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Cobar Mining Seminar 2010

Rejuvenating Historical and Producing Operations

Organised by the Cobar Branch of The Australasian Institute of Mining & Metallurgy

Cobar Mining Seminar 2010

Rejuvenating Historical and Producing Operations

Friday 6th August 2010

Cobar Golf & Bowling Club, Cobar, New South Wales, Australia

Compliers: Berthelsen R.R, Wimberger M.G.

Published by AusIMM, Cobar Branch, August, 2010

Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

With thanks to all our sponsors:

AusIMM Cobar Branch

Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

Welcome

On behalf of the Cobar Branch of the AusIMM, we welcome you to the Outback New South Wales town of Cobar for the Cobar Mining Seminar 2010 which includes activities held from Thursday 5th August to Friday 6th August, 2010. Preseminar tours at three of Cobar's mines will help to orient and prepare you for some of the following days discussions. The seminar will feature speakers from various backgrounds, disciplines and areas from around Australia. Some will focus on the deposits in the Cobar and Western Region of New South Wales, while other will review mining and processing applications which help rejuvenate historical and producing operations. Whatever your discipline or project we hope there is something in this seminar useful to you and invite you to enjoy the facilities and hospitality of our friendly town. The committee appreciates the support from speakers, sponsors and delegates in make this event a success. The committee also wishes to thank management of Endeavor Mine, CSA Mine and Peak Mine for allowing mine and mill tours to be offered.

Organising Committee

Rex Berthelsen ­ Chairman and Convenor | Principal Geologist, New Gold Inc, Cobar Neil Schunke ­ Treasurer | Mine and Tech Services Superintendent, AGD Operations, Heathcote Tom Simpson ­ Secretary | Senior Mining Consultant, Black Star Mining, Cobar Peter Lloyd ­ General Manager, Peak Gold Mines, Cobar Manfred Wimberger ­ Geology Superintendant, Peak Gold Mines, Cobar Leonie Burford ­ Mine Geologist, Endeavor Mine, Cobar Roger Jackson ­ Non Executive Director, EDMSL, Brisbane

Cover photos :

Top ­ Great Cobar Heritage Park with old Chesney Headframe Bottom ­ Great Cobar Mine: Entrance to Cobar Photos courtesy of Peak Gold Mines & taken by Mark Ingram Photography AusIMM Cobar Branch

Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

Thursday 5th August 2010

8:00am to 4:00pm ­ Mine and Mill tours CSA, Endeavor and Peak Mines 4:30pm ­ Seminar Registrations 5:00pm to 7:00pm ­ Ice Breaker, Cobar Bowling and Golf Club Auditorium

Friday 6th August 2010

8:30am 8:40am 9:10am 9:35am 10:00am 10:25am 10:55am 11:20am 11:45am 12:10pm 12:35pm 1:35pm 2:00pm 2:25pm 2:50pm 3:15pm 3:40pm 4:05pm 4:30pm 4:55pm 6:30pm

Rex Berthelsen

Opening and Welcome

Keynote Address Revitalising Mining Operations: Making the Most of What You Have Craig Stegman Jason Hosken Barry Taylor Ken McQueen Morning Tea Phil Shields Phil Carrello Peter Ganza Gernot Loidl Lunch Ian Cooper Mehmet Yumlu Peter Lean Leo Dawson Afternoon tea Ross Garling Ben Murphy Peter Lines Closing Remarks Annual Dinner Operations Exploration Using Mine Scale Structural Definition, Cobar NSW including a CSA Mine Case Study The Perseverance Gold Copper deposit ­ A New Peak Gold Mines Challenge Geochemical Vectoring to Ore in the Cobar Bedrock and Regolith Detecting Extensions Session 2 Chaired by Peter Lloyd Brownfields Exploration at Girilambone Understanding the mineralised systems CSA Mine Observations Applied to the Development of Regional Exploration Models Redevelopment of Hillgrove The Elura Pb ­ Zn ­ Ag Deposit, Central NSW Ore characterisation and geometallurgy, preliminary results Session 3 Chaired by Rubens de Figueiredo Reviving Nymagee Pastefill becoming a feasible and popular option for ensuring recovery of high grade deposits. Underground Mobile Information System (UMIS) Benchmarking for Operational Improvement Session 4 Chaired by Tony Davis Hydraulic Mining ­ a proven and cost effective way to ReMine Tailings for Plant Feed, and Sustainable Relocation Mine Based Preconcentration to reduce transportation costs for small deposits Upgrading Older Equipment Upgrades designed to take advantage of modern processes in mineral processing Cobar Golf Club Auditorium ­ Dress: Neat Casual

AusIMM Cobar Branch

Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

ABSTRACTS INDEX

OPERATIONS EXPLORATION USING MINE SCALE STRUCTURAL DEFINITION, COBAR NSW INCLUDING A CSA MINE CASE STUDY. ....................................................................................... 1 THE PERSEVERANCE GOLD COPPER DEPOSIT ­ A NEW PEAK GOLD MINES CHALLENGE. ........ 3 GEOCHEMICAL VECTORING TO ORE IN THE COBAR BEDROCK AND REGOLITH: DETECTING EXTENSIONS ............................................................................................................................... 5 BROWNFIELDS EXPLORATION AT GIRILAMBONE: UNDERSTANDING THE MINERALISED SYSTEMS ..................................................................................................................................... 7 CSA MINE OBSERVATIONS APPLIED TO THE DEVELOPMENT OF REGIONAL EXPLORATION MODELS...................................................................................................................................... 9 REDEVELOPMENT OF HILLGROVE ............................................................................................ 12 THE ELURA PB ­ ZN ­ AG DEPOSIT, CENTRAL NSW, AUSTRALIA: ORE CHARACTERISATION AND GEOMETALLURGY, PRELIMINARY RESULTS ................................................................... 13 . REVIVING NYMAGEE ................................................................................................................ 15 PASTEFILL BECOMING A FEASIBLE AND POPULAR OPTION FOR ENSURING RECOVERY OF HIGH GRADE DEPOSITS. ........................................................................................................... 16 UNDERGROUND MOBILE INFORMATION SYSTEM (UMIS) ...................................................... 17 BENCHMARKING FOR OPERATIONAL IMPROVEMENT ............................................................ 18 HYDRAULIC MINING ­ A PROVEN AND COST EFFECTIVE WAY TO REMINE TAILINGS FOR PLANT FEED, AND SUSTAINABLE RELOCATION ....................................................................... 19 MINE BASED PRECONCENTRATION PRESENTATION .............................................................. 20 UPGRADING OLDER EQUIPMENT UPGRADES DESIGNED TO TAKE ADVANTAGE OF MODERN PROCESSES ............................................................................................................................... 21

