Overall impression was the fundamentals are lining up pretty much to plan as outlined in previous announcements and this presentation. The summary below is from memory, brief comments which were not expanded on, and notes so DYOR and excuse some repetitions of what is available online/in media etc please.
Most of the comments below are from the Presentation by Peter Thompson (PT) with geology aspects from Peter Langworthy (PL).
The POG and its impact on the overall project was not discussed.
The recent grant of the Mining Lease and the Native Title agreement were mentioned. The latter has a component of compensation and potential for employment of local indigenous people.
RESOURCE ESTIMATES AND POSSIBLE MINING/PROCESSING
The recent 75+K meters of drilling will be used to upgrade the “scoping studies” inferred resource to indicated and measured categories for a possible March 2017 resource statement. The DFS is on track for late June 2017. This will be used for funding to get to production in Q3 2018.
Timing on the last? assay results “not for some time”. [Didn’t query this.]
The three ore types (laterite, saprolite, fresh) appear to have good characteristics for mining. PT said the laterite was friable and it and the other ore types should be easy to reduce to 100-125 microns for the extraction of gold.
He emphasised the non refractory aspect of the mineralisation (twice) and also that it appears free of nasties such as As and “Cu”.
Potential mine plan is for 2 stages of pitting. Stage 1 has strip ration of 3:1 while the 2nd stage is 4.5:1. The 26 degree dip of the mineralization should enable ramps to snake along the footwall rather than spiraling around a larger pit. [Mining cut off grade is expected to be 0.3 g/t Au which may bring in some of the wider low grade intersections into the resource - just a passing comment.]
IGO envisaged a 2Mtpa plant whereas currently CMM are looking at 3Mtpa. The current Mintrex designed plant is an “off the shelf” well established product that should be straight forward to set up if the cash, gold and economics are there. The longest lead time for any item is apparently 12 months for a SAG mill. The nearby bore field has good quality water at around 1000 TDS.
EXPLORATION
The opportunity to find a new deposit appears to be quite high and PT said even a modest one at the 2+ g/t Au at shallow depths would have a major impact on the start up economics.
The southern corridor offers good potential to expand Bibra to the south with some 700m of undrilled strike extent.
Francopan has too much cover and is considered for underground potential only. Its northern extensions, if any, do appear to possibly daylight to K3 (PT). see below also.
On “regional” exploration PL suggested some of the air core drilling done by IGO in the ?B1 area may have been based on magnetics rather than important, but differently oriented structures now recognised. Apparently some aircore drilling will be done in 2017 to test this concept.
ODDMENTS
PL discussed the possibility of the BHP clawback being realised. His view was such a clause was included to take advantage of the situation where a massive major discovery was made very soon after the deal. As it stands now the 5Moz mark, if it is reached, will probably be after production starts at which time expenditures (including the mill etc) will be $200M - a figure he plucked out of the air so don’t take it literally. BHP would have to come up with 3 Xs that expenditure ($600M) for 70%. In PL’s view this is an unlikely scenario for a company that hasn’t been a direct gold miner (by product excepted) for awhile and may now require a 10Moz deposit above the 1-1.5g/t of Karlawinda.
PL indicated he would like to visit Tropicana which is in a vaguely similar geological environment. They may get some ideas about how to detect ore in the pit which was? an issue for Troppo and will be for Bibra if mining progresses. PT mentioned the use of PXrF to qualitatively detect higher sulphur content associated with more pyrite rich gold bearing sections at Bibra. I believe AGA/IGO trialed (uses?) a hand held system to detect certain spectral characteristics of the Troppo ore.
PL mentioned CMM has acquired some more tenements but they are being treated as low key at the moment - no details.
Madagascar - exit strategies being established for the last of the assets. Some shares and cash? Not been easy to do business there since the 2009 coup.
GEOLOGY
Very dense and jargonistic - proceed at your own peril.
This macro geology interpretation has been created by John Hronsky (JH). I thought it was the basis for WMC chasing nickel in the Sylvania dome area in 2005 but the date is wrong.
PL (ex WMC) mentioned JH.was a “global thinker” who ‘pointed’ WMC to the Musgrave Range area and Nebo Babel etc.
Both PT and PL made a point of the serendipity of WMC intersecting significant gold with the first few drill holes at Francopan in 2005. Wish it were that easy - drill for nickel and find gold by "mistake" ! Suggests a fairly robust auriferous system as one of many possibilities.
The major tectonic corridor of the Tangadee lineament appears to have been active over a long time frame (Archean to Proterozoic at least(say 1000my or so!)) and contains the 10+Moz deposits of Telfer and Plutonic. This long active system may also be reflected at a more local level in the Karlawinda Area and CMM obviously hope this will ultimately add them to the club (i.e. 10Moz)
The relatively high metamorphic grade (ampibolite) at Karlawinda was mentioned as a possible reason for the high level of grade continuity there. Didn't ask why.
PL said they are trying to define local structures to better understand the distribution of mineralization. In this amphibolite grade metamorphic environment it will be quite a task. He mentioned the beginnings of a stratigraphic model which I didn’t grasp. Apparently the mineralization at Bibra is in metasediments (PL said sandstone) whereas Francopan appears to be hosted more by metavolcanics. These lithologies have different mechanical and chemical properties which may explain some of the higher grades seen at Francopan.
While PT implied that the K3 area was an extension of Francopan PL said it appeared to be more “sandstone” hosted and therefore in a different level of stratigraphy.
Hints of minor folding in the Bibra deposit are given by localised higher grade shoots.
CMM Price at posting:
10.0¢ Sentiment: Buy Disclosure: Held
(20min delay)