submitted to the Bureau shall besubject to confidentiality clause of the MPSA. The Contractor is further required to pay at the samedate every year reckoned from the date of the first payment, to the concerned Municipality anoccupation fee over the Contract Area amounting to PhP 75.00 per hectare. If the fee is not paid onthe date specified, the Contractor shall pay a surcharge of 25% of the amount due in addition to theoccupation fees.If the results of exploration reveal the presence of mineral deposits economically and technicallyfeasible for mining operations, the Contractor, during the exploration period, shall submit aDeclaration of Mining Project Feasibility together with a Mining Project Feasibility Study, a ThreeYear Development and Construction or Commercial Operation Work Program, a complete geologicreport of the area and an Environmental Compliance Certificate (ECC). Failure of the Contractor tosubmit a Declaration of Mining Project Feasibility during the Exploration Period shall be considered asubstantial breach of the MPSA.Once the ECC is secured, the Contractor shall complete the development of the mine includingconstruction of production facilities within 36 months from the submission of the Declaration ofMining Project Feasibility, subject to such extension based on justifiable reasons as the Secretarymay approve, upon the recommendation of the Regional Director, through the MGB Director.Any portion of the contract area, which shall not be utilized for mining operations, shall berelinquished to the Government. The Contractor shall also show proof of its financial and technicalcompetence in mining operations and environmental management. 10
  • 16. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011On February 2005, the Philippine Supreme Court decided with finality allowing for the 100% foreignownership of the mineral tenement under the Financial and Technical Assistance Agreement (FTAA).4.0 ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND PHYSIOGRAPHY 4.1 ClimateThe climate of Jabonga, Santiago and Tubay municipalities where the project area is situated belongsto Type II on the Philippines Atmospheric Geophysical & Astronomical Services Administration(PAGASA) Modified Coronas Classification. It has no dry season with very pronounced rainfallmonths. Climate averages from 1981-2000 show that peak rainfall months are from October toFebruary. The highest mean monthly rainfall is 308 mm during January and the lowest meanmonthly rainfall is 104.8 mm during May while mean annual rainfall is 2027 mm. Table 2: Climate Averages and Extremes 1961-2000 RAINFALL TEMPERATURE WIND CLOUD RHMONTH AMT AMOUNT # OF Dry Wet Dew % MAX MIN MEAN DIR SPD (okta) (mm) RD Bulb Bulb Pt.Jan 308.0 21 30.1 22 26.1 25.7 24.2 23.6 88 NW 1 6Feb 211.8 15 30.8 22 26.4 26.0 24.2 23.5 86 NW 1 6Mar 149.8 16 31.8 22.4 27.1 25.7 24.5 23.7 83 NW 1 5Apr 107.2 12 33.1 23.1 28.1 27.7 25.2 24.3 82 ESE 1 5May 104.8 14 33.8 23.8 28.8 28.3 25.8 25.0 82 ESE 1 6Jun 135.1 16 33.0 23.6 28.3 27.8 25.5 24.7 83 ESE 1 6Jul 157.5 16 32.5 23.3 27.9 27.5 25.3 24.5 84 NW 1 6Aug 105.1 12 32.8 23.5 28.1 27.8 25.4 24.6 82 ESE 2 6Sep 140.2 14 32.8 23.3 28.1 27.7 25.4 24.6 83 NW 2 6Oct 195.3 17 32.3 23.2 27.8 27.4 25.3 24.6 84 NW 1 6Nov 193.7 18 31.6 22.9 27.2 26.9 25.1 24.5 86 NW 1 6Dec 218.4 19 30.8 22.5 26.7 26.3 24.7 24.1 88 NW 1 6Annual 2026.9 190 32.1 23.0 27.6 27.1 25.1 24.3 84 NW 1 6Based on Butuan City Synoptic Station 11
  • 17. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011 4.2 Local Resources and InfrastructureA farm-to-market road was constructed by MRL in 2005 and is currently servicing three (3)barangays in two (2) towns. This road was turned-over to the local government. Road maintenanceis being supported by the company. Little infrastructure is located on the western side of thedeposits excepting the barangays general facilities.The drill sites and the whole plateaus are predominantly fern-dominated (bracken heath) opengrassland sparsely interspersed with forest tree seedlings and saplings of planted species. A fewsecondary growth trees line the streams along the lower slopes. 4.3 PhysiographyMost part of the Agata Projects spans the NNW-SSE-trending Western Range, which towers over theMindanao Sea to the west and Tubay River to the east, which drains southward from Lake Mainit.The western part of the area is characterized by a rugged terrain with a maximum elevation of 528meters above sea level. This part is characterized by steep slopes and deeply-incised valleys. Theeastern portion, on the other hand, is part of the floodplain of Tubay River, which is generally flatand low-lying, and has an elevation of less than 30m above sea level.Within the project area, the mineralization is contained upon a moderately eroded plateau that haspreserved the weathered ultramafic. Some erosion through slips has occurred but they are minorand to the north and east. Elevations range from 250-320m above sea level extending similartopographic expressions going to the south. The topography over the principal laterite developmentis shown in Figure 5 below. Figure 5: Panoramic view of Agata South showing the main area of laterite development. 12
  • 18. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011 4.4 AccessThe Agata South site is accessible by any land vehicle from either Surigao City or Butuan City via thePan-Philippine Highway. At the highway junction at Barangay Dona Rosario, turn to Tubay townsitecrossing over the Tubay River. A small boat can deliver you to Barangay Binuangan., at the base ofthe western portion of the Agata South deposit from the waterfront of Barangay La Fraternidad,Tubay. Alternatively if access can be arranged, 4WD vehicles can travel through the SRMI mine siteto the northern section of the Agata South deposit, where you can connect with the market roaddown to barangay Binuangan.5.0 HISTORYThe earliest recognized work done within the area is mostly from government-related projectsincluding: The Regional Geological Reconnaissance of Northern Agusan reported the presence of gold claims in the region (Teves et al. 1951). Mapped units include sedimentary rocks (limestone, shale and sandstone) of Eocene to mid-Tertiary age. Geologists from the former Bureau of Mines and Geosciences Regional Office No. X (BMG-X) in Surigao documented the results of regional mapping in the Jagupit Quadrangle within coordinates 125°29´E to 125°45´ east longitude and 9°10´ to 9°20´ north latitudes. The geology of the Western Range was described as a belt of pre-Tertiary metasediments, metavolcanics, marbleized limestone, sporadic schist and phyllite and Neogene ultramafic complex. (Madrona, 1979) This work defined the principal volcano-sedimentary and structural framework of the region and recognized the allochtonous nature of two areas of ultramafic rocks that comprise serpentinized peridotite in the Western Range, one between the Asiga and Puya rivers in the Agata project area and the other west of Jagupit. These were mapped by Madrona (1979) as blocks thrust westward, or injected into the metavolcanics between fault slices. The United Nations Development Program (UNDP, 1982) conducted regional geological mapping at 1:50,000 scale and collected stream sediment samples over Northern Agusan. The UNDP report of 1984 described the geological evolution of this region and included a detailed stratigraphic column for the Agusan del Norte region. Two anomalous stream sediment sites were defined near the Agata project during this phase of work. The Asiga porphyry system that lies east of the Agata tenements was explored by Sumitomo Metal Mining Company of Japan in the 1970’s and 1980’s (Abrasaldo 1999).La Playa Mining Corporation, financed by a German company in the late 1970’s, explored within theAgata Project area for chromiferrous laterite developed over weathered ultramafic rocks. Therewere five (5) test pits dug in the area.In 1987, Minimax conducted reconnaissance and detailed mapping and sampling. Geologicalmapping at 1:1,000 scale was undertaken in the high-grading localities, and an aerial photographic 13
  • 19. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011survey was conducted and interpreted. MRL established a mining agreement with Minimax inJanuary 1997, and commenced exploration in the same year.Several artisanal miners are active within the project site since the 1980’s up to the present. Theseminers are conducting underground mining operations at the Assmicor and American Tunnels areaand gold panning of soft, oxidized materials within Assmicor and Lao Prospect areas and ofsediments in major streams including that of Tubay River. The region of small-scale mining activitywas later named “Kauswagan de Oro” (translated: “progress because of gold”). The majoritysubsequently left the region for other high-grading areas in Mindanao. In more recent years, a groupof copper “high-graders” emerged in the American Tunnels area mining direct-shipping grade copperore. However, this new trend waned due to the softening of metal prices in the latter part of 2008.6.0 GEOLOGICAL SETTING 6.1 Regional GeologyThe principal tectonic element of the Philippine archipelago is the elongate Philippine Mobile Belt(PMB – Rangin, 1991) which is bounded to the east and west by two major subduction zone systems,and is bisected along its north-south axis by the Philippine Fault. The Philippine Fault is a 2000 kmlong sinistral strike-slip wrench fault. In the Surigao district, this fault has played an important role inthe development of the Late Neogene physiography, structure, magmatism and porphyry copper-gold plus epithermal gold metallogenesis (Figure 6). There has been rapid and large-scale uplift ofthe cordillera in the Quaternary, and limestone of Pliocene age is widely exposed at 1000-2000meters elevation (Mitchell and Leach 1991). A cluster of deposits on the Surigao Peninsula in thenorth consists chiefly of epithermal gold stockwork, vein and manto deposits developed in second-order splays of the Philippine Fault (Sillitoe 1988). The mineralization-associated igneous rocks inSurigao consist mostly of small plugs, cinder cones and dikes dated by K-Ar as mid-Pliocene to mid-Pleistocene (Mitchell and Leach 1991; Sajona et al. 1994; B.D.Rohrlach, 2005).The basement rocks consist of the Concepcion greenschist and metamorphic rocks of Cretaceousage overthrusted by the pillowed Pangulanganan Basalts of Cretaceous to Paleogene age, which inturn, were overthrust by the Humandum Serpentinite. Its emplacement probably occurred duringthe late Cretaceous. The Humandum Serpentinite occupies a large part in the tenement area, andthrough its subsequent weathering the area has a high potential for nickel laterite mineralization.(Tagura, et.al., 2007).The Humandum Serpentinite is overlain by Upper Eocene interbedded limestone and terrigenousclastic sediments of the Nabanog Formation. These are in turn overlain by a mixed volcano-sedimentary package of the Oligocene Nagtal-O Formation, which comprises conglomeraticandesite, wacke with lesser pillow basalt and hornblende andesite, and the Lower Miocene TigbauanFormation. The latter is comprised of conglomerates, amygdaloidal basalts, wackes and limestones.Intrusive events associated with the volcanism during this period resulted in the emplacement ofplutons and stocks that are associated with porphyry copper-gold and precious metal epithermalmineralization in the region. (Tagura, et.al., 2007) 14
  • 20. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011Lower Miocene Kitcharao Limestone and the lower part of the Jagupit Formation overlie theTigbauan Formation. The Jagupit Formation consists of conglomeratic sandstone, mudstone andminor limestone. The youngest stratigraphic unit is the Quaternary Alluvium of the Tubay Riverfloodplain.Mineral deposits within the region are dominated by epithermal precious metal deposits andporphyry copper-gold. There is a rather close spatial and probably genetic association betweenepithermal precious metals and porphyry deposits. These deposits exhibit strong structural control.First order structures are those of the Philippine Fault system, which play a role in the localization ofthe ore deposits, while the second order structures that have developed as a result of themovement along the Philippine Fault system are the most important in terms of spatial control ofore deposition. (Tagura, et.al., 2007).Other mineral deposits are related to ultramafic rocks of the ophiolite suite and comprise lenses ofchromite within harzburgite and lateritic nickel deposits that have developed over weatheredultramafic rocks. 6.2 Local GeologyThe Bolobolo and Karihatag resource areas are situated along the southern part of the uplifted andfault-bounded Western Range on the northern end of the east Mindanao Ridge. The Western Rangeis bounded by two major strands of the Philippine Fault that lie on either side of the Tubay Rivertopographic depression (B. Rohrlach, 2005). The western strand lies offshore on the western side ofthe Surigao Peninsula, whereas the eastern strand, a sub-parallel splay of the Lake Mainit Fault,passes through a portion of the property and separates the Western Range from the CentralLowlands to the east (Figure 6). These segments have juxtaposed lithologies consisting of at least sixrock units including pre-Tertiary basement cover rocks, ophiolite complex, clastic limestone and late-stage Pliocene calc-alkaline intrusive rocks. (Tagura, et.al., 2007)The rock units within the Bolobolo and Karihatag resource areas from oldest to youngest are asdiscussed below:Concepcion Greenschist (Cretaceous)The basement sequence on the property comprises greenschists, correlative to the ConcepcionGreenschists (UNDP, 1984), which occur mostly in the central to southern portions of the AgataProject and not outcropping in either Bolobolo or Karihatag. This rock outcrops in Guinaringan,Bikangkang and Agata Creek as long, elongated bodies. In the northern half, this unit is mapped asnarrow, scattered erosional windows. The predominant minerals are quartz, albite, and muscovitewith associated chlorite, epidote and sericite. In places, talc and serpentine are the maincomponents. (Tagura, et.al., 2007) The exposure of the schist by the late Eocene implies ametamorphic age of Paleocene or older and a depositional age of early Cretaceous. (UNDP, 1984) 15
  • 21. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011 Figure 6: Geological Map of Surigao Mineral District 16
  • 22. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011Humandum Ultramafic (Cretaceous?)Ultramafic rocks unconformably overlie the basement schist and formed as conspicuouslypeneplaned raised ground on the property area. These are comprised of serpentinites, serpentinizedperidotites, serpentinized pyroxenites, serpentinized harzburgites, peridotites, pyroxenites andlesser dunite, which are fractured and cross-cut by fine networks of talc, magnesite and/or calciteveins. These rocks are usually grayish-green, medium- to coarse-grained, massive, highly-shearedand traversed by meshwork of serpentine and crisscrossed by talc, magnesite and calcite veinlets.The serpentinites in the Bolobolo and Karihatag resource areas correlate with the HumandumSerpentinite (B. Rohrlach, 2005). The Humandum Serpentinite was interpreted by UNDP (1984) to beemplaced over the Concepcion greenschists probably before the Oligocene, and before late Eocenedeposition of the Nabanog Formation. MGB (2002) classified the Humandum Serpentinite as adismembered part of the Dinagat Ophiolite Complex, which is established to be of Cretaceous age.These rocks have potential for nickel due to nickel-enrichment in the weathering profile as observedin its deep weathering into a reddish lateritic soil. (B. Rohrlach, 2005).Nabanong Limestone (Upper Eocene)Several bodies of limestone correlative to the Nabanog Formation (UNDP 1984), were mapped tothe south of the project areas on the western portion of the Western Range. The easternmostlimestone body lies in the Assmicor-Lao prospect region, in the central portion of the property,Guinaringan-Bikangkang area and at Payong-Payong area located at the western side. In thenorthern half of the property, these limestones occur as narrow scattered bodies probably aserosional remnants. In places, this unit exhibits well-defined beddings and schistosity andcrisscrossed by calcite ± quartz veinlets. The limestones outcropping near intrusive bodies are highly-fractured with limonite and fine pyrite, associated with gold mineralization in fractures and showgreen hue due to chloritization. In places, the limestone is interbedded with thin sandstone,siltstone, and shale beds.Andesite and Tuff (Oligocene)Sparsely distributed across the properties are narrow bodies of andesite and tuff. Towards thevicinity of Peak 426 at the northwestern portion of the Agata region and to the south of the Boloboloresource area, the andesite occurs as a volcanic edifice. It is generally fine-grained to locallyporphyritic in texture. The tuff grades from crystal tuff to lithic lapilli. Several exposures of this unitare described by Abrasaldo (1999) as being strongly fractured adjacent to northeast-trending faults.Volcanic Intrusives (Upper Oligocene to Lower Miocene)A series of intrusives of alkalic and calc-alkaline composition occur in close vicinity to Lake MainitFault. These include syenites, monzonites, monzodiorites and diorites that are closely associatedwith gold mineralization as most of the workings and mining activities are concentrated within thevicinity of these intrusive rocks. The syenites are well-observed in the American and Assmicortunnels and consist mostly of potash feldspar. The monzonites are noted in the Lao Area, in theAmerican Tunnel and occasionally along Duyangan Creek. Monzodiorite outcrops in the Kinatongan 17
  • 23. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011and Duyangan creeks and sparsely in the American Tunnel. Trachyte to trachyandesite porphyry isnoted in the Kinatongan Creek. Diorites were observed in the American and Assmicor tunnels, whichoccur mostly as dikes. The intrusions in the Lao and American Tunnel prospects have beententatively correlated with the Mabaho Monzonite (UNDP, 1984).Kitcharao Limestone (Lower Miocene)Correlatives of the Kitcharao limestone are scattered through large areas of the southern projectsarea. Minor outcrops of the Jagupit Formation lie in the eastern claim block adjacent to barangayBangonay (Abrasaldo, 1999).Recent AlluviumQuaternary Alluvium underlies the Tubay River floodplain, within the valley between the WesternRange and the Eastern Highlands.7.0 DEPOSIT TYPES 7.1 Laterite Ni Deposit GeologyThe widespread occurrence of harzburgite, peridotite, pyroxenite, their serpentinized equivalents,serpentinite, and localized lenses of dunite/serpentinized dunite comprise the lithology in theproject area. These rocks are confined to broad ridges extending down to the footslopes of theWestern Range. The ultramafic bodies are of probable late Cretaceous age, and were emplaced aspart of an ophiolite sequence during the Upper Eocene (Abrasaldo, 1999). Schists are also present inthe extremities of the laterite area. Several of these rock types were likewise identified inpetrographic/mineragraphic analyses of drill core and rock samples as wehrlite (peridotite),serpentinized wehrlite, serpentinized websterites (pyroxenite), websterites, serpentinites andcataclasite. Lineaments trending NE within the ultramafic (and underlying green schist?) areinterpreted as either fault splays or zones of weakness in the area.Geological mapping in the project area showed favorable development of laterite along the broadridges characterized by peneplane topography. These areas are where the drilling activities areconcentrated. In areas with moderate to semi-rugged topography, erosion proceeds much fasterthan soil development, hence the laterite is thinner.In the Bolobolo Project, there is a distinct geomorphic feature that has further influenced lateriteformation and consequent nickel enrichment. The northern part of the delineated body has amoderate relief whose depth of laterite development and Ni enrichment is greater than in all otherparts of this deposit, and this is due to the erosion of this portion of the deposits via slips has beenreduced due to the presence of a volcanic plug halting the “giving way” of the laterite via continual 18
  • 24. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011erosion along developed weathering planes. Both Karihatag and Bolobolo have significant erosionissues and these have been the major delimiters of the resource, and this is a feature of many of thelateritic Ni deposits north of the Agata deposits.No test pits have been developed in either Bolobolo or Karihatag. This level of information is notrequired at this point in time due to the extensive knowledge already gained by a comprehensiveknowledge of the regions lateritic Ni deposits now gained by staff and operatives. 7.2 Other Deposit Type Geology – AgataThe Surigao Mineral District is host to several deposit types. The Philippine Fault has played animportant role in the development of the Late Neogene physiography, structure, magmatism andporphyry Cu-Au plus epithermal Au metallogenesis. An intense clustering of porphyry Cu-Au andepithermal Au deposits occurs along the Eastern Mindanao Ridge.There is a strong structural control on the distribution of Cu-Au deposits in the Surigao district, and aclear association of deposits and mineral occurrences with high-level intrusives and sub-volcanicbodies. Most of the centres of mineralization are located along NNW-SSE-trending second-orderfault splays of the Philippine Fault, and where these arc-parallel structures are intersected bynortheast-trending cross-faults. The Tapian-San Francisco property lies in a favourable structuralsetting at the district-scale, at the intersection between multiple strands of a NE-trending cross-structure and the Lake Mainit Fault. This same NE-trending structural axis encapsulates both theBoyongan porphyry deposit and the Placer epithermal gold deposits. (B. Rohrlach, 2005)Most of the known hydrothermal gold mineralization within the district is of low-sulphurisationepithermal character developed in second-order splays of the Philippine Fault. The mineralization ispredominantly of Pliocene age and is spatially and temporally associated with the Mabuhayandesitic volcanism. Epithermal mineralization tends to be confined to the Mabuhay Clastics andassociated andesitic stocks, lavas and pyroclastics, and in older rocks immediately beneath theunconformity at the base of the Mabuhay Clastics. The principal low-sulfidation epithermal-type,carbonate-replacement-type and porphyry-type deposits and occurrences include: vein-type(Tabon-Tabon vein, Plancoya vein); bulk-mineable stringer stockworks (Placer, Motherlode, Mapaso,Nabago); stratabound ore or carbonate-hosted (Siana mine); surface workings in argillized zones(Mapawa, Hill 664, Manpower, Layab, Gumod); placer gold (Malimono-Masgad region); porphyryCu-Au (Boyongan, Bayugo, Asiga and Madja); high-level porphyry-style alteration (Masgad,Malimono, Tapian-San Francisco) and high sulfidation (Masapelid Island). (B.D. Rohrlach, 2005)The principal deposit types that are being explored for in the Agata tenement area are: Porphyry Cu-Au of calc-alkaline or alkaline affinity Low-sulphurisation epithermal Au Carbonate-hosted Disseminated Au-Ag Ore Skarn Au-(Cu) Nickeliferous Laterite 19
