Technical Report (Ni43-101) Preliminary Economic Assessment of The Woodlawn Project

Heron Resources Limited Title & Contents
HERON RESOURCES
LIMITED
TECHNICAL REPORT (NI43-101) PRELIMINARY

ECONOMIC ASSESSMENT OF THE WOODLAWN
PROJECT, NEW SOUTH WALES, AUSTRALIA
Prepared by: Anne-Marie Ebbels

Principal Consultant (Mining)
SRK Consulting (Australasia) Pty Ltd
In accordance with the Requirements of National Instrument 43-101
Effective date: 29 May 2015
www.heronresources.com.au
Heron Resources Limited ©
heron@heronresources.com.au 1
Woodlawn Project PEA – 29 May 2015
Date and Signature Page
This report has been prepared and signed for by the following “Qualified Persons”
(within the meaning of National Instrument 43-101). The effective date of this report
is 29 May 2015.
Signed the 29th May 2015
________________
Anne-Marie Ebbels
Principal Consultant (Mining)
SRK Consulting (Australasia)
________________
Pty Ltd
Daniel Guibal
Principal Consultant (Geology)
SRK Consulting (Australasia)
Pty Ltd
________________
Rodney Brown
Principal Consultant (Geology)
SRK Consulting (Australasia) ________________
Pty Ltd
Peter Allen
Manager – Process & Technical
Services
GR Engineering Services
Limited
Heron Resources Limited © 2

Table of Contents
1 Summary ............................................................................................................................ 14
1.1 Introduction and Scope ................................................................................................................. 14
1.2 Economic Modelling Outcomes ..................................................................................................... 15
1.3 Property Description and Ownership ............................................................................................ 15
1.4 History and Exploration................................................................................................................. 18
1.5 Geology and Mineralisation .......................................................................................................... 18
1.6 Mineral Resource and Mineral Reserves Estimates ....................................................................... 19
1.6.1 Current Mineral Resource ............................................................................................................... 20
1.6.2 Current Mineral Reserve ................................................................................................................. 21
1.7 Mining........................................................................................................................................... 22
1.8 Metallurgy & Processing ............................................................................................................... 26
1.9 Infrastructure ................................................................................................................................ 28
1.9.1 Access and Site Roads ...................................................................................................................... 28
1.9.2 Power Supply ................................................................................................................................... 28
1.9.3 Water Supply ................................................................................................................................... 28
1.9.4 Tailings Storage Facility ................................................................................................................... 28
1.10 Environmental, Permitting & Social .............................................................................................. 29
1.10.1 Environmental Permits ................................................................................................................ 29
1.10.2 Permitting Requirements ............................................................................................................ 29
1.10.3 Social and Community Aspects, Stakeholder Consultation ......................................................... 29
1.10.4 Closure ........................................................................................................................................ 30
1.11 Capital and Operating Costs .......................................................................................................... 30
1.11.1 Capital Costs ................................................................................................................................ 30
1.11.2 Operating Costs ........................................................................................................................... 32
1.12 Economic Analysis ......................................................................................................................... 33
1.12.1 Basis of Evaluation ...................................................................................................................... 33
1.12.2 Summary Economics ................................................................................................................... 33
1.12.3 Macroeconomic Assumptions ..................................................................................................... 34
1.12.4 Technical Assumptions ................................................................................................................ 35
1.12.5 Sensitivity Study .......................................................................................................................... 37
1.13 Conclusions ................................................................................................................................... 38
1.14 Recommendations ........................................................................................................................ 39
2 Introduction ........................................................................................................................ 40
2.1 Terms of Reference ....................................................................................................................... 40
2.2 Purpose of Report ......................................................................................................................... 40
2.3 Report Preparation ....................................................................................................................... 40
2.4 Cautionary Notes .......................................................................................................................... 40
2.5 CIM Code Reconciliation ............................................................................................................... 41
2.6 Sources of Information.................................................................................................................. 41
2.7 Units and Currency ........................................................................................................................ 41
2.8 Site Visits ...................................................................................................................................... 42
3 Reliance on Other Experts ................................................................................................... 43
3.1 Report Authors ............................................................................................................................. 43
3.2 External Reports Incorporated ...................................................................................................... 44
4 Property Description and Location ....................................................................................... 45
4.1 Location ........................................................................................................................................ 45
4.2 Property Description ..................................................................................................................... 45
4.3 Location of Mineralised Zones ...................................................................................................... 48
4.4 Survey Coordinate System and Conversions.................................................................................. 48
4.5 Tenure........................................................................................................................................... 49
4.5.1 Mining License – SML 20 ................................................................................................................. 49

