Report on Property

Possible gold content and value in ExPL7/94

Geologist, Alieu Mahdi (BSc,MSc), of GeoResources (SL) Ltd. was commissioned to prepare a report on the estimate of gravels and gold values. within the Pampana River and its flanking flats and terraces. Below are the estimated figures.

1. Previous work:

The report on the work done by the now defunct National Diamond Mining Company (SL) Ltd. (NDMC), over the period June 1985 – June 1990 in its Pampana North Special Exclusive Prospecting Licences No. 2136 (Report 1) and that dated December 1993 produced by Consultant Mining Engineer Michael Manke for and on behalf of Kholifa Mining Venture based on work done between mid October to mid November 1993 by Messrs. Herber Hendricks and Michael Manke ((Report II) are the only recent professional discourse on which a meaningful estimate of the possible volume and grade of the auriferous gravels in the Pampana Channel. Its flanking flats, and terraces which can be mined with profit or with the hope of profit, can be based.

2. Possible grade of auriferous gravels:

The report by Manke uses a grade of 0.12 ounces per cubic yard in computing the possible gold content of the auriferous gravels within the Rosint Development property. Grades of this order are certainly achievable as is evidenced by the grade of 2.988gm/yd³ (0.0960ozs/yd³) produced by illicitly won bottom gravels from the Makotha Meander. Page 5 of Report I speaks of the inherent inefficiency of the Denver Gold Saver especially with respect to fine gold used in the processing of auriferous gravels to produce gold bearing concentrate. Similarly, the efficiency of the Humphrey’s Gold Miser utilized in the production of auriferous concentrate by Messrs. Manke and Hendricks is questionable.

(Pg. 3 of Report I)

In light of the foregoing the gold grades obtained by NDMC (SL) Ltd. and Messrs. Hendricks and Manke were indeed conservative. Assuming an efficiency of 85% of recoverable gold from both concentrate recovery systems. It is reasonable to increase the grades reported by at least 10%.
For this exercise however two possible grades are indicated. The first (a): is the weighted mean grade of bottom gravels treated by the defunct NDMC (SL) Ltd., while (b) the second is the geometric mean of the grade derived by Manke and Hendricks and the weighted mean grade from NDMC’s work.

(a) Weighted mean grade:

Weighted mean grade = 0.3069gm/yd³ (0.0098 oz/yd³)

(b) Geometric mean grade:

0.0098 x 0.12 = 0.0329 oz/yd³

However in the computation that follows with respect to the estimated gold content in the gravels flanking the Pampana Channel the geometric mean grade is used.

3. Estimate of volume of auriferous gravels:

The overlap between Rosint Development Company’s ExPL7/94 and NDMC’s SEPL 2136 is approximately 40%. Some of the deposits for which gravel volumes are quoted by NDMC are outside the boundaries of ExPL7/94.

In determining the possible volume of auriferous gravels within ExPL7/94, gravels within the present Pampana channel are discussed separately from those developed in the flats and terraces flanking the Pampana Right Bank.

Right Bank Deposits:

A study of the contours on Topographic Sheets 44 and 55 and the assumption that the gravels laid by the Pampana would not spread more than 1,500 metres from edge of the present river channel, have allowed possible gravel retention sites to be outlined and measured. The area of these retention sites total 11.7888km² (11,788,800sq.metres). The thickness of the gravel is taken as the average of the gravel thicknesses as in all areas tested by NDMC (SL) Ltd., in its A² and A³ development sampling programme. This approximated to 2.0 metres. The volume is therefore 23.577.600cu.metre (47,155,200cu.yds)

Pampana Channel Deposit:

Total length of river in ExPL7/94 approximates 24 kilometers, with a mean width of the about 100 metres.

The following assumptions are made in computing a possible volume of gravels in the channel

(i) only about 30% of the river is dredgeable.
(ii) Gravel thickness in the channel is 1.5 metres.

Possible gravel volume in channel:
8000 x 100 x 15 = 1,200,000cu.metres (1,569,540cu.yds.)

4. Gold content in ExPL7/94

(a) In the Pampana Channel:

(i) Assume the grade of 0.811gm/m³ recovered by 1950 Dredge for a section of the Pampana, south of ExPL7/94 holds good for dredgeable sections in ExPL7/94, then the gold content is 973 200 gms or 31.293ozs.

(ii) Assume that depletion due to illicit mining over the years is set at 30% then the gold content is reduced to 21905ozs.

(iii) At US$500/oz. The estimated gold value is US$10,952,000.

(b) In the Flanking Flats and Terraces:

Geometric Mean Grade = 0.0329oz/yd³
Gravel Volume = 47,155,200yd³
Assume 70% of gravel would be economic, volume is reduced to = 33,008,640 yd³
Gold content = 1,085,984ozs.
Depletion of 15% Gold due to previous mining – lawful and illicit: gold content is reduced to = 923,087ozs.

At gold price of US$500, the estimated gold value is US$461,543,500.

(c) The estimated gold value contained in ExPL7/94 is US$472,495,000.

5. Conclusion:

The estimated gold value in excess of US$472,000,000 in ExPL7/94 makes the property an attractive proposition.