Ann: Trial Mining and Processing Update at Old Pi, page-9

re: Ann: Trial Mining and Processing Update a... “Good announcement in that there are no unexpected bad surprises.”

That’s one big understatement. This is solidly positive news.
Plant and mill operating well other than the bogging of lines related to the coarse gold jig with that part of the circuit being bypassed without material impact on performance. Initial indications on recoveries and head grades in particular are looking excellent.

Estimated head grades on the Eastern limb were the only ones that fell (marginally) below the targeted 10g/t (which is an average for the entire resource not for any one vein) with 7.5g/t and 10g/t as the mid point of the estimates for EL north and south. The grades here might increase on the second bench and below.
Other than that minor miss, the rest are well above the 10g/t initial guidance for target head grade. The mid points of estimates being; Heartland 17.5g/t, WL north, 12.5g/t, Central 20g/t, GH 35g/t, East Side South and North 15g/t and 17.5g/t, OP south 20g/t. There are going to be some other areas with lower grades like Old Glory but these contain much less ounces so will have much less impact on average grades of the whole resource.
It looks like we can expect an overall head grade of at least 15g/t- 17g/t (probably significantly higher for trial mining with GH factored in).
Indications continue to support high recoveries. I think around 93-95%. For trial mining of 10kt, 16.5g/t ave head grade with 94% recovery will result in around 5000oz recovered. Well above the companies target.

It appears there is upside potential for the resource contained ounces not just from strike and depth extensions but also from;
vein width blowouts not modelled in the resource,
grade appearing to be under called by an average of 13% after selected re-assaying using more expensive but more accurate Leach-well analysis. This alone may result in a further 94,000oz on top of the current jorc estimate to 816,000oz,
from earlier announcements some new veins being uncovered that were not seen in outcrop,
and from any gold in surrounding rock that will be mined due to anticipated dilution that has not been included in the resource estimate. 1 mill ounces is looking increasingly likely and with depth extensions there is no obvious know limit. If this system continues to at least 500ms deep we could be looking at 2mill ounces plus.