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Relatório Serra Azul Audit On Resource 162700 12 005 20130807
Relatório Serra Azul Audit On Resource 162700 12 005 20130807
Report Prepared by
Contributors:
Leah Mach, M.Sc. Geology, CPG
Reviewed By:
Matthew Hastings, M.Sc. Geology
Page ii
Summary
SRK Consulting (U.S.), Inc., (SRK) was commissioned by MMX Minerao e Metlicos S.A. (MMX)
to audit resource estimation for the Serra Azul Mine (the Project). The Project is located in the Serra
Azul area in the state of Minas Gerais, Brazil near the town of Igarap, located approximately 60 km
southwest of Belo Horizonte, the capital of Minas Gerais. The Project consists of two contiguous
open pit mines and two beneficiation plants for the production of lump and sinter feed. The Tico-Tico
Mine was acquired by MMX as part of the acquisition of AVG Minerao S.A. (AVG) in December
2007. The Ip mine was acquired as part of the acquisition of Mineradora Minas Gerais Ltda
(Minerminas) in March 2008. The properties are operated by MMX Sudeste Minerao Ltda. (MMX
Sudeste), a 100% owned subsidiary of MMX. MMX has prepared a feasibility study to expand
production to 29 Mt of pellet feed per year. The expansion includes a new beneficiation plant, a
slurry pipeline to a new rail car loading area and a new tailings storage facility.
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August 5, 2013
Page iii
Piracicaba Group;
Itabira Group; and
Caraa Group.
Locally, the stratigraphic sequence is inverted, with the most recent quartzitic formations of the
Piracicaba Group overlain by the itabirites of the Cau Formation, part of the Itabira Group, which, in
turn, is capped by the oldest phyllites and quartzites of the Caraa Group.
The dominant structure in the project area is an antiform overturned to the north. The upper limb has
been completely eroded, leaving only the inverted lower limb.
Within the pit area, the geology is dominated by four formations. From oldest to youngest, these are
the Batatal, Cau, Gandarela and Cercadinho Formations. The Batatal Formation has been thrust
over the younger Cau Formation, which has been thrust over the youngest Cercadinho Formation.
The deposit is crosscut by a northwest-trending, high-angle fault. The mineralization at the Project
consists of metamorphosed banded iron formation (BIF) with strong evidence of hydrothermal
syngenetic formation with areas of supergene enrichment from subsequent lateritic weathering. This
results in four major mineralization types, including:
Canga;
Friable and compact itabirite;
Dolomitic itabirite
MMX has further classified the mineralization types, based on content of Fe, Al2O3, Mn and mass
recovery in the lump ore fraction.
Number of
Drillholes
11
11
365
85
450
461
Period
2005
2005
2007-2012
2007-2012
2007-2012
Length
(m)
440
440
34,938
10,621
45,559
45,999
Number of
Samples*
46
46
6,572
2,059
8,631
8,677
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Before MMX acquired the Serra Azul properties, sample preparation and analysis were performed at
the AVG laboratory on the AVG property. During the initial exploration phase and in 2009, MMX
used SGS Geosol Laboratrios, Ltda. (SGS) located in Belo Horizonte. For part of 2008, MMX used
the laboratory at Mine 63 operated by its subsidiary, MMX-Corumb Minerao Ltda. (MMXCorumb). In 2010, MMX used SGS and the Bureau Veritas laboratory in Belo Horizonte. In 2011
and 2012, MMX used only the SGS laboratory.
At the AVG laboratory, all samples were analyzed using titration methods. The sample is dried at
100C and then 0.5 g of material is analyzed for percentage of Al2O3, Ca, Fe, FeO, Loss on Ignition
(LOI), Mg, Mn, P, S, SiO2 and TiO2. At Mine 63, SGS and Bureau Veritas, all samples are analyzed
for Fe, Al2O3, SiO2, P, Mn, and TiO2 by X-Ray Fluorescence (XRF). LOI is analyzed by heating and
then weighing the residue.
MMX has a standard laboratory Quality Assurance/Quality Control (QA/QC) program in place and
regularly monitors the results.
Resource Estimate
The resource estimation for the Serra Azul Mine was prepared by Mr. Elvis Vargas and Mr. Rodrigo
Oliveira under the direction of Mr. Vandersoni Monteiro Vieira de Moraes, Manager of Geology and
Mineral Resources. MMX uses Geovias Surpac software for resource estimation and Mintecs
Minesight software for mine planning. Leah Mach, Principal Resource Consultant with SRK,
audited the resource. The resource estimation procedures included the Pau de Vinho area, but only
the Serra Azul resources are reported in this document.
Geologic Model
Seventy vertical geologic cross-sections were constructed at intervals of 100 m or 50 m depending
on the drill spacing. The following lithotypes were modeled in the cross-sections:
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Soil (SO);
Phyllite (FL).
August 5, 2013
Page v
Compositing
MMX composited the samples on 7.5 m intervals starting at the top of the drillhole with breaks at the
lithotype solid boundaries. The variables that were composited include Fe, SiO2, Al2O3, P, LOI, Mn,
CaO, MgO and mass recovery of lump ore fraction (MR1).
Variograms
MMX used the Serra Azul database for variogram studies. The study included directional and
downhole variograms for Fe, SiO2, Al2O3, Mn, P, LOI, CaO MgO, and MR1.
The variogram analysis included the IF, IAL (IA + IL), IC and IPT lithotypes. The nugget was
determined from downhole variograms. Variogram maps were produced to determine the search
ellipsoid orientation and the relationships between the axes.
Grade Estimation
A block model was created which covers both the Serra Azul and Pau de Vinho Projects. The block
size is 25 m by 25 m in plan view and 15 m high. The block model contains variables for:
Global Fe, SiO2, Al2O3, Mn, P, CaO, MgO, LOI and MR1;
Fe, SiO2, Al2O3, Mn, P, CaO, MgO, LOI and MR1 for each of the lithotypes in each block;
Majority lithotype;
Density, and
Estimation parameters number of composites, number of drillholes, average distance of
composites used in estimation, and distance to closest composite for SiO2.
The block model was coded with the percentage of each lithotype within the block from the lithotype
wireframe solids. The percentage of the block below topography was assigned to the topography
percentage variable.
A neighborhood analysis on SiO2 was performed to determine the best estimation strategy for all
variables. SiO2 was used because it is the main contaminant in the concentration process, it has a
high correlation with Fe and the Fe and SiO2 variograms are similar.
Block grades were estimated by ordinary kriging for IF, IAL (IA + IL), IC and IPT. Inverse distance
squared (ID2) was used for CGG (CD + CG) and HM (HF + HC). Each block has an Fe variable for
each of the lithotypes. Easting 576550 was used as a soft boundary during the estimation in that
there are different search orientations but composites were not limited by position relative to easting
576550.
The final block lithology was determined by the majority lithotype. The final block grade was
determined as the weighted average of the percent of the lithotype, the density of the lithotype and
the grade of the lithotype. The final block density was calculated as a weighted average of the
percent of the lithotype and the density of the lithotype.
The block model was validated by the following methods:
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Visual comparison of the block grades to the composite grades on cross-sections and
horizontal sections;
August 5, 2013
Page vi
The resources were classified according to Canadian Institute of Mining, Metallurgy and Petroleum
(CIM) classification as Measured, Indicated, or Inferred. The IF, IPT, IAL (IA + IL), CGG (CG + CD)
and HM (HF + HC) classification was based on the pass in which the block was estimated. The
compact itabirite (IC) classification followed two steps: blocks were first classified according to the
estimation pass and then, because the drillholes are terminated in the IC at different elevations, a
surface was constructed using the base of the drillholes to limit classification as Measured.
Measured blocks are above the surface and the nearest sample used in estimation is less than 200
m from the block. Classification as Indicated required that the nearest composite was within 300 m
of the block, and in the western portion where the drilling is shallow, the blocks had to be above a
surface that was constructed about 80 m below the base of drilling surface. Blocks were classified
as Inferred if they did not meet the Measured or Indicated classification requirements or if estimated
in Step 5 of the estimation.
The Mineral Resources of the Serra Azul Mine as of April 10, 2013, on a wet tonnage basis are
presented in Table 2. The resources are limited by the DNPM mineral concession boundary and the
September 28, 2012 topography. The resources are stated at a cut-off grade of 15%.
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Page vii
Table 2: Serra Azul Mineral Resource Statement, at April 10, 2013, Wet Tonnage Basis
Lithology
Friable
Canga
Powdery Itabirite
Compact Itabirite
Total
Resource
Tonnage (Mt)
Fe (%)
SiO2 (%)
Al2O3 (%)
Mn (%)
P (%)
LOI (%)
CaO (%)
MgO (%)
Measured
Indicated
M&I
Inferred
Measured
Indicated
M&I
Inferred
Measured
Indicated
M&I
Inferred
Measured
Indicated
M&I
Inferred
Measured
Indicated
M&I
Inferred
39.5
50.9
90.4
28.5
0.1
1.7
1.8
5.4
30.5
45.8
76.2
73.7
1025.4
621.7
1647.1
216.5
1095.5
720.0
1815.5
324.0
49.9
47.5
48.5
45.2
58.6
57.1
57.2
55.5
33.2
31.7
32.3
28.2
34.4
32.7
33.7
33.9
34.9
33.7
34.4
33.9
25.3
28.4
27.0
31.0
4.7
5.6
5.6
10.1
44.7
47.6
46.5
52.1
49.6
51.7
50.4
49.3
48.6
49.7
49.0
47.7
1.70
1.81
1.76
1.82
4.71
5.38
5.34
4.48
3.68
3.21
3.40
3.27
0.56
0.63
0.59
0.84
0.69
0.89
0.77
1.54
0.05
0.08
0.06
0.24
0.03
0.04
0.04
0.11
0.51
0.71
0.63
0.80
0.04
0.07
0.05
0.13
0.05
0.11
0.08
0.29
0.046
0.049
0.048
0.057
0.256
0.240
0.241
0.218
0.077
0.078
0.078
0.082
0.022
0.030
0.025
0.032
0.024
0.035
0.029
0.049
1.35
1.38
1.37
1.74
5.66
5.77
5.77
5.05
2.64
2.48
2.54
2.53
0.39
0.57
0.46
0.83
0.49
0.76
0.60
1.37
0.03
0.03
0.03
0.02
0.02
0.02
0.02
0.02
0.03
0.03
0.03
0.03
0.04
0.12
0.07
0.03
0.04
0.11
0.07
0.03
0.06
0.06
0.06
0.06
0.06
0.05
0.06
0.06
0.07
0.08
0.07
0.27
0.07
0.15
0.10
0.07
0.07
0.14
0.09
0.11
Cut-off Grade 15% Fe; tonnes on a wet basis; topography current at September 28, 2012
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Page viii
The exploration target is that material estimated in the final pass or not classified as Measured,
Indicated or Inferred. The mineral potential ranges from 10,000 to 40,000 kt at Fe grades between
30% and 40% and includes material classified as canga, detrital canga, powdery itabirite and minor
amounts of compact and friable hematite.
Conclusions
Exploration
MMX has drilled the Serra Azul property on a grid of approximately 100 m x 100 m. The
deeper drilling in the compact itabirite is on a wider spaced grid, but is still sufficient for
resource estimation.
MMX has used internationally recognized laboratories for the bulk of the sample analysis.
Some of the early samples were analyzed at the AVG laboratory and at the Mine 63
laboratory. SRK has visited both of those laboratories and found that the Mine 63 laboratory
was operated in a professional manner and that the AVG laboratory was also operated
professionally although it lacked an XRF machine. In any case, the number of samples
analyzed at these laboratories is low in respect to the total number of samples.
MMX has a standard laboratory QA/QC program in place and reviews the results on a
regular basis.
It is SRKs opinion that the drilling, sampling and analysis are conducted according to
industry best practices.
The mineral resource estimation was conducted by MMX and audited by SRK. It is SRKs
opinion that the estimation has followed industry best practices.
Because the iron formation is dipping at about 50 to the southeast, the drillholes in the
compact itabirite have not been terminated at a uniform depth or elevation. To limit the
classification of Measured and Indicated resources below drillholes, surfaces were
constructed at the base of drilling and used in the classification. It is SRKs opinion that the
classification meets CIM guidelines.
Recommendations
SRK recommends that MMX continue to drill deeper holes into the compact itabirite to decrease the
sample spacing and increase confidence in the resource. This work could be performed as mining
progresses and drilling depth decreases accordingly.
