Nyota Minerals Ltd (NYO) - Quarterly Report for the period ended 30 June
RNS Number : 9225I
Nyota Minerals Limited
31 July 2012
31 July 2012
Nyota Minerals Limited ('Nyota' or the 'Company')
Quarterly Report to 30 June 2012
Nyota Minerals Limited (ASX/AIM: NYO), the gold exploration and development
company in East Africa, is pleased to announce its Quarterly Report for the
period ended 30 June 2012.
Tulu Kapi Project, Ethiopia
· The Definitive Feasibility Study ("DFS") is progressing well and is on
schedule for completion in the third quarter of 2012. Technical elements of
the ongoing DFS were submitted to the Ethiopian Ministry of Mines ("MoM") in
July to support Nyota's application for a Mining Licence;
· 14,650m infill drilling programme initiated with Wardell Armstrong
International ("WAI"), aimed at converting a further 260,000 ounces of
Inferred Resources to Indicated status by the end of Q4 2012 to support
project finance is now 90% complete;
· Geological modelling of UNDP Target, adjacent to the main resource,
demonstrates good continuity and highlights opportunity for further extensions
to mineralisation and scope for an increase in the resource estimation before
· Peak drill assay intercept in the Tulu Kapi Feeder Zone of 6.11 g/t Au
over 17m reaffirms the Feeder Zone's potential to provide the significant
high-grade component to future mine production;
Proximal and Satellite zones
· A 2.5km^2 gold-in-soil geochemical anomaly with coincidental rock chip
samples of up to 7.2g/t and historical hard-rock mining has been identified at
the Buneya North prospect, close to Tulu Kapi;
· Positive results from the Guji Saprolite drill programme;
· First phase drilling at the Bendokoro Prospect indicates limited
economic potential, but the presence of visible coarse gold and low grade
background gold mineralisation in host rocks has led to the commencement of
further soil sampling and mapping along the interpreted extension of the
· A detailed fieldwork schedule is being planned for October 2012 to June
2013 based on results to date and previous airborne geophysical and regional
soil geochemical sampling, in order to comprehensively explore the whole
Brantham and Towchester licence areas ahead of further drilling;
· Cash on Balance Sheet at end of quarter: A$14.4m;
· This represents a reduction of A$8.1m from the end of the prior quarter
and excludes the GBP1.3m proceeds of the subscription by International Finance
Corporation received in July 2012, and
· Norman Ling was appointed as Non-executive on 21 June 2012. Mr Ling has
held a series of appointments at the UK Foreign and Commonwealth Office in a
career spanning more than30 years. Mr Ling's last post was as British
Ambassador to Ethiopia, Djibouti and the African Union from 2008 to 2011, when
he retired from government service.
Richard Chase, Chief Executive Officer commented, "The last quarter has
continued to be exceptionally busy for Nyota as we work towards the
finalisation of the DFS on our Tulu Kapi gold Project. The in-fill drill
programme has progressed quicker than we anticipated, which is a huge credit
to our team and to the contractor.
Tulu Kapi remains the greatest call on our resources and our cash but
following the completion of the DFS this will be significantly reduced until
such time as the mining license is issued."
TULU KAPI PROJECT
Mining Licence Application
Following extensive work during the quarter, Nyota announced on 6 July that it
had submitted the technical elements of the on-going DFS to the Ethiopian
Ministry of Mines ("MoM"). The documents submitted to the MoM will enable it
to commence its technical review of the Tulu Kapi project, which is a
pre-requisite for the terms of the Mining Licence to be agreed, while the
economic parameters for the DFS, which should support the issue of a Mining
Licence, are finalised.
The JORC-Compliant Mineral Resource announced in March 2012, comprising
0.83Moz of Indicated Resource and 0.84Moz of Inferred Resource, will form the
basis of the DFS to be submitted to the MoM in the third quarter of 2012 in
support of the Company's Mining Licence application.
The Board believes that negotiations with the MoM have progressed well and
remains expectant of securing a Mining Licence for Tulu Kapi in the second
half of 2012 and of achieving its current development timetable aimed at first
gold production in the fourth quarter of 2014.