  • 25. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011The first four deposit types collectively belong to the broad family of magmatic-hydrothermal Cu-Audeposits that form above, within and around the periphery of high-level intrusive stocks of hydrous,oxidized, calc-alkaline to potassic alkaline magmas that are emplaced at shallow levels in the crust ofactive volcanic arcs. These different deposit types form at different structural levels of magmaticintrusive complexes, and their character is governed by a multiplicity of factors that include depth ofmagmatic degassing, degassing behavior, host-rock lithology and structural preparation. (B.D.Rohrlach, 2005)The Tapian and Agata Projects area has high potential for the presence of one or more porphyry-type Cu-Au hydrothermal systems associated with 3 principal targets, and multiple satellite targets,that are associated with zones of high IP chargeability. Porphyry-style mineralization has beenencountered previously in the region by shallow drill holes in targets that are associated withmodest IP chargeability anomalies. The Tapian and Agata Projects possess multiple conceptual targetstyles such as porphyry, epithermal, Carlin-type and Ni-laterite (Figure 3).American Tunnels near the define Agata North lateritic Ni Project is a small erosional windowthrough ultramafic capping rocks. It is in the center of a six kilometer trend of chargeabilityanomalies and at a point where the chargeability is near-surface, and actually daylights. It is alsoassociated with extensive alteration, geochemical anomalies, and abundant gold and copper-goldshowings. American Tunnels is characterized by a chargeability anomaly, extending over 800 metersby 300 meters. There are over 100 shallow artisanal mines and workings within the trend, butmineralization is mostly obscured by ultramafic cap rock of variable thickness. Where themineralization is exposed, younger gold mineralization is telescoped into interpreted porphyrycopper-gold related mineralization (Figure 3).Mineralization is at the top of multi-phase intrusives, on the cusp of the chargeability anomaly, andis interpreted as a high-grade, late-stage concentration at the upper contact of the intrusive stocksand dykes, and derived from porphyry copper-gold mineralization below. Petrology indicatesmineralization is principally within late, more-fractionated monzonite phases of a syenite,monzonite, monzodiorite and diorite intrusive complex of dykes, sills, and small stocks intrudingultramafic rocks. Mineralization is associated with complex alteration assemblages of chlorite,epidote, actinolite, biotite ± k-feldspar, sericite, magnetite and albite. Copper minerals arechalcopyrite and bornite. These features, as well as the high molybdenum values, are consistent witha porphyry copper-gold setting.Gold is mined from a honeycombing of shallow (5 to 20 meters) underground workings, estimated tobe several hundred meters in extent, within an area of about 200 meters by 225 meters at AmericanTunnels. Free gold is also present in streams draining ultramafic cap rocks several hundred metersnorth of American Tunnels. There are also dozens of artisanal gold workings within other erosionalwindows to the south on the Agata Project.Having artisanal workings producing both gold and copper throughout the local region indicates thatthere is significant opportunity within the project area and provides Mindoro with significantopportunity outside of the Ni Laterite resources defined in this report. 20
  • 26. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 20118.0 MINERALIZATIONNickeliferous laterite deposits are present over a broad region in the Tapian and Agata Projects area(Figure 4). Any area of laterised ultramafic in the Tapian and Agata Projects area has the potential tocontain enriched levels of Ni and Co due to the high rates of weathering and the exposure ofsusceptible ultramafic rocks.The laterites being explored by MRL are developed over ultramafic rocks that lie solely along theWestern Range. The rock types within the ultramafics are harzburgite, serpentinized harzburgite,peridotite, serpentinized peridotite, pyroxenite, serpentinized pyroxenite, serpentinite with localizedlenses of dunite/serpentinized dunite. The ultramafic bodies are of probable Cretaceous age, andwere emplaced as part of an ophiolite sequence during the Upper Eocene (Abrasaldo, 1999).Formation of the laterites is thought to have occurred during the Pliocene or early Pleistocene. Thelargest of the laterite bodies overlies the central ultramafic body (Figure 7).Initially, MRL undertook aerial photograph interpretations and field inspections, to define areas ofpotential laterite formation. The soil profile is intensely ferruginous in this region, and relic cobblesof intensely fractured and serpentinized ultramafic rock lie scattered throughout the region ofobserved laterite development. At higher elevations along the topographic divide, ferruginouspisolites and blocks of lateritic crust were observed developed on an ultramafic protolith.Nickel laterites are the products of laterization or intense chemical weathering of the ultramaficrocks, especially the olivine-rich varieties like harzburgite and dunite. The high rainfalls and intenseweathering breaks down the easily weathered harzburgite and dunite and the more mobileelements of Mg and Si tend to leave the profile at a much faster rate than the less mobile Fe andNi/Co. Thus high Fe laterite and limonite zones overlie the weathering saprolite of the ultramaficrocks and where erosion of the upper Fe laterite is low quite deep depths can be formed (<10m).The Ni mineralization is predominantly at the base of the Fe laterite and the top of the saprolite, asthis element is concentrated in minerals that can hold it within their matrix (limonite and to a lesserdegree hematite, goethite and Fe-rich clays in the Fe Laterite, and more primary Mg rich clays(saponite and stevensite) in the ultramafic saprolite. When weathering is very deep, in zones ofinterpreted crush or fault zones, then more Ni can be located in the Fe laterite, but predominantlythe largest Ni enrichment is within the saprolite of the underlying ultramafic rock near the contactzone with the Fe laterite.Within the saprolitic ultramafic there are areas of more weathering resistant “boulders” and thesetend to carry less Ni mineralization than the surrounding more degraded saprolite – this is related tothe lower level presence of the Mg rich clays and their capacity to carry Ni and Co within theirstructure. 21
  • 27. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 20119.0 EXPLORATIONAll exploration work on the Agata South deposit was carried out by Mindoro under the directsupervision of James A. Climie, P.Geol., Exploration Manager. Local staff formed the explorationteam with qualified geologists logging all drill core and the site manager also being a qualifiedgeologist. All exploration since the emplacement of the MOA in 1997 is discussed in this section ofthe report. 9.1 MRL Au-Cu Exploration (1997-2000)Initial work by MRL on the Tapian - Agata Project from 1997 to 2000 comprised a geologicalevaluation conducted by Marshall Geoscience Services Pty Ltd. It was part of a due-diligenceassessment of the property prior to entering into a Joint Venture with Minimax. This work suggestedthat hydrothermal gold mineralization at Agata is related to andesitic or dioritic intrusives, that veinmineralization is representative of the upper levels of a porphyry system and that there isprospectivity for skarn mineralization within limestones on the property (Marshall, 1997; Climie etal., 2000).The 1st phase of exploration activity commenced in May 1997 in the Assmicor region and consistedof grid establishment followed by soil geochemical survey (1,617 soil samples analyzed for Au, Ag,Cu, Pb, Zn, As), geological mapping plus selective rockchip sampling and petrographic studies.Furthermore, DOZ technologies of Quebec, Canada, interpreted a RadarSat image of the Agata areaand generated a 1:50,000 scale interpretation of the region. In addition, MRL re-sampled by channelsampling, five test pits (ATP-1 to ATP-5) excavated by La Playa Mining Corporation. These pitsencountered laterite thicknesses of 2.48 to 9.40 meters. The composited assay values for each of there-sampled test pits range from 0.43% to 0.94% nickel.The 2nd phase of exploration activities on the Tapian - Agata Projects was undertaken between June1999 and December 1999. This included grid re-establishment, geological mapping within theAssmicor Prospect and American Tunnels, ground magnetic survey, soil geochemistry (50 samples),rock/core sampling, petrography and drilling of 11 holes. (Climie et al., 2000).The soil sampling survey generated widespread Cu and Au soil anomalies. Soil Cu anomalies tend tobe closely restricted to mapped intrusions at American Tunnels and Assmicor-Lao. Soil Au anomaliesare more widespread and extend into the surrounding and overlying carbonate rocks. In contrast,soil Arsenic anomalies appear to be weakly developed over the intrusions but more stronglydeveloped over carbonates. The Cu and Au soil anomalies associated with the Assmicor-Laoprospect region (Figure 3) are open to the east beneath the alluvial flood plain sediments of theTubay River. The potential for an extension of the Assmicor mineralization to the immediate eastbeneath the Tubay River floodplain is strengthened by the observation that the dikes and intrusivesencountered during drilling. 22
  • 28. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011Assmicor dip towards the east, that porphyry-like quartz veins were encountered in drillhole DH 99-11, which lies east of the Assmicor prospect, and the evidence of a resistivity anomaly developing onthe edge of the IP survey east of the Assmicor prospect.Nineteen surface channel samples were collected in the Limestone Prospect area. Sixteen of thesesamples yielded grades ranging from 0.02 g/t Au to 0.85 g/t Au. Three of the samples graded 2.79 g/tAu over 3.7 meters, 3.77 g/t Au over 2 meters and 1.48 g/t Au over 3 meters. The channel samplesindicate a zone of anomalous gold above 0.1 g/t in rock samples that extends over an area of 100mby 50m in oxidized limestone.Petrographic analyses by Comsti (1997) and Comsti (1998) reveal that the intrusive rocks at Agataconsist of alkalic, silica-undersaturated plutonic rocks. These comprise of syenites and monzonitesthat display varying degrees of sericitic and propylitic alteration. Potassic feldspar is a primarymineral phase in many of these rocks.An in-house ground magnetic survey was conducted in 1999. The magnetic data comprised a seriesof semi-continuous magnetic highs, with values >40250nT, that broadly coincide with thedistribution of ultramafic rocks along the western margin of the Lao and Assmicor areas. Themagnetic signature decreases gradually westward where the ultramafics are thought to be buried atdeeper levels beneath the limestones.MRL drilled eleven (11) diamond drill holes into the Assmicor and Limestone prospects in 1999 andencountered Au intersections associated with limonitic stockworks in biotite monzodiorite intrusive.These include 18.8m @ 1.13 g/t Au and 24.2m @ 1.38 g/t Au in holes DH 99-05 and DH 99-06,respectively. The intrusives comprise larger biotite monzodiorite bodies that are cross-cut byyounger diorite dikes, plagioclase diorite dikes, biotite diorites and quartz diorites. These dikes andintrusive bodies dip predominantly eastward, suggesting that a deeper magmatic source lies to theeast, possibly along the trace of the Lake Mainit splay of the Philippine Fault, beneath the alluvialfloodplain of the Tubay River. Drillhole DH 99-11, collared east of the Assmicor shaft, intersectedporphyry-style quartz-magnetite veins in biotite diorite, quartz diorite and in hornblende-quartzdiorite. 9.2 MRL Au-Cu Exploration (2004-2009)MRL undertook a third phase of exploration activity in 2004 on the Tapian Agata Project. This activityinvolved gridding, mapping and extensive grid-based pole-dipole induced polarization (IP)geophysical surveying along 30 east-west-oriented survey lines that extend from 7,800 mN to 13,400mN. The IP data were acquired by Elliot Geophysics International using a Zonge GGT-10 transmitter,a Zonge GDP-32 receiver and a 7.5 KVA generator. A total of 77.10 km of grid were surveyed by pole-dipole IP. The dipole spacing used in the survey was 150 meters. The data were modelled by Dr PeterElliot of Elliot Geophysics International using inversion modelling. 23
  • 29. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011Induced polarization (IP) surveying on the Agata Project has identified numerous IP chargeabilityanomalies that form finger-like apophyses at shallow levels, and which amalgamate into largeranomalies at deeper levels. The IP chargeability anomalies tend to strengthen with depth in the coreanomaly regions (Southern Target anomaly and Northern Target anomaly). The IP chargeabilityanomalies attain values that locally exceed 40 msecs, and routinely exceed 20 msecs on most of theIP pseudo-sections from Agata. Weaker modeled IP chargeability anomalies are associated withknown mineralization at Assmicor (10-18 msec) and in other satellite positions adjacent to the twocores Northern and Southern target anomalies. There is an indication, from the four plan views ofthe IP chargeability data, that NNW to NW faults may be important in controlling the distributionand shape of many of the IP anomalies at Agata. Faults that lie along these trends are expected tolie in a dilational orientation in relation to the regional stress field associated with sinistralmovement on the near north-trending Philippine Fault splay.Preliminary drilling on the Tapian Agata Project was carried out between November 2, 2005 andOctober 28, 2006. This was conducted under a joint-venture among MRL, Panoro Minerals Ltd.(Panoro), and Minimax. The prospects were highly recommended priority targets for drill evaluationas these prospects exhibit classic stacking of geophysical, geological and geochemical featuresassociated with Philippine porphyry copper-gold systems (Rohrlach, 2005). The preliminary drillingprogram was aimed to test the area of highest chargeability’s in the North and South PorphyryTargets.Great operational difficulties were encountered in extraordinarily bad ground conditions. A total offive drill holes with a combined length of only 756.45 meters were completed, four of which weredrilled within the North Porphyry Target and one at South Porphyry Target. All five holes wereprematurely terminated, not reaching target depths. The chargeability anomalies were interpretedto occur at around 375m below surface (N=4) based on IP geophysical inversion models. The deepesthole bottomed at only 251.20m, a long way from the 500-meter target.All drill holes have intersected and bottomed in strongly serpentinized ultramafics with very minimalpyrite mineralization. Dr. Peter Elliot, Consulting Geophysicist, affirmed that the serpentine was notthe cause of the anomalies, and would only cause a weak IP anomaly.From 2008 to 2009, underground mapping and sampling (continuous rock chip and grab sampling) ofthe American Tunnels prospect was undertaken. To date, results of 48 rock samples have beenreported by Mindoro. Significant results include an aggregate of 26m @1.94g/t Au; 21.90m @3.67%Cu, and 17.5m @2.01% Cu. Results of the underground sampling are incorporated in the rockgeochemistry map. 9.3 MRL Laterite Ni ExplorationLateritic Nickel mineralization was known within the Tapian Agata Project areas since the early1990’s and grades were confirmed in the development of test pits in 1997. The project since this 24
  • 30. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011initial definition has moved ahead so as to better define the resource and to provide better technicalinformation with regards to eventual exploitation.In June 2004, Taganito Mining Corporation was selected from several interested parties and grantedthe non-exclusive right to assess the nickel laterite potential of the Agata Project. Taganito carriedout two phases of evaluation and reported encouraging results. Forty-eight surface laterite and rocksamples were collected from an area of about 300 ha within a much more extensive area of nickellaterite mineralization. Nickel contents range from very low to a high of 2.09%, with most of thevalues exceeding 0.5%. Taganito considered these values to be within the range that normally capthe secondary nickel enriched zone and have recommended a detailed geological survey and drilling.However, MRL elected to allow Queensland Nickel Phils., Inc. (QNPH) to proceed with areconnaissance drill program in 2006.Since Taganito, exploration has been carried out by the use of open core drilling on a drill patternthat has been successively closed down with each subsequent drill programs so as to enhance theaccuracy of the future reported lateritic Ni resource. All drilling to date has been completed by theuse of small mobile open hole NQ coring rigs, which are highly mobile in difficult to access terrain.Recovery from these drill rigs is high, with losses generally occurring where there are changes in thehardness of the drilled material, causing material to be disrupted at the bit face. The major ore zoneis generally a softer material and losses within the ore zones have been minimal at all stages of thedrilling programs. A variety of contractors have been used over time in the Tapian Agata Projectsarea, with the drilling rate being the only variation with regards to their performance and samplingrate.10.0 DRILLING 10.1 Agata South Drilling RecordAgata South Drilling HistoryFor the resource being compiled in this report the total number of drill holes completed is 199 for2,571.05m meters of drilling with an average drill hole depth being 12.92m. Drilling was completedbetween the dates of 7th May 2011 to 14th July 2011. All drill holes completed within the AgataSouth area are located on Figure 7. All cross sections are in Appendix 1. 25
  • 31. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011 Figure 7: Agata South Drillhole Location Map – All DrillingSummaryAll exploration completed to date has been systematic and appropriate with regards to thedevelopment of a resource estimate. The author considers the drilling methodology used within theAgata South Area and the various sample recovery rates appropriate and accurate with regards toproviding a sampling platform for resource estimation. 10.2 Drillhole Collars SurveySurveying of drill hole collars’ position and elevation was undertaken by MRL surveyors using aNikon Total Station DTM-332. This, together with the topographic survey of the Agata South area istied to five National Mapping and Resource Information Authority (NAMRIA) satellite/GPS pointsand benchmarks with certified technical descriptions (Table 3). The Reference System used is PRS 92or WGS 84, used interchangeably by mathematical conversions.Consequently, the baseline for the local gridlines is based on many MRL control stations. About2,795 survey points, including drill hole collars, were established with varying shot distances. Theseare downloaded into the computer by seamless data transfer, imported to MAPINFO, which are thenused for the Digital Terrain Modelling to derive the contour map. 26
  • 32. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011 Table 3: NAMRIA Tie Points Technical Description STATION EASTING NORTHING ELEVATION B-1 770282.4648 1043049.4476 312.1215 B-2 770362.6665 1042967.3974 303.1060 T-1 7787061.9133 1020145.4420 289.5870 T-2 778198.4090 1020430.8999 286.960611.0 SAMPLING METHOD AND APPROACH 11.1 MRL Sampling ProcedureThe QA/QC Procedures for the Agata South drilling program was set up by MRL geologists and wasfollowed by all personnel involved in all stages of the program (Appendix 2). This was adapted fromthe QA/QC Protocols of QNPH for the 2006 drill program carried out on the Agata North deposits.Periodically, the protocols were evaluated and improvements implemented. The core handling,logging and sampling procedures applied in the program are briefly described below.Core checkers, under the supervision of MRL technical personnel, are present on every drill rigduring operation. This is to record drilling activities from core recovery, core run, pull-out and put-back, casing and reaming at the drill site. Once a core box is filled, it is sealed with a wooden boardthen secured with a rubber packing band. This is placed in a sack and manually carried to thetemporary core house some 300m to 1km from the drill area.Core logging was carried out in the core shed by MRL geologists. For standardization of loggingprocedures, the geologists are guided by different codes for laterite horizon classification,weathering scale, boulder size, and colour.After logging, the geologist determines the sampling interval. Core sampling interval is generally atone (1) meter intervals down the hole, except at laterite horizon boundaries, when actualboundaries are used. The sample length across the boundaries is normally in the range of 1.0 ±0.30m to avoid excessively short and long samples. In the saprolitic rocks and bedrock layers, somesample intervals have lengths greater than 1.30 meters to a maximum of 2.00 meters. 11.2 MRL Sampling ProtocolsAs in all stages of the resource definition program, the Agata South QA/QC Procedures (Appendix 2)were diligently followed during the sample preparation and security procedures. The analyses forthe 2,699 core samples were performed by Intertek Testing Services, Phils., Inc. (ITS), for the Agata 27