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Table of Contents
1.1 Introduction ......................................................................................................................................... 1
1.2 Terms of Reference and Purpose of the Report ................................................................................. 1
1.3 Qualifications of Consultants (SRK).................................................................................................... 1
1.3.1 Details of Inspection ................................................................................................................ 1
1.4 Reliance on Other Experts (Item 3) .................................................................................................... 2
1.5 Effective Date ...................................................................................................................................... 2
1.6 Units of Measure ................................................................................................................................. 2
4 History......................................................................................................................... 13
4.1 Prior Ownership and Ownership Changes........................................................................................ 13
4.2 Previous Exploration and Development Results ............................................................................... 13
4.3 Historic Mineral Resource and Reserve Estimates .......................................................................... 14
4.4 Historic Production ............................................................................................................................ 14
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7 Exploration ................................................................................................................. 31
7.1 Relevant Exploration Work ............................................................................................................... 31
7.1.1 Surveys and Investigations ................................................................................................... 31
8 Drilling......................................................................................................................... 32
8.1 Type and Extent ................................................................................................................................ 33
8.2 Procedures ........................................................................................................................................ 33
8.2.1 Core Drilling ........................................................................................................................... 34
8.2.2 RC Drilling ............................................................................................................................. 34
8.2.3 Factors Impacting Accuracy of Results ................................................................................. 35
8.3 Interpretation and Relevant Results .................................................................................................. 35
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14 Recommendations ..................................................................................................... 68
14.1 Recommended Work Programs ........................................................................................................ 68
15 References .................................................................................................................. 69
16 Glossary...................................................................................................................... 71
16.1 Mineral Resources ............................................................................................................................ 71
16.2 Mineral Reserves .............................................................................................................................. 71
16.3 Definition of Terms ............................................................................................................................ 72
16.4 Abbreviations .................................................................................................................................... 73
List of Tables
Table 1: Drilling at Serra Azul ........................................................................................................................... iii
Table 2: Serra Azul Mineral Resource Statement, at April 10, 2013, Wet Tonnage Basis ............................. vii
Table 2.2.1.1: Serra Azul Land Tenure ............................................................................................................. 7
Table 2.4.2.1: Expansion Processes ................................................................................................................. 8
Table 2.4.2.2: Processes for Current Operation ................................................................................................ 9
Table 4.4.1: Historic Production for the Tico-Tico Plant .................................................................................. 14
Table 4.4.2: Historic Production for the Ip Plant ............................................................................................ 14
Table 5.4.1.1: Mineralization Types ................................................................................................................. 28
Table 8.1: Drilling at Serra Azul ....................................................................................................................... 32
Table 8.1.1: Comparison of Twin RC and Core Drillholes............................................................................... 33
Table 9.2.2.1: Detection Limits of MMX-Corumba Laboratory Iron Ore Analysis ........................................... 38
Table 9.2.3.1: Detection Limits of SGS Laboratory Iron Ore Analysis ............................................................ 39
Table 9.2.4.1: Bureau Veritas Detection Limits ............................................................................................... 40
Table 11.1.1: Basic Statistics of All Analyzed Intervals ................................................................................... 43
Table 11.3.1: Statistics of Assays and Composites in the Serra Azul Database (1/2) .................................... 47
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Table 11.3.1: Statistics of Assays and Composites in the Serra Azul Database (2/2) .................................... 48
Table 11.3.2: Correlation Table for Composites .............................................................................................. 49
Table 11.4.1: Density of Lithotypes, on a Wet Basis ....................................................................................... 49
Table 11.5.1: Variogram Parameters .............................................................................................................. 51
Table 11.6.1: Block Model Dimensions and Origin ......................................................................................... 53
Table 11.6.2: Estimation Parameters (1/2) ...................................................................................................... 54
Table 11.6.2: Estimation Parameters (2/2) ...................................................................................................... 55
Table 11.9.1: Serra Azul Mineral Resource Statement, April 10, 2013, Wet Tonnage Basis ......................... 62
Table 11.10.1: Grade Tonnage Data for Fe and SiO2 ..................................................................................... 63
Table 25.3.1: Definition of Terms .................................................................................................................... 72
Table 25.4.1: Abbreviations ............................................................................................................................. 73
List of Figures
Figure 2.1.1: General Location Map of the Serra Azul Mine ............................................................................. 3
Figure 2.1.2: Site Location Map of the Serra Azul Mine .................................................................................... 4
Figure 2.1.3: Mineral Licenses of the Serra Azul Mine...................................................................................... 5
Figure 3.1: Surface Rights of the Serra Azul Mine Area ................................................................................. 10
Figure 5.1.1.1: Project Location within the So Francisco Craton .................................................................. 17
Figure 5.1.1.2: Location of Large Structures in the Iron Quadrangle .............................................................. 17
Figure 5.1.1.3: Geological Sections Proposed for the Region of the Serra do Curral..................................... 20
Figure 5.2.1: Stratigraphic Column. ................................................................................................................. 22
Figure 5.3.1: Geological Map of the Serra Azul Mine Area, at December 16, 2012 ....................................... 25
Figure 5.3.2: North-South Cross-sections through the Serra Azul Mine ......................................................... 26
Figure 8.1: Drillhole Location Map with Mining Concessions .......................................................................... 32
Figure 11.2.1: Decision Tree Defining Lithotypes ........................................................................................... 44
Figure 11.2.2: Cross-sections in Oblique View................................................................................................ 45
Figure 11.2.3: Longitudinal Sections in Oblique View ..................................................................................... 45
Figure 11.2.4: Cross-Sections with Geology and Drilling, Looking East ......................................................... 46
Figure 11.6.1: Cross-Sections with Geology, Block Model and Drilling Looking East .................................... 56
Figure 11.7.1: Histogram of Block Fe (upper left), Nearest Neighbor Fe (upper right), QQ plot (center) and
scatter plot (lower) of Fe in Compact Itabirite ...................................................................................... 57
Figure 11.7.2: Swath Plots of Fe in Compact Itabirite by Easting and Elevation ............................................ 59
Figure 11.8.1: Cross-sections with Geology, Block Model Classification and Drilling..................................... 60
Figure 11.10.1: Grade Tonnage Curves, Iron.................................................................................................. 64
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1.1
Page 1
Introduction
SRK Consulting (U.S.), Inc., (SRK) was commissioned by MMX Minerao e Metlicos S.A. (MMX)
to audit resource estimation for the Serra Azul Mine (the Project). The Project is located in the Serra
Azul area in the state of Minas Gerais, Brazil near the town of Igarap, located approximately 60 km
southwest of Belo Horizonte, the capital of Minas Gerais. The Project consists of two contiguous
open pit mines and two beneficiation plants for the production of lump and sinter feed. The Tico-Tico
Mine was acquired by MMX as part of the acquisition of AVG Minerao S.A. (AVG) in December
2007. The Ip mine was acquired as part of the acquisition of Mineradora Minas Gerais Ltda
(Minerminas) in March 2008. The properties are operated by MMX Sudeste Minerao Ltda. (MMX
Sudeste), a 100% owned subsidiary of MMX. MMX has prepared a feasibility study to expand
production to 24 to 29 Mt of pellet feed per year The expansion includes a new beneficiation plant, a
slurry pipeline to a new rail car loading area and a new tailings storage facility.
1.2
1.3
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August 5, 2013
1.4
Page 2
1.5
Effective Date
The effective date of the resource estimation is April 10, 2013; the effective date of the report is
August 5, 2013.
1.6
Units of Measure
The metric system has been used throughout this report. Tonnes are metric of 1,000 kg, or 2,204.6
lb. Currency is stated in United States Dollars (US$) and the Brazilian Real (R$) as indicated.
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August 5, 2013
2.1
Page 3
The Project is located approximately 60 km southwest of Belo Horizonte, and approximately 560 km
northwest of Rio de Janeiro in Minas Gerais State, Brazil (Figures 2.1.1 and 2.1.2). The Project
consists of three contiguous licenses in the Serra Azul Mountain Range, located near the city of
Igarap in the southwest part of the Quadriltero Ferrfero (Iron Quadrangle). The Project also
includes five exploration claims surrounding the licenses. The licenses lie between 200730S and
200630S and between 4417W and 4419W (Figure 2.1.3). The Project lies within the
municipalities of Brumadinho, Igarap, Itatiaiuu, Mateus Leme and So Joaquim de Bicas.
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Page 4
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Page 5
2.2
Mineral Titles
Mining Rights
Mining rights in Brazil are governed by Mining Code Decree 227 dated February 27, 1967 and
further rules enacted by Brazils National Department of Mineral Production (DNPM), which is the
governmental agency controlling mining activities in Brazil.
Each application for exploration or mining is represented by a claim submitted to the DNPM.
Brazilian Mining legislation allows that mining rights, both Exploration Permits and Mining
Concessions may be, with the DNPMs approval, totally or partially, assigned or transferred to others
by its holder. The administrative process for both is similar, even though there are specific
conditions for each. In both cases the interested party must file a specific administrative process at
the DNPM, according to the provisions set forth in the Ordinance # 199, July 14, 2006 enacted by
the DNPM.
Once granted, an Exploration Permit is valid for three years, with the possibility to be extended for
three more years. After that the holder must present the Final Exploration Report about all technical
activities performed at the project in order to define a mineral deposit and prove that this particular
project is feasible. Also, at the holders discretion this report may be presented before the expiration
date. One of the main points is the presentation of the resources (Measured, Indicated and
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August 5, 2013
Page 6
Inferred), which at the Mining Concession step will be the tonnages/volumes which the mining
company will be allowed to exploit. If during the Life of Mine (LoM), more exploration is conducted
and the reserves are expanded, then these can be added to the allowed quantities to be mined,
provided the DNPM approves this work. Even if the project does not demonstrate feasibility, the
Final Exploration Report is mandatory.
At this point it should be mentioned that the DNPM considers the Measured, Indicated and Inferred
tonnages/volumes as reserves, and not, as in other countries as resources. This wording/conceptual
difference sometimes leads to misunderstandings.
During the validity of an Exploration Permit, the holder pays a tax referred to as the Annual Tax per
Hectare. The value is R$2.02/ha for the first three years, and R$3.06/ha when the Exploration
Permit has been extended.
Exploration Permits are granted to Brazilian citizens and/or mining companies established in Brazil.
Mining Concessions are only granted to mining companies. When the application is filed at a DNPM
office, the application receives a number which is used during the whole validity of its life, either as
Exploration Permit or Mining Concession. For example, the DNPM number 834.189/2006 means
that the first filing for an Exploration Permit was made in 2006.
If the Final Exploration Report is approved by the DNPM, the holder has one year to present a Plano
de Aproveitamento Econmico (PAE), or Economic Exploitation Plan, among other documents of
minor importance. The PAE may be seen as a Feasibility Study. Construction and mining activities
may start after the PAE is approved.
Other than several corporate taxes paid by companies in Brazil, mining companies also pay a tax for
mineral exploitation called Financial Compensation for the Exploitation of Mineral Resources
(CFEM), which is levied on the sale of raw or improved mineral. For iron ore the rate is 2%. The
company must pay an amount equal to 50% of the CFEM to the landowner.
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August 5, 2013
Page 7
805.374/71
005.182/58
Holder
Cia. de
Minerao
Serra da Farofa
CEFAR
Cia. de
Minerao
Serra da Farofa
CEFAR
Cia. de
Minerao
Serra da Farofa
- CEFAR
Area
(ha)
Permit
Validity
Term
Iron
351.64
Mining
Iron
83.37
Mining
May 21,
2021
Brumadinho
Iron
74.70
Mining
Exploration
License
Exploration
License
Exploration
License
Exploration
License
Exploration
License
Exploration
Request
Exploration
Request
June 11,
2016
Location*
Mineral
833.379/2004
MMX Sudeste
Iron
259.79
832.182/2006
MMX Sudeste
Iron
102.25
830.632/2006
MMX Sudeste
Brumadinho, Igarap
Iron
107.32
832.183/2006
MMX Sudeste
Brumadinho, S. Joaquim
Iron
193.50
831.977/2005
BRASROMA
Brumadinho, Igarap
Iron
411.45
830.633/2006
MMX Sudeste
Iron
1,881.25
831.243/2006
MMX Sudeste
Mateus Leme
Iron
960.00
Iron
7.97
Brumadinho, S. Joaquim
MMX Sudeste
831.713/2010
MMX Sudeste
Brumadinho
Iron
12.01
832.607/2010
MMX Sudeste
Brumadinho
Iron
261.47
834.356/2010
MMX Sudeste
Iron
1,358.18
Exploration
Request
830.088/2011
MMX Sudeste
Iron
404.21
Exploration
Request
Brumadinho, S. Joaquim
2.3
de Bicas
Brumadinho, S. Joaquim de
Bicas
Jul 29,2016
Apr 6, 2014
6-Apr-14
Exploration
Request
830.826/2010
de Bicas
Exploration
Request
Exploration
Request
2.4
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August 5, 2013
Page 8
On August 26, 2011 MMX committed to a Behavior Adjustment Term (TAC) so that the safety,
stability and environmental quality of the tailings dam, water supply, and sediment containment are
assured.
