31st Jul 2015 07:00
31 July 2015
| AIM/ASX Code: WHE
|
WILDHORSE ENERGY LIMITED JUNE 2015 QUARTERLY REPORT |
The Board of Wildhorse Energy Limited (the "Company" or "Wildhorse") presents its June 2015 quarterly report.
HIGHLIGHTS:
Ø On 12 June 2015, the Company completed its acquisition of 100% of Australia Salt Lake Potash Pty Ltd (ASLP). ASLP is focused on two large salt lake brine projects (Projects), the priority Lake Wells Project and the Lake Ballard Project in Western Australia, which have excellent potential to produce highly sought after Sulphate of Potash (SOP) for domestic and international fertiliser markets.
Ø The Company undertook a heritage clearance survey at the Lake Wells Project, with the Aboriginal Heritage Consultants agreeing the proposed drilling and resource evaluation program to be undertaken at the Lake Wells Project. Drilling and other testwork is scheduled to commence in the current quarter.
Ø Two key exploration licences at the Lake Ballard Project covering 680 km2 were granted in the quarter. An initial reconnaissance mapping and sampling program at Lake Ballard was undertaken during the quarter.
PROJECT BACKGROUND
Wildhorse acquired 100% of Australia Salt Lake Potash Pty Ltd (ASLP), a privately held Australian company which holds the Project's Exploration Licences in a wholly owned subsidiary.
ASLP was founded to capitalise on the quality of Australia's unique salt lake brine resources, cost-effective production conditions and the growing demand for high-value SOP, a chloride-free potassium fertiliser, and its by-products.
The Company has secured five granted and five pending exploration licences covering a total area of 1,931 km2 of salt lake basins of the two targeted lakes: Lake Wells and Lake Ballard located in Western Australia.
Reconnaissance auger drilling, pit sampling programs and/or historical data have indicated the presence of highly concentrated brine resources for both projects with elemental ratios highly suitable for commercial production of SOP and its by-products via low-cost solar crystallisation and selective salt recovery methods. Both projects have ready access to transport infrastructure servicing the domestic and international fertiliser markets.
Lake Wells Project, Western Australia
Lake Wells is located approximately 80 km north of the Great Central Road and 180 km NE of Laverton in the West Australian Goldfields. ASLP holds three exploration licences and three applications over the Lake Wells playa, covering a total area of 1,126 km2. There are no known Native Title claims in relation to the permits.
ASLP had undertaken a maiden exploration program at Lake Wells, comprising reconnaissance stage auger drilling and test pit excavation across the playa. A total of 28 auger holes were drilled to an average depth of 4.1 metres and 79 test pits were dug by hand to an average depth of 0.5 metres. Brine samples from all the auger holes and 35 test pits were submitted to NATA accredited laboratories for analysis (averaging one data point per 6.8 km2) (see ASX announcement 9 April 2015).
Samples tested to date from Lake Wells have an average potassium concentration of 5,220 mg/L. This brine quality compares favourably with that reported by other Australian and overseas salt lake SOP projects.
Wildhorse believes Lake Wells has the potential to generate substantial volumes of highly enriched brine to supply a solar evaporation facility and processing plant to produce SOP, SOPM and other by-products. The Lake Wells area boasts annual pan evaporation of around 3 metres per year, which is substantially higher than evaporation rates at other brine potash projects in Utah, USA and Western China.
During the quarter, the Company completed a heritage clearance survey at the Lake Wells Project, conducted by anthropological consultants De Gand & Associates Pty Ltd, with the participation of six Aboriginal Heritage Consultants. The Company outlined the proposed drilling and resource evaluation program to be undertaken at the Lake Wells Project during 2015 and received an initial heritage clearance on completion of the survey.
Wildhorse will now undertake further drilling, pump testing, process testwork and evaporation trials to form the basis of an initial resource estimate and scoping study.
Lake Ballard Project, Western Australia
Lake Ballard is a large salt lake in the Goldfields region of Western Australia about 20 kilometres North of Menzies and 150 kilometres north of Kalgoorlie.
Wildhorse holds two exploration licences and two applications over the Lake Ballard playa covering a total area of 775 km2. No Native Title claims are registered over the area.