4.5.2 Other Approved Operations ............................................................................................................ 50

4.5.3 Existing Veolia Agreements ............................................................................................................. 50
4.6 Ownership .................................................................................................................................... 51
4.7 Environmental .............................................................................................................................. 51
5 Accessibility, Climate, Local Resources, Infrastructure and Physiography .............................. 53
5.1 Accessibility .................................................................................................................................. 53
5.2 Climate .......................................................................................................................................... 54
5.3 Vegetation .................................................................................................................................... 54
5.3.1 Vegetation communities ................................................................................................................. 54
5.3.2 Species of plant................................................................................................................................ 56
5.4 Local Resources and Infrastructure ............................................................................................... 57
5.5 Physiography ................................................................................................................................ 58
6 History ................................................................................................................................ 59
7 Geological Setting and Mineralisation .................................................................................. 61
7.1 Previous Work............................................................................................................................... 61
7.2 Regional Geology .......................................................................................................................... 61
7.3 SML 20 (Mining Lease) Geology..................................................................................................... 65
7.4 Mineralisation ............................................................................................................................... 70
8 Deposit Types ..................................................................................................................... 73
8.1 Volcanic Massive Sulphide Deposit Model .................................................................................... 73
9 Exploration ......................................................................................................................... 76
9.1 Early Exploration and Production History (Jododex, AMS and Denehurst) .................................... 76
9.2 TriAusMin Exploration 2000 to 2013 ............................................................................................. 76
9.3 Heron Exploration 2014 to 2015 .................................................................................................... 78
9.4 Regional Exploration ..................................................................................................................... 84
9.4.1 Currawang Prospect (100% Heron) ................................................................................................. 84
9.4.2 Cowley Hills Prospect (100% Heron) ............................................................................................... 85
9.4.3 Hayshed Prospect (100% Heron) ..................................................................................................... 85
9.4.4 Cullarin JV Project (78.9% Heron, GCR 21.1%) ................................................................................ 85
10 Woodlawn Drilling ........................................................................................................... 87
10.1 Historical Drilling ........................................................................................................................... 87
10.1.1 Timeline of Drilling ...................................................................................................................... 87
10.2 Drilling Procedures 2014-15 .......................................................................................................... 88
10.2.1 Hole Planning, Site Preparation and Set-Up................................................................................ 88
10.2.2 Down Hole Surveying .................................................................................................................. 88
10.2.3 RC Logging Procedures ................................................................................................................ 89
10.2.4 Diamond Logging Procedures ..................................................................................................... 89
11 Sample Preparation, Analyses and Security ...................................................................... 91
11.1 RC Drilling Sampling Methodology ................................................................................................ 91
11.2 Diamond Drilling Sampling Methodology ...................................................................................... 92
11.3 Assay Sample Preparation ............................................................................................................. 93
11.4 Methodology of Sample Assay Analysis ........................................................................................ 94
11.5 Assay Quality Control Measures ................................................................................................... 96
11.5.1 Blank Material Results for TriAusMin and Heron Samples ......................................................... 97
11.5.2 Reference Standard Sample Results ......................................................................................... 100
11.5.3 Duplicate Sample Results .......................................................................................................... 104
11.6 Density Determinations .............................................................................................................. 109
12 Data Management and Verification................................................................................ 110
12.1 Historical Data Sources ............................................................................................................... 110
12.1.1 Historical Drilling Validation ...................................................................................................... 110
12.2 Data Management ...................................................................................................................... 111
12.3 Summary of QAQC Results .......................................................................................................... 112
12.4 Independent Qualified Person Review and Verification .............................................................. 113
12.5 SRK Site Visit ............................................................................................................................... 113

