Afferro Mining Inc. - Clarification of Technical Disclosure
/NOT FOR DISTRIBUTION IN THE UNITED STATES OR FOR DISSEMINATION TO US NEWS WIRE SERVICES./
LONDON, Sept. 30, 2013 /CNW/ - The board of directors of Afferro Mining Inc. ("Afferro" or the "Company") announces that as a result of a review by the British Columbia Securities Commission ("BCSC"), the Company is issuing the following news release to clarify its disclosure.
After consultation, the Company has already taken the necessary action and addressed all aspects to the satisfaction of the BCSC. The Company is now compliant on all aspects as per the following detail.
The review undertaken by the BCSC identified the following main technical disclosure issues:
Failure to file a NI 43-101 technical report for Nkout
- The news release disclosure about a preliminary economic assessment ("PEA") subsequent to the filing of the technical report dated 29 June 2012 and, following this, the technical report dated 28 May 2013 with respect to the Nkout iron ore project ("Nkout"), triggered a requirement to file a technical report supporting going-forward disclosure of a PEA. To address this issue, the technical report dated 28 May 2013 has been revised to include a summary of the PEA as reported in the technical report dated 28 May 2012, which is based on the mineral resource estimate with an effective date of 15 November 2011 (the "Amended Technical Report"), and has been filed on SEDAR.
Failure to file a NI 43-101 compliant technical report for Nkout
- The technical reports dated 29 June 2012 and 28 May 2013 are not compliant with NI 43-101 for the following reasons: They
- do not support going-forward disclosure of a PEA, as discussed above
- contain estimates for potential exploration targets with respect to which a grade range is not provided and a cut-off grade is applied; in addition, it is implied that the quantities are potentially economic, which is inappropriate for a conceptual estimate
- contain certain limits to the scope for their preparation and disclaimers that are not compliant with NI 43-101
These issues have been addressed in the Amended Technical Report filed on 30 September 2013.
Failure to use appropriate cautionary language when referring to the PEA
- Since the publication of its PEA in May 2012, the Company has frequently referred to it in its news releases, omitting to use the required or correct cautionary language in accordance with section 2.3(3) of NI 43-101.
- The Company wishes to clarify that it acknowledges that the PEA is preliminary in nature as it includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorised as mineral reserves. There is no certainty that the PEA will be realised and the statement made that Nkout is economically viable is premature and misleading before a mining study has qualified an initial mineral reserve estimate. In addition the Company retracts statements indicating that an expanded resource estimate would have a positive effect on the PEA and project valuation. In particular the Company retracts statements regarding the enhancement of the PEA in the releases dated 4 July 2012 and 4 February 2013. In the 4 July 2012 release, the Company explained how an expanded resource estimate of higher confidence affected the Company's PEA, extending the projected mine life and enhancing the project economics. In the 4 February 2013 release, the Company stated that there was the potential for significant capex and opex improvements to the PEA, with significant upside to the economics enabling an early phase of production.
Non-compliant disclosure of potential exploration targets and increased indicated resource
- In its news release dated 30 May 2013, Afferro reports that an additional resource potential of 500 to 1,000 million tonnes ("Mt") of iron has been identified. Afferro acknowledges that the use of "resource potential" and "potentially economic" in the news release was contrary to the conceptual nature of an exploration target, which requires further exploration; Afferro further acknowledges that it should have provided the required range of grade and used appropriate cautionary language as required by NI 43-101 for all disclosure of exploration targets. Afferro wishes to clarify that, through extrapolation of drilling information 200m below the base of the pit, it is estimated that there exists an exploration target of 500Mt to 1000Mt of mineralisation with a grade of between 29% and 35% iron; it should be noted, however, that the potential quantity and grade are conceptual in nature, that there has been insufficient exploration to define a mineral resource and that it is uncertain if further exploration will result in the target being delineated as a mineral resource.
- The news releases dated 30 May 2013 and 13 June 2013 contain an indicated resource estimate forecast which is not compliant with NI 43-101 for the following reasons:
- the disclosed "indicated resource" target tonnage of DSO/saprolite significantly exceeded the available DSO/saprolite indicated resource estimate, and the indicated BIF target tonnage was also larger
- the use of the classification "indicated resource" for additional tonnes is premature and can be misleading
- appropriate grade information was not provided
- Afferro wishes to clarify that Nkout has an indicated mineral resource estimate of 1.6 billion tonnes ("Bt") at 33.3% iron and an inferred mineral resource estimate of 0.9 Bt at 30.8% iron, and that a drilling programme is currently underway to further convert and upgrade the inferred classified material to the indicated category
- Due to the uncertainty of inferred mineral resources, it should not be assumed that their upgrading to indicated class will always occur and the Company is formally retracting the prior disclosure of quantities of a larger targeted indicated resource
Howard Baker (MAusIMM(CP)) has 19 years' experience in the mining industry and 11 years' experience in the exploration, definition and mining of iron ore mineral resources. Mr Baker is a full-time employee of SRK Consulting (UK) Ltd., an independent consultancy, and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration, and to the type of activity which he is undertaking to qualify as a Qualified Person in accordance with NI 43-101 and a Competent Person as defined in the June 2009 Edition of the AIM Note for Mining and Oil & Gas Companies. Howard Baker consents to the inclusion in the announcement of the matters based on his information in the form and context in which it appears and confirms that this information is accurate and not false or misleading.
Dr David Pattinson CEng, MIMMM, has over 31 years' experience in metallurgical and process plant design. Dr Pattinson, a Principal Process Engineer with SRK is a Qualified Person (QP) as defined by the Canadian Institute of Mining, Metallurgy and Petroleum (CIM) and outlined in National Instrument 43-101 of the Canadian Securities Administrators (NI 43-101). David Pattinson consents to the inclusion in the announcement of the matters based on their information in the form and context in which it appears and confirms that this information is accurate and not false or misleading. Dr Pattinson was responsible for the review of the metallurgical testwork reviewed for the 2012 PEA.
Paul Groves, CEng MIMMM, has 24 years international experience. Mr. Groves is a full-time employee of Atkins and is a Director of Ground Engineering. Mr. Groves has wide experience of land development, major infrastructure and underground works related to civil and mining works. Mr. Groves consents to the inclusion in the announcement of the matters based on his information in the form and context in which it appears and confirms that this information is accurate and not false or misleading.
Julia Martin, P.Eng, MAusIMM (CP) has 19 years of experience in the mining industry. Ms Martin is a full-time employee with AMC Mining Consultants (Canada) Ltd. and is independent of Afferro. Ms. Martin has sufficient experience relevant to the style of mineralization and type of deposit under consideration and to the activity she is undertaking to qualify as a "Qualified Person" under National Instrument 43-101 Standards of Disclosure for Mineral Projects. Ms. Martin consents to the inclusion in the announcement of the matters based on her information in the form and context in which it appears and confirms that this information is accurate and not false or misleading.
SOURCE Afferro Mining Inc.For further information:
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