AusIMM Cobar Branch

Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

OPERATIONS EXPLORATION USING MINE SCALE STRUCTURAL DEFINITION, COBAR NSW INCLUDING A CSA MINE CASE STUDY.

Jason Hosken, XSTRACT

Abstract The regional geology of the Cobar mineral field has been extensively researched and documented compared to localised deposit geology descriptions. The application of regional scale geological findings for mine scale exploration purposes is often difficult given mine workings typically occur inside the regional mineralisation `footprint'. In the operating mine environment, structural definition of the mineralised and unmineralised framework is important for exploration success. Limited structural definition and geological understanding on the mine scale can adversely impact upon discovery potential. Economic mineralisation from the Peak Mine in the south to the Endeavor Mine in the north is typically characterised by narrow and vertically continuous pipe like lenses with short strike lengths. Deposits are typically shear hosted within northsouth trending subvertical fault complexes. The amount and size of shears hosting mineralisation varies between deposits, however structural features defining individual lenses are similar for the majority of deposits. Mine scale structural definition of host shears and faults in addition to lens dilation characteristics is crucial for developing in mine exploration models. Historical and recent workings at the CSA Mine expose structures defining a mineralisation `footprint' containing four major mineralisation systems over a strike length of 1.2 km and to a depth of >2.0 km with over 30 mineralised lenses. The evolution of geological mapping at CSA from the 1960's to the present highlights improvements in geological understanding throughout the period. Structures defining shear hosted mineralisation at CSA are similar for all four systems. Mine workings between the four systems exposes structures defining the mineralised `footprint' for each system. The strike length of northsouth trending mine scale corridors hosting mineralisation at CSA are clearly defined within the bounding structures outlining the mineralisation `footprint'. Mineralised dilation zones share similar characteristics on all scales. Definition of the structural `footprint' and style of mineralisation is required for exploration targeting and also assists with effective mine design. This presentation defines typical structural relationships defining mineralisation in the Cobar area. In addition, recent exploration success at the CSA Mine is explained through the definition and interpretation of key geological structures recorded by both historical and recent underground mapping.

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Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

References CSA Mine geology mapping Unpublished Elliot, S M, Snowden, D V, Bywater, A, Standing, C A and Ryba, A, 2001. Reconciliation of the McKinnons Gold Deposit, Cobar, New South Wales, in Mineral Resource and Ore Reserve Estimation ­ The AusIMM Guide to Good Practice (Ed: A C Edwards), pp257268 (The Australasian Institute of Mining and Metallurgy: Melbourne). Glen, R A, 1987. Copper and gold deposits in deformed turbidites at Cobar, Australia: Their structural control and hydrothermal origin, Economic Geology, 82: 124140 Hosken J, Haren E, Winchester A, 2006. Resource Modelling in an Evolving Mine ­ CSA Mine, Cobar, New South Wales 6th International Mining Geology Conference Darwin, NT, August 2006), pp153 166 (The Australasian Institute of Mining and Metallurgy: Melbourne). Jeffrey, S I, 1994. A structural, geophysical, isotopic and geochemical appraisal of the CSA Deposit, Cobar, Australia. Implications for the Deformation of the Cobar Basin and Mineral Potential. (Masters Thesis, University of Tasmania) Lawrie, K C, Hinman, M C, 1998. Cobarstyle polymetallic AuCuAgPbZn deposits, AGSO Journal of Australian Geology and Geophysics, 17(4): 169187 Mc Dermott, J J, Smith, C K, Jeffrey S I, 1996. Geology of the CSA deposit, in The Cobar Mineral Field ­ A 1996 Perspective. (Eds: Cook et al.) pp 197213 (The Australian Institute of Mining and Metallurgy, Melbourne) Stegman, C.L, Pocock, J.A, 1996. The Cobar Gold Field ­ A Geological Perspective, in The Cobar Mineral Field ­ A 1996 Perspective. (Eds: Cook et al.) pp 229264 (The Australian Institute of Mining and Metallurgy, Melbourne)

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Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

THE PERSEVERANCE GOLD COPPER DEPOSIT ­ A NEW PEAK GOLD MINES CHALLENGE.

