Shenglong Investment International Ltd (“SIIL”), a BVI incorporated company that owns 90% of the Shenglong Base Metal Project which are located in the south of the Republic of Congo, 150km west of the capital Brazzaville and 400km NE from the major sea port Pointe-Noire. The remaining 10% of the project is owned by the Congolese Government.
The SIIL Project consists of exploitation permits M’Passa-Moubiri 2011-471 and Mindouli 2011-472, which have a total area of 372km2. The Project is held for 90% by SIIL through its wholly-owned subsidiary Societe Lulu De Mine. The remaining 10% is held by the Congolese government.
The Project is located in the Neoproterozoic to Palaeozoic Niari Basin of the southern Congo. The Project sits on an NE-trending anticline (named the Mindouli Anticline in this report) in the southern part of the Niari Basin. The core of the anticline is Neoproterozoic schist-limestone (Shisto-Calcaire Series) which is overlain by Palaeozoic schist-sandstone (Schisto-Gréseux System). The boundary between the two is an unconformity that is generally faulted in an E-W direction (e.g. Buffett et al., 1987). The mineralisation on the project sits at this boundary, usually within the limestone, and is fault-controlled by major NE-striking faults.
Regarding the date on the projects, Incept have previous exploration records from up to 1977, but this information which is mainly in French has not been compiled yet. Shenglong has conducted exploration, including diamond drilling, but the data has not been recorded or has not been recorded to a JORC standard.
There are seven prospects on the Project which can be summarised as follows:
- Moubiri. Current Direct Shipping Ore (DSO) operation. Copper-lead-zinc mineralisation at and around the faulted contact between limestone and sandstone.
- Mindouli. Historical copper mine. Fault-hosted mineralisation at the contact between sandstone and limestone.
- M’passa. Historical lead-zinc and minor copper mine. Limestone-hosted mineralisation within a wedge formed by faults.
- Mimbodi. Historical lead-zinc mine.
- Tchicoomba. Exploration prospect on faulted sandstone-limestone contact.
- Makaka. Exploration prospect in the limestone group.
- Diangala. Exploration prospect on a fault zone in the sandstone group.
The Incept business plan is straight forward. It can be broken into a series of events; some of which can run concurrently. These are as follows;
1. Ramping up the operation at Moubiri. The aim here is to gradually ramp up production from the current 50 tonnes per day (tpd) to 250 tpd. This would be done over a 6 month period for a cost of approximately US$3.5-$4 million and would involve the following;
(i) Changing mining method from hand held methods to cut and fill which would involve a more mechanised approach and develop a mine plan (currently no mine plan in place)
(ii) Access underground potential by drilling out the ore body on 25 metre centres
(iii) Produce a JRC compliant resource/reserve statement
(iv) Access open pit potential with RC drill out and then pit design
(v) Advance processing/development options by maximising the value of the four commodities contained in the DSO, exploring DMs option (after Mindouli stockpile deleted) and explore more efficient marketing of the end product.
(vi) Improve logistic management; and
(vii) Metallurgical test work to upgrade the Moubiri DSO
2. Further exploration at Moubiri. The exploration target for Moubiri is for at least 500kt of 45% DSO Pb/Zn ore with 6% Cu plus Ag. Two ore bodies have been identified in the hanging wall including a lower grade Pb/Zn zone and a high grade Cu zone with one intercept of 22 metres @ 6% Cu. In addition to this Tchicoomba, which is 6km from
3. Exploration and there are numerous regional targets.
4. Complete metallurgical test work at Mindouli. Initial test work on the stockpile (circa 30,000 tonnes) returned head grade of 7% Cu and 150 g/t Ag. Further it demonstrated feed grade of 7% Cu, 150 g/t Ag, it could be processed through a Dense Media Separator (cost circa US$750k from Republic of South Africa), fines of 20-30%, primary recovery of 70%-80%; overall recovery 65% with concentrated grades of 42% Cu and 2,500 g/t Ag. Low cap ex (US$750k) for the DMS plant with projected margin on the current stockpile of circa US$5 million and the DMS plant could be used at Moubiri when the processing was complete (3-6 month process to treat the stockpile.
5. Systematic exploration and development of Mindouli. Stage 1 will require drilling the project out on 100 metre sections. This will be a 6 month program depending on the number of drills available. The drilling will be at least 20,000 metres and can be from the surface and possibly underground following the redevelopment of existing adits and will resulting JORC compliant resource. A scoping study would be run concurrently with drilling to identify the optimum process route and development plan. Stage 2 and 3 prefeasibility study and infill drilling will be completed in 12 months and will generate;
(i) JORC compliant resource and reserve
(ii) Infill on 50 metre sections; 3 month program. Total drill 10,000 metres and will result in a JORC compliant Resource/reserve.