Ferrous metals

COPPER EXPLORATION

Tsodilo silences doubters

Several eyebrows were raised when Tsodilo started exploring for diamonds in
Ngamiland, which died away when the company turned up several kimberlites, some
diamondiferous. The scepticism returned when Tsodilo announced recently that it had
discovered what looks like an extension of the Copperbelt in Botswana, but nobody is
doubting anymore. Willem Smuts takes a look at some recent developments.

Tsodilo

About Tsodilo Resources Limited

he Tsodilo Phase 1 exploration drill

programme identified three different targets all within Katangan-age
sedimentary rocks similar to those
of the Central African Copperbelt of the
Democratic Republic of the Congo and Zambia: the Xaudum Rapitan-type BIF magnetite
project in the north, the Copperbelt style
sedimentary rock hosted stratiform mineralisation, and the skarn deposits associated
with late-stage intrusions in the southern
part of the companys licence area. The company is currently focused on a detailed drilling programme on the Xaudum Magnetite
BIF Ironstone prospect.
Recent isotope dating of Late Proterozoic
diamictites interbedded within the magnetite units has provided ages (734 Ma)
that are equivalent to the Grand Conglomerate of the Zambian Copperbelt. These
rocks have been identified as being part of a

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Inside Mining 10/2012

Rapitan-type iron formation both in terms

of age and lithology, Rapitan-type iron formations are Neoproterozoic (0.8 to 0.6 Ga)
iron formations that are characterised by
their distinct association with glaciomarine
sediments. They are thought to have been
deposited in the immediate aftermath of a
so-called Snowball Earth state. Examples
include the Rapitan Group in north-west
Canada (18.6billion tonnes of 47% Fe); Matto Grosso, Brazil-Bolivia (36billion tonnes of
50% Fe); the Yudnamutara Subgroup, Australia; the Chuos Formation, Namibia; and
the Jacadigo Group, Brazil.

Whats in the basket?

Tsodilo is currently focusing on the
followingprojects:
1. Three metal areas identified on Tsodilos
prospecting land (14900km):
Xaudum Magnetite BIF: Fe grades ~70%

Tsodilo Resources is an international

diamond and metals exploration company
engaged in the search for economic
kimberlites and metal deposits at its Newdico
and Gcwihaba Resources projects in northwest Botswana. The company has a 98%
stake in Newdico (3 949 km under Precious
Stone diamond licences). The Gcwihaba
project area: 3 728 km under Precious
Stone diamond licences, 14 914 km
metal (base, precious, platinum group, and
rare earth) licences, and 6 925 km under
Radioactive Minerals licences is 100%
held by the company. Tsodilo manages
the exploration of both the Newdico and
Gcwihaba licence areas. The company has
offices in Toronto, Canada, and Gaborone
and Maun in Botswana.
ABOVE Members of affected communities
where Tsodilo operates are kept informed
as to company activities this includes
visits to operations

and anomalous Ag, Co, Mo, U, V. Belt 35 x

5km.
Copperbelt-type mineralisation: Stratabound Cu (Co) and (Ni) in meta-sediments.
Belt ~90km long; 30 and 40km wide.
Sepupa Skarn-type: Demonstrated Cu-FeAu skarns associated with ~535 Ma intrusions (IOCG)
2. Kimberlite exploration (7 300 km) continuous with:
evaluation of K10 and K11

Ferrous metals
RIGHT Tsodilos complex geological
package within the tectono-sedimentary
context of Southern Africa

targets in the most northern licences

3. Uranium (7000km) will focus on:
Duricrusts
within
the
regional
geomorphology
Neoproterozoic mineralised meta-sediments.

Bruchs on the way forward

Smuts: What is the programme for the
near-term?
Bruchs: We will start on a 43-101 Technical
and Mineral Reserves Report on the northern section of the Xaudum irondeposit.
Smuts: You have a great deal of prospective land. How are you going to advance
it all?
Bruchs: We are confident that we can advance the iron project and it is no secret that
we have been and are in discussions with
mining companies with respect to advancing the metals exploration especially copper. We are a bit different than most junior
exploration companies, and it is important
that we find the right partner so that it is a
win/win situation for bothparties.
Smuts: Hows that going?
Bruchs: All I can say is that discussions are
ongoing and we hope to reach an accord before the end of the year.

A new dawn is unfolding for

mining in Botswana... and
there is certainly a lot more
work to be done here
This series of projects is an excellent example of a situation where unexplained drill
results were not ignored but unraveled
and taken right back to academic basics to
rebuild the big picture so as to fully understand what one is dealing with. There is certainly a lot more work to be done here, but
the company is on the right track to writing a beautiful story in this north-western
corner of Botswana, which will greatly add
to our understanding of the structural and
economic geology of the region, while at the
same time unfolding a new dawn for mining
in Botswana.
In a follow-on article, Inside Mining will
look at the regional implications for Tsodilos projects and the work being carried out
to bring these and other significant resource
projects of the region tomarket.

LEFT Bernard Amaning, IFC Infrastructure and Natural Resources Department: Mining Division, and Tsodilo drill foreman, Gosaitse Moabi (right), during a recent IFC visit RIGHT The
first Davis Tube Recovery Results from the Rapitan-type Fe formation at the base of Grand
Conglomerate produced Fe with recoverable grades of between 69.5% and 72% with only
0.9% to 3.5% SiO2, 0.05% to 0.2% Al2O3, 0.002% to 0.04% S and less than 0.05% P. The
DTR tests recorded between 71% and 79% recovery by magnetic separation with most of
the iron reporting in the magnetic fraction (high magnetite and low hematite).