13 Mineral Processing and Metallurgical Testing ................................................................. 114

13.1 Introduction ................................................................................................................................ 114
13.2 Testwork Program to 2012 and Woodlawn Retreatment Project Front End Engineering Study ... 115
13.3 2014 Testwork Program on Woodlawn Underground Project ..................................................... 117
13.3.1 Samples ..................................................................................................................................... 117
13.3.2 Results ....................................................................................................................................... 118
13.3.3 Comminution............................................................................................................................. 119
13.3.4 Flotation Tests ........................................................................................................................... 120
13.3.5 Talc Flotation Circuit ................................................................................................................. 122
13.3.6 Copper Flotation Circuit ............................................................................................................ 122
13.3.7 Fine Grinding ............................................................................................................................. 122
13.3.8 Lead Flotation Circuit ................................................................................................................ 122
13.3.9 Zinc Flotation Circuit ................................................................................................................. 122
13.3.10 Concentrate Production ............................................................................................................ 123
13.4 Proposed Future Testwork .......................................................................................................... 123
14 Mineral Resource Estimates ........................................................................................... 124
14.1 Introduction ................................................................................................................................ 124
14.2 Previous Underground Mineral Resource Models ....................................................................... 125
14.2.1 Denehurst Lens Models 1988 to 1998 ...................................................................................... 125
14.2.2 TriAusMin Mineral Resource Model October 2006 .................................................................. 128
14.3 Data Used in Heron’s 2015 Underground Mineral Resource Estimate ......................................... 132
14.3.1 Backs Mapping Data .................................................................................................................. 133
14.3.2 Drilling Data ............................................................................................................................... 135
14.3.3 Survey Control ........................................................................................................................... 136
14.3.4 Drill Hole Trace Locations .......................................................................................................... 137
14.3.5 Topography ............................................................................................................................... 137
14.3.6 Underground Void Model ......................................................................................................... 138
14.3.7 Down Hole Surveying ................................................................................................................ 139
14.3.8 Bulk Density ............................................................................................................................... 139
14.4 Geology and Mineralised Domain Modelling .............................................................................. 141
14.4.1 Mineralisation and Geological Domain Modelling Methodology ............................................. 141
14.4.2 Sample Selection and Compositing ........................................................................................... 146
14.4.3 Summary Statistics and Top Cut Strategy ................................................................................. 146
14.4.4 Review of Composite Statistics by Domains ............................................................................. 147
14.5 Domain Variography ................................................................................................................... 157
14.6 Block Model Construction ........................................................................................................... 165
14.6.1 Model Limits .............................................................................................................................. 165
14.6.2 Selection of Optimal Parent Block ............................................................................................. 165
14.6.3 Grade Interpolation ................................................................................................................... 166
14.6.4 Specific Gravity .......................................................................................................................... 167
14.6.5 Model Verification and Validation ............................................................................................ 168
14.7 Resource Classification ................................................................................................................ 168
14.7.1 Classification.............................................................................................................................. 168
14.7.2 Estimate .................................................................................................................................... 169
14.7.3 Adequacy of Resource Estimation Methods ............................................................................. 171
14.7.4 Discussion .................................................................................................................................. 171
14.8 Mineral Resource Estimates (Tailings) ......................................................................................... 173
15 Mineral Reserve Estimates ............................................................................................. 175
16 Mining Methods ............................................................................................................ 176
16.1 Introduction ................................................................................................................................ 176
16.2 WRP Mining ................................................................................................................................ 176
16.2.1 Production Rate......................................................................................................................... 176
16.2.2 Mining Factors ........................................................................................................................... 177
16.2.3 Mining Schedule ........................................................................................................................ 177
16.2.4 Mining Strategy ......................................................................................................................... 178