  • 33. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011South deposit. The laboratory follows internationally-accepted laboratory standards in samplehandling, preparation and analysis.The ITS Phils. facility is among Intertek’s global network of mineral testing laboratories. It provideshigh quality assay analysis of mineral samples for lateritic nickel deposit exploration projects.Intertek mineral testing laboratories implement quality protocols that are consistent withprocedures seen in other high quality laboratory facilities seen throughout the world.Extensive work has been completed historically by Mindoro with regards to sampling protocols inlateritic Ni resource definition at Agata North, a significant resource to the north of the Agata Southdeposit. During the early phases of Mindoro’s resource work, the rechecking of the integrity oflaboratory assays was completed by independent consultant Dr. Bruce D. Rohrlach, a qualifiedcompetent person, provided MRL geologists with sampling procedures in May, 2007 after severalsite visits. This was incorporated into the QA/QC Procedures.Following the recommendations of another qualified person, F. Roger Billington in May, 2008, thesampling protocols were slightly modified. The most important modification was the insertion ofpulp rejects in the same batch as the mainstream samples. This is to ensure that all conditions inassaying are similar, if not completely the same for both the mainstream and check samples.12.0 SAMPLE PREPARATION ANALYSES AND SECURITY 12.1 MRL Core SamplingThe drilling, primary sample collection, core sampling and logging facility was under the supervisionof MRL geologist or mining engineer at all times. The logging of the drill core was completed at the drill site, and this combines the geologicalsupervision of the drilling, correct sample recovery procedures and accurate record of losses of thedrill core during drilling, as well as the completing correct “End of Hole” procedures while finishingthe drill hole in basal geological units. After the initial drilling samples are transported to a basecamp, where a civilian guard is on duty securing the base camp premises during the night. Thesamples are further transported to Agata for sample preparation if this is not completed at the basecamp.All core samples from Agata South were split-sampled so as to ensure the availability of referencesamples in the future. The cores were cut in half using either a core saw or spatula. The remaininghalf is stored in properly-labelled core boxes at the Mindoro Camp site in Agata.The sampling interval is marked in the core box by means of masking tape/aluminium strip labelledwith the sampling depth. The sample collected is placed in a plastic bag with dimension of 35cm x25cm secured with a twist tie. The plastic bag is labelled with the drill hole number and sampleinterval. 28
  • 34. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011After the samples are collected, they are weighed then sun-dried for about 5 hours and weighedagain before final packing for delivery to the laboratory. In cases where there is continuous rain, thesamples are pan-dried for 5-6 hours using the constructed drying facility or wood-fired oven.MRL prepared its own sample tags for all samples including pulp repeats, pulp standards, and coarserejects samples. The samples were placed in a rice sack and then in a crate to ensure the security ofthe samples during transport.For batches of core samples from Agata South drill programs, the core samples were delivered toIntertek’s sample preparation facility in Surigao City. Likewise, checking of samples against the listwas done upon submission. Once prepared, Intertek-Surigao sends the samples to their assaylaboratory in Muntinlupa City, Metro Manila.The ANLP drilling was directly under the supervision of James A. Climie, P. Geol., ExplorationManager of Mindoro. 12.2 Checking of Laboratory PerformanceIn addition to stringent sampling protocols, QA/QC procedures were also employed following Dr. B.Rohrlach’s and F.R. Billington’s (MRL independent consultants) guidelines. Standard referencematerials, field duplicates, coarse rejects and pulp rejects were resubmitted to the analysinglaboratory to check the accuracy of the primary laboratory results. A total of 514 analyses of checksamples (including standards and internal laboratory check analyses), were used in confirming theaccuracy and repeatability of all assays to be used within the resource estimation of Agata South.Selection of check samples are spread throughout all holes and in various laterite horizons.The field duplicates totalled 70 or 2.59% of the 2,699 mainstream core samples of the Bolobolo andKarihatag resources. Normally, 1 in every 40 core samples is duplicated. The duplicate sample isselected to ascertain that the full range of different laterite horizons is systematically covered. Thesamples were selected to cover the full range of Ni grades at both deposits, and are to extensivelycover the different stages and spatial distribution of the drill program, so as to provide arepresentative check on the reliability of the original sample splitting process undertaken by MRL atthe field offices of either Agata or Mainit. All of the core in this drill program was half-core sampled,with the field duplicates taken by cutting the remaining ½ core into 2. These samples were sent tothe laboratory in the same batch and were treated in the same way as the mainstream core samples.A set of 21 coarse reject samples, comprising 0.78% of the 2,699 core samples, were submitted tothe laboratory where the original samples were analyzed for resampling and assaying. Resamplingwas done by taking a duplicate split from the coarse rejects and then placing it back into the assaystream for analysis. Again, as in all duplicates, the submitted samples were chosen to cover thenatural range of assays. The reanalysis of the coarse reject samples was undertaken as an internalcheck on the crushing and sub-sampling procedures of the laboratory to ensure that the samplestaken for analysis were representative of the bulk sample. 29
  • 35. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011There were two sets of pulp rejects sent for re-assaying. One was sent to the Intertek (Phils)laboratory where it was originally analyzed. A total of 67 pulp rejects were sent under this category.The other set was sent to an umpire laboratory, wherein a total of 52 pulp rejects were analyzed.This is to establish reproducibility of analysis and determine the presence or absence of biasbetween laboratories. Samples were taken from all of the different laterite horizons. Originally, pulprejects were collected and sent in separate batches, but now all pulp rejects to the primarylaboratory are forwarded within the normal submitted samples, with the pulp rejects sent to theumpire laboratory forwarded as a separate batch.The umpire laboratory for the drilling program was Intertek in Jakarta. Selected pulp samples weresent by MRL to Intertek’s Manila office, after which they forward the samples to Jakarta in IntertekCilandak Commercial Estate 103E, JI Cilandak KKO, Jakarta 12560. Intertek (Jakarta) has acquired anISO 17025 2005 accreditation from KAN (National Accreditation Body of Indonesia) denominated asLP 130_IDN.Nickel standards or certified reference materials are routinely inserted to the batches of coresamples sent for assaying. This is done as a double check on the precision of the analyticalprocedures of Intertek (Phils) on a batch by batch basis. The standards, which have known assayvalues for Ni, were provided by Geostats Pty Ltd of Australia and Mindoro’s own check standards inpulverized (pulp) form weighing about 5 grams contained in 7.5cm X 10cm heavy duty plastic bags.Originally, one (1) standard sample is inserted for every batch of 40 to 45 samples. However, therewere some standards inserted in smaller intervals of 25-35 samples; however the normal range wasone standard sample included in every set of approximately 40 samples. In all, 70 standardsequivalent to 2.59 % of the core samples were used.6 types of Ni standards were used with grade ranging from 0.001% to 1.51 % Ni. The GBM standardseach come with a certificate that shows the accepted mean Ni value and standard deviation, whichare available in the website of Geostats (www.geostats.com.au). The specific nickel standards andthe frequency of using each one are listed in Table 4. # Ni Standard Assays %Ni GBM305-9 5 0.25 GBM997-4 1 0.001 MRL-9959 20 0.48 MRL-11657 20 0.23 MRL-5122 20 0.89 GBM905-13 4 1.51 6 Standards 70 Table 4: Ni Standards used at Agata South and frequency 30
  • 36. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011 12.3 Laboratory ProtocolsIntertek Testing Services Phils., Inc. is among Intertek’s global network of mineral testinglaboratories. It provides quality assay analysis of mineral samples for nickel deposit explorationprojects. Measures are taken by Intertek mineral testing laboratories to ensure that correct methoddevelopment and quality protocols are in place to produce good quality results.Each sample is analyzed for nickel (Ni), cobalt (Co), iron (Fe), magnesium (Mg), aluminum (Al), silica(SiO2), CaO, Cr2O3, K2O, MnO, Na2O, P2O5, and TiO2. Whole rock analyses are done using X-rayFluorescence. The samples are fused using lithium metaborate. XRF analysis determines totalelement concentrations that are reported as oxides.For its internal QAQC, Intertek performs repeat analyses plus split sample analyses in every 15-20samples. Furthermore, on the average, one standard reference material is inserted in every 40samples, and one blank in every 60 samples.Flowcharts of intertek sample preparation and analysis procedure flowsheets are presented inAppendix 3. 12.4 Internal Check Assays - Intertek (Phils)The Intertek laboratory in Manila has a Quality Assurance/Quality Control programs incorporated intheir sample preparation and analyses procedures. The laboratory regularly conducts duplicateanalysis of Ni and other elements as a check on analytical reproducibility within their ownlaboratories. Repeats are routinely conducted on all elements being analyzed and are typically onevery 20th sample for the Intertek laboratory in the Philippines. The duplicate analyses arecompleted upon both a split sample from the crushed pulp, or from the prepared disc for the XRDanalyses. All in all there are 92 (3.40%) XRF repeat analyses that are spread evenly throughout theentire database, and 169 (6.25%) split samples from the pulp reanalysed.In analyzing the correlation between the original and duplicate sample, the Variance between theprimary assay and the duplicate was computed as follows: (a – b) Var = ________ x 100 aWhere: a - is the original sample analyzed b - is the duplicate sample analyzed and Var - is the percentage relative difference.To interpret the Variance value, a value of zero means the two values are identical and theduplication is perfect, a negative value means the duplicate is higher, while a positive value meansthe original is higher. Values less than 10% variance (either negative or positive), are considered 31
  • 37. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011excellent when reviewing comparative samples within lateritic Ni deposit assays. [NB Thismethodology is used in all sections of Chapter 12.0 Sampling and Assaying within this report.] Internal Laboratory Comparative Statistics Intertek (repeat assay) Ni Co Fe Al Mg Si Variance from 1st Assay 0.36% -0.28% 0.21% 0.33% 0.01% 0.17% Duplicates = 1st Assay 0 3 0 0 1 0 Duplicates < 1st Assay 57 46 65 59 56 59 Duplicates > 1st Assay 35 43 27 33 35 33 Intertek (split assay) Ni Co Fe Al Mg Si Variance from 1st Assay -0.01% 0.43% 0.00% 0.23% -0.14% -0.06% Duplicates = 1st Assay 3 9 1 1 0 1 Duplicates < 1st Assay 89 90 82 98 81 85 Duplicates > 1st Assay 77 70 86 70 88 83 Table 5: Variance of Internal Laboratory Duplicate AnalysesThere is an excellent correlation for all of the elements within an internal repeat analyses with allbelow Variances <1% (0.00 – 0.43%) as shown in Table 5, which is consistent with high precisionrepeatability. There is generally a very even spread of the check assay being both higher and lowerthan the primary assay which indicates that there is no systematic bias occurring in the checkanalyses routine. 12.5 External Check Assays (MRL)MRL has also set up its own QA/QC protocols vis-à-vis the laboratories’ sample preparation andanalytical procedures, which the author has observed in the field and analysed the results for thisreport. The external laboratory checks determine the assaying laboratories to replicate a knownstandard, the repeatability of the assay from the field splitting and the pulp repeats (i.e external andinternal repeats of the primary assays), the consistency of grade between laboratories, and thedetermination of any bias within the sample preparation process through the analyses of the coarserejects. It is a comprehensive series of analyses compiled to ensure grade estimates are of thehighest calibre. 32
  • 38. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011Nickel StandardsAs a double check on the precision of the analytical procedures of the Intertek laboratory, nickelstandards were inserted by MRL into the sample runs at approximately 1 to 45 samples on theaverage. A total of 70 nickel standards, representing 2.59 % of the 2,699 core samples were sent.Many of these standards were purchased from Geostats Pty. Ltd of Australia, with 3 standardsprepared by MRL staff to save costs and to provide a greater range of Ni values. Six (6) types ofstandards were used for the whole drilling course to date, with grade ranging from 0.001 to 1.51 %Nickel.The graphical representation of the standards data shows that the Ni grade is extremely consistentwithin the standard and within most standards the check assays vary above and below thestandard’s value (Figure 8). Figure 8: Graphs of Nickel Standards Assays.Field DuplicatesThe analytical reproducibility of field duplicate samples is a measure of the representativity of theoriginal split of the sample, a check on the reliability of the sample reduction procedure (splitting)undertaken by MRL at the field area.The field duplicates were sent together with the regular core samples for assaying. A total of 70 corefield duplicates (2.59% of the 2,699 core samples) were analysed by Intertek (Phils). 33
  • 39. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011 Field Duplicates Comparative Statistics Ni Co Fe Al Mg Si Variance from Assay -0.36% 0.68% 0.62% 0.63% 3.41% 0.81% (Abs Variance from Assay) 2.60% 6.59% 2.43% 3.08% 7.24% 2.67% Field Duplicates = Assay 0 0 0 0 0 0 Field Duplicates < Assay 38 42 40 39 54 38 Field Duplicates > Assay 32 28 30 31 26 32 Table 6: Variance of Field Duplicate to Original AssaysThe results presented in Table 6 range from -0.36% to 3.41% for all elements, which indicates thatthere is an extremely high repeatability for all field samples for most elements. When reviewing theAbsolute Variance, i.e the maximum variance from the sample average, most values for theelements are under 6% of the average grade which supports the consistency of the splitting methodand the reliability of the assays. The outliers with higher variance are Co which relates to the unevendistribution of the Mn oxides which carry a significant portion of this element, and Mg whichhighlights the occurrence of high Mg boulders in the Mg depleted limonite zone which can find theirway into split samples at varying percentages and alter grade dramatically (removal of 4 outliersreduces ABS Variance from 7.24% to 4.92%). Reviewing the split of duplicate samples being higher orlower in grade on average, the total count indicates that there is an equal chance of any duplicatebeing higher or lower than the original assay.The author confirms that the field splitting and sampling protocol was and is excellent and supportsthe validity of the samples to be assayed for use in estimation purposes for all elements.Coarse RejectsThe reanalysis of the coarse reject samples was undertaken as an internal check on the crushing andsub-sampling procedures of Intertek to ensure that the samples taken for analysis wererepresentative of the bulk sample. A total of 21 coarse reject samples were submitted during thisprogram. The variance results for the coarse fraction post crushing in comparison to the primaryassay are shown in Table 7. 34
  • 40. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011 Coarse Reject Comparitive Statistics Ni Co Fe Al Mg Si Variance from Assay -0.49% 4.30% -0.31% -0.43% -0.59% -0.93% (Abs Variance from Assay) 1.36% 8.74% 0.99% 1.42% 1.13% 1.09% Coarse Rejects = Assay 0 0 0 0 0 1 Coarse Rejects < Assay 8 12 8 6 9 4 Coarse Rejects > Assay 13 9 13 15 12 16 Table 7: Variance of Coarse Reject to Original AssaysThe results presented in Table 7 range from -0.31% to 4.30% for all elements, which indicates thatthere is an extremely good correlation of the coarse rejects with the passing material that formedthe pulp for assaying. When reviewing the Absolute Variance, i.e the maximum variance from thesample average, there is only Co that has a raised variance and this is due to specific minerals (Mnoxides which carry significant Co within the mineral structure) that crush less evenly due tohardness– but even with this minor variance is accounted for, the coarse sample rejects are verysimilar to the fines material. Reviewing the split of coarse rejects being higher or lower in grade onaverage, the total count indicates that there is a slight bias for many of the minerals and this due tothe major carrying minerals in the sample have a variety of hardness’s which will very slightly biasduring the crushing process.The author confirms that the crushing of the primary sample protocol was excellent and supportsthe validity of the resultant pulps to be assayed for use in estimation purposes for all elements.Pulp Rejects Analyzed by Primary LaboratoryA total of 67 of the pulp rejects were re-sampled and analyzed by the primary laboratoryrepresenting 2.48% of the 2,699 core samples. These were selected from previously submittedbatches covering a range of sample grades, a range of horizons and a range of holes from the coredrilling programs, so as to be representative of all the samples.The duplicate pulp analyses were conducted to test for homogeneity of the pulps generated by thelaboratory, and the accuracy of the equipment and analysing procedure from the point of pulppreparation through to XRD consistency. Insufficiently milled samples will lead to multiple assayingof pulps with poor precision (i.e. poor repeatability). Inversely, agreement between assays ofduplicates of the pulp would indicate that the milling procedure in the laboratory was efficient andgenerated a suitably homogeneous pulp, as well as show that the XRD preparation process and theXRD itself was consistent. 35
  • 41. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011The results presented in Table 8 range from 0.10% to 0.58% for all elements except Co, whichindicates that there is an extremely high correlation of the repeat pulp assay with the primary assayfor those elements. When reviewing the Absolute Variance of all elements apart from Co, i.e themaximum variance from the sample average, the range is extremely small at 0.82-1.62% whichindicates an extremely good repeatability for the pulps presented to the laboratories prior toassaying. The Co lesser repeatability is coming through in many categories and indicates that theminerals in which the Co is bound are not evenly spread through the core. The Co Variance of 5.95%,though not very high in itself is slightly higher than would be expected. Reviewing the split of pulprepeats being higher or lower in grade on average, the total count indicates that there is generallyan equal chance of any pulp duplicate being higher or lower than the original assay. Pulp Duplicates Comparative Statistics Ni Co Fe Al Mg Si Variance from Assay 0.10% 5.95% 0.58% -0.11% -0.46% 0.10% (Abs Variance from Assay) 1.31% 9.78% 0.82% 1.50% 1.62% 0.81% Pulp Duplicates = Assay 0 0 0 0 1 0 Pulp Duplicates < Assay 35 49 49 35 34 35 Pulp Duplicates > Assay 32 18 18 32 32 32 Table 8: Variance of Pulp Duplicate and Original AssaysThe author confirms that the pulp repeatability was excellent for most elements and good for Co,and supports the validity of the primary pulps to be assayed for use in estimation purposes for allelements.Pulp Rejects Analyzed by Umpire LaboratoryThe umpire laboratory used by Mindoro was the Intertek laboratory in Jakarta for this comparativetest work. A total of 52 samples of the pulp rejects from Agata South were re-sampled and analysedby the umpire laboratory representing 1.92% of the 2,699 core samples. 36
  • 42. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011 Interlab Pulp Duplicates Comparative Statistics Ni Co Fe Al Mg Si Variance from Assay 1.85% -7.76% 0.58% -0.39% 2.03% -0.76% (Abs Variance from Assay) 2.02% 14.39% 0.88% 2.08% 2.15% 1.06% Intk (Indos) = Intk (Phils) 0 0 0 0 0 0 Intk (Indos) > Intk (Phils) 47 17 39 20 45 14 Intk (Indos) < Intk (Phils) 5 35 13 32 7 38 Table 9: Variance of Pulp Duplicate and Interlab AssaysAll samples analysed by Intertek (Indos) were completed using an XRF as is the methodology appliedby Intertek (Phils).The results presented in Table 10 range from -0.39% to -7.76% for all elements, which indicates thatthere is a very good high correlation for most of the elements of the interlab repeat pulp assay withthe primary assay. There is only a single element, Co, which has provided greater than expectedlevels of variation with the Intertek (Indos) laboratory analysing the majority of the pulps ~8% higherin grade than seen in the primary Intertek (Phils) assay. The reason for this becomes apparent whenyou consider the average grade is very low (0.034%) and this means a variance of 0.002% is sufficientto bring the samples variance to a value of ~8%.Reviewing the split of pulp interlab repeats being higher or lower in grade on average, the totalcount indicates that there is an equal chance of any pulp duplicate being higher or lower than theoriginal assay for the elements Co and Al. Ni, Fe, Mg and Si did show a tendency to be higher in onelaboratory than the other (Ni, Fe, Mg higher values from Intertek (Phils), and Si higher values fromIntertek (Indos)), but when the average grade of the samples are calculated they are very close,indicating minimal bias from the primary laboratory.The author confirms that the pulp interlab repeatability was excellent and further supports thevalidity of the primary pulps to be assayed for use in estimation purposes for all elements. 12.6 SummaryIn the authors opinion the sampling protocols, procedures and methods performed by MRL, andtheir implementation are of acceptable standards. Assays performed at the Intertek in Metro Manilaare of acceptable standards to excellent standard and this is confirmed by the numerous checks viastandards, pulp repeats, split samples, coarse reject assays, and the comparison to an umpirelaboratory. 37