00886/2003/023/2011
00886/2003/025/2012
00886/2003/027/2012
14968/2012/001/2012
14968/2012/003/2013
00886/2003/029/2013
149468/2012/004/2013
14968/2012/002/2012
LEM/MLM
Description
LP
LI
LI + LP
(ADME and Main
Access)
LP Dam tailings
9B
LP + LI
(Pit expansion
and stack
storage)
LP + LI
(Concrete Plant)
LO (Concrete
Plant)
LOP (Geological
Survey)
LP (Gas Station)
LP + LI
(ADME 2)
Municipalities
So Joaquim de
Bicas
So Joaquim de
Bicas
So Joaquim de
Bicas
Status
License granted with conditions
Itatiaiuu, Itana,
Mateus Leme,
Igarap e So
Joaquim de Bicas
Brumadinho,
Igarap e So
Joaquim de Bicas
So Joaquim de
Bicas
So Joaquim de
Bicas
Brumadinho
So Joaquim de
Bicas
So Joaquim de
Bicas
August 5, 2013
Page 9
00886/2003/021/2011
00049/1984/024/2012
02194/2004/012/2012
LEM/MLM
Description
LOC for tailings disposal from
Ip mine.
LP + LI Stock Pile Grota das Cobras,
Phase 1 Preliminary
Environmental Authorization
for the new mechanical workshop
at Tico-Tico Mine
LOC B1A Ip mine dam raising
Municipalities
Brumadinho
Brumadinho
Brumadinho
Brumadinho
Igarap
Brumadinho
Igarap
Igarap
Igarap
Status
License granted with
conditions
License granted with
conditions
Environmental
Authority granted
License granted with
conditions
Under analysis by the
Environmental Authority
License granted with
conditions
Under analysis by the
Environmental Authority
Under analysis by the
Environmental Authority
Under analysis by the
Environmental Authority
Igarap
Igarap
Igarap
August 5, 2013
Page 10
3.1
LEM/MLM
August 5, 2013
Page 11
The Project is located in the Central Brazil Complex, which is the transition zone between the
Scrublands and Atlantic Forest Biomes. According to Rizzini (1979), vegetation from both biomes
can be found in the Complex. These include vegetation of the Atlantic Forest, Seasonal Forest, the
Cerrado (Sclerophyll Forest), hygrophila communities, and areas covered by treeless fields or
rupestrian fields. The Project is located in a steep, mountainous terrain where forest and campestral
vegetation have been identified. The first occupy the slopes, climbing up the mountains along the
ravines in the form of hillside thickets or narrow bands of gallery forest. The campestral vegetation is
found in the valleys and on peaks. Vegetation corresponds to the ecological succession from
submontane and semi-deciduous to seasonal or pluvial forest. Natural reforestation of the cleared
land has resulted in an irregular distribution of the forest and open fields of native grasses or scrub
growth.
3.2
3.3
3.4
LEM/MLM
August 5, 2013
Page 12
Horizonte metropolitan area. MMX is currently constructing its own rail terminal about 6.7 km from
the mine. These railways provide easy access to the iron ore transport route, the coastal ports of
Porto de Sepetiba and Tubaro as well as Porto Sudeste, currently being developed by MMX.
3.5
LEM/MLM
August 5, 2013
History
4.1
Page 13
CEFAR is the holder of the three licenses comprising the Project. On January 1, 2011, MMX
incorporated AVG and became the only lessee of the mineral rights of the three mining concessions
(249/2012 Mining Group). Prior to ownership by AVG and Minerminas, the area covered by Mining
License 801.908/68 was developed by Santa Mariana Participaes e Administrao Ltda (Santa
Mariana), which operated under a 10-year lease agreement initiated on May 23, 1986. In 1987,
Santa Mariana sub-leased this license to Minerao Serra das Farofas Ltda, the predecessor of
AVG. Eight years later, Santa Mariana assigned its rights in the lease agreement to AVG through a
Contract of Assignment of Lease Right, approved by DNPM on July 19, 1996. At same time,
CEFAR extended the 10-year lease agreement for an additional two years, until June 2, 1998. A
new lease agreement between CEFAR and AVG was initiated on May 19, 1998 and on May 3, 2003,
this lease agreement was extended until 2021. Minerminas started operations at the area on July
01, 2003 through a lease agreement with CEFAR, with AVGs approval. This agreement assigned
Minerminas the right to mine the western part of Mining License 801.908/68 covering approximately
57% of the area.
The first work on Mining License 805.374/71 was conducted by Mineradora Rio Bravo Ltda, under a
10-year lease agreement with CEFAR. This contract was initiated on June 4, 1986 and had an
option to extend the term for an additional 10 years. In 1998, CEFAR signed a 5-year lease
agreement with Minerao Serra das Farofas Ltda, which was initiated on December 11, 1998 and
completed on June 23, 1999. Minerminas started mining activities on this mining license in March
1999 under a 22-year lease agreement, which is still in effect. Minerminas was incorporated into
AVG in 2010.
The lease on Mining License 005.182/1958 was assigned to AVG on October 24, 2010.
4.2
LEM/MLM
August 5, 2013
Page 14
compatible with the size of the deposit. Mining was based on the empirical knowledge of the
technical team operating at the mine. The mine was not optimized and lacked a life of mine (LoM)
plan.
After the purchase of the mineral rights by MMX, AVG and Minerminas were combined into
AVG/Minerminas which is now referred to as Serra Azul. Since then, MMX has implemented an
aggressive exploration and development program including drilling, mapping, sampling, resource
estimation, pit optimization, mine planning, and process evaluation using best industry practices.
4.3
4.4
Historic Production
The AVG plant, now referred to as the Tico-Tico Plant, began magnetic separation in May 2006 so
spiral rejects could be recovered.
Since MMX gained control of the AVG Mine in December 2007, the Minerminas mine in March 2008,
and completed its first year of production in 2008, there have been plant upgrades and production
improvements through the plant.
In 2008, the Minerminas plant, now referred to as the Ip Plant, had a crusher refurbishment and
addition of a magnetic separator to aid in recovery of the fines.
Tables 4.4.1 and Table 4.4.2 present the production from each unit
Table 4.4.1: Historic Production for the Tico-Tico Plant
Description
RoM (Mt)
Fines (Mt)
Total Plant Feed (Mt)
Lump (Mt)
Coarse Sinter Feed (Mt)
Sinter Feed Spirals(Mt)
Pellet Feed (Mt)
Total Production (Mt)
Recovery (%)
2005
2.2
2.1
0.5
0.6
0.4
1.6
73.3
2006
2.4
2.4
0.4
0.7
0.5
1.6
69.3
2007
2.3
0.8
3.0
0.4
1.0
0.9
2.3
75.7
2008
2.7
1.1
3.8
0.6
1.3
0.6
0.3
2.8
74.0
2009
2.2
1.9
4.0
0.6
1.4
0.6
0.3
2.9
71.48
2010
3.0
1.5
4.5
0.7
1.4
0.8
0.4
3.5
74.34
2008
1.0
0.1
1.1
0.3
0.2
0.1
0.0
0.6
53.4
2009
1.4
0.9
2.2
0.4
0.5
0.0
0.4
1.2
54.99
2010
2.6
1.3
3.8
0.6
1.1
0
0.7
2.4
62.68
2011
2.6
1.7
4.2
0.9
1.9
0.5
0.3
3.6
67.51
2012
2.3
1.1
3.4
1.0
1.8
0.4
0.1
3.6
73.93
LEM/MLM
2005
1.2
1.2
0.4
0.1
0.5
41.7
2006
1.3
1.3
0.5
0.2
0.1
0.7
54.4
2007
1.5
1.5
0.6
0.3
0.1
0.9
61.6
2011
2.3
1.4
3.8
0.5
0.5
0.9
0.6
2.5
65.29
2012
2.5
1.5
4.1
0.5
0.8
0.4
0.6
2.3
55.88
August 5, 2013
LEM/MLM
Page 15
August 5, 2013
Page 16
5.1
Regional Geology
The Project area is situated in the western portion of the Iron Quadrangle near Belo Horizonte, Minas
Gerais, in the Serra do Curral homocline. Mineralization is hosted by the Minas Supergroup which is
dominated by supracrustal metasedimentary and metavolcanic rocks. Intrusive rocks are rarely
found in the area but, where present, are basic sills and dikes up to 1 m wide. Regional
metamorphism reached the greenschist facies during multiple episodes of deformation.
The Serra do Curral homocline is located in the north and has a NE-SW strike and dips SE. The
Serra Moeda syncline is located in the west part of the Iron Quadrangle and is the west limb of a
syncline which has an N-S axis and dips to the south. The Dom Bosco syncline is in the south and
has an E-W axis and is connected to the Serra Moeda syncline on the west side. There is also the
Falha do Engenho zone of trans-current shearing, the Mariana anticline to the southeast and the
Santa Rita syncline to the east. According to Dorr (1969), the Santa Rita syncline corresponds to the
major and most complex folding of the region. Finally, the Gandarela isoclinal syncline is located to
the northeast with SE dipping limbs and the Fundo-Cambotas fault system that extends for almost
the entire length of the east border. Figure 5.1.1.2 shows the homocline, synclines and anticlines in
the region.
LEM/MLM
August 5, 2013
Page 17
Source: Marshak & Alkmim 1989 and Alkmim & Marshak 1998
Source: Modified from Alkmim & Noce 2006 after Dorr (1969) and Romano (1989)
August 5, 2013
Page 18
The homocline is a section of the Serra dos Trs Irmos region (Eichler, 1964);
The homocline is the south limb of the Piedade syncline (Dorr, 1969);
Oliveira et al. (2005) interpret the homocline as the overturned limb of a recumbent
allochthonous megafold, referred to as the Curral Nappe.
Figure 5.1.1.3 shows schematic sections showing each authors interpretation, which are discussed
in detail below.
The first interpretation was proposed by Eichler (1964) and is shown in Figure 5.1.1.3 schematic
section (a). Eichler (1964) interprets the homocline as a section of the Serra dos Trs Irmos region
transported by north-directed thrust faults.
According to Simmons (1968), the Serra do Curral homocline is the south limb of the Piedade
syncline, as suggested by Dorr (1969). This is shown in schematic section (b) in Figure 5.1.1.3.
This structure is well characterized at the NE limit of the Serra do Curral (Serra da Piedade), where
the two limbs of the syncline are recognized, a fact that leads Simmons (1968) to believe that the
homocline represents one of the limbs of this megastructure. The Serra do Curral homocline,
dipping to the SE, is characterized by secondary folding with axial planes oblique to the direction of
the mountain ridge. Small reverse faults parallel to the syncline with displacement to the southeast
and high-angled normal faults cut the megastructure.
Pires (1979) was the first author to propose that the regional folding is related to an anticline.
Through work that was done at the junction of the Serra do Curral homocline with the Moeda
syncline, Pires (1979) proposed the schematic section shown in Figure 5.1.1.3 (c). In this section,
Pires (1979) shows an anticline, the north limb of which would represent the Serra do Curral
homocline. This structure is limited at the base by the Curral Thrust Fault and at the north by schists
of the Rio das Velhas Supergroup.
Romano (1989) determined the petrographic and textural characteristics of the metavolcanic rocks of
the Mateus Leme to Esmeraldas and Par de Minas to the Pitangui regions. According to the
author, these rocks represent the continuity of the Rio das Velhas Supergroup in the Occidental
Serra do Curral. In this region, Romano (1989) identified thrust faults and other deformational
features cutting the Rio das Velhas Supergroupes. The structures are attributed to two phases of
regional deformation (Dn and D1). The first deformation affected only the Rio das Velhas
Supergroup and the second extended to the Minas Supergroup in the western portion of the Serra
do Curral homocline. The second regional deformation was of a progressive compressional
character.
Marshak et al. (1992) and Jordt-Evangelista et al. (1992) identified a zone of normal shearing in the
contact between the Sabar Group and the Belo Horizonte Metamorphic Complex in the region of
Ibirit, southwest of the city of Belo Horizonte, and described three zones of contact metamorphism.
They are, from northwest to southeast, cordierite-sillimanite, staurolite-andalusite-cordierite and
LEM/MLM
August 5, 2013
Page 19
biotite. These zones exemplify the metamorphic aureoles that occur in the contact zones of the
supercrustal rocks with the basement metamorphic complexes in response to the formation of
domes and synclines.
Endo and Machado (1997) interpret the Serra do Curral homocline as part of a syncline
characterized by the absence of a northern limb at the western limit of the structure. Endo and
Machado (1997) observed that on the southern limb, the rocks of the Minas Supergroup are in
normal stratigraphic sequence with inclinations that vary from moderate to high while on the northern
limb, the stratigraphic sequence is inverted. According to Endo and Machado (1997), the Zone of
Normal Shearing (the Moeda-Bonfim zone) in contact between the Bonfim Metamorphic Complex
and the supracrustal rocks along the Serra da Moeda extends to the Serra do Curral homocline.