Lake Ballard is located next to a sealed highway, a mining haul road, and a railway which links it to Esperance Port. A gas pipeline also transects in close proximity to the eastern edge of the lake.
Other Projects
Wildhorse also holds exploration licences or applications covering all or parts of Lake Irwin and Lake Minigwal and Lake Marmion in Western Australia, Lake Lewis in the Northern Territory and Lake Macfarlane and Island Lagoon in South Australia.
The Company is compiling and assessing available data on these properties to allow an initial assessment of their prospectively for large scale Sulphate of Potash production from brines.
Golden Eagle Uranium and Vanadium Project
The Golden Eagle Uranium and Vanadium Project holds nine U.S. Department of Energy (DOE) Uranium/Vanadium Mining Leases, covering 22.7 km2 located in the Uravan Mineral Belt, Colorado USA.
Technical reports for a number of the lease have been drafted based on historic data, however, exploration drilling and core analysis need to be completed in order to finalise these reports. The leases will expire eight years after the courts complete their review of the Record of Decision (ROD) published in 2014 in the Federal Register and the DOE allows the lease holders to resume activates on their leases.
Wildhorse also possess an option on Gold Eagle Mining Inc (GEMI) leases; GEMI has three DOE properties of which two have active operating permits.
The Company has commenced a technical review of existing exploration information and is now focusing on establishing the project's scales and potential for exploration upside.
Mecsek Hills Uranium Project
The Company is continuing with its efforts to extract the best value for shareholders for its interest in this Mecsek Hills Uranium Project, which may include a joint venture or sale of the Company's interest in the project. It is also noted that with effect from 31 December 2014, the Hungarian government has deemed the project joint venture entity ("Magyar Uran Zrt") a company of national importance, which may impact on this process.
Table 1 - Summary of Exploration and Mining Tenements
As at 30 June 2015, the Company holds the following interests in the listed tenements:
Australian Projects:
Project | Status | License Number | Area (km2) | Term | Grant Date | Date of First Relinquish-ment | Interest (%) 1-Apr-15 | Interest (%) 30-Jun-15 |
Western Australia | ||||||||
Lake Wells | ||||||||
Central | Granted | EL 38/2710 | 192.2 | 5 years | 05-Sep-12 | 4-Sep-17 | - | 100% |
South | Granted | EL 38/2821 | 131.5 | 5 years | 19-Nov-13 | 18-Nov-18 | - | 100% |
North | Granted | EL 38/2824 | 198.2 | 5 years | 04-Nov-13 | 3-Nov-18 | - | 100% |
Outer East | Pending | EL 38/3055 | 298.8 | - | - | - | - | 100% |
Single Block | Pending | EL 38/3056 | 3.0 | - | - | - | - | 100% |
Outer West | Pending | EL38/3057 | 301.9 | - | - | - | - | 100% |
Lake Ballard | ||||||||
West | Granted | EL 29/912 | 607.0 | 5 years | 10-Apr-15 | 10-Apr-20 | - | 100% |
East | Granted | EL 29/913 | 73.2 | 5 years | 10-Apr-15 | 10-Apr-20 | - | 100% |
North | Pending | ELA 29/948 | 94.5 | - | - | - | - | 100% |
Lake Irwin | ||||||||
Central | Pending | ELA 37/1233 | 573.4 | - | - | - | - | 100% |
Lake Marmion | ||||||||
Central | Pending | EL 29/952 | 201.3 | - | - | - | - | 100% |
Lake Minigwal | ||||||||
Central | Pending | EL 39/1876 | 436.1 | - | - | - | - | 100% |
South Australia | ||||||||
Lake Macfarlane | Pending | EL 2015/085 | 816 | - | - | - | - | 100% |
Island Lagoon | Pending | EL 2015/084 | 978 | - | - | - | - | 100% |
Northern Territory | ||||||||
Lake Lewis | ||||||||
South | Granted | EL 29787 | 146.4 | 6 year | 08-Jul-13 | 7-Jul-19 | - | 100% |
North | Granted | EL 29903 | 125.1 | 6 year | 21-Feb-14 | 20-Feb-19 | - | 100% |
Other Projects:
Location | Name | Resolution Number | Percentage Interest |
Hungary | Pécs | PBK/6947/3/2006 | 100% |
USA - Colorado | C-SR-10 | C-SR-10 | 80% |
USA - Colorado | C-JD-5A | C-JD-5A | 80% |
USA - Colorado | C-SR-11A | C-SR-11A | 80% |
USA - Colorado | C-SR-15A | C-SR-15A | 80% |
USA - Colorado | C-SR-16 | C-SR-16 | 80% |
USA - Colorado | C-WM-17 | C-WM-17 | 80% |
USA - Colorado | C-LP-22A | C-LP-22A | 80% |
USA - Colorado | C-LP-23 | C-LP-23 | 80% |
Competent Persons Statement
The information in this report that relates to Exploration Results for Lake Ballard's pit sample program is based on information compiled by Mr Ben Jeuken, who is a member Australian Institute of Mining and Metallurgy. Mr Jeuken is employed by Groundwater Science Pty Ltd, an independent consulting company. Mr Jeuken has sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration and to the activity, which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Mr Jeuken consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.