  • 43. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 201113.0 DATA VERIFICATIONThe author has visited the Mindoro Lateritic Ni Projects on numerous occasions in the past 18months and in each occasion has reviewed protocols and processes set in place at the Mindoro basecamp in Agata and Mainit. The author has also visited the site of Agata South and been presentduring exploration activities. The datasets provided by Mindoro were checked and verified bycomparing a random portion against original field sheets and official Certificates of AnalyticalResults. Selected core trays were visually inspected against the logs. In addition, the core photoswere viewed and compared with the cross sections showing laterite horizons generated by MRL. Thelithology was checked in the field and in the drill cores. The digital file was checked for logical errorsor data entry errors. There were a few but very minor errors found.The author has also independently collected samples from the Agata South project so as to provide agreater level of data verification and the results for all the major elements are provided here. Table10 and Figure 9 show the results and the correlation vis-à-vis original MRL assay values. MRL MGG MRL MGG MRL MGG MRL MGG MRL MGG HOLE ID FROM TO RUN Ni % Ni % Co % Co % Fe % Fe % Al % Al % Mg % Mg % ASL-10 0.8 1.8 1 1.28 1.27 0.039 0.041 18.9 22.4 1.5 1.9 15.1 13.2 ASL-10 2.9 4 1.1 1.40 1.40 0.045 0.037 22.9 22.1 0.8 0.8 12.4 13.1 ASL-10 4 5.1 1.1 1.29 1.30 0.035 0.030 17.6 17.1 0.5 0.5 15.6 15.7 ASL-10 9.1 10.4 1.3 0.78 0.78 0.018 0.014 8.2 8.2 0.3 0.3 20.2 20.4 ASL-13 4.4 4.8 0.4 0.54 0.76 0.013 0.010 5.9 6.4 0.9 0.7 20.9 21.8 ASL-13 5.9 6.95 1.05 1.24 1.27 0.076 0.070 35.7 35.8 3.8 3.8 3.4 3.5 ASL-13 6.95 7.1 0.15 1.17 1.11 0.014 0.012 7.6 7.4 0.7 0.7 20.7 20.9 ASL-13 7.1 8.05 0.95 1.14 1.13 0.047 0.041 23.4 23.8 2.5 2.6 10.3 10.1 ASL-13 11.15 12.05 0.9 0.53 0.41 0.012 0.008 6.9 6.4 1.4 1.4 19.3 19.9 ASL-25 0.8 2.65 1.85 0.66 0.65 0.090 0.074 38.1 38.1 6.6 6.9 1.1 1.2 ASL-25 2.65 3.7 1.05 1.23 1.24 0.060 0.052 25.9 26.0 5.0 5.3 4.7 4.6 ASL-25 3.7 5.05 1.35 1.32 1.31 0.047 0.039 23.6 23.6 3.9 4.0 5.8 6.0 ASL-25 6.25 7.4 1.15 1.28 1.28 0.040 0.031 19.8 20.0 2.8 3.0 9.2 9.2 ASL-25 11.65 13.05 1.4 0.64 0.61 0.013 0.010 6.7 6.4 1.1 1.1 20.5 21.2 ASL-59 0.7 4 3.3 0.62 0.64 0.083 0.060 31.1 29.6 1.6 1.6 1.6 2.4 ASL-59 4 5.15 1.15 0.80 0.80 0.021 0.014 9.9 10.0 1.0 1.1 15.6 15.5 ASL-59 5.15 6.8 1.65 0.68 0.64 0.015 0.009 7.6 7.5 1.0 1.1 19.6 19.5 38
  • 44. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011 ASL-59 8.5 9.6 1.1 0.27 0.27 0.015 0.011 6.9 7.2 1.0 1.1 20.6 20.7 ASL-63 4.55 5.6 1.05 0.73 0.74 0.173 0.158 41.4 40.0 5.9 6.2 1.2 1.4 ASL-63 5.6 6.2 0.6 0.77 0.82 0.037 0.037 7.0 7.3 1.2 1.3 20.5 20.5 ASL-63 6.2 6.6 0.4 0.91 0.89 0.134 0.114 30.9 31.3 5.0 5.1 4.1 4.4 ASL-63 9.6 12 2.4 0.90 0.90 0.023 0.019 12.1 12.3 1.7 1.8 16.4 16.4 ASL-77 4 5.2 1.2 0.48 0.47 0.142 0.123 47.7 46.9 6.2 6.2 0.5 0.4 ASL-77 5.2 7.6 2.4 0.69 0.68 0.089 0.072 37.7 37.3 5.2 5.4 2.7 2.5 ASL-77 7.6 10 2.4 0.93 0.90 0.058 0.043 27.2 26.2 4.0 4.0 6.6 7.0 ASL-77 16.1 17.65 1.55 0.94 0.94 0.030 0.021 14.4 13.9 2.0 2.0 14.0 14.8 ASL-77 17.65 19.2 1.55 0.86 0.84 0.022 0.016 9.8 9.7 1.1 1.1 18.7 18.9 Table 10: Results of Independent Check on Agata South Drill Core Assays Figure 9: Comparison of Independent Checks and MRL AssaysThe graphs show good correlation between the MRL assays and that of the author’s samples (Figure9). This is attested by the values of the coefficient of determination R2, which range from 0.97 for Nito 0.9953 for Fe and Mg. 39
  • 45. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011The author has verified all aspects drill hole collar locations, sampling and assay procedures,examined mineralized material in the field and in drill core, as well as the geological and assaydatabases during numerous visits to the project area and a specific site visit to the Agata Southdeposit. With these factors, as well as the evaluation of the results of assay rechecking, the writer issatisfied that all data utilised in the resource estimate can be relied upon.14.0 ADJACENT PROPERTIESAll adjacent properties and resources to the Agata South resource area has been discussed inprevious sections and can be located in Figure 2. Mindoro have access to an extensive section of theWestern Range in the Agusan del Norte and Surigao del Norte regions of Region XIII and the lateriticNi deposits located to date form part of an extensive study into the best methods to exploit thisresource to best effect.15.0 MINERAL PROCESSING AND METALLURGICAL TESTINGTest work is currently being carried out upon lateritic Ni ores from the Agata North deposit so as toprovide Mindoro with a data set that can ensure the resources defined to date can be mined andprocessed efficiently and cost effectively. Though Agata South will form part of Mindoro’s largelateritic Ni resource base, no mineral processing or metallurgical testing has been completed uponthese lithological materials as yet. 15.1 Bulk Density DeterminationsMRL have completed a significant number of bulk density tests within the lateritic Ni deposits of theTapian-Agata region so as to provide data for estimating the tonnages of each specific mineralizedzone within the ore body. Though density samples have been taken from the Agata South deposit,the results have been affected by excessive moisture due to unseasonable weather and the quickturnaround between resource drilling and resource compilation. The author considers the samplesobtained from the numerous test pits within the Agata North deposit during a large and extensive 40
  • 46. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011period of testing to best represent the densities of the ores in situ, due to their size and the weatherconditions at the time of report collation.Samples were predominantly taken from test pits prepared for the taking of density samples. A totalof 30 samples from 15 test pits were used for the ferruginous laterite horizon; 37 samples from 19pits for limonite; and 17 pit samples from 6 pits for saprolite. In addition 19 core samples weretested from the saprolite zone (Figure 10). All primary data used for these determinations arelocated in Appendix 4.For BD measurements done on site, large samples ranging in volume from 0.005 m 3 to 0.08 m3 werecollected from twenty test pits. The locations of these test pits are distributed around the drillingarea (Figure 10). The bulk samples were measured for volume, wet weight, and dry weight. Thedescription of the methodology is detailed in the ANLP QA/QC Procedures (Appendix 2)The BD and moisture content were computed with the following formulas. Weight (kg) Bulk Density = _______________ ÷ 1000 (kg/ton) Volume (m3) Weight wet – Weight dry % Moisture Content = __________________ x 100 Weight wetFor the drill cores, relatively solid/less compressed portions of 10cm-20cm lengths were selectedfrom drill holes that are spatially distributed and coated in paraffin wax to preserve the moisture.These were then dispatched to McPhar Laboratories wherein the samples were measured using thewater displacement method. It is standard practice for McPhar to check the wax coating andperform re-waxing if needed. Table 11: Summary of Bulk Density Measurements Moisture Wet Dry No. of HORIZON Content Density Density Samples % FERRUGINOUS LATERITE 1.72 1.20 30.49 30 LIMONITE 1.81 1.24 31.74 37 SAPROLITE (Pit Samples) 1.98 1.46 26.11 17 SAPROLITE (Core Samples) 1.82 1.45 20.60 19 41
  • 47. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011Table 11 shows the summary results of these measurements, and the dry density values used in theresultant block model were 1.24 dt/m3 for Limonite and 1.45 dt/m3 for Saprolite. Figure 10: Agata North Bulk Density Test Pit Location Map16.0 MINERAL RESOURCE ESTIMATEThe resource Estimate calculations were completed by Mike Job, Principal Consultant and AlastairCornah, Principal Consultant, for Quantitative Group based out of Fremantle, West Australia. All datawas checked and forwarded by the author, and all modelling methodologies were discussed prior tocommencement of developing the resource. 16.1 Geological InterpretationThe sample dataset provided was provided in Microsoft Excel format, relevant data was extracted incsv format, the data loaded into Vulcan, and desurveyed to produce 3D drillholes. Topographypoints and contours for the deposit were supplied in dxf format – these were imported into Vulcanand used to construct wireframe surfaces. Quantitative Group (QG) performed only cursory 42
  • 48. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011validation of the dataset, with no serious issues arising. Minor issues, such as the transposition ofcollar RL between two holes were quickly rectified.There is a total of 193 drillholes in the dataset. All of the holes are vertical and relatively shallow,with an average depth of 13.3m and the deepest hole being 30.0m. The drilling is mostly on a 50m x50m grid. UTM coordinates for all drilling and wireframes have been used. Drillhole collar locationsfor the deposits are shown in Figure 11. Figure 11: Drillhole spacing, Agata South.The limonite / saprolite contact point was identified in each drillhole by using the Mg and Fe assaydata as well as the logged lithology. There is an abrupt change in the level of Mg in limonite (usuallyless than 1% Mg) to saprolite (generally well over 10% Mg, although sometimes down to about 5%Mg), and there is also an abrupt drop of Fe in limonite (~40% to 50%) to saprolite (less than 10%).These geochemical boundaries matched the geological logging reasonably.The saprolite / bedrock contact point in each drillhole was identified by using the Ni assay data(bedrock generally less than 0.5%) and the geological logging. The geological logging also matchedthese grade-determined boundaries reasonably closely.Strings were constructed in north-south cross section, with some additional control points insertedat interpreted locations in-between drillholes in order maintain geological consistency and to 43
  • 49. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011account for drillholes finishing before hitting bedrock. The strings were then triangulated to produce3D surfaces, and these were visualised against drillholes in both north-south and east-west crosssections (for example, see Figure 12Figure 1).The triangulations for the limonite / saprolite contact and the saprolite / bedrock contact were usedalong with a topography surface to generate a 3D block model. A parent cell size of 25m x 25m x 1mwas used with 5m x 5m x 1m sub-blocking (see Table 12 and Figure 113).At Agata South boulders also exist within the laterite profile; these are minor occurrences within thelimonite / transitional zone which have survived the alteration process. The occurrences are erraticand inherently random with no lateral extension of the material along any specific zone or layer. Theboulder occurrences within the drillholes are reasonably easy to identify through geochemistry asthey are typically <10% Fe encapsulated by limonitic material of between 25% and 50% Fe; Mg istypically >15% in the boulders compared to around 1% in the limonite (for example see16).In spite of this they are not amenable to wireframing because of their highly erratic nature. Thegrades of boulders were therefore excluded from the estimation and their volume was accountedfor within the volume of the reported Resource. The clear assumption associated with this approachis that the boulder material is separable from the surrounding ore. This is considered reasonable asthe boulders are extremely hard, competent, and distinct in colour to the surrounding ore. Boulderswere identified in 27 drillholes in total. Easting (m) Northing (m) RL (m)Origin 777,770 1,019,500 150Parent block size 25 25 1Sub-block size 5 5 1Extent 778,770 1,020,700 350Table 12: Block model propertiesThe block model numeric domain codes (DOMAIN field in the Datamine files) are shown in Table 14.Code Domain0 Air (above topography)1 Limonite2 Saprolite3 Bedrock 44
  • 50. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011Table 13: Block model domain codes. Limonite Saprolite Bedrock Figure 12: Wireframe surfaces and drilling, Agata South (Mg on left, Ni on right side of drill trace). Figure 13: Block model coloured by laterite horizons, Agata South. 45
  • 51. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011 Figure14: Example of a boulder within hole ASL-02016.2 Exploratory Data AnalysisBecause the sample length is variable the data was composited into one metre intervals,approximately matching the average sample length (see Figure 115). The composites were split atthe domain boundaries and the boulder grades were excluded from the composited grade values. AtAgata South, the maximum sample length before compositing is 6.45m, with an average length of0.95m (see Figure 115). The compositing process results in the majority of composites at 1m andresiduals between 0.05m and 1m. Only composites exceeding 0.5m were used in the subsequentestimation. 46
  • 52. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011 Figure 15: Raw sample lengths (left) and composite lengths (right)Basic summary statistics for the composited data for each deposit are shown by domain in Table 15,and the histograms for the composites are shown in the Appendix, Error! Reference source notfound. to Error! Reference source not found.4. Table 14: Basic Statistics.QG analysed grades across the limonite / saprolite boundary using contact analysis. The techniqueanalyses two zones at a time, calculating the distance of each sample from the interpreted contact.Samples are then ‘binned’ according to their distance either side of the contact and the average 47
  • 53. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011grade of each bin is calculated for each variable of interest. The mean grades across the contact areplotted, providing a visual guide as to whether the transition is gradational or sharp.Plots for each variable are contained in the Appendix, Error! Reference source not found. and Error!Reference source not found.2. In the plots, each sample is represented by a green point (withnumber of samples also plotted), and the mean grade by distance class across the contact isrepresented by the red line series; the interpreted contact itself is represented by the vertical blackline (at zero distance).Ni tends to increase in grade with depth through the limonite and decrease in grade with depththrough the saprolite; the maximum mean Ni grade is found around the limonite / saprolite contact.The limonite to saprolite contact is marked by a sharp and substantial decrease in Fe, Co and Al 2O3whilst there is a sharp rise in Mg and SiO2. This analysis supports the use of a hard estimationboundary between limonite and saprolite.Analysis of the contact between the saprolite and bedrock domains showed that Ni, Fe and Al 2O3decline through the transition into bedrock (see Error! Reference source not found.). However,estimates were not required for the bedrock domain.16.3 Variography and EstimationExperimental variograms were generated for the six variables. No anisotropy in the horizontal planewas identified, so omnidirectional variograms within the horizontal plane were generated with anadditional downhole direction to help model short range structure. A lag value of 50m in thehorizontal plane was used with 1m in the vertical direction. Using a slicing height of 2m in thehorizontal plane provided an improvement in variogram structure. Experimental variograms andtheir associated models are contained in Appendix 5, Figure 5 to Error! Reference source notfound.12 and the models are tabulated in 15 and Table 16. Table 15: Limonite variogram model parameters. 48
  • 54. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011 Table 16: Saprolite variogram model parameters.In the limonite the grade variables have nugget variance of between approximately 20% and 50%with total ranges of continuity between 60m and 140m. Nugget variances are typically a little lowerfor saprolite (typically around 10%) and ranges are a little longer at up to 170m. This behaviour isrelatively consistent between all of the variables and has been modelled as such in order to maintainrelativity between variables during independent estimation (therefore maintaining reasonable totalassay back calculation).Ordinary Kriging was carried out independently for each variable in both of the estimation domainsusing the neighbourhood parameters presented in Table 18 and a block discretisation of 5x5x1.As discussed above, the composite values that were input into the estimation exclude the grades ofthe boulder intercepts. The boulder intercepts account for 14.2m of the total 642.6m of drilling thatis interpreted to be within limonite (including the boulders). Assuming that the boulders arerepresentatively intercepted within the drillholes, the boulders can be expected to representapproximately 2.21% of the total volume of the limonite. Table 17: Search parameters.Two estimation passes were carried out, the second pass with less restrictive parameters (doublethe search ellipse, minimum of 4 samples), used to estimate blocks that were not estimated in thefirst pass. The pass number for Ni was recorded during estimation, and Table19 shows theproportion of model volume that was filled for each pass by deposit and domain. All blocks wereestimated within these two passes with the vast majority estimated within the first pass. 49
  • 55. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011 Table18: Proportion of model estimated for Ni per pass.Dry bulk density was assigned to the model (limonite 1.24, saprolite 1.45), which is the same as thatused at Agata North. Note that no bulk density data was in the supplied database.To validate the estimates, swath plots were generated. These plots represent E-W and N-S ‘slices’ (at50m spacings) through the deposit, and the mean grade of the block model and the compositeswithin each of these slices was reported and compared for all of the variables in limonite andsaprolite. An example is illustrated in Figure18 which compares composite grade (yellow line) andblocks (green line) for Ni in saprolite. The number of composites per slice is shown by the purple barchart. As expected, in all cases the block model follows the trends of the composites, with lessvariability (i.e. a ‘smoothing’ of the composites). Ni by Easting, Saprolite 1.2 180 160 1 140 0.8 120 Number of Samples 100 Ni % 0.6 80 0.4 60 40 0.2 20 0 0 777820 777870 777920 777970 778020 778070 778120 778170 778220 778270 778320 778370 778420 778470 778570 778620 778670 Easting No. Samples Model SampleFigure 16: Swath plot, Ni by easting, Agata South 50
  • 56. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011Visual validation of the block model grades against drillhole grades was carried out with noanomalies identified. The estimated block means (above a zero cut-off) match relatively closely tothe composite means (Table 20). Table 19: Input sample composites vs. model.16.4 Resource ClassificationThe resource classification approach reflects confidence in both geometric interpretation andconfidence in geostatistical grade estimates, and also classifies the resource in a spatially coherentmanner, avoiding small patches of different categories. The vast majority of the deposits are drilledon 50m x 50m, although there is some broader-spaced drilling.The 50m x 50m drilling is enough to support a category of Indicated, with Inferred around the steep-sided creek systems, where the drilling is on a broader pattern and the laterite horizons thin out.None of the mineral resource has been classified as Measured. Figure 17 shows the block modelcoloured by resource classification. 51
  • 57. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011Figure17: Mineral Resource classification for Agata South. Drill hole locations in yellow16.5 ResultsThe Mineral Resource Estimate figures above a 0.5% Ni cut-off for limonite and above a 0.8% Ni cut-off for saprolite are presented in Table 20. There are no previous resource estimates to comparethese numbers against. The tonnage of limonite has been adjusted to account for boulders underthe assumptions outlined above and the assumption that the dry bulk density of the limonite issimilar to that of the boulders. 52
  • 58. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011Classification Horizon kTonnes Ni Co Fe Al Mg SiO2Indicated Limonite 1,566 0.66 0.09 42 5.7 1.4 11 Saprolite 3,474 0.95 0.02 13 1.5 16.6 37 Total 5,040 0.86 0.04 22 2.8 11.9 29Inferred Limonite 217 0.70 0.08 40 5.4 1.7 14 Saprolite 232 0.95 0.02 14 1.4 16.1 37 Total 449 0.83 0.05 26 3.3 9.2 26 Table 20: Agata South Mineral Resource Estimate as at 13 September 2011.The mean grades for the excluded boulders are contained below in Table 21. Table 21: Mean grades for boulders.Nickel grade-tonnage curves for the Indicated resource are shown in Figure18 and Figure19. Figure 18: Ni grade-tonnage curves, Agata South limonite. 53
  • 59. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011 Figure 19: Ni grade-tonnage curves, Agata South saprolite.17.0 OTHER RELEVANT DATA AND INFORMATIONNot Applicable18.0 INTERPRETATION AND CONCLUSIONSThe presence of large areas of an exposed Ultramafic along the Western Range, an upthrust ridgeeast of the Philippine Fault, has provided a location for lateritic weathering of the ultramafic. Thespecific region known as Agata South has been enriched within the laterite profile in Ni and Co.The laterite profile of the Agata South deposit consists of ferruginous laterite, limonite and saprolitezones or horizons, and the saprolitic rock, from surface to increasing depth. The limonite zone ischaracteristically iron oxide-rich, where the predominant minerals are hematite, goethite and clays,and with moderate nickel content (over 1%), which overlies the saprolite zone that has much lessoxidised, is magnesium -rich, and has a slightly higher nickel content than the limonite horizon, withgrades in both zones generally at their highest near or adjacent to the contact zone.This report is based on the data that was produced and compiled by MRL. Data verificationperformed by the author found no discrepancies in the sampling and analyses that biased the dataset. Hence the database is considered adequate to meet industry standards to estimate mineralresources. 54
  • 60. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011The resource for the Agata South deposit was calculated by Quantitative Group using OrdinaryKriging as the estimation method. Both the limonite zone and the saprolite zones were estimatedindependently as the form of mineralisation in both zones were unique and could not be used forcomparative statistics. The measured and indicated resource total for Agata South as estimated fromthis report is as below: 5,040,000t ore @ 0.86%Ni, 0.04%Co, 22%FeThe cut-offs applied to the resource were 0.5%Ni for Limonite and 0.8%Ni for Saprolite (as per theprevious estimates completed upon the Agata North Laterite Project, (Cox, 2008 2009a 2009b;Gifford 2010)).19.0 RECOMMENDATIONSExploration methodology, assaying technique and resource definition are all adequate and requireno further work. The density measurements are however transferred values from Agata North, amajor deposit to the north of Agata South, and it will be necessary prior to exploitation that densitytestwork be carried out in a systematic procedure over the Agata South deposit, and tonnagesaltered accordingly. 55