Here, the zone of normal shearing is identified by the Souza Nochese Zone of Shearing. Thus, the
principal structural features are:
Normal ductile shearing between the metasediments and the Bonfim Complex; and
Stratigraphic inversions in the south rim/limb of the synform.
Based on these structures, Endo and Machado (1997) propose eight events of deformation for the
region: four in the Neo-Archean and four in the Proterozoic, all of co-axial character.
Alkmim & Marshak (1998) observed parasitic asymmetric folding and mesoscopic faults trending to
the northwest at the western limit of the Serra do Curral homocline. This observation led to the
interpretation that the Serra do Curral homocline may be the inverted flank of a regional anticline with
polarity to the northwest. According to Alkmim & Marshak (1998), the Curral anticline is refolded at
the Curral-Moeda junction with the Moeda syncline. The development of the mega-anticline would
be related to a compressive event during the Transamazonic period and older than the extension
that resulted in doming and syncline formation. Alkmim and Marshaks (1998) interpretation is
shown in Figure 5.1.1.3 section (d).
Finally, the relations proposed by Oliveira et al. (2005) for the region of Itatiaiuu, is shown in Figure
5.1.1.3 (e). According to the Oliveira et al. (2005), the schistocity observed in the rocks of the Minas
Supergroup and Rio das Velhas in the entire Serra do Curral region, is the same that predominates
in the sedimentary layering and schistocity in the mesoscopic folds with overturned limbs. According
to the authors, the Serra do Curral homocline is the overturned limb of a allochthonous recumbent
megafold, trending to the north-northeast, and referred to by Oliveira et al (2005) as the Curral
Nappe.
LEM/MLM
August 5, 2013
Page 20
Sources:
a) Schematic section proposed by Eichler (1964) in the region of the Serra dos Trs Irmos;
b) Section proposed by Dorr (1969), section NW-SE in the Quadriltero Ferrfero;
c) Section proposed by Pires (1979) for the region of junction of the Serra do Curral with the Moeda syncline;
d) Section proposed by Alkmim & Marshak (1998) for the region west of the homocline of the Serra do Curral;
e) Schematic section proposed by Endo et al (2005) for the region of Itatiaiuu (Section Itatiaiuu).
(Fm. Formation, Gr. Group, Sgp. Supergroup, ST Topographic Surface).
Figure 5.1.1.3: Geological Sections Proposed for the Region of the Serra do Curral
LEM/MLM
August 5, 2013
5.2
Page 21
Local Geology
In the Project area, the Serra das Farofas is composed of rocks from the Minas Supergroup that are
underlain by the Rio das Velhas Supergroup in an unconformity. The Minas Supergroup is
subdivided, from youngest to oldest, into three groups:
Piracicaba Group;
Caraa Group.
A stratigraphic column is shown in Figure 5.2.1. Locally, the stratigraphic sequence is inverted, with
the most recent quartzitic formations of the Piracicaba Group overlain by the itabirites of the Cau
Formation, part of the Itabira Group, which, in turn, is capped by the oldest phyllites and quartzites of
the Caraa Group. This stratigraphic inversion, as discussed in Section 5.1.1, characterizes the
mountain ridge and is most likely the limb of a recumbent fold.
Structural elements which show three deformation phases (D1, D2 and D3) can be observed in the
Project area. The closed, isoclinal folds of the bedding are related to the D1 deformation phase. In
addition to the thickening of the axial lines and thinning of the limbs, there is an axial plane cleavage
associated with L1 mineral lineations. The folds show that the D2 deformation phase are re-folds of
the first phase, are generally kink folds with angular axial lines and straight limbs verging to the NW
where crenulation lineations are developed. The development of dilational structures filled with
quartz veins is common. The D3 deformation phase is represented by open folds verging to the
south. They are symmetrical with a sinusoidal profile and re-fold the D1 and D2 structures.
Reverse faults are observed at different scales and are associated with the strong deformational
shortening of the iron formations. They are associated with the D2 deformation phase and may be
manifested as brittle shearing zones which affect the original bedding, deforming the first D1 phase.
Narrow fault breccia marks the nuclei of the faults and the rotation of the fragments indicate sinistral
kinematic movement.
LEM/MLM
August 5, 2013
Page 22
LEM/MLM
August 5, 2013
Page 23
5.2.2 Alteration
Alteration in the area is described by MMX geologists as intense silicification of compact itabirite
resulting from hydrothermal activity.
5.2.3 Structure
The dominant structure in the project area is an antiform overturned to the north. The upper limb has
been completely eroded, leaving only the inverted lower limb.
As a result of the numerous deformational episodes, bedding is rarely observed and then only in the
quartzite and phyllite of the Cercadinho Formation. However, the principal foliation, Sn is well
developed in all of the local lithologies. The Sn foliation dips approximately 30 to 40 south in the
northern part of the project and increases to about 70 south in the southern part of the area. This
suggests that the Project is located on the inverted limb of an isoclinal anticline with vergence to the
north. Small scale, asymmetric folds with amplitudes from centimeter to meter scale are observed at
the Project where cataclasite has also been observed. These folds are typically tight with east-west
axes. Intense folding is seen in the iron formation, often obliterating the primary structures.
LEM/MLM
August 5, 2013
Page 24
The contacts between formations show tectonic textures and are interpreted to be thrust faults.
Normal faults are also observed in the project area.
5.2.4 Metamorphism
The metamorphism identified in the Project area is related to continental collision during the
Transamazonian Orogeny. Metamorphic grade in the Iron Quadrangle increases from west to east
as described by Dorr (1969). The rocks of the western and central portions reached greenschist
facies whereas those in the east reached the almandine-amphibolite facies. In the Serra do Curral,
metamorphism of greenschist facies predominates.
Itabirite is a highly deformed rock with a composition derived by tectonic and metamorphic
processes. Small preserved nuclei of magnetite in the interior of hematite crystals suggest that the
greater part of these rocks were oxidized by hydrothermal solutions during the deformational
processes. The most common minerals, other than quartz, are siderite, ankerite, ferroan dolomite,
magnetite, martite and, locally, chlorite. Martite is a product of altered magnetite and ankerite and is
often a secondary mineral.
5.3
Property Geology
Within the pit area, the geology is dominated by four formations. From oldest to youngest, these are
the Batatal, Cau, Gandarela and Cercadinho Formations. The pit geology is shown in Figure 5.3.1
and typical cross-sections are shown in Figure 5.3.2. The Batatal Formation has been thrust over
the younger Cau Formation, which has been thrust over the youngest Cercadinho Formation. The
deposit is crosscut by a northwest-trending, high-angle brittle fault that appears to be offset by
younger northeast trending faults.
The dominant structural features consist of Sn foliation, fracture planes and minor fold axes.
Foliation is the most conspicuous planar element within the pit and is preferentially developed in the
enriched itabirite. The Sn foliation strikes northwest-southeast and dips both northeast and
southwest suggesting the presence of a larger fold. Parasitic fold axes typically trend 150 to 200.
Well-defined fracture planes are found in both the friable itabirite and compact itabirite. It is typically
more prominent in the compact itabirite. The fracture planes have two predominant orientations.
One strikes northwest and dips northeast the other strikes north-northeast and dips southeast.
These fabrics often host breccia zones with areas of significantly enriched iron.
LEM/MLM
August 5, 2013
Page 25
Figure 5.3.1: Geological Map of the Serra Azul Mine Area, at December 16, 2012
LEM/MLM
August 5, 2013
Page 26
August 5, 2013
5.4
Page 27
Canga;
Dolomitic itabirite
Canga is the product of chemical weathering of all the types of friable ore. It generally has more
elevated grades of aluminum, phosphorous, and greater loss on ignition (LOI). It occurs in three
stratigraphic locations: at the top of the BIF, in the base of the southern Serra das Farofas and over
the schists of the Batatal Formation. In the Batatal Formation, canga is formed in the iron ore
colluvium. In some areas, it has elevated iron grades, due to the nature of the source rock. The
presence of visible hematite clasts is common and goethite and limonite commonly occur with
secondary minerals, increasing the hardness.
The friable itabirite is confined to the proximities of compact itabirite or of zones of silicification. The
principal characteristics of this type of ore are silica grades that vary from 6% to 10% and in
granulometry that is above 19 mm. The bands are composed of friable hematite intercalated with
bands of recrystallized quartz.
Compact itabirites occurs at the base of the friable itabirites and as small elongated bodies
preferentially oriented west-northwest/east-southeast within the friable itabirite. These last are
protoliths of proto-ore that remain after intense weathering and/or hydrothermal alteration along
certain preferential directions such as the axis of folds.
The carbonate itabirite is characterized by intercalations of clay bands alternating with bands of
friable and compact hematite. The bands of clay are generally light rose colored but locally may be
white in color. Where these bands are white, kaolinite is often present. The texture is banded, with
bands up to 40 to 50 cm in width. Where kaolinite is common in the clay-rich bands, internal breccia
texture are observed. The clay bands of clay also contain isolated crystals of euhedral quartz and
specularite, both of which are coarse to very coarse in grain size. The euhedral quartz and the
specularite are the product of secondary alteration, growing over the original texture of these rocks.
The hematite bands are fine and even occur as films intercalated with clay minerals. Friable
hematite also occurs disseminated within the clay bands.
MMX has further classified the mineralization types, based on content of Fe, Al2O3, Mn and mass
recovery in the lump ore fraction (MR1). The mineralization types that are included in the geologic
model are listed in Table 5.4.1.1.
LEM/MLM
August 5, 2013
Page 28
MR1%
Mn%
Fe%
Type
25 to 62
IF
Friable Itabirite
> 62
HF
Friable Hematite
25 to 62
IC
Compact Itabirite
> 62
> 35
HC
Compact Hematite
CG, CD
< 55
IL
Lateritic Itabirite
> 55
IA
Aluminous Itabirite
> 0.1
25 to 45
IPT
Powdery Itabirite
NA
< 25
QF
Ferruginous Quartzite
< 45
< 1.6
NA
> 45
> 1.6
NA
NA
NA
NA
Description
Canga
LEM/MLM
August 5, 2013
Page 29
The contacts between friable and compact ores may be sharp or transitional. Where there are
carbonate veins/veinlets there is a tendency for the intensity of friability to be greater than the areas
without carbonate veining.
Iron remobilization most likely occurred as an association with hydrothermal fluids, resulting in the
formation of concordant and discordant hematite veins. These veins are often breccia zones filled by
hematite. Some of the remobilized material is composed of magnetite. The process of quartz
remobilization was very intense in some areas, resulting in breccia formation and silicification of the
itabirite. Quartz remobilization often results in high compactness to the itabirite (hard itabirite). In
places, the orientation of these silicified zones appears, to be controlled by the hinges of D1 folds,
where it is parallel to the banding. However, in other areas the pattern is rather complex.
The iron formation extends across the Serra Azul ridge including the entire license block of Serra
Azul which is approximately 4000 m long and 800 m wide. The formation dips steeply to the south at
the west end of the mine and at about 35 to the south in the center and east. The true thickness of
the formation varies, but averages about 300 m. The itabirite continues to depth in the steeply
dipping areas. The friable itabarite varies in thickness, but averages about 50 m in thickness below
the surface. The compact itabirite varies between 200 and 400 m in true thickness.
LEM/MLM
August 5, 2013
Deposit Type
6.1
Mineral Deposit
Page 30
Iron mineralization in the Iron Quadrangle, as in other world locations, is controversial. Various
models are proposed, but the currently accepted models are hydrothermal syngenetic and/or
supergene enrichment. According to Guild (1957), ferruginous sediments of the Minas Supergroup
are chemical precipitates, deposited when iron-bearing river waters mixed with marine waters in a
shallow, low energy basin. This basin was isolated from the Proterozoic ocean by a volcanic arc and
it is suggested that volcanic ash interacting with saline basin waters lowered the pH of the water,
resulting in iron precipitation. In addition, petrologic observations indicate that this basin received
limited clastic material. The ferruginous sediments consist predominantly of iron oxide and colloidal
silica with limited carbonate minerals. Carbonate mineral deposition was limited by the low pH of the
receiving basin waters.
The deposits within the Minas Supergroup are characterized by fine, alternating layers of iron and
silica minerals. The iron minerals typically are hematite or magnetite and the silica minerals are
chert or quartz. Many of these formations have iron content deemed too low for profitable
exploitation. However, during intensive weathering, silica is leached from the rock resulting in
material enriched in iron and creating a deposit of potentially economic iron mineralization.