The information in this report that relates to Exploration Results for Lake Wells, is extracted from the report entitled 'Wildhorse Acquires Two Large Scale High Grade Sulphate Of Potash Brine Projects' dated 9 April 2015 and available to view on www.wildhorse.com.au. The information in the original ASX Announcement that related to Exploration Results for Lake Wells based on information compiled by Mr Ben Jeuken, who is a member Australian Institute of Mining and Metallurgy. Mr Jeuken is employed by Groundwater Science Pty Ltd, an independent consulting company. Mr Jeuken has sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration and to the activity, which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Mr Jeuken consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. The Company confirms that it is not aware of any new information or data that materially affects the information included in the original market announcement. The Company confirms that the form and context in which the Competent Person's findings are presented have not been materially modified from the original market announcement.
APPENDIX 1 - LAKE BALLLARD TEST PIT RESULTS
East | North | K (mg/L) | SO4 (mg/L) | Mg (mg/L) | TDS (mg/L) | |
LB0514P1 | 321,840 | 6,734,640 | 1,590 | 4,550 | 4,720 | 182,651 |
LB0514P1A | 321,779 | 6,734,498 | 2,300 | 5,640 | 7,250 | 257,556 |
LB0514P2 | 319,885 | 6,734,832 | 2,290 | 8,540 | 8,670 | 273,283 |
LB0514P3 | 314,471 | 6,733,977 | 2,250 | 8,210 | 8,370 | 277,092 |
LB0514P4 | 300,585 | 6,740,232 | 1,910 | 8,210 | 7,000 | 265,528 |
LB0514P5 | 293,818 | 6,744,582 | 2,310 | 7,910 | 8,050 | 304,053 |
LB0514P6 | 288,206 | 6,745,939 | 2,220 | 7,840 | 7,320 | 296,805 |
LB0514P7 | 287,545 | 6,746,663 | 2,380 | 7,750 | 7,840 | 297,936 |
APPENDIX 2 - JORC TABLE 1
Section 1 Sampling Techniques and Data
Criteria | JORC Code explanation | Commentary |
Sampling techniques | Nature and quality of sampling (eg cut channels, random chips, or specific specialised industry standard measurement tools appropriate to the minerals under investigation, such as down hole gamma sondes, or handheld XRF instruments, etc). These examples should not be taken as limiting the broad meaning of sampling. Include reference to measures taken to ensure sample representivity and the appropriate calibration of any measurement tools or systems used. Aspects of the determination of mineralisation that are Material to the Public Report. | Brine samples were collected from shallow pits dug into the lake surface to a depth of 0.5 to 0.75m. Brine samples are composite samples from the water that filled the pit after digging. The material in the pit was geologically logged as a composite qualitative description for the entire pit. |
Drilling techniques | Drill type (eg core, reverse circulation, open-hole hammer, rotary air blast, auger, Bangka, sonic, etc) and details (eg core diameter, triple or standard tube, depth of diamond tails, face-sampling bit or other type, whether core is oriented and if so, by what method, etc). | Not Applicable |
Drill sample recovery | Method of recording and assessing core and chip sample recoveries and results assessed. Measures taken to maximise sample recovery and ensure representative nature of the samples. Whether a relationship exists between sample recovery and grade and whether sample bias may have occurred due to preferential loss/gain of fine/coarse material. | Not Applicable |
Logging | Whether core and chip samples have been geologically and geotechnically logged to a level of detail to support appropriate Mineral Resource estimation, mining studies and metallurgical studies. Whether logging is qualitative or quantitative in nature. Core (or costean, channel, etc) photography. The total length and percentage of the relevant intersections logged. | All pits were geologically logged by a qualified geologist, noting colour, induration, moisture content of sediments grain size distribution and lithology. |