  • 61. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 201120.0 ReferencesAbrasaldo, E.M. 1999. Exploration Report Agata Project June 1997-April 1998. MRL Gold Phils., Inc., Internal Company Report (unpubl)Ambagan, D. 2007. Notes on Resource Estimation of Agata Nickel Laterite Project of MRL Gold Phils., Inc., Internal Report., (unpubl). January 2007.Aurelio, M.A. and Peña R.E. 2002. Geology and Mineral Resources of the Philippines, Volume 1: Geology. (eds) Aurelio, M.A. and Peña, R.E., Department of Environment and Natural Resources, Mines and Geosciences Bureau, Philippines.Bailey, D.G. 2003. Surigao Property Group, Northeastern Mindanao, Geology and Exploration Potential. Bailey Geological Consultants (Canada), Technical Report for Panoro Minerals Ltd.Buenavista, A.G. 2008. Notes on the Geology and Mineralization in the Surigao Western Range. MRL Gold Phils., Inc. Internal Report, February 2008.Buenavista, A.G. 2008. Geochemistry of the Agata Nickeliferrous Laterite Deposit. MRL Gold Phils., Inc. Internal Report, May 2008.Cox, D.M. 2008. Independent Geologic Report on the Nickel Laterite Resource at Agata North Laterite Project Area, Agata Project, Agusan del Norte Province, Northern Mindanao, Phillipines. MRL Gold Phils., Inc., September 2008, rev. Oct 2008.Cox, D.M. 2009a. 43-101 Technical Report on the Mineral Resource Estimate for the Agata North Nickel Laterite Project of Mindoro Resources Ltd., January 22, 2009.Cox, D.M. 2009b. 43-101 Technical Report on the Mineral Resource Estimate for the Agata North Nickel Laterite Project of Mindoro Resources Ltd., December 22, 2009.Climie, J.A., et,al. 2000. Accomplishment Report for the Period: June to December 1999. MRL Gold Phils., Inc., Internal Company Report (unpubl). January 2000.Climie, J.A., et,al. 2005. Interim Exploration Program Report, Surigao Joint Venture Projects: March 1 to June 20, 2005. MRL Gold Phils., Inc., Internal Company Report (unpubl). July 2005.De Luna, R., et.al., 2004. Report on the Reconnaissance Geologic Survey of the Nickeliferrous Laterite Deposits at Barangay Tapian, Mainit, Surigao del Norte and Barangay E. Morgado, Santiago, Agusan del Norte. Taganito Mining Corp. Report, July 2004.Elliott, P.J. 2005. Report on IP and Magnetic Surveys Over the: Agata Prospect, San Francisco Project, Philippines. MRL Gold Phils., Inc. and Panoro Minerals Ltd,, Company Report, June 2005 56
  • 62. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011Fang, E.F.E and C.A. Matilac. 2006. Evaluation of Preliminary Exploration on Agata Nickel Laterite Prospect of MRL Gold Phils., Inc., QNPH Report, June 2006Fetiza, I.A. Jr. 1999. Exploration Report: Tapian-San Francisco Project, May 1997 - May 1998. MRL Gold Philippines Inc. Internal Company Report (unpubl.).Gifford M.G. 2010. 43-101 Independent Report on the Nickel Laterite Resource - Agata North, Philippines. August 20, 2009.Marshall, N.J. 1997. Geological Report on the Agata, Mat-I, Nabago and Tapian Gold Prospects, Northern Mindanao, Republic of the Philippines. Marshall Geoscience Services Pty. Ltd., Australia.Mitchell, A.H.G. and Leach, T.M. 1991. Epithermal gold in the Philippines: Island arc metallogenesis, geothermal systems and geology. Academic Press Geology Series.Rangin, C. 1991. The Philippine Mobile Belt: A complex plate boundary. Journal of Southeast Asian Earth Sciences, 6 (3/4), pp. 209-220.Rohrlach, B.D. 2005. Independent Geological Report on the Surigao Property Group, Northern Mindanao, Philippines. MRL Gold Phils., Inc. and Panoro Minerals Ltd., Company Report, April 2005Sajona, F.G., et.al., 1994. Magmatic response to abrupt changes in geodynamic settings: Pliocene- Quaternary calc-alkaline and Nb-enriched lavas from Mindanao (Philippines). Tectonophysics, 237(1-2), pp. 47-72.Sillitoe, R.H. 1988. Geotectonic setting of western Pacific gold deposits. In: M.J. Bartholomew. D.W. Hyndman, D.W. Mogk, and R. Mason, (eds), 8th International Conference on Basement Tectonics, 8, pp. 665-678. Kluwer Publishers, Butte, Montana.Tagura, F. et. al. 2006. Comprehensive Report, MPSA-134-99-XIII, Agata Tenement Blocks. MRL Gold Phils., Inc. Internal Company Report (unpubl.), 2006Tagura, F. et. al. 2006. Report on the Preliminary Drill Evaluation on Canaga (MPSA-33-95-X), Malimono, Surigao del Norte. MRL Gold Phils., Inc. Internal Company Report (unpubl.), September 2006Tagura, F. et. al. 2007. Report on Agata Drilling Program, Agusan del Norte, Philippines (Phase 1 Year 2 Expenditure Period 2005-2006), MRL Gold Phils., Inc. Internal Company Report (unpubl.), January 2007UNDP. 1984. Geology of Northern Agusan, Mindanao, United Nations Technical Report No. 2, DP/UN/PHI-79-004/6, New York. 57
  • 63. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011UNDP. 1987. Geology and Gold Mineralization of Surigao del Norte, United Nations Technical Report No. 4, DP/UN/PHI-85-001/4, New York.Zurkic, N. 2009. AGL-Vario_Report. Zurkic Mining Consultants Pty. Ltd., Internal Report (unpubl) 58
  • 64. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 201121.0 DATE AND SIGNATURE PAGE CERTIFICATE OF QUALIFICATIONI, Mark G. Gifford of 636 Bramley River Road, Margaret River, West Australia hereby certify that: 1. I am a Professional Geologist employed as a private consultant. 2. I am responsible for the preparation of the Technical Report titled “Independent Report on the Nickel Laterite Resource – Agata South, Philippines.” And dated November 4, 2011. 3. I am a Fellow in good standing of the Australian Institute of Mining and Metallurgy with membership number 108672 4. I am a graduate of the University of Waikato, New Zealand with a Masters Degree (1st Class Honours) in Earth Sciences. 5. I have practiced my profession for 23 years, and have worked specifically on lateritic Nickel deposits throughout the world for 5 years in a geological managerial position. I have been operating as an Independent Consulting Geologist since 2005. 6. I certify that by reason of my education, affiliation with a professional association (as defined by NI 43-101), and past relevant work experience, I fulfil the requirements to be a “qualified person” for the purposes of NI 43-101. I am an independent qualified person as defined by NI 43-101 and by the companion policy 43-101CP to National Instrument 43-101. 7. This technical report is based on my review of the available published data, company reports and data, and personal visits to the property. I have visited the deposit locations in 2011 and have completed inspections of all aspects of the exploration process, as well as consulting with MRL staff at all levels during the development of the report. My visits to the resource areas were during February – May 2011 8. I have read NI 43-101 and form 101F1. The technical report has been prepared in compliance with both of these documents. 9. I, Mark Gifford, do not expect to receive any interest (direct, indirect or contingent), in the properties described herein, nor in the securities of Mindoro Resources Limited or any of their affiliates. I am independent of the issuer under all criteria of Section 1.5 of NI 43-101. 10. I am not aware of any material fact or material change with respect to the subject matter of this Technical Report which is not reflected in this report. I am not aware of any possible omissions that would deem this report misleading. 11. I consent to the filing of the Technical Report with any stock exchange and other regulatory authorities, and any further publication by them for regulatory purposes. I consent to the 59
  • 65. Independent Report on the Lateritic Ni Resource – Agata South, Philippiness 2011 inclusion of parts of the Technical Report as electronic publication on the companies’ websites that are accessible to the public.Signed in Melbourne, Australia. Dated 4th November 2011._________________________________Signature of Qualified PersonMark G. Gifford MSc (Hons), FAusIMM________________________________Name of Qualified Person 60
  • 66. Appendix 1Agata South – Cross Sections
  • 67. Appendix 2Agata South QA/QC Procedures 1
  • 68. MNDORO RESOURCES LIMITED [MRL GOLD PHILS., INC.] AGATA NICKEL LATERITE PROJECTQUALITY ASSURANCE AND QUALITY CONTROL PROCEDURES MRL Gold Phils., Inc. Agata Project Exploration Staff 2
  • 69. Table of Contents1. INTRODUCTION....................................................................................................................................42. GEOLOGIC MAPPING ...........................................................................................................................53. TRENCHING...........................................................................................................................................54. SURVEYING...........................................................................................................................................6 4.1 Grid Lines Survey............................................................................................................................... 6 4.2 Topographic Surveying....................................................................................................................... 65. DRILLING...............................................................................................................................................76. CORE SECURITY...................................................................................................................................97. CORE LOGGING .................................................................................................................................. 10 7.1 Logging Codes.................................................................................................................................. 10 7.2 Weathering Scale.............................................................................................................................. 10 7.3 Boulder Size ..................................................................................................................................... 10 7.4 Color Code ....................................................................................................................................... 118. CORE SAMPLING ................................................................................................................................ 11Geologist Maya Arguelles doing core logging at the drill site...................................................................... 119. TRANSPORT OF SAMPLES ................................................................................................................ 1310. ASSAYING ......................................................................................................................................... 1411. ASSAY DATA QUALITY ANALYSIS ............................................................................................... 14 11.1 Duplicate Samples ...................................................................................................................... 14 11.2 Standard Samples........................................................................................................................ 15 11.3 Check Samples............................................................................................................................ 1512. Bulk Density and Moisture Content Determination ............................................................................... 1513. Documentation ..................................................................................................................................... 1714. Data Management................................................................................................................................. 19 3
  • 70. 1. INTRODUCTIONMRL as any other exploration company ensures that sampling procedures and sample quality is upto standard. It is not only a “must” but also guarantees that the sanctity of the samples is maintainedall-throughout from its collection to its transport into the laboratory for analysis.As SOP of the company, a site geologist or mining engineer is assigned on the drill site to make surethat QA/QC procedures and protocol is consistently followed. The QA/QC measures beingimplemented in Agata Nickel-Iron Laterite Project were adapted from the QC/QA practiced fromother MRL Projects and mostly from BHP QC/QA protocol that was used during BHP preliminarydrilling evaluation study of Agata Laterite Prospect conducted on January – April, 2006.This paper document details protocols being implemented. The project area straddles over Bgy,Lawigan, Tubay, and Bgy. E. Morgado, Santiago in the province of Agusan Del Norte. The field office and main camp is located at Barangay E. Morgado. Left: MRL field camp and core houseBelow: A panoramic view of the nickel-iron laterite prospect area MRL fly camp and core 4 house/storage and drillers camp proximal to the drilling area
  • 71. 2. GEOLOGIC MAPPINGGeologic map is essential and foremost in any geological studies. As such geologic mapping is doneby geologists. There was previous mapping conducted in the area. However, detailed mapping has tocontinue to progressively updating the geologic map on a regular basis as there are new exposuresseen on the newly brushed/cut grid lines, roadcuts, creeks, trenches and test pits as the drillingprogram advances. The purpose of this activity is: 2.1. To identify and delineate different lithologic units in the area. 2.2. To determine the surficial characteristics and contact of the different laterite horizons as well as bedrock geology.3. TRENCHINGTrenching activities are being undertaken at the western and southern periphery of the currentdrilling area. The purpose is to expose the laterite profile and determine contacts and thickness ofthe different laterite horizons and the bedrock.Determining the different laterite horizons at the periphery of the deposit is useful in the correlationand projection to the surface profile at the edge of the deposit when doing cross section maps foreach grid line. This is very important in ore estimation and formulation of the site development planwhere mine pit limit will be based on the contoured contacts. Trenching at L10000N/9325E showing garnierite Trench showing laterite profile Staining (green) on the saprolite zone 5
  • 72. 4. SURVEYINGPrior to the implementation of the proposed drilling program survey team was sent to the area toconduct the following;4.1 Grid Lines SurveyGrid lines were laid in the area using an EDM survey instrument. The grid lines were establishedevery twenty five (25) meters interval with control stakes marked by flagging tape and aluminumplates for easy reference and location by drill site preparation team.The proposed drill holes are located on a 50 x 50 meters interval along the established gridlines.Gridlines are controlled using the local gridlines designated as 10,000N/10,000E as baseline grid. Grid line survey and location of proposed drill site4.2 Topographic SurveyingSimultaneous with the laying out of the gridlines a detailed topographic survey was likewise done inthe area. Control points are shot at five (5) meters interval to generate a relatively accuratetopographic contour. Drill-hole collar elevation is shot before the start of the drilling activity andafter the completion of the drill hole.Reference points BLM, and other government monument established by the concerned governmentagency (DENR land management) in the area are likewise located on the ground and verified as togeographical coordinates and the elevation of these established monuments.To avoid data overloading and instrument error,data collected by the EDM machine are regularlydownloaded into the company computers andregularly processed by the chief GIS. Back-up filesare kept in the Surigao office to avoid data lossesin case the computer crashes or bugs down due tovirus infestation that may destroy the stored files. 6
  • 73. Surveyor Frank Sumpo doing topographic survey5. DRILLINGAfter the drill holes have been located, the site preparation team prepares the site for drilling. Drillsites are leveled manually usually by four (4) laborers, thence, a water sump is manually dug withdimensions of 1.5m x 1.5m x 1.5m for water storage and as container for the return water.Drilling was carried out by Construction and Drilling Specialists, Inc. using five (5) man-portable orlightweight rigs during the initial resource delineation. These rigs are Toho DS-Js, YBM-01, GM-50and twoTS-50. NW drill rods and tungsten carbide bits will be used except for very dense hard rockswhere diamond bits and NQ drill rods are used. Dry blocking or drilling with no water is usually donein the limonitic soil. When penetrating into dense bedrocks, wet is employed.In December 2007, TCD Drilling Consultancy Services was contracted to commence the infill drilling.It drilled 48 holes with an aggregate of 773.12 meters. Four man-portable drill rigs were brought innamely: 1.) TONE 1, 2) TOHO 1, 3) TOHO 2, and 4) TOHO 3. These rigs are similar to those of theprevious contractor but with single tube using conventional dry drilling techniques. Due tosluggishness of the drilling, the services of TCD were terminated.On June 18, 2008, JCP Geo-Ex Services, Inc. continued the drilling. It drilled 225 holes up toSeptember 25, 2008 with an aggregate of 3,591.85m. JCP used four (4) rigs. These rigs are: 1.)KOKEN, 2) YBM, 3) JCP 3, and 4) JCP 11. JCP is employing similar drilling techniques as that of TCDbut is accomplishing it at a substantially faster rate. JCP continued the drilling of 185 holescomprising 3,560.75m from April 7, 2010 to July 13, 2010. They used 4 rigs namely: JCP 1, JCP 2, JCP3 and JCP 4.The drilling activities are constantly monitored by the site geologist. The purpose is to avoid over-drilling and ensure that the bedrock has been penetrated at least three (3) meters as standard 7
  • 74. operating procedure. There were instances that more than two (2) meters of boulders were encountered. It is also a standard procedure that core checkers who is under the supervision of MRL technical staff are present in every drill rig during drilling operation. This is to record drilling activities from core recovery, core run, pull-out and put-back, casing and reaming (Appendix 1 – Drilling Activity Report) and most important is to watch out if the retrieval of core from the core tube is done properly and see to it that the recovered cores are properly placed in the core box and appropriately labeled. Core blocks are placed at the bottom of each run indicating drillhole number, core run, core recovered and current bottom. Core recovery is checked after each run and recorded in the core recovery sheet (Appendix 2 – Borehole Recovery). Before the start of the drilling program the core checkers were properly oriented and trained on the nature and routine of their job. A daily briefing before the start of their work is being done to remind them to keep the core always in good quality. The core checkers sees to it that the drill site is clean and also safe to work. The Safety Officer as well as company environmental officers regularly inspect the drill site. The completed drill holes are immediately rehabilitated and concrete markers are installed Marker showing completed drill hole with markings such as drillhole number, local coordinates and depth of the drill holes.Core checker measuring the rod stick-up tocheck the run. 8
  • 75. 6. CORE SECURITYThe core box is at all times covered by plywood after each retrieved core was placed in the core boxto prevent any accidental spillage or contamination. Once a core box is filled up, it is sealed with aplywood board and nailed to the core box then tightly tied with rubber packing band. Since this ismanually transported to the core house some 300 - 500 meters from the drill area, the core box isplaced inside a sack and carried by two persons accompanied by MRL supervisor/personnel.Core box is covered at all times as a precaution to accidental A filled core box transported to the core housespillage or contaminant.The core storage and core house is strictly under the supervision of the site geologist. Onlyauthorized personnel are allowed to enter the core house premise. The filled-up core boxes arestored on an elevated rack and are kept dry and shielded from rain and excessive sunlight. Core storage area 9
  • 76. 7. CORE LOGGINGCore logging is absolutely done by the site geologist so that he can gain intimate knowledge of thegeological aspects of the deposit. Appendix 3 (Drill hole log sheet) shows the logging sheet beingused.7.1 Logging Codes Code Laterite Horizon LF Red-brown limonite (ferruginous or overburden) LA Yellow limonite (without Mn staining or veining) LB Yellow limonite (with Mn staining or veining) TM Transition Material (mixed zone of limonite and saprolite SAP Saprolite (gritty clay with <10% boulders of weathered bedrock RSAP Rocky saprolite (with 10% -50% boulders of weathered bedrock) SAPROCK Saprolitic rock (with 50% - 90% bedrock) D Dunite SD Serpentinized Dunite SS Serpentinite HZ Harzburgite SHZ Serpentinized Dunite7.2 Weathering Scale Laterite Horizon Classification Characteristic Fresh Rock 0 Black/green/light grey, unweathered, dense and hard Saprolite 1 Black/brown, slightly weathered, discolored, still hard 2 Brown/gray 3 Pink / brown/ green 4 Pink/brown/green, friable, relatively low density with some remnant textures 5 Brown, yellow/red, pink/green-grey, very soft, original texture still visible Limonite 5F Yellow-red, very soft “soil like” very low density to compact, mud-like texture Ferricrete 6 Red-black, hard include pisoliteCombinations of the various weathering “stages” could be used i.e.; 2/3, 3/4, 2-5 or 0-3. The firstnumber in double-digit references indicates the predominant weathering stage, but the numbersseparated by a hyphen include all intermediate weathering stages.7.3 Boulder SizeThe size of the boulders is also recorded to help in the analysis of rock distribution and to determinewhether screening of these rocks during mining operation is necessary. Code Description 1 < 20 cm (will be acceptable for shipping) 2 20 -50 cm (will be screened at the grizzly) 3 > 50 cm (will be left at the pit) 10
  • 77. 7.4 Color Code Code Color Bl Black Br Brown R Red Bu Blue P Pink O Orange Y Yellow Gn Green Gy Grey W White Combination of colors or color codes could be used i.e. YO – yellow orange, RBr – red brown, etc. Site Geologist Ramon Diaz doing the core logging 8. CORE SAMPLING Whole core sampling is applied in most of the first 148 holes except for 17 holes wherein the cores were split for possible checking of the sampling process, performance of the laboratory and their analytical process at a later time. This is equivalent to a frequency of about 1 in every 5 holes. The purpose of the procedure is to avoid any bias that could occur during splitting and quartering of the core.Geologist Maya Arguelles doing core logging at the drill 11site.