Occurrences of leached BIFs account for the worlds main source of iron. The BIFs in the Iron
Quadrangle are locally called itabirite named for Pico do Itabirito, the type locale for itabirite. The
itabirites in the Iron Quadrangle are composed of hematite and fine-grained quartz.
Extreme lateritic weathering has produced zones nearly devoid of silica locally referred to as canga
caps. Below the canga caps, itabirites with enriched iron grade and hematite-magnetite are found.
The itabirites are typically characterized by the degree of leaching. Three common varieties are
friable itabirite, semi-compact itabirite and compact itabirites. Each of these are characterized by a
relative decrease in the amount of leaching. Itabirites require processing to liberate the hematite
from the quartz and are very amenable to treatment. Consequently, itabirites and powdery hematite
are processed into iron product concentrates, or iron product fines. Fines are preferably sold as
sinter feed, but product that contains a significant fraction of particles smaller than 1 mm cannot be
fed directly into the sintering machine. This finer product is sold as feed for pelletizing plants, or
pellet feed.
Pure hematite contains a maximum of 69.94% iron compared to pure magnetite, which contains
72.36% iron. Despite the higher iron content of magnetite, hematite is more valued by the steel
industry due to its higher reduction rate. During the steel-making process, hematite (Fe2O3) is
progressively reduced to magnetite (Fe3O4), then wstite (FeO), and is finally refined into iron (Fe).
Hematite and magnetite have different crystal lattice structures; hematite has a hexagonal lattice,
whereas magnetite has a simple cubic lattice. This difference in atomic arrangement accounts for a
volume increase during the loss of oxygen atoms. Consequently, hematite in a blast furnace
undergoes a much higher volume increase during the reduction process than the equivalent iron
amount as magnetite. The increased porosity resulting from the volume change causes a marked
increase in the overall reduction rate, more than offsetting the effect of the lower iron content of
hematite.
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August 5, 2013
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Exploration
The first geologic mapping in the area was part of a joint program between the Brazils DNPM and
the United States Geological Survey (USGS). The resulting paper by Dorr et al (1961) was
published in both Portuguese and English, forming the basis of geologic understanding in the Iron
Quadrangle. The economic potential of the Serra Azul area was reevaluated by Samitri during the
same year (1961), through an agreement with the DNPM and the USGS.
Like most private iron mine operators in Brazil, AVG, Minerminas and operators prior to AVG and
Minerminas have not had extensive and detailed exploration programs. There has been minimal
exploration drilling prior to MMXs involvement in the Project. Limited channel samples were
collected in the pit area.
7.1
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August 5, 2013
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Drilling
Core drilling in the Project area by MMX was performed by Vrtice Sondagens e Servios de
Minerao, Ltda. (Vrtice) and Geolgica e Sondagens Ltda. (Geosol), both based in Belo
Horizonte. MMX also conducted reverse circulation (RC) drilling contracted to Geosol Geosedna
Perfuraes and Especiais S.A. (Geosedna), also based in Belo Horizonte.
A total of 45,999 m have been drilled at the Project in 461 holes. Holes were drilled on a slightly
irregular 100 m x 100 m grid. Table 8.1 lists the number of drillholes by program and company and
Figure 8.1 shows the locations of the drillholes within the mining concessions.
Table 8.1: Drilling at Serra Azul
Campaign
AVG
Total AVG
MMX Core*
MMX RC
Total MMX
Total
Number of
Drillholes
11
11
365
85
450
461
Period
2005
2005
2007-2012
2007-2012
2007-2012
Length
(m)
440
440
34,938
10,621
45,559
45,999
Number of
Samples*
46
46
6,572
2,059
8,631
8,677
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August 5, 2013
8.1
Page 33
Orientation From
To
RPSF15
Vertical
SEFDSF08
North,-70
0
17
0
16.9
0
12.7
0
12
12
51
11.3
52.6
8.2
39.9
5
37
FSAVGSB05 Vertical
RPSF16
Vertical
Drilled
Vertical
Lith.
Interval Thickness
12
12 FS
34
34 IF,IC
11.3
10.6 FS
35.7
33.5 IF,IC
8.2
8.2 CG
27.2
27.1 IF,IC
5
5 CG
25
25 IF
Fe
49.1
50.87
44.4
52.02
63.79
47.91
60.2
56.84
SiO2 Al2O3
24.95
26.11
31.7
24.2
2.42
29.67
12
16.72
2.43
0.47
1.6
0.52
2.57
0.56
1.47
1.02
P
0.072
0.014
0.052
0.011
0.057
0.014
0.02
0.012
Mn LOI
0.01
0.01
0.01
0.02
0.03
0.02
0.01
0.01
2.42
0.27
1.38
0.17
3.51
1.06
0.86
0.71
SRK also reviewed the drillholes in cross-section and did not detect a noticeable difference in grades
between the RC and core holes.
8.2
Procedures
The drillhole locations are first determined by the supervising geologist. Drill access is provided by
clearing drill pads with the use of a bulldozer. For inclined holes, a line is drawn between two stakes
in the azimuth direction and the drill rig is aligned with it. The inclination of the drill rig is set by a
MMX technician using the inclinometer of a Brunton compass. Upon completion of the drillhole, the
final collar location is surveyed by Prisma Produtos e Servios Ltda. ME (Prisma) using a Topcon
Total Station, 239W, 3003W or 3005W. Prisma then generates a Microsoft Excel spreadsheet
and/or a certified report in PDF format.
LEM/MLM
August 5, 2013
Page 34
The drilling at the Project has focused on the pit area. With the 2010 to 2013 drilling, the drilling grid
is roughly 100 m by 100 m. All holes on this grid do not extend to depth into the compact itabirite.
Core recovery is typically in excess of 90%.
8.2.2 RC Drilling
The RC drilling is conducted dry, without injecting water. The sample is discharged from the center
tube return through a hose to a cyclone. The entire sample is collected over 1 m intervals in plastic
bags. The bags were marked with the drillhole number and interval from and to information. The
bags were weighed by Geosedna personnel and the weights recorded on a form for MMX. A small
sample was collected for logging and stored in wooden boxes with 30 compartments and a hinged
cover.
MMX personnel supervise all sample security. The samples were collected from drill sites, logged
and sampled under the direction and control of MMX. SRK is of the opinion that there has been no
tampering with the samples.
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August 5, 2013
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8.3
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August 5, 2013
Page 36
9.1
Sample Preparation
The crushed fraction is homogenized and split with a Jones splitter to reduce it to 250 to 300
g;
The split is pulverized until 95% passes through a #150 mesh sieve;
The remaining coarse reject and pulp are archived for future use.
LEM/MLM
Weighing;
Jaw crushing until 100% of the sample passes through a 38.1 mm sieve;
Reducing the sample to 25% of its initial mass in a rotary sampler. The remaining 75% is
stored for future use;
Reducing the sample size, using a rotary sampler, to obtain an aliquot of 3kg;
Roll crushing the sample to 2 mm;
Archiving the remaining pulp, from which duplicate samples are made.
The
August 5, 2013
Page 37
All pulps are analyzed for Fe, Al2O3, SiO2, P, Mn, and TiO2 by X-Ray Fluorescence (XRF).
Reducing the volume by homogenization and quartering in Jones splitter to reduce sample
to 250 to 300 g.
Pulverizing the split until 95% passes a 150 mesh sieve;
The RC samples are received at the laboratory as the 1 m samples originally collected at the drill.
The sampling intervals, as noted by the geologist, are sent to the lab with the sample batch. The
sample preparation consists of the following steps:
Jaw crushing until 95% of the sample passes through a 6.3 mm sieve;
Splitting in a riffle splitter and dividing the sample into two halves, one for analysis and one
retained for additional metallurgical or other testwork.
Crushing the whole sample until 95% of the sample passes through a 2 mm sieve;
Reducing the volume by homogenization and quartering in a rotary splitter to reduce sample
to 300 to 600 g;
The RC samples are received at the laboratory as the 1 m samples originally collected at the drill.
The sampling intervals, as noted by the geologist, are sent to the lab with the sample batch. The
sample preparation consists of the following steps:
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August 5, 2013
9.2
Page 38
Splitting in a riffle splitter and dividing the sample into two halves, one for analysis and one
retained for additional metallurgical or other testwork.
Sample Analysis
Drying the sample in an oven at about 110C for at least one hour;
Placing 1 g of the dried sample in the container and weighing again (C+A);
Placing the container with the sample in a previously heated oven and waiting until the
temperature reaches 100050C and letting it calcine for more than one hour;
Removing the container from the oven, resting it on the refractory plate until it loses
incandescence, and then putting it in a closed dryer until the container and sample cool;
Weighing and recording the final weight; and
%FW
(C A) (Final Weight)
x100
(C A) (CV)
Data are entered into Microsoft Excel worksheets by a lab technician. Original, signed assay
certificates and worksheets are provided to MMX. The detection limits for analysis are shown in
Table 9.2.2.1
Table 9.2.2.1: Detection Limits of MMX-Corumba Laboratory Iron Ore Analysis
Analysis
Fe
SiO2
Al2O3
MnO
P
TiO2
LOI
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August 5, 2013
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Drying the sample in an oven at around 110C for at least one hour;
Placing 1.5 to 2 g of the dried sample in the container and weighing again (C+A);
Placing the container with the sample in a previously heated oven and waiting until the
temperature reaches 100050C and letting it calcine for more than 1 hour;
Removing the container from the oven, resting it on the refractory plate until it loses
incandescence, and then put it in a closed dryer until the container and sample cool; and
Weighing and record the final weight. LOI is calculated using the following formula:
%FW
(C A) (Final Weight)
x100
(C A) (CV)
The detection limits are shown in Table 9.2.3.1. Data is recorded in the LIMS database.
Table 9.2.3.1: Detection Limits of SGS Laboratory Iron Ore Analysis
Analysis
Fe
SiO2
Al2O3
Mn
P
TiO2
LOI
Drying the sample in an oven at around 110C for at least one hour;
Weighing the empty container (CV);
Placing 1.5 to 2 g of the dried sample in the container and weighing again (C+A);
Placing the container with the sample in a previously heated oven and waiting until the
temperature reaches 1,000 50C and letting it calcine for more than 1 hour;
Removing the container from the oven, resting it on the refractory plate until it loses
incandescence, and then put it in a closed dryer until the container and sample cool; and
Weighing and record the final weight. LOI is calculated using the following formula:
%FW
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(C A) (Final Weight)
x100
(C A) (CV)
August 5, 2013
Page 40
9.3
Blind duplicates;
MMX has used acQuire at its properties as a database management tool since December 2007.
AcQuire includes QA/QC protocols within the sample numbering procedure. In the sampling plan,
the system inserts two different standards and one pulp duplicate for each 20 samples at random
positions. The standard batch size is 40 samples, with 34 primary samples, 2 pulp duplicates and 4
company standards. For each 50 samples, one coarse duplicate is also inserted into the batch at a
random position, reducing the primary samples to 33. If the batch is less than 20, the system
assures that at least two different standards and one pulp duplicate sample will be inserted in each
batch.
Comparison of Assayed and Calculated Global Grades
MMX calculates a global grade of iron and other major elements by determining a weighted average
based on analysis of different sample of different grain size, and compares this to the analytical
results from the global sample.
Stoichiometric Closure
MMX calculates stoichiometric closure for analyses at Bureau Veritas from Fe2O3, SiO2, Al2O3, P2O5,
MnO, TiO2, CaO, MgO, K2O, Na2O and LOI. This is basically a mass balance calculations and
stoichiometric closure is calculated by MMX using the following equation:
S.C.=1.4298*(Fe- 0.7773*FeO)+SiO2+Al2O3+2.2915*P+1.2912*Mn+TiO2+CaO+MgO+Na2O+K2O+(LOI+0.1114*FeO)+FeO
August 5, 2013
Page 41
MMX sent 20 of each samples to SGS in Belo Horizonte, Perth and Ontario, ALS Chemex in Lima
and Perth, Intertek, Genalysis, Bureau Veritas, Ultratrace, Amdel and ACTLabs for analysis of Fe, P,
SiO2, Al2O3, CaO, TiO2, MgO, K2O, Na2O, FeO and Mn. MMX then performed various statistical
tests on the results to arrive at the accepted mean and standard deviation for each element or oxide.
Duplicate Samples
MMX requests the laboratories to prepare coarse and pulp duplicates.
Monitoring Program
MMX monitors the results of the QA/QC samples on a regular basis and produces charts and tables
to assess the lab performance. The laboratory is requested to re-assay samples if the CRM fails.
SRK has reviewed the data and the QA/QC reports and considers the laboratories to be performing
well.
9.4
Interpretation
The samples from Serra Azul are submitted with QA/QC samples, including standards and duplicate
samples with standard samples appropriate to the Project. MMX has developed new standards from
Serra Azul material. These samples have been sent to several laboratories in a round robin to
produce analyses used to calculate an expected mean and standard deviation.