Resource Infill Drilling
As Inferred Resources cannot be converted to Mineable Reserves under the JORC
code and in parallel with the DFS drilling, Nyota has commissioned Wardell
Armstrong International ("WAI") to produce an infill drilling programme
designed to upgrade the most significant areas of Inferred Mineral Resources
to "Indicated" status. These areas are located up to a depth of up to 200m and
found within the existing conceptual open pit outline. This should result in
significant upside to the DFS and confirm an initial mine life of around 10
years; ahead of project financing. It should be noted that drilling has also
identified mineralisation beyond this pit outline which may be included in
subsequent resource estimations.
The infill drilling programme comprises 130 vertical drill holes for a total
of 14,650m and is aimed at converting an estimated 260,000 ounces of gold to
an Indicated Resource status. The drilling programme is now 90% complete and
assay results will be used in an updated Mineral Resource statement and the
Ore Reserve statement before the end of 2012.
The UNDP target is located north of and adjacent to the main Tulu Kapi
resource. Mineralisation is contained in a NE-SW trending corridor dipping at
25-30 degrees to the northwest and similar in morphology to the shallow Tulu
An updated geological model demonstrates good continuity and provides the
evidence necessary to warrant further drilling to test the strike extensions
to the deposit. At the same time the model has been submitted to WAI for its
consideration in the next resource estimation and to confirm an infill drill
programme to upgrade the resource from an Inferred to an Indicated status.
This drilling will be scheduled for some time in Q4.
As part of the DFS, the diamond drill hole TKMT-001 was drilled to a final
depth of 468.57m to provide core for metallurgical testing, and at depth to
test the continuity of the deep high grade mineralisation which has not
previously been defined in this part of the deposit. The drilling and assay
results confirm the strike continuity of the deep high grade mineralisation by
60m to the SW and 40m (up dip) SE of previously intersected deep high grade
Only mineralisation in the Feeder Zone was processed at Tulu Kapi and
dispatched for gold assay as the balance of the drill core was sent directly
to independent laboratory for metallurgical test work. Two mineralised
intercepts were identified, the first returning a peak grade of 6.11 g/t au
over 17m and the second deeper zone returning a peak grade of 1.38 g/t au over
The evidence of further extensions of mineralisation over substantial widths
and at grades exceeding 6g/t Au reaffirm the Company's view that ultimately
the Feeder Zone has the potential to provide a significant high-grade
component to future mine production.
Shareholders are aware that drill rigs were reallocated to DFS drilling in
order to support the application for the conversion of the current Exploration
Licence to a Mining Licence but this recent high-grade drill result supports
the Company's intent to assign at least one diamond drill rig to further
Feeder Zone drilling in Q4.
PROXIMAL AND SATELLITE TARGETS
Despite the focus on Tulu Kapi, good progress has been made this quarter on
the Proximal and Satellite exploration areas. However, there are some major
targets that still require investigation.
The selection of targets for follow-up during the period has been driven by
the need to plan the final locations of key elements of infrastructure for the
Tulu Kapi mine, including the processing plant, tailings storage facility and
access roads. As a result, additional close-spaced gold in soil sampling has
been completed and some limited sterilisation drilling undertaken where
targets are located "under" preferred infrastructure sites (Guji Getere Tulu
Kapi; Ankore). One of these holes exhibits 10m of albitized syenite with
pyrite and quartz veins that will be followed-up if the samples contain
Thereafter the emphasis remains the completion of sufficient exploration and
preliminary evaluation to demonstrate to shareholders that the targets within
the Company's Proximal and Satellite exploration licences have obvious
potential to provide for an extension of mine life well beyond the 10 year
initial programme planned for Tulu Kapi.
The Tulu Kapi Trend
The Tulu Kapi trend comprises a chain of topographic highs formed by a series
of granitoids (mainly sericitised syenite), many of which are anomalous in
gold. In addition to the Tulu Kapi and UNDP resources, these targets include
Kelley and Chalti.
830 soil samples and 119 grab samples have been taken during the quarter and,
combined with historical data, have highlighted 7 targets areas warranting
A mafic-rich syenite with numerous quartz vein and pervasive alteration. A
campaign of rock chip sampling and trenching has been undertaken.
A geophysical survey and reappraisal of the available data, including drill
core, was undertaken at the end of 2011 / start of 2012. This has been
followed by detailed soil sampling over the weathered ground southeast of the
main Chalti massif. Some additional fences of vertical reverse circulation
drillholes are planned to test the target further.
The Ankore Trend
The Ankore Trend is defined based on the regional geophysical surveys as a
northwest trending series of magnetic highs and lows running parallel to the
Tulu Kapi trend of granitoids.