  • 78. Splitting of the above-mentioned cores was manually done. The core was laid on a canvass sheet,pounded and crushed by use of a pick, thoroughly mixed, quartered, then the split sample is takenfrom 2 opposite quarter portions. The other 2 quarters are combined and kept as a duplicate in aproperly-sealed and labeled plastic bag and arranged in core boxes according to depth. Theduplicates are stored in the core house at the Agata core storage located at E. Morgado, Santiago,Agusan Del Norte.The next 45 holes (AGL 2008-138 to 187, inclusive) were split-sampled to ensure the availability ofreference samples in the future. The cores were cut in half using a core saw. The remaining half isstored in properly-labeled core boxes. Core sampling is done as much as possible at one (1) meterinterval down the hole except at laterite horizon boundaries. The sample length across theboundaries should only be in the range of 1.0 ± 0.30m to avoid excessively short and long samples. Left: Geologist Reggie Visperas doing core sampling; Right: Samples collected are put in plastic bags with correspondingThe depth. Split samples taken on drill hole AGL-2007-04 arranged according to depth.sampling interval is marked in the core box by means of masking tape and written on it is thesampling depth. The sample collected is placed on a plastic bag with dimension of 35cm X 25cm tiedwith a “magic twister” tie wire. Outside of the plastic bag is written the hole number and sampleinterval.After the samples are collected it is weighed then sun-dried for about 5 hours and weighed again(Appendix 4 – Sample Preparation Sheet) before finally packing for delivery to the laboratory. Incases where there is continuous rain the samples are pan dried for 5-6 hours using the constructeddrying facility or wood-fired oven. Starting with batch 2008 AGL 18, only the sun-drying waspracticed. This simple process aims to roughly determine moisture content of the samples. Sampling interval markings using flattened pvc pipe 12
  • 79. 9. TRANSPORT OF SAMPLESFrom the core house at the drilling area, the samples are manually carried down to the Agata campfor final checking and packing before delivery to the laboratory. Six to eight samples are placed in arice sack depending on the weight that should have maximum of 12 kilos sufficient enough for oneperson to carry it carefully. The sample haulers are convoyed by MRL personnel.Once at the Agata camp, the samples are checked and inspected for completeness of samples andsample tags and check any damage to the sample bags. Sample tags are provided by Mcphar. Thesesamples are placed in a rice sack and then in a box within a wooden crate to ensure the safety of thesamples during transport. For all of the 2007 cores and batch 2008 AGL 10, the samples are delivered to Mcphar Laboratory through LBC-Butuan City or LBC-Surigao City with a transmittal receipt. The transportation of the crates containing the samples is always accompanied by designated MRL staff. The LBC personnel acknowledge the receipt that they have received the samples with corresponding receipt of the weight and payment of samples (Appendix 5 – Transmittal letter). For batches 2008 AGL 1, 3 and 6, the samples were delivered by MRL personnel to McPhar’s samplepreparation facility in General Santos City. The assaying was still done in their laboratory in MakatiCity.For batches 2008 AGL 13, 16, 18 and onwards, the core samples were delivered to Intertek’s samplepreparation facility in Surigao City. Once prepared, Intertek-Surigao sends the samples to their assay laboratory in Muntinlupa City, Metro Manila. In the 2010 drilling, samples were sent directly to the Intertek lab in Manila via air cargo (Cebu Pacific Airlines). A sample submission form to both McPhar and Intertek Assay laboratories is included in the package of samples 13
  • 80. (Appendix 6 – Sample Submission Form). Only when there is a discrepancy, McPhar or Intertek wille-mail MRL, otherwise, the results of the analysis will just come in 3 weeks thereafter by e-mail anddelivery of the hard copies to MRL’s Main Office. Samples in wooden crate ready to transport10. ASSAYINGIn McPhar, each sample is analyzed for nickel (Ni), cobalt (Co), iron (Fe), magnesia (MgO), alumina(Al2O3), silica (SiO2) and some samples for phosphorous (P). The Ni, Co, Fe, MgO and Al2O3 areassayed by dissolving a 25g charge with a three acid digest using hydrochloric and nitric acid andreading the results by Atomic Absorption Spectroscopy (AAS).The SiO2 and P are analyzed bygravimetric process.McPhar conducts regular rechecks on their analysis. This is done by preparing a solution differentfrom the solution on the regular sample taken on the same pulp of a particular sample.In June 2008, Mindoro changed their primary laboratory for the ANLP Drilling Program to IntertekTesting Services Philippines, Inc. as recommended by consultant F. Roger Billington. Intertek uses X-Ray Fluorescence (XRF) for nickel laterite assaying. In whole rock analysis, samples are fused usinglithium metaborate and analyzed by XRF. This scheme determines total element concentrations thatare then reported as oxides. The elements analyzed include Ni, Co, Fe, Al2O3, MgO, SiO2, P2O4,CaO, Cr2O3, K2O, MnO, Na2O, TiO2. The loss in ignition (LOI) is also reported.11. ASSAY DATA QUALITY ANALYSISThe objective of the quality control of assays is to check the precision of sample preparation,consistency of performance and accuracy of the laboratory’s analytical results. These objectives areattained through:11.1 Duplicate SamplesTo ensure the repeatability or consistency of samples, a duplicate sample is taken one (1) in a batch ofevery twenty (20) samples or about 5% of total samples. The duplicate sample is selected subjectivelyto ascertain that the full range of different laterite horizons is systematically covered.This duplicate sample is taken by crushing to smaller size fragments the sample then quartered afterthoroughly mixing. One-fourth part of the prepared sample represents the field duplicate sample andthe three-fourth part as regular sample. These samples are sent to the laboratory in the same batch.This on-site procedure of taking duplicate samples was modified in 2008. With split-core sampling,one duplicate sample in every set of forty (40) is directly obtained, by taking half of the remainingcore after splitting. Simply put, the field duplicate is just the one-fourth of the whole core. Thesesamples are also sent to the laboratory in the same batch as the mainstream samples. Each subset of 40samples in a batch contains 37 mainstream cores, 1 nickel standard, and 1 field duplicate. 14
  • 81. 11.2 Standard SamplesThe samples are provided by GEOSTATS of Australia. Standard samples are sent to monitor accuracyof the assay process on a batch by batch basis. These standard samples, which have known assayvalues for Ni are already pulverized (pulp) weighing about 5 grams contained in 7.5cm X 10cm heavyduty plastic bags, which are tightly sealed in packs. As more standards were later needed, pulverizedsamples contained in 250-gram bottles were purchased. Repacking into 5-grams was done in the MRLcorehouse facility. One (1) standard sample is inserted for every batch of forty five (45) samples or2% of total samples. Recently, the frequency of inserting standards was changed to 1 in every set of40 samples, as discussed in Section 11.1.11.3 Check SamplesSelected pulp rejects from previously analyzed samples from Mcphar weree sent to one independentand internationally accredited laboratory (Intertek of Jakarta, Indonesia). This is to establishreproducibility of analysis and determine the presence or absence of bias between laboratories. Twopercent (2) or about one in every 50 samples will be sent at a regular basis to have a constant check onMcphar analysis. Samples are taken on all of the different laterite horizons.An additional check sampling procedure was introduced in 2008. Sample intervals for future pulprejects were randomly selected, approximately one in every 40 samples and were pre-numbered. Asagreed in the sample preparation protocol, splits of all pulps are prepared by Intertek in its Surigaofacility. MRL then collects all of these split pulps and discreetly inserts pre-selected ones into theirpre-assigned numbers before the whole batch is sent to Intertek laboratory in Manila. These pulprejects are therefore analyzed in the same batch as its source. To date, 35 pulp rejects (3.09 %) wereinserted out of 1,133 samples analyzed in Intertek.12. Bulk Density and Moisture Content DeterminationThe bulk density and moisture content is essential in ore reserves estimation. There are severalalternatives of measuring density, ranging from laboratory test on small scale sampling andestimation based on bulk sampling.Two methodologies are to be undertaken by Mindoro for the determination of Bulk Density (BD). Forthe ferruginous laterite and limonite horizons, bulk samples are collected from test pits andmeasured on site. The same procedure will be done for the saprolite zone but to be supplementedwith another method, i.e., the collection and measurement of drill core samples.The test pits are designed with an optimal dimension of 0.9m x 1.4m with the wider sectionoriented in the north-south direction. Old test pits, on the other hand, have dimensions of 0.7m x1.2m. The narrower side is extended by0.5m extension to expose a fresh wall for the sampling. 15
  • 82. For BD measurements to be done on site, large samples ranging in volume from 0.005 m 3 to 0.08 m3will be collected from test pits. The locations of these test pits must be distributed around thedrilling area.To secure representative samples for the BD tests, small pits or “boxes” and channels will beexcavated or chiseled into test pit walls. Pre-fabricated plywood with square holes measuring 0.40mx 0.40m and 0.20m x 0.20m are used as guides in excavating and chiseling of the pit faces to ensurevolume accuracy. The plywood guides are then nailed to the pit walls to be sampled. Once nailed,chiseling of the area outlined by the plywood guide begins from the center of the “boxes” chippingtowards the “boxes’” boundaries. To ensure consistency of the volume excavated, knife putties areused to smoothen the edges of the “box”. Level bars and square boxes are regularly utilized toachieve a more or less perfect sampling dimension desired. The chipped samples chiseled from thebox falls freely onto a clean canvass placed at the bottom of the pit.There were instances that the final dimension of the excavation in the pit walls became irregular dueto the presence of boulders or rocks that were hard to chisel. In such cases, the final dimension wasdetermined by carefully measuring the height, width and breadth. These were done by MRLgeologists themselves in conjunction with their test pit logging.The bulk samples will be measured for volume, wet weight, and dry weight. The samples are to becontained in plastic bags and weighed using a 16-kg capacity, Korean made (“Choongang” brand),“Ohaus”-type single beam field weighing balances equipped with a 5-gram graduation beam. Theweighing scales are placed in tables exclusively used for this purpose. The weighing instruments arecleaned and calibrated regularly. The weight of the plastic bags are to be subtracted from theweighed samples to arrive at the actual weight of the samples.After determining the wet weight, the samples will be spread evenly in a canvass and sun-dried forinitial drying. Thence, these samples will undergo heating in constructed fire wood/charcoal-firedheating facilities for four to six hours. The samples should be regularly “stirred” to ensure evendrying. The dried samples are cooled naturally for about 20 minutes, after which they are collectedonto plastic bags for final weighing.The BD and moisture content are computed with the following formulas. Weight (kg) Bulk Density = _______________ ÷ 1000 (kg/ton) Volume (m3) Weight wet – Weight dry % Moisture Content = __________________ x 100 Weight wet 16
  • 83. For the drill cores, relatively unbroken portions of 10cm-20cm lengths are selected from drill holesthat are spatially well-distributed. The samples are to be coated in paraffin wax to preserve themoisture. These are then dispatched to McPhar Laboratories wherein the samples will be measuredusing the water displacement method. It is standard practice for Mcphar to check the wax coatingand perform re-waxing if needed.At Mcphar, the volume of the core is measured by displacement in a graduated cylinder or by waterdisplacement. The wax is then removed, and the core is weighed (wet). Thence, the sample is oven-dried and then re-weighed (dry) to be able to calculated the free moisture content.13. DocumentationBefore the cores are logged the undisturbed core are photographed first to show visual presentationof the core samples. Three (3) core boxes at a time are placed on the core stand. The header of thiscore stand shows the drill hole number and core box numbers. Core boxes and camera stand 17
  • 84. Photo of core on AGL-420Significant intercepts and other relevant activities deemed necessary for documentation are alsophotographed. Garnierite (green) as fracture fill and replacement of Garnierite on fractures of serpentinized harzburgite Serpentinite in highly oxidized and brecciated silicified harzburgite harzburgite Garnierite partially replacing serpentinite in brecciated, Brecciated harzburgite with vuggy quartz veinlets Slightly silicified harzburgite. 18
  • 85. 14. Data ManagementThe data entry is done in the field camp and MRL Surigao office but database maintenance andsafekeeping is done at Surigao City office. Mindoro’s office has since been transferred to ButuanCity (March 2008). To ensure the security of the data, both digital and hard copies of datasets andfield sheets are likewise maintained in Mindoro’s main office in Makati City.Since errors are introduced through incorrect transcription of physical field data, all entries of datainto the computer are checked by field geologists especially the core logging, sampling data andrecovery sheets.Assay results are entered electronically from digital Excel files e-mailed by the laboratories. Once the datasets are with the Data Management Unit, the entries are again re-checked for consistency vis-à-vis the hard copies. These are also checked for possible logical errors. 19