SRK has reviewed the analyses of MMXs QA/QC samples and finds that the results are acceptable.
QA/QC sample failures are handled appropriately and are reviewed and investigated to determine
the reason for the error. The sampling preparation and analyses follow industry guidelines and the
results from the QA/QC samples indicate that the analyses are suitable for a resource database.
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August 5, 2013
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10 Data Verification
10.1 Quality Control Measures and Procedures
MMX directly imports data received from the laboratories into its database. SRK has compared
assay certificates of 10% of the database and found no errors. The laboratory QA/QC measures are
described in the proceeding section.
MMX is monitoring core recovery and is eliminating intervals with low recovery from the resource
estimation database.
MMX personnel check topographic updates to be sure that data is correct and check drillhole collars
against topography.
10.2 Limitations
SRK considers the data to be suitably verified and acceptable for resource estimation.
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August 5, 2013
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Assay: From, to, Fe, SiO2, Al2O3, P, Mn, LOI, TiO2, CaO, MgO, K2O, Na2O and FeO.
Table 11.1.1 contains basic statistics for the assay interval and metal variables of all analyzed
intervals.
Table 11.1.1: Basic Statistics of All Analyzed Intervals
Variable Number Minimum Maximum Average
Interval
Fe
SiO2
Al2O3
P
Mn
LOI
8677
8677
8677
8677
8677
8664
8677
0.80
2.86
0.70
0.02
0.002
0.001
-1.95
16.20
69.30
94.78
29.90
1.440
21.53
37.29
4.44
39.94
39.91
1.37
0.037
0.08
1.02
st
rd
1
3 Standard Coefficient
Median
Quartile
Quartile Deviation of Variation
3.80
5.00
5.00
1.06
0.24
32.00
37.00
48.40
12.08
0.30
27.23
45.21
52.50
17.97
0.45
0.17
0.49
1.73
2.23
1.63
0.010
0.020
0.046
0.054
1.43
0.01
0.01
0.02
0.51
6.21
0.05
0.31
1.27
1.93
1.89
11.2 Geology
Seventy vertical geologic cross-sections were constructed at intervals of 100 m or 50 m depending
on the drill spacing. Information from the project geologists and structural data from the geological
mapping were used along with the drillhole data to construct the sections. MMX first defined
lithotypes based on Fe, Al2O3 and Mn content and mass recovery of the lump ore fraction according
LEM/MLM
August 5, 2013
Page 44
to the decision tree shown in Figure 11.2.1. After that the result was compared with the vertical
sections and changed if necessary, giving a final lithotype definition.
Soil (SO);
Canga (CG);
Intrusive (IN);
Phyllite (FL).
After the construction of the north-south vertical sections, three east-west cross sections were
generated to check the geology on the North-south sections. An intermediate stage consisted of
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August 5, 2013
Page 45
using Surpacs stringmorphing tool to generate intermediate vertical sections every 25 m between
the primary sections. This methodology provided smoother transition between the sections.
The cross-sections were used to prepare wireframes solids for the mineralization types. The
transition between Serra Azul and Pau de Vinho wireframes occurs at Easting 576550. The geology
was coded into the block model based on the wireframes.
Figure 11.2.2 shows all the cross-sections in oblique view; Figure 11.2.3 shows the three longitudinal
sections and Figure 11.2.4 shows two typical cross-sections through Serra Azul.
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August 5, 2013
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11.3 Compositing
The average length of the samples used in grade estimation is 4.44 m with a range from 0.8 to 15 m.
MMX composited the samples on 7.5 m intervals starting at the top of the drillhole with breaks at the
lithotype solid boundaries. The variables that were composited include Fe, SiO2, Al2O3, P, LOI, Mn,
CaO, MgO and MR1. Table 11.3.1 presents basic statistics of the assays and composites in the
Serra Azul database.
Table 11.3.1: Statistics of Assays and Composites in the Serra Azul Database (1/2)
Lithology
Element
Fe (%)
CGG
SiO2 (%)
Al2O3 (%)
Fe (%)
HM
SiO2 (%)
Al2O3 (%)
Fe (%)
IAL
SiO2 (%)
Al2O3 (%)
Fe (%)
IC
SiO2 (%)
LEM/MLM
N Sample
Mean
Variance
Std Deviation
N Sample
Mean
Variance
Std Deviation
N Sample
Mean
Variance
Std Deviation
N Sample
Mean
Variance
Std Deviation
N Sample
Mean
Variance
Std Deviation
N Sample
Mean
Variance
Std Deviation
N Sample
Mean
Variance
Std Deviation
N Sample
Mean
Variance
Std Deviation
N Sample
Mean
Variance
Std Deviation
N Sample
Mean
Variance
Std Deviation
N Sample
109
57.69
46.95
6.85
109
6.80
67.35
8.21
109
4.74
9.30
3.05
128
62.48
58.03
7.62
128
8.49
119.54
10.93
128
0.98
0.30
0.54
852
53.40
101.72
10.09
852
18.63
230.46
15.18
852
2.62
4.81
2.19
4910
35.37
57.84
7.61
4910
Composites
7.5 m
64
58.16
35.68
5.97
64
6.20
54.54
7.39
64
4.54
6.16
2.48
82
62.32
63.61
7.98
82
8.74
132.62
11.52
82
1.02
0.21
0.46
494
53.89
85.05
9.22
494
17.83
190.74
13.81
494
2.67
3.95
1.99
2966
35.22
47.87
6.92
2966
Mean
Variance
Std Deviation
48.35
123.67
11.12
48.61
101.85
10.09
Variable
Samples
August 5, 2013
Page 48
Table 11.3.1: Statistics of Assays and Composites in the Serra Azul Database (2/2)
Lithology
IC
Element
Al2O3 (%)
Fe (%)
ICA
SiO2 (%)
Al2O3 (%)
Fe (%)
IDOL
SiO2 (%)
Al2O3 (%)
Fe (%)
IF
SiO2 (%)
Al2O3 (%)
Fe (%)
IPT
SiO2 (%)
Al2O3 (%)
Variable
Samples
N Sample
N Sample
Mean
Variance
Std Deviation
N Sample
Mean
Variance
Std Deviation
N Sample
Mean
Variance
Std Deviation
N Sample
Mean
Variance
Std Deviation
N Sample
Mean
Variance
Std Deviation
N Sample
Mean
Variance
Std Deviation
N Sample
Mean
Variance
Std Deviation
N Sample
Mean
Variance
Std Deviation
N Sample
Mean
Variance
Std Deviation
N Sample
Mean
Variance
Std Deviation
N Sample
Mean
Variance
Std Deviation
N Sample
Mean
Variance
Std Deviation
N Sample
Mean
Variance
Std Deviation
4910
4910
0.49
0.80
0.89
25
27.48
15.90
3.99
25
36.40
22.14
4.71
25
0.08
0.00
0.06
25
23.44
55.36
7.44
25
30.56
99.42
9.97
25
0.21
0.05
0.23
1456
48.35
99.32
9.97
1456
28.13
222.01
14.90
1456
1.29
2.21
1.49
713
32.38
126.16
11.23
713
46.11
260.72
16.15
713
3.72
6.98
2.64
Composites
7.5 m
2966
2966
0.46
0.54
0.73
16
27.59
13.41
3.66
16
36.52
15.30
3.91
16
0.08
0.00
0.05
16
23.95
49.02
7.00
16
31.45
75.88
8.71
16
0.18
0.03
0.17
849
48.82
80.26
8.96
849
27.48
179.51
13.40
849
1.28
1.81
1.34
398
32.11
98.08
9.90
398
46.47
211.47
14.54
398
3.74
5.32
2.31
August 5, 2013
Page 49
MMX generated histograms, probability plots and box plots for the composite data as well as the
correlation table shown in Table 11.3.2.
Table 11.3.2: Correlation Table for Composites
Element
Fe
Fe
SiO2
Al2O3
Mn
LOI
CaO
MgO
1.00
SiO2
-0.99
1.00
Al2O3
0.06
-0.18
1.00
-0.13
0.07
0.23
1.00
0.04
-0.10
0.42
0.17
1.00
LOI
0.10
-0.16
0.56
0.28
0.36
1.00
CaO
-0.05
-0.04
-0.02
0.06
0.10
0.64
1.00
MgO
-0.04
-0.05
-0.01
0.08
0.04
0.64
0.94
1.00
MR1
-0.40
0.45
-0.49
-0.11
-0.21
-0.47
0.07
-0.06
Mn
P
MR1
1.00
11.4 Density
Prior to 2010, MMX conducted three programs of density measurements at the project. The first and
second programs were performed by Prominas under contract to MMX. The first program was done
at AVG and the second was at Minerminas. The third was done at both AVG and Minerminas by
Libaneo e Libaneo Ltda (Libaneo). The sand flask method was used for the friable lithotypes and
the water displacement method was used for the competent lithotypes. Average values were
calculated with and without outlier values by lithotype. The average values without outliers were
used in the resource estimation. Table 11.4.1 presents the densities by lithotype.
Table 11.4.1: Density of Lithotypes, on a Wet Basis
Code
1
2, 31
32
33
3
4
34
35
5
10
11
12
13
14
Abbreviation
IF
CG, CD
HC
HF
IPT
IC
IA
IL
IN
QTZ
FL
SO
WD
FS
Description
Friable Itabirite
Mineralized Canga
Compact Hematite
Friable Hematite
Friable Carbonate Itabirite
Compact Itabirite
Aluminous Itabirite
Lateritic Itabirite
Intrusive
Quartzite
Phyllite
Soil
Waste Dump
Fine stockpile
Density (t/m3)
2.78
2.74
4.81
3.07
2.62
3.34
2.78
2.78
2.18
2.62
2.16
2.00
2.50
2.88
Type
Ore
Ore
Ore
Ore
Ore
Ore
Ore
Ore
Waste
Waste
Waste
Waste
Waste
Waste
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August 5, 2013
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August 5, 2013
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Nugget
Sill 1
Range 1
Sill 2
Range 2
Bearing
Plunge
Dip
M/SM (1)
M/m (2)
Fe
3.50
28.50
130.00
17.00
650
270
60
1.25
2.00
SiO2
7.50
63.00
130.00
35.50
650
270
60
1.25
2.00
Al2O3
0.10
0.28
130.00
0.12
650
270
60
1.40
1.60
0.00002
0.00009
160.00
0.00008
800
270
60
1.75
2.00
0.000025
0.00011
60.00
0.00013
300
270
60
1.25
3.00
0.02
0.10
110.00
0.05
550
270
60
1.10
2.50
Variable
Mn
IC
P
LOI
CaO
0.0002
0.00045
70.00
0.0004
350
270
60
2.00
4.00
MgO
0.00005
0.00025
50.00
0.00032
250
270
60
1.20
3.00
MR1
170.00
121.00
130.00
128.00
650
270
60
3.50
5.00
Fe
1.00
9.25
30.00
70.75
120
270
30
1.25
3.00
SiO2
5.00
40.00
30.00
135.00
120
270
30
1.25
3.00
Al2O3
0.04
0.46
55.00
1.30
110
270
30
1.00
2.50
0.00045
0.0038
100.00
0.0015
200
270
30
1.00
1.00
0.000025
0.00045
37.50
0.0009
75
270
30
1.00
1.25
Mn
IF
P
LOI
0.025
0.31
60.00
0.64
120
270
30
1.00
2.00
CaO
0.00003
0.0004
45.00
0.00022
90
270
30
1.40
2.00
MgO
0.00002
0.00041
45.00
0.00022
90
270
30
1.00
1.40
MR1
25.00
92.80
40.00
33.30
120
270
30
1.00
2.00
Fe
1.22
37.49
100.00
46.17
200
270
30
1.25
6.00
SiO2
1.22
97.52
100.00
99.70
200
270
30
1.25
6.00
Al2O3
0.10
0.80
90.00
2.20
180
270
30
1.00
6.00
0.00005
0.00025
200.00
0.0008
400
270
30
1.00
10.00
0.0001
0.001
90.00
0.0015
180
270
30
1.00
6.00
0.15
0.99
45.00
1.19
90
270
30
1.20
2.40
CaO
0.00002
0.0001
70.00
0.00041
140
270
30
1.00
3.00
MgO
0.000008
0.000009
40.00
0.00016
80
270
30
1.00
1.75
MR1
10.00
150.00
75.00
23.00
225
270
30
1.00
5.00
Mn
IAL
P
LOI
LEM/MLM
August 5, 2013
Lith
IPT
Page 52
Nugget
Sill 1
Range 1
Sill 2
Range 2
Bearing
Plunge
Dip
M/SM (1)
M/m (2)
Fe
8.38
12.30
125.00
95.60
250
260
60
2.50
3.00
SiO2
5.89
77.49
125.00
129.55
250
260
60
2.50
3.00
Al2O3
0.12
2.05
90.00
0.55
180
260
60
1.30
2.00
Mn
0.01
0.03
125.00
0.40
250
260
60
1.10
3.75
0.0002
0.0009
125.00
0.001
250
260
60
2.00
4.00
Variable
P
LOI
0.12
1.23
125.00
1.15
250
260
60
3.00
6.00
CaO
0.000034
0.000166
125.00
0.000081
250
260
60
1.00
2.50
MgO
0.00006
0.00021
125.00
0.0023
250
260
60
1.50
4.50
MR1
27.00
73.50
100.00
147.90
200
260
60
1.00
1.00
LEM/MLM
August 5, 2013
Page 53
Minimum
571,800
7,773,350
745
Maximum
579,500
7,776,400
1,405
Block Size
25
25
15
Global Fe, SiO2, Al2O3, Mn, P, CaO, MgO, LOI and MR1;
Fe, SiO2, Al2O3, Mn, P, CaO, MgO, LOI and MR1 for each of the lithotypes in each block;
Density, and
The block model was coded with the percentage of each lithotype within the block from the lithotype
wireframe solids. The percentage of the block below topography was assigned to the topography
percentage variable.