Barry Taylor, Peak Gold Mines, Newgold

Abstract The Perseverance deposit is the most southerly known economic copper/gold deposit within the Cobar Gold Field. The deposit is situated approximately 12km to the southsoutheast of Cobar at MGA 393725E: 6506540N. The deposit is essentially blind to surface with the top of economic mineralisation occurring 750m below ground level. Based on the December 2009 JORC compliant resource estimate (inclusive of reserves and nett of depletion) the deposit contains 2,760,000 tonnes @ 5.97g/t Au and 0.90% Cu (530,000oz of gold and 24,700 tonnes of copper). 190,000oz of gold and 15,000 tonnes of copper have been produced to date, principally from the Zone A section of the Perseverance lens. The deposit comprises 4 principal lenses, the Perseverance, Hulk, Zone B, and Hercules lenses. In excess of 90% of the known resource tonnes are contained within the Perseverance and Hulk lenses. The Perseverance lens remains open at depth and to the south. The deposit is shear related and hosted within mid to upper Devonian rocks of the Cobar Basin. The competency contrast of rhyolites juxtaposed against sediments by the PeakPerseverance Shear appears to be the principal control on mineralisation. Both the Perseverance and Hulk lenses are primarily hosted by brecciated rhyolite peripheral to the PeakPerseverance Shear which juxtapose rhyolites against Chesney Formation sediments across the shear. This faulted rhyolite sediment contact roughly defines the global orientation of the deposit. The Zone B and Hercules lenses, which are significantly less important in tonnage terms, are hosted by rhyolite breccias within the main body of the rhyolite and appear to be unrelated to the PeakPerseverance Shear. The Perseverance lens continues within the shear for up to several hundred metres beyond the extent of the faulted rhyolite sediment contact. Mineralisation within the shear beyond the faulted rhyolite contact zone is hosted by sheared silicified sediments. Brecciated rhyolite hosted chalcopyrite and pyrrhotite with accessory gold occur predominantly as crosscutting vein breccias and are the dominant and economically most significant mineralisation style within the deposit. Additional mineralisation styles include clast specific disseminated chalcopyrite and pyrrhotite and overprinting galenasphalerite veins and breccia fill mineralisation. Within the Perseverance lens the presence of northeast trending high grade breccia veins developed oblique to a northsouth trending shear system has led to the development of steeply north plunging high grade ore shoots within a globally northsouth trending mineralised domain. These high grade shoots have limited horizontal continuity but significant down plunge extent. The presence of coarse gold and the resulting strongly skewed nature of the gold grades, in conjunction with controls on mineralisation which are not parallel to the mineralised domain lead to predictive difficulties regarding stope performance. Zone D (the southern section of the Perseverance Lens) produced its first stope ore in August 2009 and is currently Peak's principal focus for development. Zone D will be Peak's main gold ore source Page | 3 AusIMM Cobar Branch

Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

in the short to medium term (1 to 5 years). Maximising the returns from the deposit will continue to require diligent underground mapping and sampling and closespaced delineation drilling. Ongoing challenges include optimising sampling to assist in grade control. Strong heterogeneity of the gold content of the ore and geological controls on mineralisation which are not parallel to the global trend of the mineralisation impose a set of difficulties which meaningful sampling and sound geological control should help overcome.

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Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

GEOCHEMICAL VECTORING TO ORE IN THE COBAR BEDROCK AND REGOLITH: DETECTING EXTENSIONS

K.G. McQueen, University of Canberra

Abstract

Ore systems in the Cobar Basin show a range of styles and geometries, but are commonly structurally controlled/modified lenses of sulphides, concentrated in steeply plunging pipelike clusters. Many have great depth extension, but a small horizontal footprint and they represent difficult exploration targets. Around known deposits, extensions or nearby lenses might easily be missed, particularly if they lack a strong geophysical signature. Geochemical dispersion halos around these deposits, and the vectoring potential they provide, reflect a combination of element patterns related to primary hydrothermal wallrock alteration (mostly of major elements) and the variable weathering overprint on the primary pattern and dispersion of ore elements following sulphide destruction. Observations and geochemical studies at Elura, CSA and New Cobar show that below the weathering front major element patterns related to visible and cryptic mineral alteration provide the largest target halo for exploration. Primary dispersion of the ore elements is more restricted. For example, at Elura (Endeavor Mine) cryptic wallrock alteration can be identified up to 300 m around the deposit below the weathering front using Pearce Element Ratio (PER) analysis and mineralogical modelling (GER). Visible alteration extends to between 5 and 70 m. Detectable primary dispersion of ore and pathfinder elements (Zn, Pb, Cu, As, Sb, Tl) is generally restricted to less than 70 m. At the CSA deposits alteration accompanying ore formation has produced cryptic depletion of Li up to 500 m around the Eastern System and less extensive depletion of Na, K, Sr and Ba. This geochemical pattern reflects pervasive Ferich chlorite development, destruction of feldspar and replacement of muscovite. Visible alteration in the form of strong silicification and quartzcarbonate veining is typically restricted to 20 m. Detectable enrichment in ore and pathfinder elements (e.g. Cu, Pb, Zn, Ag and As) is limited to less than 20 m from the ore lenses. Above the weathering front wall rock alteration patterns have been largely destroyed or dramatically reduced by intense chemical alteration related to the long and multistage weathering history of the Cobar terrain. Primary alteration involving enrichments in Si, Fe, Mn, and to some extent K are better preserved due to the weathering stability of some primary minerals, such as quartz and muscovite or the relative stability of secondary Fe and Mn oxides. Less stable alteration minerals such as carbonates and chlorites are lost, although some of their constituents (e.g. Fe and Mn) may be retained in the regolith. Within the regolith, ore and associated pathfinder elements provide the best dispersion halo or geochemical target. The geometries of these patterns are controlled by hydrologic factors and, in the case of outcropping deposits, by the degree of mechanical dispersion of lag derived from gossan or ferruginised saprolite. For example, at Elura subtle Zn and Cd anomalies are detectable up to 150 m from ore in ferruginous mottled saprolite. The dispersion of Pb and Ag is more limited and irregular. Mechanical dispersion of the exposed gossan has produced an elongate Pb anomaly (>50 ppm) extending more than 1,200 m along a Page | 5 AusIMM Cobar Branch

Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

shallow drainage feature with an associated Zn soil anomaly. At the CSA site, detectable Cu, Zn and As anomalies extend up to 100 m in saprolite around known lenses. Anomalous values of Ba and Sb extend up to 50 m, but elevated levels of Pb and Bi are typically restricted to less than 20 m. The near surface zone of the smaller New Cobar CuAu deposit shows an interesting pattern of ore and pathfinder element dispersion that is related partly to weathering of a primary dispersion pattern, with further but limited secondary hydromorphic dispersion. There is a distinctive Pb, Ag and Cu halo up to 25 m wide, related to the weathering of disseminated primary mineralisation around the main lode (i.e. in situ preservation of ore elements within a weathered primary halo). In addition, sub horizontal ferruginous veins with Pb values up to 700 ppm extend for 70 m away from the main lode. This represents the remnants of a primary leakage halo surrounding the deposit, in which the ore and surrounding alteration features are no longer evident but where the ore elements have been preserved in stable iron and manganese oxides. Secondary dispersion of these elements extends for a further 10 m. Within this broad multiorigin halo there is an inner halo of anomalous As, Bi, Se, W and Sn, closely surrounding the lode and reflecting varying levels of secondary dispersion. Gold has been strongly leached from the very upper part of the weathering profile but concentrated deeper in the gossan. While secondary dispersion of ore and pathfinder elements and related spatial zoning for elements with differing mobility provide the best geochemical vectors to ore in the regolith it is important recognise that patterns are also dependant on the level of deposit exposure and the extent and history of physical and chemical weathering. During geochemical exploration for Cobartype deposits the weathering front represents an important switch over point from using the dispersion pattern of ore and pathfinder elements in the regolith to using major element patterns related to wall rock alteration in the bedrock. Depending on the search depth and extent of weathering, different approaches are needed to detect the overall orefluid system and the position of contained ore lenses. This presentation will document the characteristic dispersion features of these two environments and also highlight two techniques for detecting cryptic alteration and using zoning within the alteration halo to vector to ore.

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Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

BROWNFIELDS EXPLORATION AT GIRILAMBONE: UNDERSTANDING THE MINERALISED SYSTEMS

Phil Shields and Phil Jones, Straits Resources Ltd

Abstract Exploration drilling, targeting sulphide deposits beneath the Murrawombie open cut, Tritton Deeps and Budgery copper oxide workings in central New South Wales, has successfully delineated new and additional copper resources occurring within large tabular pyritic sulphide sheets. At Tritton Deeps mineralisation has been intersected and remains open to a vertical depth of 1200 metres, Murrawombie Deeps to 700 metres and at Budgery to 350 metres. Reinterpretation of historical and more recent geological data, including relogging of drill core, allied with a focus on geochemical haloes has redefined the tabular mineralising systems. Mineralisation is hosted within highly siliceous and ankeritic hydrothermally altered metasediments which are underlain by magnesium chlorite rich and variable stringer sulphide veined alteration zones. Hanging wall ankerite alteration is strongly evident at Tritton but less so at Murrawombie. At Budgery there is a variable but strong magnetite chlorite carbonate alteration package within the hanging wall sequence. Doleritic intrusives within the hanging wall and footwall portions of the Tritton host sequence occur as bedding parallel dyke? swarms interdigitating with the metasediments whereas basaltic volcanics and volcaniclastics at Budgery and at Great Hermidale occur as synsedimentary lavas and reworked sequences. Other doleritic intrusives and volcanics? occur within the Murrawombie mine sequence as well as serpentinised ultramafic intrusives structurally emplaced into graphitic shear zones. Recently defined narrow polymict soft sediment breccias within the overlying host metasediment sequence contain abundant fine grained lithic debris as well as minor mafic, rare massive sulphide and trace ultramafic clasts within a coarse grained quartz rich psammitic matrix. Some psammites and a black psammopelite unit appear to be good local mappable stratigraphic horizons. The three deposits appear to have been formed synchronous with sedimentation in the form of tabular and steeply south east plunging bodies that have been subjected to considerable deformation and consequent remobilisation of sulphides. The mineralisation is both massive or banded pyrite and chalcopyrite with minor sphalerite, bornite, tetrahedrite and galena. The sulphidic mineralisation defined to date is compatible with that currently being processed at Straits Resources Limited ("SRL") owned Tritton Copper Mine process plant located 26 kilometres south west of Girilambone. The Tritton Copper Mine, which was commissioned in late 2004, currently produces approximately 96,000 tonnes of copper concentrate per year containing 24,000 tonnes of copper. The majority of the ore being processed comes from Tritton with an increasing proportion coming from the recently reopened North East orebody. A recent review of the Murrawombie interpretation has culminated in a significant increase in contained copper and resulted in a new resource of 5.89Mt tonnes @ 1.6% Cu and 0.3g/t Au (0.8% Cu cutoff) being defined. A small open pittable resource of 2.02Mt @ 1.1%Cu (0.3% Cu cutoff) has been defined at Budgery to a depth of 200 metres with transition and primary sulphides defined within a larger pyritic tabular sheet. Exploration is continuing to assess

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Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

the down dip and possible underground sulphide potential. Permitting for this deposit is progressing. Resource definition drilling is continuing on the Murrawombie Deeps, Tritton Deeps and Budgery deposits located from Hermidale in the south to Girilambone in the north. The similarities in geology, alteration, deformation and metallurgy (compatibility with the Tritton Mill) between the deposits bodes well for the addition of deeper resources at North East and Larsens and possibly at other under explored prospects such as Double Tanks and Avoca Tank.