16.3 WUP Access ................................................................................................................................ 180

16.3.1 Underground Mine Access ........................................................................................................ 180
16.3.2 Option 2 Portal and Decline Geotechnical Reviews .................................................................. 181
16.3.3 Option 2 Western Portal Preliminary Design ............................................................................ 181
16.3.4 Decline Temporary Construction Facilities................................................................................ 182
16.4 WUP Mining ................................................................................................................................ 182
16.4.1 Introduction .............................................................................................................................. 182
16.4.2 Existing Workings ...................................................................................................................... 184
16.4.3 Mining Method Selection .......................................................................................................... 184
16.4.4 Vertical Development................................................................................................................ 188
16.4.5 Material Handling ...................................................................................................................... 188
16.4.6 Mine Design Guidelines............................................................................................................. 188
16.4.7 General Design Parameters ....................................................................................................... 188
16.4.8 Stope Design Criteria ................................................................................................................. 189
16.4.9 Dilution ...................................................................................................................................... 189
16.4.10 Mining Recovery ........................................................................................................................ 190
16.4.11 Cutoff Grades ............................................................................................................................ 190
16.5 Mine Services and Infrastructure ................................................................................................ 190
16.5.1 Ventilation ................................................................................................................................. 190
16.5.2 Backfill ....................................................................................................................................... 193
16.5.3 Water ........................................................................................................................................ 193
16.5.4 Compressed Air ......................................................................................................................... 193
16.5.5 Power ........................................................................................................................................ 193
16.5.6 Emergency Egress...................................................................................................................... 193
16.6 Mining Schedule.......................................................................................................................... 194
16.6.1 Scheduling Strategy ................................................................................................................... 194
16.6.2 Scheduling Parameters and Rates ............................................................................................. 194
16.6.3 Development Schedule ............................................................................................................. 195
16.6.4 Production Schedule ................................................................................................................. 196
16.7 WUP Equipment, Infrastructure and Manpower Requirements .................................................. 197
16.7.1 Mine Equipment Fleet ............................................................................................................... 197
16.7.2 WUP Infrastructure ................................................................................................................... 197
16.7.3 Personnel .................................................................................................................................. 197
17 Recovery Methods ......................................................................................................... 199
17.1 Introduction ................................................................................................................................ 199
17.2 Process Design Basis ................................................................................................................... 202
17.3 Process Plant Description ............................................................................................................ 203
17.3.1 Overview ................................................................................................................................... 203
17.3.2 Crushing - Underground Plant Feed .......................................................................................... 204
17.3.3 Grinding - Underground Plant Feed .......................................................................................... 204
17.3.4 Grinding – TSF Reclaim .............................................................................................................. 205
17.3.5 Talc Flotation Circuit ................................................................................................................. 205
17.3.6 Copper Flotation Circuit ............................................................................................................ 206
17.3.7 Lead Flotation Circuit ................................................................................................................ 207
17.3.8 Zinc Flotation Circuit ................................................................................................................. 208
17.3.9 Concentrate Production ............................................................................................................ 209
17.3.10 Paste Backfill Plant .................................................................................................................... 210
17.3.11 Tailings Thickening .................................................................................................................... 211
17.4 Reagents ..................................................................................................................................... 211
17.4.1 Aero 3894 .................................................................................................................................. 212
17.4.2 MIBC .......................................................................................................................................... 212
17.4.3 Sodium Metabisulphite (SMBS) ................................................................................................ 212
17.4.4 Sodium Isobutyl Xanthate (SIBX) ............................................................................................... 213
17.4.5 Hydrated Lime ........................................................................................................................... 213
17.4.6 Copper Sulphate ........................................................................................................................ 213

17.4.7 Anti-Scalant ............................................................................................................................... 214