  • 86. AGATA NICKEL LATERITE PROJECT DRILLING ACTIVITYDrill Hole No: AGL-542 Date Started: 6/28/2010 DateLocation: 10600N-9750E 6/29/2010 Completed:Rig Type: JCP1 Core Checker: CADIO CAPON Time Date Activity From To RIG DISMANTLING AND MACHINE DRILL MOBILIZATION TO AGL-6/28/2010 12:55PM 1:00PM 543 1:00PM 2:30PM RIG ASSEMBLE SET-UP W/MACHINE DRILL AND CHECK-UP 2:30PM 3:28PM START CORING 3:28PM 4:55PM STANDBY; MACHINE TROUBLE; PINION GEAR 4:55PM 6:30PM RESUME CORING 6:30PM END OF SHIFT6/29/2010 6:00AM 6:55AM BREAKFAST MOBILING TO RIG SITE MACHINE CHECK-UP 6:55AM 8:57AM START CORING 8:57AM 11:49AM STANDBY; MACHINE TROUBLE; PINION GEAR 11:49AM 12:00N RESUME CORING 12:00NN 12:35PM LUNCH BREAK 12:35PM 2:57PM RESUME CORING 2:57PM FINAL BTM 12.25M EOH 20
  • 87. AGATA NICKEL LATERITE PROJECT BOREHOLE RECOVERY SHEETDrill Hole No. AGL-542 Location 10600N-9750E Date Started 6/28/2010Total Depth 12.25 Total Rec. 11.45 Date Completed 6/29/2010Next Site AGL-543 Rig No. JCP 1 Core Checker CADIO CAPON Interval Core Core Date Time % Rec Lithology Comments Run Rec. From To6/28/2010 2:30PM 0.00 0.35 0.35 0.35 100 LF6/28/2010 0.35 0.75 0.40 0.35 88 LA6/28/2010 0.75 0.95 0.20 0.20 100 LA6/28/2010 0.95 1.25 0.30 0.30 100 LA6/28/2010 1.25 1.55 0.30 0.30 100 LB6/28/2010 1.55 1.85 0.30 0.25 83 LB6/28/2010 1.85 2.15 0.30 0.27 90 LB6/28/2010 2.15 2.50 0.35 0.30 86 BLDR6/28/2010 2.50 2.75 0.25 0.20 80 BLDR6/28/2010 2.75 3.50 0.75 0.50 67 BLDR6/28/2010 3.50 3.90 0.40 0.35 88 LB6/28/2010 3.90 4.30 0.40 0.40 100 LB6/28/2010 4.30 5.05 0.75 0.75 100 LB6/28/2010 5.05 5.45 0.40 0.40 100 TM6/28/2010 5.45 5.85 0.40 0.40 100 TM6/29/2010 6:54AM 5.85 6.30 0.45 0.45 100 SAP6/29/2010 6.30 6.50 0.20 0.20 100 SAP6/29/2010 6.50 6.80 0.30 0.30 100 SAP6/29/2010 6.80 7.05 0.25 0.25 100 SAP6/29/2010 7.05 7.45 0.40 0.40 100 SROCK 21
  • 88. 6/29/2010 7.45 7.85 0.40 0.40 100 SAPROCK6/29/2010 7.85 8.25 0.40 0.40 100 SAPROCK6/29/2010 8.25 8.50 0.25 0.25 100 SAPROCK6/29/2010 8.50 8.70 0.20 0.18 90 SAPROCK6/29/2010 8.70 8.95 0.25 0.20 80 SAPROCK6/29/2010 8.95 9.65 0.70 0.70 100 SAPROCK6/29/2010 9.65 10.05 0.40 0.35 87 SAPROCK6/29/2010 10.05 10.45 0.40 0.40 100 SAPROCK6/29/2010 10.45 10.85 0.40 0.35 87 SAPROCK6/29/2010 10.85 11.25 0.40 0.40 100 SAPROCK6/29/2010 11.25 11.80 0.55 0.45 82 SAPROCK6/29/2010 11.80 12.15 0.35 0.35 100 SAPROCK6/29/2010 EOH 12.15 12.25 0.10 0.10 100 BEDROCK AVE. 12.25 11.45 93 22
  • 89. AGATA NICKEL LATERITE PROJECT DRILL HOLE LOG SHEETDrill Hole No. AGL-542 Date Started: 28-Jun-10Location Lawigan Date completed: 29-Jun-10N Coordinate 10604.44 Remarks :E Coordinate 9751.00 Drilling Contractor-Rig: JCP3Collar Elevation : 267.43 Logged By : WF EspirituFinal Depth : 12.25M Date Logged: June 28 to 29, 2010 Weath % Rock MOISFrom To Run Litho Color ering Comments Rock Size TURE CONTAINS ORGANIC 0.00 0.35 0.35 LF RBR 5F 1 M MATERIAL 0.35 1.25 0.90 LA RBR 5F 3 M 1.25 2.15 0.90 LB RBR_OBR 5F 4 M CONTAIN MN STAIN W/ GOUGE OF SSHz FROM 2.15 3.50 1.35 BLDR GY 2 79 1 DR 3.20m-3.50m 3.50 5.05 1.55 LB RBR_OBR 5F 4 M CONTAIN MN STAIN 5.05 5.85 0.80 TM RBR_GNOBR 5 5 M W/ GOUGE OF SSHz FROM 5.85 7.15 1.30 SAP GNOBR 5_4 8 M 6.30M-6.45M W/ INFILL OF CLAY 7.15 12.15 5.00 SAPROCK GYGNBR 2_5 52 1 M MATERIAL FROM 8.95m- 9.35m, FAULT-CONTROLLED12.15 12.25 0.10 BEDROCK GY 2 72 1 DR Hz EOH 23
  • 90. 24
  • 91. AGATA NICKEL LATERITE PROJECT SAMPLE PREPARATION SHEET HOLE SERIES Weight SAMPLE SAMPLING FROM TO Run GEOLOGY ID NO Wet (Kg) NO REMARKSAGL-454 40 0.00 1.00 1.00 1.86 SU08307 LFAGL-454 1 1.00 1.85 0.85 2.29 SU08308 LFAGL-454 2 1.85 2.85 1.00 2.54 SU08309 LAAGL-454 3 2.85 3.75 0.90 1.63 SU08310 LBAGL-454 4 3.75 4.00 0.25 0.48 SU08311 SAPAGL-454 5 4.00 4.20 0.20 0.36 SU08312 BLDRAGL-454 6 4.20 4.85 0.65 1.37 SU08313 SAP, BLDRAGL-454 7 4.85 5.30 0.45 0.95 SU08314 SAPAGL-454 8 5.30 6.10 0.80 1.75 SU08315 BLDRAGL-454 9 6.10 6.90 0.80 1.87 SU08316 SAPAGL-454 10 6.90 7.90 1.00 2.17 SU08317 RSAP, SAPAGL-454 11 7.90 8.95 1.05 2.11 SU08318 SAPAGL-454 12 8.95 9.90 0.95 1.87 SU08319 SAPAGL-454 13 9.90 10.90 1.00 2.16 SU08320 SAPAGL-454 14 10.90 12.00 1.10 2.18 SU08321 SAPAGL-454 15 12.00 13.10 1.10 2.41 SU08322 SAPAGL-454 16 13.10 14.20 1.10 2.63 SU08323 SAPROCK, BLDRAGL-454 17 14.20 15.40 1.20 2.70 SU08324 BLDRAGL-454 18 15.40 16.10 0.70 1.74 SU08325 RSAPAGL-454 19 16.10 17.55 1.45 3.38 SU08326 RSAPAGL-454 20 17.55 18.75 1.20 2.31 SU08327 SAPROCKAGL-454 21 18.75 20.00 1.25 2.69 SU08328 SAPROCKAGL-454 22 20.00 20.95 0.95 2.13 SU08329 SAPROCKAGL-528 23 0.00 1.00 1.00 2.02 SU08330 LF, LAAGL-528 24 1.00 2.05 1.05 2.38 SU08331 LA 25
  • 92. AGL-528 25 2.05 3.15 1.10 2.90 SU08332 LAAGL-528 26 3.15 3.80 0.65 1.51 SU08333 LBAGL-528 27 3.80 4.80 1.00 2.30 SU08334 LBAGL-528 28 4.80 5.80 1.00 2.22 SU08335 LBAGL-528 29 5.80 6.85 1.05 2.01 SU08336 LBAGL-528 30 6.85 7.35 0.50 1.12 SU08337 TMAGL-528 31 7.35 8.25 0.90 1.87 SU08338 SAPAGL-528 32 8.25 8.70 0.45 1.18 SU08339 BLDRAGL-528 33 7.35 8.25 0.90 0.98 SU08340 DUPAGL-528 34 8.70 9.85 1.15 2.54 SU08341 SAPAGL-528 35 9.85 10.30 0.45 1.35 SU08342 BLDRAGL-528 36 GBM 903-5 SU08343 GBMAGL-528 37 10.30 11.45 1.15 2.80 SU08344 SAPAGL-528 38 11.45 12.95 1.50 3.35 SU08345 SAP, BLDR HOLE SERIES Weight SAMPLE SAMPLING FROM TO Run GEOLOGY ID NO Wet (Kg) NO REMARKSAGL-528 39 12.95 13.75 0.80 1.60 SU08346 SAPAGL-528 40 13.75 14.60 0.85 2.40 SU08347 BLDRAGL-528 1 14.60 15.60 1.00 1.85 SU08348 SAPAGL-528 2 15.60 16.25 0.65 1.58 SU08349 RSAP, BLDRAGL-528 3 16.25 16.70 0.45 1.57 SU08350 RSAP, BLDRAGL-528 4 16.70 17.10 0.40 0.92 SU08351 BLDRAGL-528 5 17.10 18.55 1.45 3.82 SU08352 RSAP, BLDRAGL-528 6 18.55 19.75 1.20 3.45 SU08353 SAPROCKAGL-528 7 19.75 20.70 0.95 2.34 SU08354 SAPROCKAGL-528 8 20.70 21.50 0.80 2.30 SU08355 SAPROCKAGL-528 9 21.50 22.30 0.80 2.52 SU08356 BEDROCKAGL-543 10 0.00 0.95 0.95 1.72 SU08357 LF, LA, TMAGL-543 11 0.95 1.95 1.00 1.67 SU08358 SAPAGL-543 12 1.95 2.95 1.00 1.89 SU08359 SAPAGL-543 13 2.95 3.90 0.95 1.94 SU08360 SAPAGL-543 14 3.90 4.90 1.00 2.26 SU08361 SAP 26
  • 93. AGL-543 15 4.90 5.75 0.85 1.76 SU08362 RSAPAGL-543 16 5.75 6.90 1.15 2.26 SU08363 SAPROCKAGL-543 17 6.90 7.85 0.95 2.25 SU08364 SAPROCKAGL-543 18 7.85 9.35 1.50 2.01 SU08365 SAPROCKAGL-543 19 9.35 10.55 1.20 2.38 SU08366 SAPROCK, BEDROCKAGL-543 20 6.90 7.85 0.95 0.91 SU08367 DUPAGL-542 21 0.00 1.25 1.25 2.54 SU08368 LF, LAAGL-542 22 1.25 2.15 0.90 1.63 SU08369 LBAGL-542 23 2.15 3.50 1.35 2.04 SU08370 BLDRAGL-542 24 3.50 4.30 0.80 1.46 SU08371 LBAGL-542 25 4.30 5.05 0.75 1.10 SU08372 LBAGL-542 26 5.05 5.85 0.80 1.26 SU08373 TMAGL-542 27 5.85 7.15 1.30 2.47 SU08374 SAPAGL-542 28 7.15 8.25 1.10 1.95 SU08375 SAPROCKAGL-542 29 8.25 9.25 1.00 1.84 SU08376 SAPROCKAGL-542 30 9.25 10.25 1.00 2.28 SU08377 SAPROCKAGL-542 31 GBM 397-6 SU08378 GBMAGL-542 32 10.25 11.25 1.00 2.38 SU08379 SAPROCKAGL-542 33 11.25 12.25 1.00 1.88 SU08380 SAPROCK, BEDROCK 27
  • 94. TRANSMITTAL RECEIPT FOR COURIERDATE : March 29, 2007ATTENTION: LBC Express, P. Burgos St., Butuan City Pleaseacknowledge receipt of the following (in duplicate copies):1 Crate #1 (28 bags) 55 kg. Tracking no. 60196947952 Crate #2 (25 bags) 62 kg. Tracking no. 60196946173 Crate #3 (27 bags) 66 kg. Tracking no. 60196946374 Crate #4 (26 bags) 74 kg. Tracking no. 60196947355 Crate #5 (22 bags) 44 kg. Tracking no. 60196955866 Crate #6 (15 bags) 35 kg. Tracking no. 6019694775Dispatched by: Danilo F. Odtojan Date and time:3/29/07 5:40 pmDelivered by: Danilo F. Odtojan Date and time:3/29/07 5:40 pmReceived by: (LBC personnel) Rico A. Orjansa Date and timereceived: 3/29/07 5:40 pmPlease use separate sheet when necessary.D:MRL-SURIGAO PROJECTDOCUMENTSFORMSLBC_BXU_TR_24Mar07.doc Eledia Apt., Tuazon Village, Barangay Luna, Surigao City Telefax No.: (6386)826-2658 • www.mindoro.com 28
  • 95. Form No. SMP - 001SAMPLE SUBMISSION FORMTO : McPhar Assay Laboratory BJS Compound 1869 P. Domingo Street Tel. No. 896-1656 / 896-1681 / 896-7973 Fax No. 890-Makati, Metro Manila 0290 email lab@mcphar.com.phFROM : MRL Gold Phils., Inc. Unit 17b, Pearl of the Orient Bldg. 1318 Roxas Tel. No. 02 5258869 / 086 8262658 Fax No. email No. ofBlvd. corner P. Faura, Ermita Manila Elidia Apt., Tuazon Vill., KM.3, Surigao Samples: 195 CORE DISPATCH No. 2007 AGL 02CitySAMPLE DESCRIPTION NO. SAMPLE PREPARATION ELEMENTS ASSAY METHOD(S) OTHER TYPE INSTRUCTIONS REQUIRED SEE McPHAR REF. INSTRUCTI SEE McPHAR REF. DOC DOC NO. SMP-003 ON NO. SMP-003 SECTIONS SP1 TO SP9Box # 1 Dissolving a 25g:17894 - 17910 17 core charge with a two acid digest. (usingBox # 2 hydrochloric and nitric Ni, Co, Fe, Mg acid) and reading the17911 - 17937 27 core and Al, results by atomic absorptionBox # 3 spectroscopy (AAS)17938 - 17960 23 coreBox # 417961 - 17988 28 core Si Analysis by a Si gravimeter process.Box # 517989 - 17800 12 core17501 - 17519 19 coreBox # 617520 - 17545 26 core For Density Analysis : After Density Analysis return to tagBox # 7 no. From : 17585 back to 17563 17586 back to 1756517546 - 17562 17 core 17587 back to 17570 17588 back to 17581Box # 8 Note : All samples must be analyzed for the 6 elements as17563 - 17588 26 core indicatedReporting Send results and invoice to person indicated below Send results and invoice to : Fax results to : E-mail : edsel@mrlgold.com.ph/joe@mrlgold.com.phSubmitted by Ferland Tagura Date 14-Apr-07TEL: 896-1656; 896-1681; 896-7973 FAX: (63-2) 815-8195; (63-2) 761-2080FAX: (63-2) 890-0290 e-mail: mcphar@info.com.ph email: mcpharlab@portalinc.com 29
  • 96. Intertek Testing Services Phils. Inc. Warehouse 7, Phicrest 1 Compound Km. 23, West Service Road Cupang, Muntinlupa 1772SAMPLE SUBMISSION FORM: SERIAL NO. 000015Client Order No.: Submitted by: Jean Ravelo Project: Agata Nickel Laterite ProjectSENDER: Courier Delivered Report to: MR. TONY CLIMIEMRL GOLD PHILS, INC. Copies to Con. Note / AWB:Unit 604 Penthouse 1. MR. EDSEL M. ABRASALDOOppen Bldg Originating from AGATA 2. MS. JEAN S. RAVELO349 Sen. Gil Puyat Ave., No. of packages 10 SACKSMakati City Air bag Post Email No. of samples : 243 SAMPLES XX Invoice to: MR. EDSEL M.Phone: 895-5459 Security Tag No. 2010-AGL-010 ABRASALDO Date June 24, 2010Email:www.mrlgold.com.ph/webmail Sample Numbers Sample Instructions / Elements Method of Type Concentration Ranges Analysis As per quotations given 13 elements +BOX 1 SU07825 – SU07856 32 Core XRF Fusion by Mrs. Torre LOIBOX 2 SU07857 – SU07880 24 Core - Do - - Do - - Do -BOX 3 SU07881 – SU07904 24 Core - Do - - Do - - Do -BOX 4 SU07905 – SU07932 28 Core - Do - - Do - - Do -BOX 5 SU07933 – SU07959 27 Core - Do - - Do - - Do -BOX 6 SU07960 – SU07984 25 Core - Do - - Do - - Do -BOX 7 SU07985 – SU08012 28 Core - Do - - Do - - Do -BOX 8 SU08013 – SU08045 33 Core - Do - - Do - - Do -BOX 9 SU08046 – SU08067 22 Core - Do - - Do - - Do - 243 samplesPreparation SchemesPT – Total Preparation: Dry, crush, pulverize entire sample to 95% passing 200#. 30
  • 97. PB – Basic Preparation: Dry, crush, split, pulverize <1.5 Kg to 95% passing 200#, retain coarse residue.PS – Soil Preparation: Dry, pulverize < 1.5 Kg to 95% passing 200#.Other - As per client instructions______________________________________________________________________________Sample Storage /Disposal Hold 3 months then dispose Hold 3 months then return to client-XXX Hold 3 months then paid storage Hold 3 months then contact client Please note that storage charges apply after 3 months. Samples are automatically stored unless the clientadvises otherwise.JEAN S. RAVELO June 24, 2010 31
  • 98. Appendix 3Intertek Sample Preparation Procedures 32
  • 99. Intertek Laboratory ProtocolsIntertek Testing Services Phils., Inc. is among Intertek’s global network of mineral testinglaboratories. It provides quality assay analysis of mineral samples for nickel deposit explorationprojects. Measures are taken by Intertek mineral testing laboratories to ensure that correct methoddevelopment and quality protocols are in place to produce good quality results.Their sample preparation procedure is illustrated in the following flowchart. (Figure 3)Each sample is analyzed for nickel (Ni), cobalt (Co), iron (Fe), magnesium (Mg), aluminum (Al), silica(SiO2), CaO, Cr2O3, K2O, MnO, Na2O, P2O5, and TiO2. Whole rock analyses are done using X-rayFluorescence. The samples are fused using lithium metaborate. XRF analysis determines totalelement concentrations that are reported as oxides.For its internal QAQC, Intertek performs repeat analyses plus split sample analyses in every 15-20samples. Furthermore, on the average, one standard reference material is inserted in every 40samples, and one blank in every 60 samples.Figure 1: Intertek’s Sample Preparation Procedure for Laterite 33
  • 100. Appendix 4ANLP Bulk Density Data 34
  • 101. Table 1: Summary of Bulk Density Measurements Moisture Wet Dry No. of HORIZON Content Density Density Samples % FERRUGINOUS LATERITE 1.72 1.20 30.49 30 LIMONITE 1.81 1.24 31.74 37 SAPROLITE (Pit Samples) 1.98 1.46 26.11 17 SAPROLITE (Core Samples) 1.82 1.45 20.60 19Table 2: Bulk Density Measurements on Ferruginous Laterite Materials Sample No. Wet Density Dry Density Moisture Content % 1 1.70 1.15 32.37 2 1.85 1.29 30.19 3 1.62 1.26 21.98 4 1.67 1.15 31.13 5 1.98 1.34 32.06 6 2.03 1.49 26.70 7 1.63 1.10 32.85 8 1.88 1.33 29.41 9 1.63 1.15 29.16 10 1.54 1.03 33.00 12 1.69 1.24 27.06 13 1.54 1.03 33.26 14 1.56 1.05 32.53 15 1.86 1.17 37.14 16 1.53 1.13 26.32 17 1.61 1.10 31.52 18 1.58 1.05 33.11 35
  • 102. 19 1.59 1.07 32.65 20 1.60 1.24 22.35 21 1.95 1.32 32.28 22 1.96 1.29 33.83 23 1.57 1.13 28.29 24 1.62 1.19 26.61 25 1.59 1.09 31.63 26 1.78 1.22 31.65 27 1.78 1.27 28.82 28 1.88 1.27 32.13 29 1.54 1.05 31.74 30 2.07 1.38 33.12 31 1.84 1.29 29.82Table 3: Bulk Density Measurements on Limonite Materials Sample No. Wet Density Dry Density Moisture Content % 32 1.76 1.14 34.97 33 2.07 1.46 29.50 34 1.75 1.22 30.40 35 1.67 1.13 32.75 36 1.88 1.34 28.52 37 1.97 1.35 31.45 38 1.99 1.36 31.72 39 1.90 1.30 31.24 40 2.00 1.34 32.83 41 2.04 1.40 31.44 42 1.82 1.25 31.42 43 1.82 1.22 33.21 44 2.02 1.40 30.72 45 1.82 1.21 33.67 36
  • 103. 46 1.67 1.13 32.10 47 1.74 1.21 30.50 48 1.73 1.17 32.43 49 1.91 1.36 28.84 50 1.86 1.27 31.86 51 1.64 1.09 33.65 52 1.63 1.06 34.75 53 1.83 1.20 34.29 54 1.58 1.06 33.35 55 1.77 1.26 28.86 56 1.66 1.19 28.48 57 1.75 1.28 26.83 58 1.79 1.14 36.50 59 1.67 1.03 38.31 60 1.82 1.32 27.17 61 1.87 1.31 30.06 62 1.60 1.05 34.19 63 1.83 1.21 33.91 64 1.89 1.31 30.87 65 1.82 1.17 35.80 66 1.75 1.23 30.00 67 1.82 1.23 32.55 68 1.97 1.47 25.23Table 4: Bulk Density Measurements on Saprolite Materials (Pit Samples) Sample No. Wet Density Dry Density Moisture Content % 69 2.08 1.338 35.8 37
  • 104. 70 1.96 1.336 31.8 71 2.17 1.548 28.5 72 2.12 1.609 24.1 73 2.20 1.711 22.3 74 2.23 1.380 38.1 75 1.71 1.425 16.7 76 1.91 1.338 29.8 77 2.03 1.498 26.2 78 2.16 1.714 20.8 79 1.95 1.355 30.6 80 1.89 1.323 30.0 81 1.73 1.340 22.6 82 1.651 1.348 18.4 83 1.90 1.505 20.7 84 1.83 1.558 14.9 85 2.15 1.449 32.6Table 5: Bulk Density Measurements on Saprolite Materials (Core Samples) Sample No. Wet Density Dry Density Moisture Content % 13666 1.96 1.52 22.24 13905 1.61 1.18 26.84 13909 1.68 1.31 21.90 13913 2.13 1.93 9.33 13603 1.79 1.30 27.48 13612 1.75 1.11 36.58 13606 1.74 1.39 19.90 13877 1.96 1.67 14.61 13880 2.13 1.80 15.35 13884 1.89 1.44 23.99 13907 1.72 1.37 20.37 38