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Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

CSA MINE OBSERVATIONS APPLIED TO THE DEVELOPMENT OF REGIONAL EXPLORATION MODELS

Phil Carrello, CSA

Abstract CSA Mine is situated 10 kilometres north of Cobar in central New South Wales. It is operated by Cobar Management Pty Ltd (CMPL), a wholly owned Australian subsidiary of Glencore International AG (Switzerland). Since being discovered in 1871, CSA mine has produced in excess of 800,000 tonnes of copper metal. The mine started in 1871 and operated with an erratic production history until 1964 when Broken Hill South Ltd began large scale production. The mine passed to CRA in 1980 and then to Golden Shamrock Mines in 1992. The mine was closed in 1997/8 following its acquisition by Ashanti Goldfields and was reopened in 1999 by Glencore. The current mining rate at CSA is 950,000 tonnes per annum at an average grade greater than 5% copper and 30ppm silver. Exploration from 1999 to the present has mostly focused on exploring for additional underground resources at the CSA Mine with various periods of detailed surface exploration on CMPL regional leases. Recent exploration efforts have concentrated on using observations from CSA to develop regional exploration models. Observations relating to the geometry, structure, geology, geochemistry, alteration and geophysics at CSA have been used to develop some of the regional exploration targets. Geometrical features of the CSA deposits which can be applied to exploration include the short strike length but large plunge extent of ore bodies which vary in width from about 3 to 30 metres. In terms of vertical extent, some lenses can be traced for over 1 kilometre. For instance, the Western system of ore lenses extends from the surface to about 1 kilometre below the surface and the K lens situated within the QTS North lens system extends from approximately 600 metres to 2 kilometres below surface. Structural features on a mine scale will not be dealt with in great detail however on a semiregional scale several observations pertaining to regional exploration models may be significant. Such features include the relationship between regional north striking stratigraphy and the apparent although to some extent poorly defined northerly striking regional structures, areas of ductile deformation interspersed with local zones of brittle failure and stratigraphic thickening. These features are interpreted to be major indicators of strong mineralisation at the CSA Mine scale. The exact location of the regional northerly trending structures is to some extent uncertain and is reliant on interpretation of aeromagnetics, previous geological mapping and surface geochemistry. Underground geological mapping and local surface mapping within the CSA Mine environs has also identified the importance of local intersection of structures as a major control of mineralisation. Underground mapping has also identified a distinctive morphology for ore lenses. Mineralisation zones grade from barren material to zones of chalcopyrite and quartz sulphide veins and/or disseminated chalcopyrite to massive to semimassive sulphide to chalcopyrite and quartz sulphide veins and/or disseminated chalcopyrite to barren material. Some of the lens systems exhibit this complete ore type morphology such as the QTS North series of lenses while others such as the Western and Eastern system of lenses may contain only part of this morphology gradation. Page | 9 AusIMM Cobar Branch

Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

Another important geological feature is the appearance and differences in the surface expression of CSA ore bodies within CML5. For the Western system of lenses, the lenses are expressed at the surface as gossanous materials whereas at the surface of the QTS North lens system, the ore lenses are expressed as buck and barren quartz veins with some local shearing and fracturing with some associated ferruginous staining of country rock. Understanding of the regolith and the weathering profile is perhaps an area where considerably more work could be undertaken in order to assist in the development of regional exploration models and although there is some information available above the Western System little is known above the QTS North and QTS South ore lenses. Surface sampling media such as soils has primarily been used to identify prospective trends. Bedrock geochemical sampling using auger and percussion drilling has also been extensively practiced. Other selective bedrock programs have also been used historically to identify the characteristics of the CSA primary mineralisation. These selective programs can be summarised as a means to analyse depletion haloes of for instance alkali and alkaliearth elements and also to define the narrow enhancement haloes in the vicinity of the underground ore bodies. Use of pathfinder element geochemistry is perhaps one of the major regional geochemical techniques that CMPL has used recently in regional exploration programs with some success. Surface and bedrock geochemical techniques have been particularly successful in identifying prospective trends and in identifying CSA style pathfinder geochemical trends in primary mineralisation. Analysis of surface geochemical trends has identified that mineralisation appears to be related to elevated Cu, Pb, Zn and Ag and also anomalous levels of Sb, W, As, Au, Se, Cd, Hg and Bi. Elemental distribution within and surrounding primary copper mineralisation both within the CSA underground mined ore lenses is characterised by enhanced Ag, Au, As, Sb, Hg, Se, Cd, Hg and Bi within mineralisation but becomes less abundant in these elements in the barren country rock. Other important geochemical features which are used as regional exploration tools include the metal zonation which is observed in the Western system of lenses within CSA Mine where lenses range from lead and zinc rich near surface and grade to copper rich ore bodies at depth. In contrast, above the QTS North and QTS South ore bodies, lead and zinc rich mineralisation is absent and copper ore bodies begin approximately 600 metres below the surface. This observation indicates that surface copper anomalism can not be used necessarily as a "footprint" for subsurface mineralisation which increases the difficulty in developing regional exploration models. Because of the different surface geochemical expression of ore lenses above the CSA mine ore bodies, it is critical that multielement geochemical trends with or without copper anomalism be evaluated with drilling. Alteration is also an important feature in the CSA mine where two main observations have been noted. Firstly, strong mineralisation is associated with black, magnesium rich chlorite alteration with green, iron rich chloritisation also prominent but situated in more distal positions with respect to mineralisation Secondly, silica is an important but not consistently present alteration component of the ore lenses. Magnetite alteration also appears to be an important alteration component in places but is at this stage not understood. There appears to be prominent alteration haloes in and around the CSA Mine lenses signified by trends in trace element geochemistry and/or major element geochemistry. Regional surface trace and major element geochemistry trends have been used to define broad alteration trends and to define major structures. This technique has been used north of the CSA Mine to define the Myrt Page | 10 AusIMM Cobar Branch

Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

Fault using, for instance, antimony anomalism. Threshold data for the trace element geochemistry must be evaluated before using regional trace element geochemistry trends to define alteration haloes,. A technique not used as yet on CMPL tenure but used elsewhere in the Cobar district with some apparent success is PIMA technology to define regional alteration trends. Geophysics is an important exploration tool that has been used in the CSA Mine environs where coincident conductive and magnetic ore bodies have been defined. The ore bodies also have a high specific gravity and hence gravity surveying could also be useful in developing regional exploration models. Gravity surveying was critical in the discovery of QTS North and QTS South mineralisation. This has been shown at Shuttleton project where gravity surveying has defined a prominent anomaly within the project area. Surface electromagnetic surveying, although not used recently in the CSA Mine area, has defined several anomalies both within the CSA Mine tenement and elsewhere such as at the Shuttleton project. Down hole EM surveying is routinely employed on CMPL surface exploration diamond drill holes, detecting several anomalies relating to in hole and off hole conductors. Of considerable interest in the CSA Mine area has been the use of MIMDAS surveys which support the interpreted extension of mineralisation directly north of the QTS North ore lenses. This technique was employed in an attempt to detect relatively deep mineralisation. The Shuttleton Project is the best understood of the CMPL regional projects. `CSA like' features at Shuttleton include the lenticular nature and extent of mineralisation as evidenced in CMPL drilling programs and historic mining records and the geochemical signature both within and surrounding primary mineralisation. The host rock sequence at Shuttleton is similar to that encountered at CSA Mine. Interbedded siltstone and sandstone is prevalent with stratigraphy striking broadly northsouth. Sandstone beds are generally thicker at Shuttleton and act as a focus for brittle failure with the chloritic siltstone locally having undergone ductile deformation. Mineralisation at Shuttleton is similar to mineralisation in the Western and Eastern systems at CSA. Surface disturbance due to historic mining activities has precluded the observation of surface gossanous material at Shuttleton, however significant goethitic and haematitic material was noted near surface within drilling completed in 2007. Geophysics has been used less recently at Shuttleton but historic gravity surveying defined a large gravity "high" that coincides with a significant aeromagnetic "high". Downhole EM surveying of holes drilled in 2007 identified an offhole conductor which appears equivalent to copper mineralisation. A combination of geological, geophysical and geochemical observations made in the CSA Mine ore lenses and in the environs of the CSA Mine have been used to develop regional exploration models north of the CSA Mine and within the Restdown, Mt Hope and Shuttleton projects.

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Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

REDEVELOPMENT OF HILLGROVE

Peter Ganza, Hillgrove Mine, Straits Resources

Abstract

The Hillgrove Mine was redeveloped in late 2006 with the objective of delivering antimony, gold and scheelite ore from a modern, productive underground mine to a newly constructed mill. The mine, located on the New England plateau of New South Wales, is rich in narrow vein underground mining history and is contained in an environmentally sensitive and topographically challenging area. The Hillgrove area boasts approximately 200 lodes that have been mined at some time by numerous operators during the areas' one hundred and thirty year history. Each of these mines was predominantly worked by hand held methods, relying on rail haulage within the mine and ultimately a hoisting system to the operator's mill. Tonnages from these mines were small but high grade and when combined with fluctuating antimony prices and rising costs, it resulted in a chequered start stop history for the field. The goal was to redevelop the mine into a modern diesel trackless mining operation capable of delivering a target 250kt pa of ore from the underground mine to the mill. To achieve this, numerous aspects had to be considered, including the mining method to sustain production, equipment selection, recruitment and the establishment of infrastructure that could support the future plans for the mine.

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Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

THE ELURA PB ­ ZN ­ AG DEPOSIT, CENTRAL NSW, AUSTRALIA: ORE CHARACTERISATION AND GEOMETALLURGY, PRELIMINARY RESULTS

Gernot C. Loidl1, Ian R. Plimer1, Oskar A.R. Thalhammer1,2

1School of Earth and Environmental Sciences, Department of Geology and Geophysics, University of Adelaide,

Australia 2Department of Applied Geosciences and Geophysics, University of Leoben, Austria

Abstract The Ellura leadzincsilver deposit, with an estimated total premined resource of 45Mt at 8.5% Zn, 5.3% Pb and 69g/t Ag, is located in central NSW, approximately 800km west of Sydney, Australia. The orebody is of epigenetic nature, sedimenthosted and strongly structural controlled. The host rock is a turbiditic sequence, characterised by interbedded sand, mud and siltstone layers, characterised by variance of frequency and thickness of the sandstone layers. The changing quantities of sandstone affected brittle ­ ductile fracture behaviour, and subsequently the permeability. Approx. 70% of the entire orebody is located within a sandstoneenriched CSA Siltstone sequence. Therefore, the mineralisation is at least to some extent lithologically controlled. The mineralisation is of an overall sheetlike geometry, with several subvertical massive sulphide pipes which are surrounded by a halo of breccia ­ stringer type mineralisation. Those massive sulphide pipes show a concentric framework with predominant pyrrhotite in the core and almost exclusively pyrite in the rim areas. It formed in zones of increased dilation within a NNWtrending, transpressional fault corridor. Sulphides comprise sphalerite, galena, pyrrhotite, pyrite, chalcopyrite, arsenopyrite and argentian tetrahedrite, quartz, siderite, subordinate calcite and ankerite, with varying quantities of sericite and chlorite as the major gangue minerals. The first mining activities commenced in 1983. The deposit, now known as Endeavor, is currently exploited by CBH Resources Ltd. Despite (a) the long and continues mining history, (b) the frequent and significant fluctuations of Zn and Pb ore to concentrate metal recovery rates, and (c) elevated Bi concentration in the lead concentrate, only few studies on ore characteristics have been undertaken since the existence of the Elura Mine. In order to increase the knowledge and the understanding about geometallurgical characteristics, a detailed multidisciplinary study covering mineralogy, mineral chemistry, ore textures and trace element distributions, in particular those of smelter penalty elements e.g. Bi, has been undertaken as part of a PhD project. Trace elements were analysed by ALS (Australia), electron microprobe analyses (EMP) were conducted on a JEOL Superprobe JXA 8200 at the University of Leoben (Austria), particle mineral analyses and field scans were conducted on a QEMSCAN® E430 by AMDEL Laboratories (Adelaide). Trace elements on whole rock samples revealed several significant concentration trends as a function of depth within the orebody. Bi, Co, Se, Te and In show a pronounced concentration increase within the deeper parts of the orebody with values up to 714ppm, 288ppm, 45ppm, 1.88ppm and 3.21ppm, respectively. The analyses for Cd resulted in a maximum value of 444ppm, and is supporting the downwards trend. The elements Bi, Co and Ga occur at rather constant and low values in the lower uppermost part to the mineralisation, however, show enrichment at depth. The observed increases in their median values are by over 130 times for Bi, 6 times for Co and by 1.4 times for Ga. A converse trend has been observed for Sb, Hg and Tl, which reach maxima in the uppermost regions of the orebody. The observed maximum values are over 2000ppm for Sb and 66ppm for Hg. Arsenic concentration is quite variable throughout the entire mineralisation; Page | 13 AusIMM Cobar Branch

Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

nevertheless, an overall weak enrichment trend towards the upper parts of the orebody is noticeable. Concentrations between 10ppm and 1.5wt% have been observed. Elements such as Se, In, Cd, Co and Cu feature a weak but nevertheless verifiable affinity to pyrrhotitic ore types in the core zones of the massive sulphide pipes. Thallium is characterised by a clear preference towards the pyritic ore type. EMP analyses of galena showed elevated Bi concentrations with maximum values between 0.1 and 0.7wt%. Element mapping suggests that Bi is occurring in solidsolution rather than as discrete Bi mineral phases intergrown with galena. Elevated Hg concentrations are observed in pyrite, pyrrhotite, sphalerite and chalcopyrite. The increase of Sb corresponds with the occurrence of argentian tetrahedrite in the uppermost zones of the orebody. The investigation of sphalerite composition revealed a pronounced enrichment trend of Cd with increasing depth which is in accordance with the whole rock geochemistry. The compositional variation of Fe in sphalerite showed: (a) a strong correlation of Ferich Sph to pyrrhotitic and Fepoor Sph to pyritic ore in the upper areas of the orebody with mean values of 7.4 and 3.2wt%, respectively; (b) a preferred occurrence of Ferich Sph within the lower parts, accompanied by an absent correlation to neither of the ore types. QEMSCANTM analyses are being processed by the author; preliminary results will be presented at the conference. Particle mineral analysis on particle separates mounted on polished blocks were undertaken in order to investigate mineral liberation, mineral associations and mineral specific surface exposure for all major sulphide phases. Field scans on polished thinsections were used to study textural ore characteristics such as grain size distributions, intergrowths, inclusions and exsolutions. Both data sets will also help to identify host mineral phases for smelter penalty elements not identified in the course of microscopic and EMP investigations. The authors acknowledge the support of AMDEL laboratories, FEI Company and CBH Resources Ltd.

Page | 14 AusIMM Cobar Branch

Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

REVIVING NYMAGEE

Ian Cooper, YTC Resources Ltd

Abstract

The Nymagee mineral field is located 80km to the south east of Cobar. Historic production is dominated by the Nymagee Copper Mine which mined 422000t @ 5.8% Cu. Exploration by numerous companies during the 1970's to 1990's outlined multiple anomalous areas with some ore grade intersections. A detailed review of previous work accompanied by soil geochemistry, IP and down hole EM led to discovery of the Hera Deposit in 2001 by Pasminco. Triako Resources acquired the Hera Deposit from Pasminco in late 2003 and started a major evaluation programme and feasibility studies with a focus on the gold potential of the project. This resulted in a resource of 1.79Mt @ 6.7g/t Au, 14g/t Ag, 0.2% Cu, 2.5% Pb, 2.8% Zn. In late 2006 Triako Resources was acquired by CBH Resources who focused on the Hera Deposit as a base metal resource to match their existing operations resulting in a resource of 3.30Mt @ 2.67g/t Au, 15g/t Ag, 2.7% Pb, 3.4% Zn. In late 2009 YTC Resources purchased the Hera Deposit and surrounding tenements from CBH Resources and has commenced a definitive feasibility study with gold being the main commodity being sought. The Nymagee area is in a similar setting to the Cobar Gold Field. The area lies to the immediate west of the regional Rookery Fault. Mineralisation in the broader Cobar Basin is hosted in Devonian siltstones and sandstones with little or no volcanic present. Mineralisation tends to be short strike length with great vertical extent. There are distinct Pb+Zn±Au and Cu lenses. Alteration is dominated by silicification and chloritisation. Mineralisation is structurally controlled, epigenetic and is syn to post deformation and regional metamorphism. Whilst matching the general features above the Hera Deposit and nearby Hebe Prospect have some additional features such as longer strike extents contained in brittle fault zones; nonmagnetic pyrrhotite and cubanite indicating formation temperatures over 350°C; skarn mineralogy such as scheelite, apatite, garnet, zoisite, and tremolite and mineralogy suggesting a possible magmatic input such as fluorite and Kfeldspar. Exploration for further deposits in the area has been greatly assisted by thorough review of previous work over the past 45 years. Key features of the exploration noted to date include: A strong positive gravity response related to the significant volume of disseminated pyrrhotite surrounding mineralisation as part of the alteration system. The equivocal nature of magnetic data with both magnetic and non magnetic mineralisation present. The use of down hole EM with mixed results. Pb, As and Sb found to be good pathfinder elements in surficial geochemistry.

Page | 15 AusIMM Cobar Branch

Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

PASTEFILL BECOMING A FEASIBLE AND POPULAR OPTION FOR ENSURING RECOVERY OF HIGH GRADE DEPOSITS.

