Projects/Assets

Resources & Reserves

Resource Estimate

A resource estimate was completed by Geos Mining in January 2012. The full Statement of Mineral Resources in respect of the Lorena Gold Project and associated the Competent Person Statement can be viewed by clicking here.

The resource estimate incorporates both historical data and the results of two phases of infill drilling conducted by Malachite during 2010-11 The resource estimation is presented in the two tables below; the first being the resource estimation for A Lode and the second for B Lode.

Table 1 – Resource Estimations for A Lode

Cut-off	Measured			Indicated			Total
Au g/t	Tonnes	Au g/t	Au Oz	Tonnes	Au g/t	Au Oz	Tonnes	Au g/t	Au Oz
5.0	34,700	11.7	13,100	57,000	15.6	28,600	91,700	14.2	41,700
2.0	68,700	7.6	16,700	110,800	9.5	34,000	179,500	8.8	50,700
1.0	88,300	6.2	17,600	165,900	6.9	36,600	254,200	6.6	54,200
0.5	105,800	5.3	18,000	228,200	5.2	38,000	334,000	5.2	56,000
0	156,100	3.7	18,400	513,100	2.4	39,500	669,200	2.7	57,900

Table 2 – Resource Estimations for B Lode

Cut-off	Indicated			Inferred			Total
Au g/t	Tonnes	Au g/t	Au Oz	Tonnes	Au g/t	Au Oz	Tonnes	Au g/t	Au Oz
5.0	2,400	9.7	800	10,900	11.9	4,200	13,300	11.5	5,000
2.0	3,100	8.3	800	20,600	7.7	5,100	23,700	7.8	5,900
1.0	3,800	7.1	900	30,800	5.6	5,600	34,600	5.8	6,400
0.5	8,400	3.6	1,000	45,000	4.1	5,900	53,400	4.0	6,900
0	14,200	2.2	1,000	117,200	1.6	6,200	131,400	1.7	7,200

The resource estimate for the A Lode, using 3D block modelling, amounts to 179,500 tonnes at 8.8 g/t Au, for a contained gold content of 50,700 ounces of gold at a 2 g/t cut off. The resource estimate for B Lode is an Inferred Resources of 23,700 tonnes at 7.8 g/t Au, for 5,900 ounces of contained gold at a 2 g/t gold cut-off.

Parts of the known resource contain very high grades and there is strong evidence for extensions to the known ore grade mineralisation at depth and along strike. Significant copper mineralisation is also present at Lorena, mostly in what appear to be discrete copper-gold lodes, adjacent to but separate from the main gold lodes.

A particular emphasis on the resource estimate by Geos Mining was the creation of a 3D block model that could be used as a basis for open pit mine design. The work carried out by GEOS confirmed a resource of 203,200 tonnes at 8.7 g/t Au, for a contained gold content of 56,730 ounces of gold at a 2 g/t cut off.