Sub-sampling techniques and sample preparation | If core, whether cut or sawn and whether quarter, half or all core taken. If non-core, whether riffled, tube sampled, rotary split, etc and whether sampled wet or dry. For all sample types, the nature, quality and appropriateness of the sample preparation technique. Quality control procedures adopted for all sub-sampling stages to maximise representivity of samples. Measures taken to ensure that the sampling is representative of the in situ material collected, including for instance results for field duplicate/second-half sampling. Whether sample sizes are appropriate to the grain size of the material being sampled. | Not Applicable |
Quality of assay data and laboratory tests | The nature, quality and appropriateness of the assaying and laboratory procedures used and whether the technique is considered partial or total. For geophysical tools, spectrometers, handheld XRF instruments, etc, the parameters used in determining the analysis including instrument make and model, reading times, calibrations factors applied and their derivation, etc. Nature of quality control procedures adopted (eg standards, blanks, duplicates, external laboratory checks) and whether acceptable levels of accuracy (ie lack of bias) and precision have been established. | Samples were submitted to ALS Environmental Laboratory, Perth for analysis. · The technique used is Inductively Coupled Plasma Optical (Atomic) Emission Spectrometry (ICP OES) excluding sulphate determination which was carried out by gravimetric method. o The primary laboratory's analytical methodology was reviewed by ASLP's technical specialist for suitability to very high concentration brine assay by ICP determination. The review and subsequent methodology implemented specific dilution techniques and standards to ensure accurate ICP assay results. o The accuracy of dilution procedures and subsequent ICP assay by the primary laboratory was confirmed through duplicate assay at a Research Laboratory (A Arakel per com, 2014) using wet chemistry assay methods which are better suited to high concentration brines. Results compare favourably with ALS Global Laboratory indicating that the dilution and subsequent ICP methodology is suitable. · The assay method and results are suitable for calculation of the resource estimate. |
Verification of sampling and assaying | The verification of significant intersections by either independent or alternative company personnel. The use of twinned holes. Documentation of primary data, data entry procedures, data verification, data storage (physical and electronic) protocols. Discuss any adjustment to assay data. | · Data entry is done in the field to minimise transposition errors. · Brine assay results are received from the laboratory in digital format to prevent transposition errors and these data sets are subject to the quality control described above. · No holes were twinned, and independent verification of significant intercepts was not considered warranted given the relatively consistent nature of the brine resource |
Location of data points | Accuracy and quality of surveys used to locate drill holes (collar and down-hole surveys), trenches, mine workings and other locations used in Mineral Resource estimation. Specification of the grid system used. Quality and adequacy of topographic control. | Pit co-ordinates were captured using hand held GPS. Coordinates were provided in GDA 94, MGA Zone 51. Topographic control is obtained using Geoscience Australia's 1-second digital elevation product. Topographic control is not considered critical as the salt lakes are generally flat lying and the water table is taken to be the top surface of the brine resource. |
Data spacing and distribution | Data spacing for reporting of Exploration Results. Whether the data spacing and distribution is sufficient to establish the degree of geological and grade continuity appropriate for the Mineral Resource and Ore Reserve estimation procedure(s) and classifications applied. Whether sample compositing has been applied. | Data spacing is very wide and can only be considered to be reconnaissance level work.