17.4.8 Zinc Sulphate ............................................................................................................................. 214
17.4.9 Flocculant .................................................................................................................................. 214
17.4.10 Sodium Carboxymethyl Cellulose (CMC) ................................................................................... 214
17.4.11 Binder ........................................................................................................................................ 215
17.5 Services ....................................................................................................................................... 215
17.5.1 Control Systems ........................................................................................................................ 215
17.5.2 Online Analysis .......................................................................................................................... 216
17.5.3 Compressed Air ......................................................................................................................... 217
17.5.4 Raw Water ................................................................................................................................. 217
17.5.5 Potable Water ........................................................................................................................... 218
17.6 Processing Labour Force .............................................................................................................. 218
18 Project Infrastructure .................................................................................................... 219
18.1 Existing Infrastructure and Services ............................................................................................ 219
18.2 Site Schematic Layout ................................................................................................................. 220
18.3 Buildings ..................................................................................................................................... 221
18.4 Power Supply .............................................................................................................................. 221
18.4.1 Load ........................................................................................................................................... 221
18.4.2 HV Power Distribution ............................................................................................................... 221
18.5 Water Supply .............................................................................................................................. 222
18.5.1 Raw Water ................................................................................................................................. 222
18.5.2 Evaporation Pond Water ........................................................................................................... 222
18.5.3 Potable Water ........................................................................................................................... 222
18.5.4 Sewage ...................................................................................................................................... 222
18.6 Mining Contractor’s Infrastructure .............................................................................................. 223
18.7 Communications ......................................................................................................................... 223
18.8 Accommodation .......................................................................................................................... 223
18.9 Security ....................................................................................................................................... 223
18.10 Roads ...................................................................................................................................... 223
18.10.1 Site Access Road ........................................................................................................................ 223
18.10.2 Haulage and General Site Roads ............................................................................................... 223
19 Market Studies and Contracts ........................................................................................ 224
19.1 Market Studies ............................................................................................................................ 224
19.2 Contracts..................................................................................................................................... 224
20 Environmental Studies, Permitting and Social or Community Impact ............................... 225
20.1 Environmental Permits ............................................................................................................... 225
20.1.1 Project Approvals ...................................................................................................................... 225
20.1.2 Approval Conditions .................................................................................................................. 225
20.1.3 Ongoing Reporting Requirements ............................................................................................. 226
20.2 Social and Community Aspects, Stakeholder Consultation .......................................................... 227
20.3 Mine Closure and Bond Requirements ........................................................................................ 228
21 Capital and Operating Costs ........................................................................................... 230
21.1 Operating Costs ........................................................................................................................... 230
21.1.1 Introduction .............................................................................................................................. 230
21.1.2 Summary ................................................................................................................................... 230
21.1.3 Qualifications and Exclusions .................................................................................................... 232
21.1.4 Underground Mine Operating Costs ......................................................................................... 234
21.1.5 Tailings Mining Operating Costs ................................................................................................ 234
21.1.6 Processing and Maintenance Costs ........................................................................................... 235
21.1.7 General and Administration Costs ............................................................................................ 238
21.2 Capital Cost Estimate .................................................................................................................. 239
21.2.1 Introduction .............................................................................................................................. 239
21.2.2 Summary ................................................................................................................................... 239
21.2.3 Estimate Basis ........................................................................................................................... 242
21.2.4 Qualifications and Exclusions .................................................................................................... 242

21.2.5 Mine Development ................................................................................................................... 242