Buneya North and Extension
In-fill soil sampling has defined an anomaly of greater than 45ppb
gold-in-soil covering an area of approximately 2.5km^2 (peaking at 9.3g/t gold
in soil) underlain by diorite, granite and meta-sediment, subject to
shear-type deformation and intense alteration.
Rock chip samples containing a peak of 7.2g/t gold plus anomalous zinc and
copper were collected proximal to a site of historical small scale exploratory
hard-rock mining over an area of 200 meters by 400 meters. Gold is associated
with quartz veining and pyrite mineralization in sericitised and silicified
sheared host rocks. Mechanical trenching and an initial drill programme are
An initial diamond drilling programme is planned for late 2012 or early 2013.
The Guji-Komto Trend
As reported in the quarterly report to 31 March 2012, the Guji gold-bearing
saprolite is a small portion of a larger, 2.5km - 2.8km long linear
geochemical anomaly, extending from Komto in the south to Guji in the north
coincidental with a meta-sedimentary / meta-volcanic belt including
mineralized ferruginous schists and limonitic quartz breccia. The gossan
bodies are lenticular, typically 100m wide and several hundred meters long.
The first phase Guji drill programme is complete, with 64 holes drilled for a
total of 5,381m. Sample assays from nine of the 64 holes are pending.
Drilling thus far covers only a 600m portion of the Guji gold-in-soil anomaly,
with the anomaly open for 700m to the north, and 800m to the south.
This initial drill programme was designed specifically to test the scope for
the quick and low-cost development of additional easily accessible resources
to feed into the future Tulu Kapi plant from mineralisation found in
near-surface saprolitic mineralisation. The programme has concluded the
· economic intersections of mineralised saprolite exist (as previously
announced on 11 June 2012);
· mineralisation is found where gold in soil geochemical anomalies are
coincident with ground geophysical targets generated by the resistivity
geophysical survey completed in late 2011; and
· anomalous gold in soil geochemistry occurs for a further approximate
800m south and 700m north of the current drill zone which is expected to
return further mineralised gold intersections once drilled.
A second phase of shallow reverse circulation drilling is being planned for
late 2012, after the rainy season, aimed specifically at the extensions to
mineralisation defined by the geophysical and geochemical surveys.
A road has been constructed to the Komto meta-sediment target, the
southernmost extension of the prospective Guji-Komto Trend. Subject to
trenching, reverse circulation drilling to confirm the depth extent of
mineralization is planned and the drill pads prepared. Drilling expected to
be undertkane in before the end of 2012.
REGIONAL EXPLORATION - NORTHERN BLOCKS
Very limited field work is possible during the rainy season so the emphasis
has turned to data compilation and desktop studies.
As previously reported, 12 holes (2,244m) were drilled at the Bendokoro
prospect in the first phase of drilling targeting rock chip and trench
intersections coincidental with a complex but distinct NW-SE lineation evident
from the airborne geophysical survey conducted by Nyota in late 2010.
All sample assays have been received and the results analysed.
Two distinct styles of gold mineralisation are observed: the first is
associated with pyrite and rare chalcopyrite sulphide mineralisation and
sericite alteration of the meta-volcanic and schist host rocks and is
typically in the range of 0.1 - 1.0 g/t (for example BKBH008: 9.5m at 0.45g/t;
BKBH009: 5.0m at 0.54g/t; BKBH10: 2.0m at 0.41g/t;BKBH001: 5.4m @ 0.44g/t) and
the second is associated with silicification and quartz veining. The latter
includes the visible gold noted in borehole BKBH-003 (Bendokoro West) (assayed
at 2.15g/t Au over 7m, including a peak of 11.65g/t Au at 153m-154m depth)
and borehole BKBH-005, drilled to intersect the depth extension of the
Bendokoro East target, assayed at 100 g/t over 0.64 m.
In addition, elevated silver values have been noted in samples taken from
boreholes on the eastern anomaly.
The origins ("protolith") of the Bendokoro East gossan, which assayed up to
10.2g/t in rock chip, was not obvious in the boreholes drilled beneath it and
therefore remains enigmatic.
It is clear from the 2011/12 fieldwork that the Bendokoro target is
gold-bearing and that mineralisation is associated with epithermal alteration
of preferential host rocks proximal to a regional shear zone. Drilling results
from the central section are encouraging but narrow widths and poor continuity
indicates low economic potential.