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Orientation of data in relation to geological structure | Whether the orientation of sampling achieves unbiased sampling of possible structures and the extent to which this is known, considering the deposit type. If the relationship between the drilling orientation and the orientation of key mineralised structures is considered to have introduced a sampling bias, this should be assessed and reported if material. | · All pits were vertical as geological structure is generally flat lying and the pits do not cut multiple geological units. Structures may be present in the underlying clay and may control brine flow in the sub-surface but their orientations are unknown. · |
Sample security | The measures taken to ensure sample security. | Samples are labelled and kept onsite before transport to the laboratory. Chain of Custody system is maintained. |
Audits or reviews | The results of any audits or reviews of sampling techniques and data. | Data review is summarised in Quality of assay data and laboratory tests and Verification of sampling and assaying. No audits were undertaken. |
Section 2 Reporting of Exploration Results
Criteria | JORC Code explanation | Commentary |
Mineral tenement and land tenure status | Type, reference name/number, location and ownership including agreements or material issues with third parties such as joint ventures, partnerships, overriding royalties, native title interests, historical sites, wilderness or national park and environmental settings. The security of the tenure held at the time of reporting along with any known impediments to obtaining a licence to operate in the area. | Refer to Table 1
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Exploration done by other parties | Acknowledgment and appraisal of exploration by other parties. | No other known exploration for potash has occurred on the Exploration Licences. |
Geology | Deposit type, geological setting and style of mineralisation. | Salt Lake Brine Deposit |
Drill hole Information | A summary of all information material to the understanding of the exploration results including a tabulation of the following information for all Material drill holes: o easting and northing of the drill hole collar o elevation or RL (Reduced Level - elevation above sea level in metres) of the drill hole collar o dip and azimuth of the hole o down hole length and interception depth o hole length. If the exclusion of this information is justified on the basis that the information is not Material and this exclusion does not detract from the understanding of the report, the Competent Person should clearly explain why this is the case. | Hand dug pits as described above and presented in the announcement.
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Data aggregation methods | In reporting Exploration Results, weighting averaging techniques, maximum and/or minimum grade truncations (eg cutting of high grades) and cut-off grades are usually Material and should be stated. Where aggregate intercepts incorporate short lengths of high grade results and longer lengths of low grade results, the procedure used for such aggregation should be stated and some typical examples of such aggregations should be shown in detail. The assumptions used for any reporting of metal equivalent values should be clearly stated. | No data aggregation has been undertaken. The complete data set is used for analysis. Within the salt lake extent no low grade cut-off or high grade capping has been implemented due to the consistent nature of the brine assay data. |
Relationship between mineralisation widths and intercept lengths | These relationships are particularly important in the reporting of Exploration Results. If the geometry of the mineralisation with respect to the drill hole angle is known, its nature should be reported. If it is not known and only the down hole lengths are reported, there should be a clear statement to this effect (eg 'down hole length, true width not known'). | Not Applicable |
Diagrams | Appropriate maps and sections (with scales) and tabulations of intercepts should be included for any significant discovery being reported These should include, but not be limited to a plan view of drill hole collar locations and appropriate sectional views. | Addressed in the announcement. |
Balanced reporting | Where comprehensive reporting of all Exploration Results is not practicable, representative reporting of both low and high grades and/or widths should be practiced to avoid misleading reporting of Exploration Results. | All results have been included. |
Other substantive exploration data | Other exploration data, if meaningful and material, should be reported including (but not limited to): geological observations; geophysical survey results; geochemical survey results; bulk samples - size and method of treatment; metallurgical test results; bulk density, groundwater, geotechnical and rock characteristics; potential deleterious or contaminating substances. | All material exploration data reported. |
Further work | The nature and scale of planned further work (eg tests for lateral extensions or depth extensions or large-scale step-out drilling). Diagrams clearly highlighting the areas of possible extensions, including the main geological interpretations and future drilling areas, provided this information is not commercially sensitive. | Further drilling to assess the occurrence of brine at depth. Closer spaced, more evenly distribute drilling, particularly to define the thickness of the LPS unit. Hydraulic testing be undertaken, for instance pumping tests from bores and/or trenches to determine, aquifer properties, expected production rates and infrastructure design (trench and bore size and spacing). Lake recharge dynamics be studied to determine the lake water balance and subsequent production water balance. For instance simultaneous data recording of rainfall and subsurface brine level fluctuations to understand the relationship between rainfall and lake recharge, and hence the brine recharge dynamics of the Lake. Study of the potential solid phase soluble or exchangeable potassium resource.
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For further information please visit www.wildhorse.com.au or contact:
Sam Cordin | Wildhorse Energy Limited | Tel: +61 8 9322 6322 |
Colin Aaronson/Jen Clarke/Jamie Barklem | Grant Thornton UK LLP | Tel: +44 (0)207 383 5100 |
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