A neighborhood analysis on SiO2 was performed to determine the best estimation strategy for all
variables. SiO2 was used because it is the main contaminant in the concentration process, it has a
high correlation with Fe and the Fe and SiO2 variograms are similar.
Block grades were estimated by ordinary kriging for IF, IAL (IA + IL), IC and IPT. Inverse distance
squared (ID2) was used for CGG (CD + CG) and HM (HF + HC). Each block has an Fe variable for
each of the lithtypes. The parameters for each pass are given in Table 11.6.2. Easting 576550 was
used as a soft boundary during the estimation in that there are different search orientations but
composites were not limited by position relative to easting 576550. Composites of length less than
3.75 were not used in the estimation.
The final block lithology was determined by the majority lithotype. The final block grade was
determined as the weighted average of the percent of the lithotype, the density of the lithotype and
the grade of the lithotype. The final block density was calculated as a weighted average of the
percent of the lithotype and the density of the lithotype.
Figure 11.6.1 presents cross-sections through the Serra Azul property with block grades and
drillholes.
LEM/MLM
August 5, 2013
Page 54
Group
IC
Group
IF
Group
IAL (IA
+ IL)
LEM/MLM
Step
Resource
1
Measured
2
Measured
3
Measured
4
Indicated
5
Inferred
6
Potential
Ellipsoid:
Bearing
270
Plunge
0
Dip
60
Step
Resource
1
Measured
2
Measured
3
Measured
4
Indicated
5
Inferred
Ellipsoid:
Bearing
270
Plunge
0
Dip
30
Step
Resource
1
Measured
2
Measured
3
Indicated
4
Inferred
5
Potential
Ellipsoid:
Bearing
270
Plunge
0
Dip
30
Ordinary Kriging - Fe (%), SiO2 (%), Al2O3 (%), Mn (%), P (%), LOI (%), CaO (%), MgO (%), MR1 (%)
Search Radius
Samples
Search
Major/SemiMajor/Minor Observation
Max. per
Method
Major
Max. Vertical Min. Max.
DH
Octant
130
130
8
24
3
1.25
2
First Variogram Range
Octant
325
325
8
24
3
1.25
2
50% Total Variogram Range
Ellipsoid
325
325
4
24
3
1.25
2
50% Total Variogram Range
Ellipsoid
650
650
4
24
3
1.25
2
Total Variogram Range
Ellipsoid
1300
1300
3
24
3
1.25
2
Double Total Variogram Range
Ellipsoid
2500
2500
1
24
3
1.25
2
To estimate remaining blocks
Search
Method
Octant
Ellipsoid
Ellipsoid
Ellipsoid
Ellipsoid
Search
Method
Octant
Ellipsoid
Ellipsoid
Ellipsoid
Ellipsoid
Search Radius
Max.
Vertical
Min.
60
60
120
240
2500
60
60
120
240
2500
8
4
4
3
1
Search Radius
Max.
Vertical
Min.
100
100
200
400
2500
100
100
200
400
2500
8
4
4
3
1
Samples
Max. per
Max.
DH
24
3
24
3
24
3
24
3
24
3
Samples
Max. per
Max.
DH
24
3
24
3
24
3
24
3
24
3
Major/SemiMajor
Major/Minor
1.25
1.25
1.25
1.25
1.25
3
3
3
3
3
Major/SemiMajor
Major/Minor
1.25
1.25
1.25
1.25
1.25
6
6
6
6
6
Observation
50% Total Variogram Range
50% Total Variogram Range
Total Variogram Range
Double Total Variogram Range
Only to estimate all blocks
Observation
First Variogram Range
First Variogram Range
Total Variogram Range
Double Total Variogram Range
Only to estimate all blocks
August 5, 2013
Page 55
IPT
Group
CGG
(CG +
CD)
Group
HM
(HF +
HC)
Step
Resource
1
Measured
2
Measured
3
Indicated
4
Inferred
5
Potential
Ellipsoid:
Bearing
260
Plunge
0
Dip
60
Step
Resource
1
Measured
2
Measured
3
Indicated
4
Inferred
5
Potential
Ellipsoid:
Bearing
260
Plunge
0
Dip
60
Step
Resource
1
Measured
2
Measured
3
Indicated
4
Inferred
5
Potential
Ellipsoid:
Bearing
270
Plunge
0
Dip
30
Search
Method
Octant
Ellipsoid
Ellipsoid
Ellipsoid
Ellipsoid
Search
Method
Octant
Ellipsoid
Ellipsoid
Ellipsoid
Ellipsoid
Search
Method
Octant
Ellipsoid
Ellipsoid
Ellipsoid
Ellipsoid
Search Radius
Max.
Vertical
Min.
125
125
250
500
2500
125
125
250
500
2500
8
4
4
3
1
Search Radius
Max.
Vertical
Min.
100
100
200
400
2500
100
100
200
400
2500
8
4
4
3
1
Search Radius
Max.
Vertical
Min.
60
60
120
240
2500
60
60
120
240
2500
8
4
4
3
1
Samples
Max. per
Max.
DH
24
3
24
3
24
3
24
3
24
3
Samples
Max. per
Max.
DH
24
3
24
3
24
3
24
3
24
3
Samples
Max. per
Max.
DH
24
3
24
3
24
3
24
3
24
3
Major/SemiMajor
Major/Minor
2.5
2.5
2.5
2.5
2.5
3
3
3
3
3
Major/SemiMajor
Major/Minor
1.25
1.25
1.25
1.25
1.25
6
6
6
6
6
Major/SemiMajor
Major/Minor
1.25
1.25
1.25
1.25
1.25
3
3
3
3
3
Observation
First Variogram Range
First Variogram Range
Total Variogram Range
Double Total Variogram Range
Only to estimate all blocks
Observation
First Variogram Range
First Variogram Range
Total Variogram Range
Double Total Variogram Range
Only to estimate all blocks
Observation
50% Total Variogram Range
50% Total Variogram Range
Total Variogram Range
Double Total Variogram Range
Only to estimate all blocks
LEM/MLM
August 5, 2013
Page 56
Figure 11.6.1: Cross-Sections with Geology, Block Model and Drilling Looking East
Visual comparison of the block grades to the composite grades on cross-sections and
horizontal sections;
The visual examination of the block grades to the composite grades was in general quite good as
shown in Figure 11.6.1.
Figure 11.7.1 shows histograms of the kriged and nearest neighbor estimates, a scatter plot and a
QQ plot of kriged and nearest neighbor Fe grades in the compact itabirite.
LEM/MLM
August 5, 2013
Page 57
Figure 11.7.1: Histogram of Block Fe (upper left), Nearest Neighbor Fe (upper right), QQ plot
(center) and scatter plot (lower) of Fe in Compact Itabirite
LEM/MLM
August 5, 2013
Page 58
Swath plots were prepared as north-south and east-west bands 100 m in width and by elevation by
15 m bands and a comparison made to the nearest neighbor grades. The swath plots for iron
indicate that the kriged and composites track quite well except, at depth, the kriged grades are
higher than the NN grades in the compact itabirite (Figure 11.7.1).
LEM/MLM
August 5, 2013
Page 59
LEM/MLM
August 5, 2013
Page 60
SRK has also conducted a resource estimation using similar parameters as MMX and has
reproduced their results within 2%, which is acceptable. SRK considers that MMX has used good
practices in its resource estimation.
Figure 11.8.1: Cross-sections with Geology, Block Model Classification and Drilling
LEM/MLM
August 5, 2013
Page 61
LEM/MLM
August 5, 2013
Page 62
Table 11.9.1: Serra Azul Mineral Resource Statement, April 10, 2013, Wet Tonnage Basis
Lithology
Friable
Canga
Powdery Itabirite
Compact Itabirite
Total
Resource
Tonnage (Mt)
Fe (%)
SiO2 (%)
Al2O3 (%)
Mn (%)
P (%)
LOI (%)
CaO (%)
MgO (%)
Measured
Indicated
M&I
Inferred
Measured
Indicated
M&I
Inferred
Measured
Indicated
M&I
Inferred
Measured
Indicated
M&I
Inferred
Measured
Indicated
M&I
Inferred
39.5
50.9
90.4
28.5
0.1
1.7
1.8
5.4
30.5
45.8
76.2
73.7
1025.4
621.7
1647.1
216.5
1095.5
720.0
1815.5
324.0
49.9
47.5
48.5
45.2
58.6
57.1
57.2
55.5
33.2
31.7
32.3
28.2
34.4
32.7
33.7
33.9
34.9
33.7
34.4
33.9
25.3
28.4
27.0
31.0
4.7
5.6
5.6
10.1
44.7
47.6
46.5
52.1
49.6
51.7
50.4
49.3
48.6
49.7
49.0
47.7
1.70
1.81
1.76
1.82
4.71
5.38
5.34
4.48
3.68
3.21
3.40
3.27
0.56
0.63
0.59
0.84
0.69
0.89
0.77
1.54
0.05
0.08
0.06
0.24
0.03
0.04
0.04
0.11
0.51
0.71
0.63
0.80
0.04
0.07
0.05
0.13
0.05
0.11
0.08
0.29
0.046
0.049
0.048
0.057
0.256
0.240
0.241
0.218
0.077
0.078
0.078
0.082
0.022
0.030
0.025
0.032
0.024
0.035
0.029
0.049
1.35
1.38
1.37
1.74
5.66
5.77
5.77
5.05
2.64
2.48
2.54
2.53
0.39
0.57
0.46
0.83
0.49
0.76
0.60
1.37
0.03
0.03
0.03
0.02
0.02
0.02
0.02
0.02
0.03
0.03
0.03
0.03
0.04
0.12
0.07
0.03
0.04
0.11
0.07
0.03
0.06
0.06
0.06
0.06
0.06
0.05
0.06
0.06
0.07
0.08
0.07
0.27
0.07
0.15
0.10
0.07
0.07
0.14
0.09
0.11
Cut-off Grade 15% Fe; tonnes on a wet basis; topography current at September 28, 2012
LEM/MLM
August 5, 2013
Page 63
Measured + Indicated
Inferred
LEM/MLM
Cut-off Fe (%)
Mt
Fe (%)
SiO2 (%)
15
20
22
24
26
28
30
32
34
36
38
40
42
44
46
48
50
52
54
56
58
60
15
20
22
24
26
28
30
32
34
36
38
40
42
44
46
48
50
52
54
56
58
60
1815.5
1811.4
1806.4
1792.2
1750.4
1682.4
1542.8
1253.2
892.3
517.2
291.2
189.1
132.1
95.5
70.9
54.4
42.1
32.5
25.0
17.2
10.6
5.5
324.0
323.4
321.8
308.9
298.3
283.9
249.3
206.0
146.5
81.0
42.2
28.5
24.3
21.8
19.6
17.5
15.5
13.3
9.1
4.6
2.8
1.8
34.4
34.5
34.5
34.6
34.8
35.1
35.7
36.7
38.3
40.6
43.6
46.1
48.3
50.4
52.3
53.9
55.3
56.6
57.7
59.0
60.3
61.6
33.9
34.0
34.0
34.5
34.8
35.2
36.1
37.1
38.8
41.8
46.5
50.1
51.7
52.7
53.6
54.4
55.1
55.7
57.0
59.1
60.6
61.6
49.0
49.0
48.9
48.8
48.5
48.1
47.4
45.9
43.6
39.9
35.2
31.3
27.7
24.5
21.6
19.0
16.6
14.4
12.6
10.6
8.7
7.4
47.7
47.6
47.5
47.1
46.8
46.3
45.2
43.8
41.3
36.5
28.8
22.9
20.3
18.7
17.1
15.7
14.3
13.2
11.9
9.4
8.2
6.8
August 5, 2013
Page 64
2000
65
1750
60
1500
55
1250
50
1000
45
750
40
500
35
250
30
25
Fe%
Tonnes(Millions)
FeGradeTonnage MeasuredandIndicated
15 20 22 24 26 28 30 32 34 36 38 40 42 44 46 48 50 52 54 56 58 60
Mt
Fe(%)
Cutoff%Fe
FeGradeTonnage Inferred
65
350
60
300
55
50
200
45
150
40
Fe%
Tonnes(Millions)
250
35
100
30
50
25
20
15 20 22 24 26 28 30 32 34 36 38 40 42 44 46 48 50 52 54 56 58 60
Mt
Fe(%)
Cutoff%Fe
LEM/MLM
August 5, 2013
Page 65
LEM/MLM
August 5, 2013
Page 66
12 Adjacent Properties
MMX has a contract with Usiminas for production from Pau de Vinho. MMX has performed due
diligence on the property and has included data from that property in its resource estimation. SRK
has visited the Pau de Vinho property, reviewed the core, discussed geology and mineralization with
Usiminas personnel, reviewed drill logs and assay certificates and is of the opinion that the drilling,
logging and sample analysis meet industry standards and that it is appropriate to use the data in the
resource estimation. SRK further notes that the influence of the Pau de Vinho drilling is limited to the
eastern portion of Serra Azul and to within the search distance used in the resource estimation.