21.2.6 Mining Equipment ..................................................................................................................... 244
21.2.7 Processing Plant ........................................................................................................................ 244
21.2.8 Infrastructure ............................................................................................................................ 244
21.2.9 Contingency............................................................................................................................... 244
21.2.10 Indirect Capital .......................................................................................................................... 245
21.2.11 Owner’s Cost ............................................................................................................................. 246
22 Economic Analysis ......................................................................................................... 247
22.1 Basis of Evaluation ...................................................................................................................... 247
22.2 Summary Results ........................................................................................................................ 247
22.2.1 Revenue Splits ........................................................................................................................... 248
22.2.2 Cash Costs ................................................................................................................................. 249
22.3 Cautionary Notes & Resource Categorisation .............................................................................. 251
22.3.1 Underground Resource Categorisation of Plant Feed ............................................................... 251
22.3.2 Tailings Resource Categorisation of Plant Feed ........................................................................ 251
22.4 Macroeconomic Assumptions ..................................................................................................... 251
22.4.1 Exchange Rates, Inflation and Discount Rates .......................................................................... 252
22.4.2 Expected Metal Prices ............................................................................................................... 252
22.4.3 Taxes and Royalties ................................................................................................................... 253
22.4.4 Selling Expenses ........................................................................................................................ 253
22.5 Technical Assumptions ................................................................................................................ 254
22.5.1 Mine Production Schedule ........................................................................................................ 254
22.5.2 Concentrates Produced ............................................................................................................. 257
22.5.3 Recoveries to Concentrates ...................................................................................................... 257
22.5.4 Operating & Closure Costs ........................................................................................................ 258
22.5.5 Capital Costs .............................................................................................................................. 259
22.5.6 UG Starter Case Financial Statements ....................................................................................... 262
22.6 Sensitivity Analysis ...................................................................................................................... 264
22.6.1 UG Starter Case Sensitivities ..................................................................................................... 264
22.6.2 Sensitivity Discussion ................................................................................................................ 265
23 Adjacent Properties ....................................................................................................... 267
23.1 Introduction ................................................................................................................................ 267
23.2 Captains Flat Deposit (Ironbark Zinc Ltd 50%, Glencore plc 50%) ................................................ 268
23.3 Dargue’s Reef (Unity Mining Ltd 100%) ....................................................................................... 268
23.4 Mayfield Prospect (Capital Mining Ltd earning in) ....................................................................... 269
23.5 Collector Prospect (Centrex Metals Ltd 100%)............................................................................. 270
24 Other Relevant Data and Information ............................................................................ 271
25 Interpretation and Conclusions ...................................................................................... 272
25.1 Study Conclusions ....................................................................................................................... 272
25.2 Opportunities .............................................................................................................................. 273
25.3 Risks ............................................................................................................................................ 273
26 Recommendations......................................................................................................... 274
26.1 Development Timetable .............................................................................................................. 274
26.2 Feasibility Study Considerations.................................................................................................. 274
26.3 Exploration ................................................................................................................................. 275
27 List of Abbreviations Used ............................................................................................. 276
28 References .................................................................................................................... 279
29 Certificates of Authors ................................................................................................... 281
30 Appendices.................................................................................................................... 287
30.1 Appendix 1: Summary of Risks .................................................................................................... 287