However, as the target area is "pregnant" with gold the potential exists along
shear extensions for more significant accumulations follow-field work has
therefore already commenced. This comprises detailed soil sampling to the
north and south of the main Bendokoro gold-in-soil geochemical anomaly and
outcrop, mapping and sampling focusing on the western fault zone and
associated silica alteration and sulphide mineralisation; a strike extent over
more than 1km. In addition, the Bendokoro model will be extended to similar
volcano-sedimentary terranes and structures elsewhere in the Northern Block
The Company took another large step forward in terms of corporate governance
with the appointment of Norman Ling as independent Non-Executive Director on
21 June 2012.
Mr Ling has held a series of appointments at the UK Foreign and Commonwealth
Office in a career spanning more than30 years. Mr Ling's last post was as
British Ambassador to Ethiopia, Djibouti and the African Union from 2008 to
2011, when he retired from government service.
The Board believes that the wealth of diplomatic and relevant regional
experience that Mr Ling brings with him, most recently in East Africa and
Ethiopia, should serve Nyota well in building on its good working relationship
with the Ethiopian government and in moving towards full-scale development of
the Tulu Kapi mine.
During the quarter the Company cancelled the following option series
previously issued to directors and senior management:
· 3,933,334 options exercisable at 42 cents on or before 31 December 2015,
· 3,933,332 options exercisable at 50 cents on or before 31 December 2015.
These options were cancelled for no consideration. There are no remaining
options on issue with the above terms and conditions.
The Company announced on 21 June that International Finance Corporation
("IFC") had subscribed for 21,727,650 new ordinary shares in the Company at 6
pence per ordinary share (the "Subscription").
The placing announced by Nyota on 3 February 2012 (the "Placing") was closed
prior to IFC completing their investment approval process. Approval was
received to undertake the Subscription on the same terms as those investors
that participated in the Placing, in accordance with the agreement signed and
announced at the time of IFC's original investment in Nyota.
Following the Subscription, IFC now hold 13.2% of the Company's issued share
Nyota had cash of A$14.4 at the 30^th June.
The high rate of spending during the quarter is directly attributable to the
work required for the DFS, and in particular the drilling of in-fill holes,
which because they are in-filling between existing holes can typically be
achieved more quickly than when drilling virgin areas, and the more careful
and costly work required for geotechnical and hydrological investigation
In-fill drilling and DFS work continued throughout July but the rate of cash
burn should fall thereafter and the general focus in Q3 is on completing
desktop studies and analysis and advancing the mining license application.
Health and Safety
Nyota recognizes that the health and safety of its personnel is fundamental to
the success of its operations. During the last quarter, with the pressure on
drilling activities at the Tulu Kapi project, several lost time injuries were
recorded. The Company is committed to learning from these incidents and
adapting operational methods appropriately. Nyota strives to continually
improve the health and safety of its personnel.
TO VIEW THE ASX APPENDIX 5B, PLEASE CLICK ON THE FOLLOWING WEB LINK:
For further information please visit: http://www.nyotaminerals.com or enquire
Richard Chase (CEO) / Anthony Rowland (Business Development)
Nyota Minerals Limited
+44 (0) 20 7400 5740
Richard Morrison / Jen Boorer
RFC Ambrian Limited
+44 (0)20 3440 6800
Ocean Equities Limited
(+44) (0) 20 7786 4370
Mirabaud Securities LLP
(+44) (0)20 7878 3360
Jos Simson / Emily Fenton
(+44) (0)20 7920 3150
The technical exploration and mining information contained in this
Announcement has been reviewed and approved by Mr D Hage Pr.Sci.Nat, Chief
Geologist for Nyota Minerals Limited. Mr Hage has sufficient experience which
is relevant to the style of mineralisation and type of deposit under
consideration and to the activity to which he is undertaking to qualify as a
Competent Person as defined in the 2004 Edition of the Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore Reserves and as a
qualified person under the AIM Note for Mining and Oil & Gas Companies, 2009.
Mr. Hage is an employee of Nyota Minerals Limited and is a Member of the South
African Council for Natural Scientific Professions (SACNASP). Mr Hage consents
to the inclusion in this Announcement of such information in the form and
context in which it appears.
This information is provided by RNS
The company news service from the London Stock Exchange
DRLWGURPMUPPGUG -0- Jul/31/2012 10:40 GMT
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