LEM/MLM
August 5, 2013
Page 67
LEM/MLM
August 5, 2013
Page 68
14 Recommendations
14.1 Recommended Work Programs
SRK recommends that MMX continue to drill deeper holes into the compact itabirite to decrease the
sample spacing and increase confidence in the resource. This work could be performed as mining
progresses and drilling depth decreases accordingly.
LEM/MLM
August 5, 2013
Page 69
15 References
Alkmim F.F., Marshak S (1998). Transamazonian orogeny in the southern So Francisco Craton
Region, Minas Gerais, Brazil: evidence for paleoproterozoic collision and collapse in the
Quadriltero Ferrfero. Precambrian Res 90:2958.
Alkmim, F. F.; Chemale JR, F.; Endo, I. (1996). A deformao das coberturas proterozicas do
Crton do So Francisco. Rem: Revista Escola de Minas, Ouro Preto, v. 48, n. 1, p. 14-31.
Alkmim, F.F. and Noce, C.M. (eds.) 2006. The Paleoproterozoic Record of the So Francisco
Craton. IGCP 509 Field workshop, Bahia and Minas Gerais, Brazil. Field Guide & Abstracts,
114 p.
Almeida, F. F. M., Brito Neves, B. B. & Fuck, R. A. (1981). Brasilian structural province: an
introduction. Earth. Sci. Rev., 17: 1-29.
Dorr, J.V.N.II, Herz. N., Barbosa, A.L.M. and Simmons, G.C., (1961).Outline of the Geology of the
Quadriltero Ferrfero, Minas Gerais, Brazil. Brasil, Departamento Nacional da Produo
Mineral. Publicao Especial 1, 120p. Rio de Janeiro
Dorr, J.V.N. (1969). Physiographic, Stratigraphic and Structural Development of the Quadrilatero
Ferrifero, Minas Gerais, Brazil: US Geol Survey Professional Paper 641A
Eichler, J. (1964). Die eisenerzlargerstatte Crrego do Feijo, Minas Gerais, Brasillian, 46 p.
Endo, I.; Machado, R. (1997). Regimes Tectnicos no Segmento Meridional do Crton do So
Francisco: Quadriltero Ferrfero e reas Adjacentes, Minas Gerais. In: Simpsio de
Geologia de Minas Gerais, 1997, Ouro preto. Anais do IX Simpsio de Geologia de Minas
Gerais. Belo Horizonte: SBG/NCLEO Minas Gerais, 1997. p. 58-59.
Endo, I., Oliveira, A.H., and Peres, G.G. (2005). Estratigraa e Arcabouo Estrutural da regio da
juno serra do Curral synclinal Modea, Quadrilatero Ferrifero, MG, 58p; relatorio interno.
Guild P.W. (1957). Geology and mineral resources of the Congonhas do Campo District, Minas
Gerais, Brazil. US Geol Surv Prof Paper, 90p.
Jordt-Evangelista, H.; Alkmim, F. F.; Marshak, S. (1992). Metamorfismo Progressivo e a Ocorrencia
dos Tres Polimorfos de Al2Sio5 (Cianita, Andaluzita e Silimanita) na Formao Sabara em
Ibirite, Quadrilatero Ferrifero, MG. REM - revista da escola de minas, Ouro Preto, v. 45, n. 12, p. 157-160.
Libaneo & Libaneo Ltda. (2011). Relatrio Da Campanha 2010/2011 De Ensaios De Densidade
Aparente Das Minas Ip E Tico-Tico Da Mmx-Minerao E Metlicos S.A., 31 p.
Marshak S. & Alkmim F.F. (1989). Proterozoic contraction/extension tectonics of the southern So
Francisco region, Minas Gerais, Brazil. Tectonics, 8:555-571.
Marshak S., Alkmim F.F. and Jordt-Evangelista, H. 1992. Proterozoic Crustal Extension and the
Generation of Dome-and-Keel Structure in an Archean Granite-Green-stone Terrane. Nature
357: 491-493.
MMX (2009), Geology and Geological Modeling of the Serra Azul Complex, March 2009,
Unpublished internal report.
LEM/MLM
August 5, 2013
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LEM/MLM
August 5, 2013
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16 Glossary
16.1 Mineral Resources
The mineral resources and mineral reserves have been classified according to the CIM Standards
on Mineral Resources and Reserves: Definitions and Guidelines (November 27, 2010).
Accordingly, the Resources have been classified as Measured, Indicated or Inferred, the Reserves
have been classified as Proven, and Probable based on the Measured and Indicated Resources as
defined below.
A Mineral Resource is a concentration or occurrence of natural, solid, inorganic or fossilized organic
material in or on the Earths crust in such form and quantity and of such a grade or quality that it has
reasonable prospects for economic extraction.
The location, quantity, grade, geological
characteristics and continuity of a Mineral Resource are known, estimated or interpreted from
specific geological evidence and knowledge.
An Inferred Mineral Resource is that part of a Mineral Resource for which quantity and grade or
quality can be estimated on the basis of geological evidence and limited sampling and reasonably
assumed, but not verified, geological and grade continuity. The estimate is based on limited
information and sampling gathered through appropriate techniques from locations such as outcrops,
trenches, pits, workings and drillholes.
An Indicated Mineral Resource is that part of a Mineral Resource for which quantity, grade or
quality, densities, shape and physical characteristics can be estimated with a level of confidence
sufficient to allow the appropriate application of technical and economic parameters, to support mine
planning and evaluation of the economic viability of the deposit. The estimate is based on detailed
and reliable exploration and testing information gathered through appropriate techniques from
locations such as outcrops, trenches, pits, workings and drillholes that are spaced closely enough for
geological and grade continuity to be reasonably assumed.
A Measured Mineral Resource is that part of a Mineral Resource for which quantity, grade or
quality, densities, shape, physical characteristics are so well established that they can be estimated
with confidence sufficient to allow the appropriate application of technical and economic parameters,
to support production planning and evaluation of the economic viability of the deposit. The estimate
is based on detailed and reliable exploration, sampling and testing information gathered through
appropriate techniques from locations such as outcrops, trenches, pits, workings and drillholes that
are spaced closely enough to confirm both geological and grade continuity.
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Study. This Study must include adequate information on mining, processing, metallurgical,
economic, and other relevant factors that demonstrate, at the time of reporting, that economic
extraction can be justified.
A Proven Mineral Reserve is the economically mineable part of a Measured Mineral Resource
demonstrated by at least a Preliminary Feasibility Study. This Study must include adequate
information on mining, processing, metallurgical, economic, and other relevant factors that
demonstrate, at the time of reporting, that economic extraction is justified.
LEM/MLM
Definition
The chemical analysis of mineral samples to determine the metal content.
All other expenditures not classified as operating costs.
Combining more than one sample result to give an average result over a larger
distance.
A metal-rich product resulting from a mineral enrichment process such as gravity
concentration or flotation, in which most of the desired mineral has been separated
from the waste material in the ore.
Initial process of reducing ore particle size to render it more amenable for further
processing.
The grade of mineralized rock, which determines as to whether or not it is economic
to recover its gold content by further concentration.
Waste, which is unavoidably mined with ore.
Angle of inclination of a geological feature/rock from the horizontal.
The surface of a fracture along which movement has occurred.
The underlying side of an orebody or stope.
Non-valuable components of the ore.
The measure of concentration of gold within mineralized rock.
The overlying side of an orebody or slope.
A horizontal underground excavation which is used to transport mined ore.
A process whereby material is graded according to size by exploiting centrifugal
forces of particulate materials.
Primary crystalline rock formed by the solidification of magma.
An interpolation method of assigning values from samples to blocks that minimizes
the estimation error.
Horizontal tunnel the primary purpose is the transportation of personnel and
materials.
Geological description pertaining to different rock types.
Life-of-Mine plans.
Long Range Plan.
Mine properties.
A general term used to describe the process in which the ore is crushed and ground
and subjected to physical or chemical treatment to extract the valuable metals to a
concentrate or finished product.
A lease area for which mineral rights are held.
The Material Properties and Significant Exploration Properties.
Capital estimates of a routine nature, which is necessary for sustaining operations.
See Mineral Reserve.
Rock left behind to help support the excavations in an underground mine.
Run-of-Mine.
Pertaining to rocks formed by the accumulation of sediments, formed by the erosion
of other rocks.
An opening cut downwards from the surface for transporting personnel, equipment,
supplies, ore and waste.
Serra Azul_Audit on Resource_162700.12_005_SH
August 5, 2013
Term
Sill
Smelting
Stope
Stratigraphy
Strike
Sulfide
Tailings
Thickening
Total Expenditure
Variogram
Page 73
Definition
A thin, tabular, horizontal to sub-horizontal body of igneous rock formed by the
injection of magma into planar zones of weakness.
A high temperature pyrometallurgical operation conducted in a furnace, in which the
valuable metal is collected to a molten matte or dor phase and separated from the
gangue components that accumulate in a less dense molten slag phase.
Underground void created by mining.
The study of stratified rocks in terms of time and space.
Direction of line formed by the intersection of strata surfaces with the horizontal
plane, always perpendicular to the dip direction.
A sulfur bearing mineral.
Finely ground waste rock from which valuable minerals or metals have been
extracted.
The process of concentrating solid particles in suspension.
All expenditures including those of an operating and capital nature.
A statistical representation of the characteristics (usually grade).
16.4 Abbreviations
The following abbreviations may be used in this report.
Table 25.4.1: Abbreviations
Abbreviation
%
C
A
AA
Al2O3
BIF
CoG
cm
cm2
cm3
dia.
DNPM
Fe
g
ha
IC
ID2
ID3
kg
km
km2
kt
L
LOI
LoM
m
m2
m3
masl
mm
mm2
mm3
Mn
LEM/MLM
Unit or Term
percent
degree (degrees)
degrees Centigrade
ampere
atomic absorption
alumina
banded iron formation
cut-off grade
centimeter
square centimeter
cubic centimeter
diameter
Brazils National Department of Mineral Production
iron
gram
hectares
compact itabirite
inverse-distance squared
inverse-distance cubed
kilograms
kilometer
square kilometer
thousand tonnes
liter
Loss On Ignition
Life-of-Mine
meter
square meter
cubic meter
meters above sea level
millimeter
square millimeter
cubic millimeter
manganese
August 5, 2013
Abbreviation
MR1
Mt
m.y.
NI 43-101
NN
P
PAE
ppb
ppm
QA/QC
RC
RoM
RQD
sec
SG
SiO2
t
USGS
m
XRF
y
LEM/MLM
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Unit or Term
mass recovery of lump ore fraction
million tonnes
million years
Canadian National Instrument 43-101
Nearest neighbor
phosphorous
Plano de Aproveitamento Econmico or Economic Exploitation Plan
parts per billion
parts per million
Quality Assurance/Quality Control
rotary circulation drilling
Run-of-Mine
Rock Quality Description
second
specific gravity
silica
tonne (metric ton) (2,204.6 pounds)
United States Geological Survey
micron or microns
x-ray fluorescense
year
August 5, 2013
Page 75
Reviewed by
Thissignaturewasscannedfortheexclusive
useinthisdocumentwiththeauthorsapproval;
anyotheruseisnotauthorized.
All data used as source material plus the text, tables, figures, and attachments of this document
have been reviewed and prepared in accordance with generally accepted industry practices.
LEM/MLM
August 5, 2013