Kenya

Red Rock is exploring the Migori gold belt in Kenya. Recent successes of nearby gold projects, and the progression of the Kenyan government in natural resource management and policy, has increased the prospects of Kenya following Tanzania up the ranks of East Africa’s gold producers.

Highlights

- JORC resource estimates completed at 0.5 g/t Au cut-off: 29.4 mt @ 1.26 g/t Au with contained metal content of 1.2 MOz Au
 

    • Mikei shear: Large system 7km long, up to 250m wide (with upside potential between known zones)
       
    • Mineralisation remains open at depth and along strike, and down plunge of key higher grade zones
       

- Preliminary technical and economic assessment completed on the Nyanza gold deposit for a standalone open pit gravity operation

    • Capital cost of US$3 million recoverable within first 6 months of operation
       

- Over 30 anomalous targets identified across the 63km strike length of the Migori Greenstone belt with confirmed base metal and gold mineralisation potential

- Mining Lease Application submitted to the Kenyan Ministry of Mining for the reprocessing of the Macalder Tailings: 1.3Mt @ 1.7g/t Au for 68koz contained Au

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Assets

  • Migori Project

 

Investment

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Red Rock holds a 15% direct interest in Mid Migori Mining Company Ltd (“MMM”) and 32.27% indirectly through its 37.96% investment in Kansai Mining Corporation Ltd. MMM is the holder of SPL122 and SPL202. Upon completion of a Bankable Feasibility Study (“BFS”), Red Rock will be entitled to a 60% direct interest, bringing its total to over 75%.

Location

SPLSs 122 and 202 are located 20–30km north of the operating North Mara gold mine in Tanzania and immediately east of Lake Victoria in SW Kenya.

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Geology

The Migori licences cover a 310km2 area over the Migori Greenstone belt (MGB), extending 63km along strike. The belt has a rich history of colonial and artisanal mining, and the Kilimapesa deposit, immediately east of the Migori licences, is currently Kenya’s only operating gold mine.

The MGB forms the northern extension of the Archean, gold-enriched, Tanzanian craton. The granite-greenstone terrain to the south of the MGB is host to world class producing gold mines (e.g. North Mara 3Moz Au, Geita 30Moz Au). The mineralisation and stratigraphy observed in the MGB is similar to that of the Lake Victoria Greenstone belts in Tanzania and other Archean greenstone belts found globally e.g. Red Lake in Canada (2.6Moz Au).

Gold enrichment is predominantly found in and around shear zones associated with quartz-carbonate veining and significant alteration, as well as banded iron formations (BIFs) and poly-metallic Volcanogenic Massive Sulphides (VMS). The dominant lithologies are felsic and mafic intrusives, BIFs and metasediments of the Nyanzian system, overlain by younger Kavirondian volcaniclastic sediments and intruded by younger granitic intrusions.

The VMS deposit at Macalder is a base metal system of copper and zinc with accessory gold, silver and lead mineralisation. The deposit was mined for copper and gold between the 1930s-60s and, in 2011, RC drilling terminated in Cu mineralisation at approx. 20 metres depth. Other potential VMS mineralisation may exist within the belt and 2012 airborne VTEM geophysics has identified two potential VMS targets.

A tailings dam adjacent to the old Macalder mine area still exists. The tailings deposit still hosts Au mineralisation (1.7g/t Au grade) which is amenable to cyanide leach extraction.

Projects


Mikei Resource

The project’s 1.2Moz gold resource lies over five main zones within the Mikei Shear zone. The final mineral resource statement was released in December 2012 with the resources validated to indicated and inferred JORC status.

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Summary of 2011-2012 JORC-compliant mineral resource estimate (0.5 g/t Au cut-off)
  Inferred Indicated Total
  mt g/t Au mt g/t Au mt g/t Au Metal MOz
KKM 1.4 1.15 16.3 1.00 17.8 1.01 0.58
KKM-West 3.0 1.02 1.1 1.07 4.2 1.04 0.14
Nyanza

1.2

1.70 1.2 3.73 2.3 2.72 0.20
Gori Maria 3.8 1.16 0 0 3.8 1.16 0.14
MK 0.6 1.76 0.8 4.05 1.4 3.07 0.13
Total 10.0 1.21 19.4 1.29 29.4 1.26 1.19

NB. Apparent errors may occur due to rounding

Nyanza Gold Project

The Nyanza deposit is host to very high grade ore shoots within the Mikei shear zone. The host geology is amenable to gold enrichment consisting of predominantly iron-rich mafics with carbonate alteration and some felsic intrusives, cut by major shear zone and in close proximity to the Migori granite. Significant drill intersections up to 31m @ 3.91g/t Au have been drilled.

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Nyanza Block Model at 0.5 g/t Au cut-off 

Nyanza Block Model at 1.5 g/t Au cut-off (highlighting the high grade zone)

Feasibility Study

A pit optimisation on the MGP was carried out in Q2 2013 with the NZ prospect followed by the MK prospect showing the best potential as starter pits due to lower metal price sensitivity and favourable conversion from Mineral Resources to diluted pit shell metal inventories (NZ ~77%).

SRK Pit Optimisation Executive Summary [PDF]

Following this pit optimisation work, a preliminary technical and economic assessment constituting the first stage of a feasibility study on the Nyanza gold deposit was completed. The positive results demonstrate the viability of the 200koz Au deposit as a standalone open put operation for generating short term cash flow utilising a modular gravity plant.

AG&M Preliminary Technical and Economic Assessment Executive Summary [PDF]

  • Projected life of mine revenue from gold sales of US$95 million (at US$1,200/oz Au price)
  • Capital cost of US$3 million recoverable within first 6 months of operation
  • Production of approximately 80,000oz of gold over 9 years mine life
  • This option gives a pre-tax NPV (at 10% discount rate) of $8 million

Migori regional exploration
The company is currently planning the next phase of regional exploration.

Grassroots Zones

  • Assessment of the base metal potential of the licences
  • Traversing, mapping and surface sampling at early stage prospects

Anomaly Testing

  • Drilling or trenching to follow up geochemical and geophysical anomalies

Target Generation

  • New regional targets identified from geochemical sampling programme

 

Macalder Tailings Resource
The Macalder VMS deposit was discovered in the mid-1930s and mined for copper and gold. The tailings produced from the mining were deposited adjacent to the mining area near Macalder town. To this day, the tailings still contain economic levels of residual gold mineralisation. A JORC Measured mineral resource estimate was completed in 2011.

Macalder Tailings: 2011 JORC Measured Resource Estimate
Prospect JORC Classification mt kOz Au g/t Au Cut-off g/t Au
Macalder Tailings Measured 1.3 68 1.65 No Cut-Off

 

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3D view of Macalder Tailings measured resource block model

Historic leach tank at Macalder

In August 2012, a Mining Lease Application (MLA) was lodged at the Kenyan Ministry of Mining to allow the company to start investigating mine planning and construction options.