Mehmet Yumlu, AMC Consultants

Abstract The upward demand cycle for minerals and metals seems to have returned. Difficult projects are being reconsidered and existing operations are reviewing their mining methods. Typically the projects involve the potential recovery of selective ore blocks with high contained metal values and often in problematic ground conditions. The existing operations are getting deeper and often have pillars to recover. Mining methods that rely on cemented paste fill have been traditionally viewed as "high cost" and "methods of last resort". However, as the true value of the mineral assets are recognised, paste fill plants are rapidly becoming the preferred system for mine backfill applications where high ore recovery is fundamental to project success. This presentation will provide a review of some recent trends in the implementation of paste backfill in a variety of underground mining situations.

Page | 16 AusIMM Cobar Branch

Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

UNDERGROUND MOBILE INFORMATION SYSTEM (UMIS)

Peter Lean, Perilya Broken Hill Ltd

Abstract

An investigation into real time information delivery underground highlighted the requirement for a more efficient way to communicate between surface departments and the underground shift supervisors. Critical information relevant to operations on that particular shift needed to be passed on to allow shift supervisors to make quality decisions about resources, priority tasks and safety related issues. For this information to be made available, a customised computer application has been developed for use on Tablet PC's, with information being updated using a network of wireless "hotspots" throughout the mine. The application allowed information such as mine plans, survey memo's, risk assessments, void assessments, ventilation plans and personnel training records to be made available to shift supervisors on the job, with the confidence that they had access to the most upto date information. The project successfully identified and addressed the critical issues with information currency and accuracy, and provided a robust solution that effectively manages the problem. The solution minimised the time taken to locate critical information and maximised the productivity and efficiency of the shift supervisors.

Page | 17 AusIMM Cobar Branch

Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

BENCHMARKING FOR OPERATIONAL IMPROVEMENT

Leo Dawson, AMC Consultants

Abstract

The operation of mature mines often involves a continued focus on the reduction of controllable costs and striving for improvements to production performance. Benchmarking is one technique available to assist miners to achieve these goals. Benchmarking can be defined as the practice of measuring an operation's performance and practices in key areas and comparing them with other operations to find ways of achieving better results. Benchmarking leads to operational improvement through a process of measurement, comparative analysis, identification of performance gaps, and the development and implementation of solutions. However, when comparing performance it is vital to remember that the mining operations are not in the business of simply moving rock more cheaply than their peers, they are there to generate the best possible return from their operation that meets with their overall business objectives. This presentation reviews the application of benchmarking and the results of selected case studies that have been used effectively to identify performance gaps and target and prioritise improvement opportunities at a number of Australian operations.

Page | 18 AusIMM Cobar Branch

Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

HYDRAULIC MINING ­ A PROVEN AND COST EFFECTIVE WAY TO REMINE TAILINGS FOR PLANT FEED, AND SUSTAINABLE RELOCATION

RW Garling and D Prentice, Hydraulic Mining Solutions

Abstract Hydraulic Mining has been a recognised method for mining alluvial and tailings deposits for well over a hundred years. Indeed there are many relics around the old tin and gold mining areas in say Tasmania, and the Palmer River in Queensland, and many other locations in Australia and overseas. However over the last 50 years Fraser Alexander have been refining their hydraulic mining techniques on the gold tailings dumps around Johannesburg, and elsewhere around the world, drawing on some of the latest technology from the china clay mining in the United Kingdom. The hydraulic mining of old was low pressure (approx 10bar), relatively fixed in location, and requiring large infrastructure to supply the large volumes of water necessary. Today's hydraulic mining differs markedly in that it utilises: The paper will describe the above factors and draw on the many examples of projects undertaken in Australia, South Africa and elsewhere around the world. Much higher pressures, typically in the order of 30 bar, but variable to suit the conditions Concentrates the pressure into a high impact area to create a dense slurry Creates consistently high densities ­ 5060% solids in gold & copper tailings Is mounted on remote controlled track mounted units Utilise flexible supply hoses and are thus quite manoeuvrable Due to the high densities the water requirement is lower and generally recyclable Allow good visual control to mine cleanly and protect infrastructure Being a wet process dust is not generated As the only water is between the monitor and slurry pump the evaporation losses are minimised. Can be very low cost depending on the volumes moved ­ each unit can produce up to 500 tph The high intensity jetting provides a consistent fine slurry to the mill for reprocessing with no clay balls.

Page | 19 AusIMM Cobar Branch

Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

MINE BASED PRECONCENTRATION PRESENTATION

Ben Murphy, Gekko Systems

Abstract Despite advances in mobile fleet efficiency and materials handling technology in recent years, the cost of transporting ore from the mine to the processing plant is still a significant operating cost in most mining operations. If the volume of the ore needing to be transported can be reduced this could lead to a smaller mobile fleet, reduced materials handling and less stockpiling adding up to significant capital and operating cost savings. Along with these potential cost savings, employing mine based preconcentration using fine crushing and gravity separation also has a number of environmental and permitting advantages that may make mining smaller deposits viable. Mine based preconcentration can break a number of mining industry paradigms and deliver step change improvements.

Page | 20 AusIMM Cobar Branch

Cobar Mining Seminar 2010 ­ Rejuvenating Historical and Producing Operations

UPGRADING OLDER EQUIPMENT UPGRADES DESIGNED TO TAKE ADVANTAGE OF MODERN PROCESSES

Peter Lines, FLSmidth Minerals

Abstract There is a significant equipment data base globally still in operation, that was supplied before 1970. A lot of that equipment was designed to operate under totally different economic assumptions compared to those that are in place today as well as the design being tailored to suit the operating philosophies prevailing at the time of purchase. The advances in Processing technologies, availability, cost and performance of ancillary additives, and advances in Mechanical Engineering device designs, have resulted in a number of component retrofits which are available for installation onto the old equipment significantly improving that equipment capacity, performance, efficiency and reliability. A selection of examples in Sedimentation, Flotation and Filtration applications are provided in the body of the paper to illustrate the technologies available today to upgrade older equipment to provide 20th Century performance.

Page | 21 AusIMM Cobar Branch

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