  • 105. 13912 1.62 1.15 28.79 13917 1.84 1.53 16.68 13923 1.90 1.66 12.72 17582 1.64 1.28 21.98 17586 1.70 1.28 24.66 17596 1.90 1.68 11.43 17604 1.70 1.26 25.64 17610 1.90 1.69 10.82Figure 1: Graphs of Dry Bulk Density Measurements DRY DENSITY Limonite 2.0 Dry Density 1.5 1.0 0.5 0.0 DRY DENSITY DRY DENSITY Saprolite (Core Samples) Saprolite (Pit Samples) 3.0 2.00 Dry Density Dry Density 1.50 2.0 1.00 1.0 0.50 0.0 0.00Figure 2: Graphs of Moisture Content 39
  • 106. MOISTURE CONTENT Ferruginous Laterite 40Moisture Content 30 20 (%) 10 0 MOISTURE CONTENT MOISTURE CONTENT Saprolite (Core Samples) Saprolite (Pit Samples) 40 40Moisture Content Moisture Content 30 30 20 20 (%) (%) 10 10 0 0 40
  • 107. Appendix 5Agata South Resource Estimate Statistics and Variography 41
  • 108. AL MG Nb Samples: 700 Nb Samples: 700 0 5 10 0 5 10 Minimum: 0.970 Minimum: 0.112 Maximum: 11.408 0.7 Maximum: 0.712.050 Mean: 5.856 Mean: 1.315 Std. Dev.: 1.779 Std. Dev.: 1.938 0.15 0.15 0.6 0.6 0.5 0.5 Frequencies FrequenciesFrequencies Frequencies 0.10 0.10 0.4 0.4 0.3 0.3 0.05 0.05 0.2 0.2 0.1 0.1 0.00 0.00 0.0 0.0 0 5 10 0 5 10 AL MG CO NI Nb Samples: 700 Nb Samples: 700 0.0 0.1 0.2 0.5 1.0 1.5 2.0 Minimum: 0.004 Minimum: 0.229 Maximum: 0.193 0.25 Maximum: 0.25 2.100 Mean: 0.086 Mean: 0.641 0.15 Std. Dev.: 0.035 0.15 Std. Dev.: 0.256 0.20 0.20 Frequencies FrequenciesFrequencies Frequencies 0.15 0.15 0.10 0.10 0.10 0.10 0.05 0.05 0.05 0.05 0.00 0.00 0.00 0.00 0.0 0.1 0.2 0.5 1.0 1.5 2.0 CO NI FE SIO2 Nb Samples: 700 Nb Samples: 700 10 20 30 40 50 0 10 20 30 40 50 Minimum: 13.833 0.3 Minimum: 0.31.225 Maximum: 54.650 Maximum: 48.851 0.20 Mean: 42.231 0.20 Mean: 10.382 Std. Dev.: 7.323 Std. Dev.: 8.044 0.15 0.15 0.2 0.2 Frequencies FrequenciesFrequencies Frequencies 0.10 0.10 0.1 0.1 0.05 0.05 0.00 0.00 0.0 0.0 10 20 30 40 50 0 10 20 30 40 50 FE SIO2Figure 1: Histograms of composites for limonite 42
  • 109. AL MG Nb Samples: 1483 Nb Samples: 1483 0 5 10 0 10 20 Minimum: 0.129 0.25 Minimum: 0.25 0.290 0.4 Maximum: 0.49.490 Maximum: 23.190 Mean: 1.377 Mean: 17.195 Std. Dev.: 1.228 Std. Dev.: 4.410 0.20 0.20 0.3 0.3 Frequencies FrequenciesFrequencies Frequencies 0.15 0.15 0.2 0.2 0.10 0.10 0.1 0.1 0.05 0.05 0.0 0.0 0.00 0.00 0 5 10 0 10 20 AL MG CO NI Nb Samples: 1483 Nb Samples: 1483 0.0 0.1 0.2 0.3 0.4 0 1 2 0.9 Minimum: 0.90.001 Minimum: 0.060 Maximum: 0.386 Maximum: 2.405 0.8 Mean: 0.80.022 Mean: 0.886 Std. Dev.: 0.019 0.20 Std. Dev.: 0.282 0.20 0.7 0.7 0.6 0.6 Frequencies FrequenciesFrequencies Frequencies 0.15 0.15 0.5 0.5 0.4 0.4 0.10 0.10 0.3 0.3 0.2 0.2 0.05 0.05 0.1 0.1 0.0 0.0 0.00 0.00 0.0 0.1 0.2 0.3 0.4 0 1 2 CO NI FE SIO2 Nb Samples: 1483 Nb Samples: 1483 10 20 30 40 50 0 10 20 30 40 50 0.4 Minimum: 0.45.000 Minimum: 2.002 Maximum: 52.700 0.6 Maximum: 0.645.764 Mean: 11.804 Mean: 37.822 Std. Dev.: 6.401 Std. Dev.: 4.776 0.5 0.5 0.3 0.3 Frequencies FrequenciesFrequencies Frequencies 0.4 0.4 0.2 0.2 0.3 0.3 0.2 0.2 0.1 0.1 0.1 0.1 0.0 0.0 0.0 0.0 10 20 30 40 50 0 10 20 30 40 50 FE SIO2Figure2: Histograms of composites for saprolite 43
  • 110. Distance (m) Distance (m) Limonite To Saprolite Limonite To Saprolite -10 0 10 -10 0 10 7 17 7 2 7 2 2 27 29 2 7 17 40 40 6 6 27 5 29 5 30 30 4 4 FE ALFE AL 20 22 20 3 3 11 14 4 2 22 2 10 10 2 11 10 9 8 10 1 14 1 10 10 8 42 9 0 0 0 0 -10 0 10 -10 0 10 Distance (m) Distance (m) Distance (m) Distance (m) Limonite To Saprolite Limonite To Saprolite -10 0 10 -10 0 10 0.10 0.10 29 10 9 8 0.09 17 27 0.09 10 2 20 4 20 7 14 0.08 2 0.08 0.07 0.07 11 22 0.06 0.06 2 0.05 0.05 CO MGCO MG 10 10 0.04 0.04 22 11 0.03 0.03 14 0.02 10 10 9 42 0.02 8 29 27 0.01 0.01 2 2 7 17 0.00 0.00 0 0 -10 0 10 -10 0 10 Distance (m) Distance (m) Distance (m) Distance (m) Limonite To Saprolite Limonite To Saprolite -10 0 10 -10 0 10 4 10 10 9 8 4 2 40 14 40 1.0 22 1.0 11 11 14 22 2 29 30 30 10 27 10 9 8 SIO2 SIO2 7 17 NINI 2 20 20 0.5 2 0.5 29 27 10 2 10 2 7 17 0.0 0.0 0 0 -10 0 10 -10 0 10 Distance (m) Distance (m)Figure3: Contact analysis plots for limonite (left) to saprolite (right) 44
  • 111. Distance (m) Distance (m) Saprolite To Bedrock Saprolite To Bedrock -10 0 10 -10 0 10 0.02 0.02 34 2 5 54 1117 75 34 1.0 2 1.0 54 21 75 27 47 17 63 1 1 2 27 3 5 11 63 47 0.01 21 0.01 AL COAL CO 3 1 1 2 0.5 0.5 0.0 0.0 0.00 0.00 -10 0 10 -10 0 10 Distance (m) Distance (m) Distance (m) Distance (m) Saprolite To Bedrock Saprolite To Bedrock -10 0 10 -10 0 10 2 2 273 4721 6 1 1 10 3 5 10 75 54 20 1117 34 20 34 1117 3 5 54 2 75 2 27 63 4721 1 1 FE MGFE MG 5 5 10 10 0 0 0 0 -10 0 10 -10 0 10 Distance (m) Distance (m) Distance (m) Distance (m) Saprolite To Bedrock Saprolite To Bedrock -10 0 10 -10 0 10 0.8 0.8 44 44 0.7 0.7 0.6 11 34 54 0.6 2 17 42 42 5 75 0.5 0.5 5 2 2 3 1117 7563 54 27 47 21 1 1 SIO2 2 27 SIO2 34 NI 0.4 0.4NI 63 40 40 47 21 0.3 3 0.3 1 1 0.2 0.2 38 38 0.1 0.1 0.0 0.0 36 36 -10 0 10 -10 0 10 Distance (m) Distance (m)Figure 4: Contact analysis plots for saprolite (left) to bedrock (right) 45
  • 112. Variogram Model - Global Window Distance (m) Distance (m) 0 100 200 300 0.0 2.5 5.0 7.5 10.0 7 7 3 3 6 6 N0 5 5Variogram : AL Variogram : AL Variogram : AL Variogram : AL 2 2 4 4 3 3 1 1 2 2 1 D-90 1 0 0 0 0 0 100 200 300 0.0 2.5 5.0 7.5 10.0 Distance (m) Distance (m)IsatisDrillholes/Lines_1m(Sel: Limonite) ac- Variable #1 : ALExperimental Variogram : in 1 direction(s) Sep 02 2011 09:55:22D2 : D-90 Agata_South Angular tolerance = 90.00 Lag = 1.00m, Count = 15 lags, Tolerance = 50.00%Model : 2 basic structure(s)S1 - Nugget effect, Sill = 0.8S2 - Spherical - Range = 8.00m, Sill = 1.7 Directional Scales = ( 140.00m, 140.00m, 8.00m) Rotation = No rotationFigure 5: Experimental and model variograms for Al in limonite Variogram Model - Global Window Distance (m) Distance (m) 0 100 200 300 0.0 2.5 5.0 7.5 10.0 0.00125 0.00125 0.0025 0.0025 N0 0.00100 0.00100 0.0020 0.0020 Variogram : CO Variogram : COVariogram : CO Variogram : CO 0.00075 0.00075 0.0015 0.0015 0.00050 0.00050 0.0010 D-90 0.0010 0.00025 0.00025 0.0005 0.0005 0.00000 0.00000 0.0000 0.0000 0 100 200 300 0.0 2.5 5.0 7.5 10.0 Distance (m) Distance (m)IsatisDrillholes/Lines_1m(Sel: Limonite) ac- Variable #1 : COExperimental Variogram : in 1 direction(s) Sep 02 2011 09:54:24D2 : D-90 Agata_South Angular tolerance = 90.00 Lag = 1.00m, Count = 15 lags, Tolerance = 50.00%Model : 2 basic structure(s)S1 - Nugget effect, Sill = 0.0007S2 - Spherical - Range = 4.00m, Sill = 0.0006 Directional Scales = ( 60.00m, 60.00m, 4.00m) Rotation = No rotationFigure 6: Experimental and model variograms for Co in limonite 46
  • 113. Variogram Model - Global Window Distance (m) Distance (m) 0 100 200 300 0.0 2.5 5.0 7.5 10.0 70 70 50 N0 50 60 60 40 40 50 50Variogram : FE Variogram : FE Variogram : FE Variogram : FE 30 30 40 40 30 D-90 30 20 20 20 20 10 10 10 10 0 0 0 0 0 100 200 300 0.0 2.5 5.0 7.5 10.0 Distance (m) Distance (m)IsatisDrillholes/Lines_1m(Sel: Limonite) ac- Variable #1 : FEExperimental Variogram : in 1 direction(s) Sep 02 2011 10:12:22D2 : D-90 Agata_South Angular tolerance = 90.00 Lag = 1.00m, Count = 15 lags, Tolerance = 50.00%Model : 2 basic structure(s)S1 - Nugget effect, Sill = 10S2 - Spherical - Range = 7.00m, Sill = 30 Directional Scales = ( 140.00m, 140.00m, 7.00m) Rotation = No rotationFigure 7: Experimental and model variograms for Fe in limonite Variogram Model - Global Window Distance (m) Distance (m) 0 100 200 300 0.0 2.5 5.0 7.5 10.0 N0 3 3 2.0 2.0Variogram : MG Variogram : MG Variogram : MG Variogram : MG 1.5 1.5 2 2 1.0 1.0 1 1 D-90 0.5 0.5 0 0 0.0 0.0 0 100 200 300 0.0 2.5 5.0 7.5 10.0 Distance (m) Distance (m)IsatisDrillholes/Lines_1m(Sel: Limonite) ac- Variable #1 : MGExperimental Variogram : in 1 direction(s) Sep 02 2011 10:20:48D2 : D-90 Agata_South Angular tolerance = 90.00 Lag = 1.00m, Count = 15 lags, Tolerance = 50.00%Model : 2 basic structure(s)S1 - Nugget effect, Sill = 0.9S2 - Spherical - Range = 7.00m, Sill = 1.1 Directional Scales = ( 140.00m, 140.00m, 7.00m) Rotation = No rotationFigure 8: Experimental and model variograms for Mg in limonite 47
  • 114. Variogram Model - Global Window Distance (m) Distance (m) 0 100 200 300 0.0 2.5 5.0 7.5 10.0 0.06 0.06 0.03 0.03 N0 0.05 0.05Variogram : NI Variogram : NI Variogram : NI Variogram : NI 0.04 0.04 0.02 0.02 0.03 0.03 0.02 0.02 0.01 0.01 0.01 0.01 0.00 0.00 0.00 D-90 0.00 0 100 200 300 0.0 2.5 5.0 7.5 10.0 Distance (m) Distance (m)IsatisDrillholes/Lines_1m(Sel: Limonite) ac- Variable #1 : NIExperimental Variogram : in 1 direction(s) Sep 02 2011 10:32:36D2 : D-90 Agata_South Angular tolerance = 90.00 Lag = 1.00m, Count = 15 lags, Tolerance = 50.00%Model : 2 basic structure(s)S1 - Nugget effect, Sill = 0.01S2 - Spherical - Range = 3.00m, Sill = 0.022 Directional Scales = ( 60.00m, 60.00m, 3.00m) Rotation = No rotationFigure 9: Experimental and model variograms for Ni in limonite Variogram Model - Global Window Distance (m) Distance (m) 0 100 200 300 0.0 2.5 5.0 7.5 10.0 70 N0 70 300 300 60 60Variogram : SIO2 Variogram : SIO2 Variogram : SIO2 Variogram : SIO2 50 50 200 D-90 200 40 40 30 30 20 20 100 100 10 10 0 0 0 0 0 100 200 300 0.0 2.5 5.0 7.5 10.0 Distance (m) Distance (m)IsatisDrillholes/Lines_1m(Sel: Limonite) ac- Variable #1 : SIO2Experimental Variogram : in 1 direction(s) Sep 02 2011 10:27:40D2 : D-90 Agata_South Angular tolerance = 90.00 Lag = 1.00m, Count = 15 lags, Tolerance = 50.00%Model : 2 basic structure(s)S1 - Nugget effect, Sill = 9S2 - Spherical - Range = 6.00m, Sill = 35.62 Directional Scales = ( 101.88m, 101.88m, 6.00m) Rotation = No rotationFigure 10: Experimental and model variograms for SiO2 in limonite 48
  • 115. Variogram Model - Global Window Distance (m) Distance (m) 0 100 200 300 0 5 10 15 N0 1.25 1.25 1.25 1.25 D-90 1.00 1.00 1.00 1.00Variogram : AL Variogram : AL Variogram : AL Variogram : AL 0.75 0.75 0.75 0.75 0.50 0.50 0.50 0.50 0.25 0.25 0.25 0.25 0.00 0.00 0.00 0.00 0 100 200 300 0 5 10 15 Distance (m) Distance (m)IsatisDrillholes/Lines_1m(Sel: Sapprolite) ac- Variable #1 : ALExperimental Variogram : in 1 direction(s) Sep 02 2011 10:36:55D2 : D-90 Agata_South Angular tolerance = 90.00 Lag = 1.00m, Count = 15 lags, Tolerance = 50.00%Model : 2 basic structure(s)S1 - Nugget effect, Sill = 0.1S2 - Spherical - Range = 15.00m, Sill = 1.1 Directional Scales = ( 140.00m, 140.00m, 15.00m) Rotation = No rotationFigure 11: Experimental and model variograms for Al in saprolite Variogram Model - Global Window Distance (m) Distance (m) 0 100 200 300 0 5 10 15 0.00020 0.00020 0.0003 0.0003Variogram : CO Variogram : CO Variogram : CO Variogram : CO 0.00015 0.00015 N0 0.0002 D-90 0.0002 0.00010 0.00010 0.0001 0.0001 0.00005 0.00005 0.00000 0.00000 0.0000 0.0000 0 100 200 300 0 5 10 15 Distance (m) Distance (m)IsatisDrillholes/Lines_1m(Sel: Sapprolite) ac- Variable #1 : COExperimental Variogram : in 1 direction(s) Sep 02 2011 10:41:18D2 : D-90 Agata_South Angular tolerance = 90.00 Lag = 1.00m, Count = 15 lags, Tolerance = 50.00%Model : 2 basic structure(s)S1 - Nugget effect, Sill = 6e-005S2 - Spherical - Range = 6.00m, Sill = 0.00014 Directional Scales = ( 70.00m, 70.00m, 6.00m) Rotation = No rotationFigure 12: Experimental and model variograms for Co in saprolite 49
  • 116. Variogram Model - Global Window Distance (m) Distance (m) 0 100 200 300 0 5 10 15 60 60 25 25 50 50 20 N0 20Variogram : FE Variogram : FE Variogram : FE Variogram : FE 40 40 D-90 15 15 30 30 10 10 20 20 5 5 10 10 0 0 0 0 0 100 200 300 0 5 10 15 Distance (m) Distance (m)IsatisDrillholes/Lines_1m(Sel: Sapprolite) ac- Variable #1 : FEExperimental Variogram : in 1 direction(s) Sep 08 2011 14:54:14D2 : D-90 Agata_South Angular tolerance = 90.00 Lag = 1.00m, Count = 15 lags, Tolerance = 50.00%Model : 3 basic structure(s)S1 - Nugget effect, Sill = 1.63S2 - Spherical - Range = 5.00m, Sill = 18 Directional Scales = ( 5.00m, 5.00m, 8.00m) Rotation = No rotationS3 - Spherical - Range = 9.00m, Sill = 5.5 Directional Scales = ( 80.00m, 80.00m, 9.00m) Rotation = No rotationFigure 13: Experimental and model variograms for Fe in saprolite Variogram Model - Global Window Distance (m) Distance (m) 0 100 200 300 0 5 10 15 N0 25 25 15 15 D-90 20 20Variogram : MG Variogram : MG Variogram : MG Variogram : MG 10 10 15 15 10 10 5 5 5 5 0 0 0 0 0 100 200 300 0 5 10 15 Distance (m) Distance (m)IsatisDrillholes/Lines_1m(Sel: Sapprolite) ac- Variable #1 : MGExperimental Variogram : in 1 direction(s) Sep 08 2011 14:56:20D2 : D-90 Agata_South Angular tolerance = 90.00 Lag = 1.00m, Count = 15 lags, Tolerance = 50.00%Model : 3 basic structure(s)S1 - Nugget effect, Sill = 1S2 - Spherical - Range = 4.10m, Sill = 9 Directional Scales = ( 4.10m, 4.10m, 10.00m) Rotation = No rotationS3 - Spherical - Range = 10.00m, Sill = 6 Directional Scales = ( 170.00m, 170.00m, 10.00m) Rotation = No rotationFigure 14: Experimental and model variograms for Mg in saprolite 50
  • 117. Variogram Model - Global Window Distance (m) Distance (m) 0 100 200 300 0 5 10 15 0.3 0.3 N0 D-90 0.125 0.125 0.100 0.100Variogram : NI Variogram : NI Variogram : NI Variogram : NI 0.2 0.2 0.075 0.075 0.050 0.050 0.1 0.1 0.025 0.025 0.000 0.000 0.0 0.0 0 100 200 300 0 5 10 15 Distance (m) Distance (m)IsatisDrillholes/Lines_1m(Sel: Sapprolite) ac- Variable #1 : NIExperimental Variogram : in 1 direction(s) Sep 08 2011 15:00:57D2 : D-90 Agata_South Angular tolerance = 90.00 Lag = 1.00m, Count = 15 lags, Tolerance = 50.00%Model : 3 basic structure(s)S1 - Nugget effect, Sill = 0.0075S2 - Spherical - Range = 5.00m, Sill = 0.07 Directional Scales = ( 5.00m, 5.00m, 10.00m) Rotation = No rotationS3 - Spherical - Range = 10.00m, Sill = 0.04 Directional Scales = ( 110.00m, 110.00m, 10.00m) Rotation = No rotationFigure 15: Experimental and model variograms for Ni in saprolite Variogram Model - Global Window Distance (m) Distance (m) 0 100 200 300 0 5 10 15 12.5 12.5 D-90 6 6 N0 10.0 10.0 5 5 Variogram : SIO2 Variogram : SIO2Variogram : SIO2 Variogram : SIO2 4 4 7.5 7.5 3 3 5.0 5.0 2 2 2.5 2.5 1 1 0 0 0.0 0.0 0 100 200 300 0 5 10 15 Distance (m) Distance (m)IsatisDrillholes/Lines_1m(Sel: Sapprolite) ac- Variable #1 : SIO2Experimental Variogram : in 1 direction(s) Sep 08 2011 15:02:04D2 : D-90 Agata_South Angular tolerance = 90.00 Lag = 1.00m, Count = 15 lags, Tolerance = 50.00%Model : 3 basic structure(s)S1 - Nugget effect, Sill = 0.383S2 - Spherical - Range = 5.00m, Sill = 4 Directional Scales = ( 5.00m, 5.00m, 8.00m) Rotation = No rotationS3 - Spherical - Range = 9.00m, Sill = 1.5 Directional Scales = ( 80.00m, 80.00m, 9.00m) Rotation = No rotationFigure 16: Experimental and model variograms for SiO2 in saprolite. 51