IFC does a private placement

Tsodilo Resources closed a non-commissioned private placement financing agreement
for gross proceeds to the company of US$2 million (R16.4 million) on 11 September The
financing is for 1 818 181 units of the company. Each unit is comprised of one common
share priced at C$1.10 and one common share purchase warrant per unit, each such warrant
entitling the holder to purchase one common share of the company for a period until the
close of business on 29 June 2015 at US$1.21. The common shares to be issued as a result
of the financing will have a statutory four-month hold period expiring on 8 January 2013. The
proceeds of the financing will be used by Tsodilo for advancement of the Xaudum iron ore
and metals project in Botswana, and for general corporate working capital.
IFC, a member of the World Bank Group, is the sole placee in this financing and, as a
result, will own upon the closing thereof 4 520 883 common shares (representing 16.11%
of the issued and outstanding share capital of the company and up to 30.27% on a partially
diluted basis, assuming the exercise of all of IFCs warrants granted to date [2 802 802 priced
at C$2.17, expiring on 29 June 2015, and 1 818 181 priced at US$1.21, also expiring on
29 June 2015]).
James Bruchs, chairman, said: IFC is our Partner of Choice; its participation,
professionalism, guidance and expertise combined with the economic, political and social
stability afforded by the government of Botswana, together with the assistance and support
provided by the Ministry of Minerals, Energy and Water Resources and the Department of
Geological Survey, create a winning atmosphere for mineral exploration and development.

Inside Mining 10/2012

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Ceterum Censeo

A much bigger jinx

BY WILLEM SMUTS

Recently the news wires and press have been awash with saucy
headlines like Juju jinxes Zuma over mining unrest and many of
similar ilk. Unfortunately, these storylines all too often miss the bigger
picture as it is ultimately the workers that get sucker-punched and
the South African economy that gets the jinx.

Well-known

market
observer Alec Hogg believes
that South African mining is
in a crisis and that the national
anxiety will spark overdue action on mining and Malema.
I suspect Hogg has too much
faith in the national will to fix
anything and I certainly agree
with him on the crisis, but in
my opinion the hour is very late
for severe measures in addressing the ever-growing problem.
I think we are now at the point
where companies like Lonmin
need to stop the bleeding and
close down those shafts if the
company doesnt, eventually
its shareholders will, and that
is a place where no company
would like to end up, for then
it ends really badly for everybody. Hope springs eternal,
but if both government and the
mining sector do not take decisive steps on their own turfs
the current situation of uncontrolled demands and spiralling violence will take us to the
abyss in no time. We have, over
the past six decades or so, seen
what that looks like on our continent we really do not have to
test it forourselves.

INDEX TO ADVERTISERS

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Inside Mining 10/2012

Zimbabwe change of
feet again?
The cancellation of exclusive
prospective orders (EPOs) by
the Ministry of Mines and Mining Development has resulted
in the release of additional
ground, Zimbabwes permanent secretary in the ministry,
Prince Mupazviriho, told attendees at the recent Mining Indaba held in Harare. He stated
that in excess of 344 EPOs were
withdrawn in order to deal with
speculative holding of mining
rights. Targeted companies included large players like RioZim
and Metallon Gold Exploration.
Mupazviriho, who chairs the
Mining Affairs Board responsible for allocating the EPOs, said
the government had withdrawn
the EPOs after it emerged that
they had been lying idle for over
10 years. He stated that the
ministry would push for the enforcement of use it or lose it
policy for land that would not be
used in the immediatefuture.
Meanwhile, the talk about
amendments to the Mines and
Minerals Act and what to do
about the diamonds rolls on
endlessly. Perhaps they should

visit Eritrea and learn how to

get something that works once
and for all? No structures
around the policy can address
the structural deficiencies of
the current legislation, but you
can fix security of tenure and
transparency. Mupazviriho also
said he believes there was need
to look at every mineral to see
how the sector could come up
with beneficiation strategies.
Forget beneficiation if you cant
get the basics right first.
Here is some free advice to
the ministry and the Mining
Affairs Board: the two most
critical investment criteria for
spending money in mining are
geological potential and security oftenure.
Now be assured that in terms
of item one, Zimbabwe is in my
opinion (and I am certainly not
alone in this) one of the most
prospective countries on the beloved dark continent.
The problem is that Zimbabwe
fails miserably on issue two!
Nobody has faith that their tenure is safe at all. Policies keep
changing, are clear as mud and
the way decisions are made
even worse. If indeed it is true

that major players in the industry are ignoring the Ministry of

Mines over latent EPOs then
clearly there is a great disconnect and I would expect responsible officials to have sleepless
nights over this.
Investment opportunities exist in greenfield exploration and
known highly prospective areas.
There are also many projects at
embryonic stage in the country.
It is a fact that there are numerous investors with approved
funds and technical teams in
place to explore and develop
late-stage projects in Zimbabwe
who have been begging deaf
ears in the ministry for years
to get their tenure confirmed,
with absolutely no joy. Chamber of Mines president Winston Chitando said the sector
requires US$5illion to US$7billion (R41.7 to 58.4 billion) to
recapitalise. This will never
happen unless the government
cleans the house and sets clear,
simple rules withoutdiscretion.
In my opinion a good start
for this ministry would be to
get a copy of the last few years
Fraser Institute annual mining
reports. Then read them, get a
good fright, take some good advice and get off from the bottom
of the barrel!
In my opinion Zimbabwe really should not be one of the hyenas of African mining...
Willem Smuts