As a Matter of Interest - Highlights of the Pyramid Lake Scoping...

As a Matter of Interest - Highlights of the Pyramid Lake Scoping Study - 2018
Can anyone contact the company to find out how close they are at finalising documentation and contracts in the offering covering Pyramid Lake.

This should be happening now according to Company source announcements below, and to all of the loyal CHK holders to date, I hope the Directors should be able to finalise this deal whilst waiting to release Pernatty C drilling results, the Company directors need to be more dedicated than they have been to date.
I have previously rung the Company and never received a call back, not a good look, I hope this year will be the one that will consolidate the future of all our tomorrows.

• A proposed 9-year production scenario for the Lake Pyramid gypsum project returned the following key findings:

o CAPEXAUD$1.2million(b)o OPEXAUD$6.30/tonne(b)o Payback period of less than 2.5 years at an average ex-mine price of $25 /tonne (c)

• Initial production rate of 50,000 tonnes, ramping up to 400,000 tonnes by year 9 (c).

• Mine life in excess of 10 years based on Indicated and Inferred Resources (a).

• Scoping study for Pyramid Lake gypsum project demonstrated potential for robust sales for ameliorating

  sodic soils, salinity, aluminium toxicity and calcium and sodium deficiencies.

• Independent studies showed the use of gypsum at 5 – 10 t/ha improved water use efficiency (WUE) in

  responsive soils resulting in crop yield increases up to 85% and returns of $200 /ha over 4 years.

• Further studies of gypsum for aluminium toxicity showed that an annual application of 1 t/ha increased

  productivity and profitability markedly.
  (a) See Appendix 1 (b) See Appendix 2 (c) See Appendix 3

  Cohiba is pleased to announce that following a recent resource estimate it has completed a scoping study which demonstrated the potential for robust, profitable, long-term sales from its Pyramid Lake Gypsum deposit.

  Cohiba Minerals Limited holds (100%) exploration licence E74/594, which covers all of Pyramid Lake in south-

  2western Western Australia, for a total of 11,266 hectares or 112.66 km . Pyramid Lake itself is a relatively salt-

  lake covering 6,632 hectares located 115 kilometres northwest of the town of Esperance on the northern limit of the agricultural area (Figure 1).

  Figure 1: Location of Cohiba’s Pyramid Lake Exploration Licence (from Hydrominex 2018).

  Registered Office Level 4, 100 Albert Road, South Melbourne, Victoria 3205 Phone 03 9692 7222 Fax 03 9077 9233 Web www.cohibaminerals.com.auACN 149 026 308 ABN 72 149 026 308

For personal use only

Production Target - Further Cautionary Statement

It should be noted that over the proposed nine-year production plan it is projected that 2 Mt of gypsum will be sold. Under the current resource model 1.3 Mt is an indicated mineral resource and 2.6 Mt is an inferred mineral resource. This means that over the nine-year production model 35% (700,000 t) of the projected 2 Mt would be from the existing inferred mineral resource (as the resource model currently stands).

There is a low level of geological confidence associated with inferred mineral resources and there is no certainty that further exploration work will result in the determination of indicated mineral resources or that the production target itself will be realised.

The scoping study showed that the uses for gypsum go well beyond the amelioration of sodic soils to include the amelioration of transient salinity, aluminium toxicity and calcium and sulphur deficiencies in subsoils, thereby markedly increasing its market potential.

In addition, the study showed that gypsum markedly improved water use efficiency (WUE) in responsive soils with 5 to 10 t/ha of gypsum increasing yield potential up to 85%, meaning that crop returns increased by almost $200 /ha over a 4-year period.

The economics around these major agricultural issues were such that the Pyramid Lake gypsum can be readily applied to a broad geographic area which includes the southern portion of the Goldfields-Esperance region, through to the eastern-most portion of the Great Southern and Wheatbelt regions.

A production scenario was established for the Pyramid Lake gypsum which showed the potential for a 9-year model to deliver a Net Present Value (5% discount rate) of $33.2 million and an Internal Rate of Return (IRR) of 104.7%, demonstrating the robustness of the project.

The production model and associated financial model showed that this could be achieved at a very modest capital investment ($1.2 million) with a further moderate capital injection ($0.6 million) in year 6 to accommodate plant and throughput expansion. The capital expenditure has been based largely on the acquisition of second-hand equipment with low operating hours to keep overall costs down.

The gypsum resource is situated at the surface (no overburden) as part of a major dune system. There is no requirement for drilling and blasting as the material can be “free-dug” from the dune system and due to the current sizing and the tendency of the gypsum to reduce further in size when handled there will also be no need for a crushing circuit. The process will comprise the following:

1. Loading and hauling – from the mine to the processing plant

2. Screening – at various sizes

3. Conveying – to various stockpiles

4. Loading to stockpile areas (with possibility of a bagging plant in the future)

5. Loading from stockpile to trucks for delivery to end-users

The majority of the gypsum will be sold as bulk tonnage for broad-acre applications. A brief investigation into bagged products was undertaken and it was determined that more work needed to be completed to determine the merits of generating bagged gypsum.

The proposed production model assumes that the plant and equipment are established and commissioned in the first year and bulk gypsum sales commence in the second year. Based on market enquiries and existing historical production and usage figures for the gypsum industry in Western Australia it was projected that 50,000 tonnes of gypsum could be sold by the end of year 2.

Pyramid Lake Gypsum (Western Australia)


Cohiba has submitted a renewal application and all the supporting documentation to DMIRS WA for a further five (5) years over the Pyramid Lake tenement (E74/594). Cohiba is still committed to the establishment of a Mining Lease over the premium and high-grade gypsum resources that have been identified and is working with a local consulting firm to finalise the necessary documentation.


Pyramid Lake Update (E74/594) The Company has continued to progress towards the final Mining Lease approval over the high-grade part of the Pyramid Lake resource and will look to finalise over the coming months.

https://www.asx.com.au/asxpdf/20181126/pdf/440mvqn8rb3ypk.pdf