List of Figures
Figure 1.1 : Woodlawn location map with relative population sizes ....................................................................... 16
Figure 1.2: Woodlawn site layout ........................................................................................................................... 17
Figure 1.3: Woodlawn Project Mineral Resource Block Model (ZnEq coloured) .................................................... 19
Figure 1.4: PEA Stope Design (SRK) .................................................................................................................... 23
Figure 1.5: Plant Feed Sources and Grades Delivered to the Mil .......................................................................... 24
Figure 1.6: Underground Production by Mining Type............................................................................................. 25
Figure 1.7: Underground Production by Domain .................................................................................................... 25
Figure 4.1 : Woodlawn location map with relative population sizes ....................................................................... 46
Figure 4.2: Woodlawn Site Layout ......................................................................................................................... 47
Figure 4.3: Grid conversion calculations at Woodlawn .......................................................................................... 48
Figure 4.4: Demarcation of the Veolia and Heron Activities ................................................................................... 51
Figure 7.1: Regional Geological Setting of the Woodlawn Project, within the Goulburn Basin. ............................. 62
Figure 7.2: Interpreted solid geology for the Woodlawn area. ................................................................................ 64
Figure 7.3: Interbedded volcanic mudstone and quartz-crystal-rich sandstone. Arrow indicates the local younging
direction ........................................................................................................................................................ 66
Figure 7.4: Monomictic quartz-phyric rhyolite breccia viewed on a surface parallel to cleavage ........................... 67
Figure 7.5: Equant rhyolite clast with curviplanar margins, in the monomictic quartz-phyric rhyolite breccia; viewed
on a surface parallel to cleavage................................................................................................................... 67
Figure 7.6: Interbed of graded quartz-crystal-rich sandstone in the monomictic quartz-phyric rhyolite breccia.
Arrow indicates the local younging direction ................................................................................................. 68
Figure 7.7: Strongly chlorite-altered quartz-phyric rhyolite ..................................................................................... 68
Figure 7.8: Massive amygdaloidal basalt / dolerite (amygdales are filled by dark green chlorite). ......................... 69
Figure 7.9: Schematic section based on the Woodlawn Pit traverse. The section was not measured but the
approximate thickness is in the range of several tens of metres to possibly 150 m. The younging direction is
not confidently known but is generally considered to be younging up the section. ....................................... 70
Figure 7.10: Copper stringer and polymetallic massive sulphide mineralisation from WLTD015 Kate Lens
“discovery hole”, 396 to 409m with assay results .......................................................................................... 72
Figure 8.1: Cross section through typical Palaeozoic VMS system of Eastern Australia (after Gemmell et al 1998).
...................................................................................................................................................................... 75
Figure 9.1 Woodlawn Oblique Cross-Section looking north (top) and Figure 9.2 Woodlawn Long-section looking
east in the plane of the Kate Lens (bottom). ................................................................................................. 81
Figure 9.3: Woodlawn lens plan view..................................................................................................................... 82
Figure 9.4: G Lens long section looking east ......................................................................................................... 83
Figure 9.5: Woodlawn Prospects Location Plan..................................................................................................... 84
Figure 10.1: WNDD0018 comparison of Pathfinder vs Keeper Gyro down hole survey readings .......................... 89
Figure 11.1: Control standard plot BLANK_SS Zn Analysis ................................................................................... 98
Figure 11.2: Control standard plot BLANK_SS Cu Analysis .................................................................................. 98
Figure 11.3: Control standard plot BLANK_SS Pb Analysis .................................................................................. 99
Figure 11.4: Control standard plot BLANK_SS Au Analysis .................................................................................. 99
Figure 11.5: Control standard plot BLANK_SS Ag Analysis .................................................................................. 99
Figure 11.6: Control standard plot GBM309-15 Zn Analysis ................................................................................ 101
Figure 11.7: Control standard plot GBM309-15 Cu Analysis ............................................................................... 101
Figure 11.8: Control standard plot GBM309-15 Pb Analysis ................................................................................ 101
Figure 11.9: Control standard plot GBM309-15 Ag Analysis ................................................................................ 102
Figure 11.10: Control standard plot GBM911-11 Zn Analysis .............................................................................. 102
Figure 11.11: Control standard plot GBM911-11 Cu Analysis ............................................................................. 102
Figure 11.12: Control standard plot GBM911-11 Pb Analysis .............................................................................. 103
Figure 11.13: Control standard plot GBM911-11 Ag Analysis .............................................................................. 103
Figure 11.14: Control standard plot G901-7 Au Analysis ..................................................................................... 103
Figure 11.15: Correlation Plot for Zn TriAusMin (Original) vs Heron (Duplicate) Analysis ................................... 104
Figure 11.16: Correlation Plot for Cu TriAusMin (Original) vs Heron (Duplicate) Analysis ................................... 104
Figure 11.17: Correlation Plot for Pb TriAusMin (Original) vs Heron (Duplicate) Analysis ................................... 105
Figure 11.18: Correlation Plot for Au TriAusMin (Original) vs Heron (Duplicate) Analysis ................................... 105
Figure 11.19: Correlation Plot for Ag TriAusMin (Original) vs Heron (Duplicate) Analysis ................................... 106
Figure 11.20: Correlation Plot for Zn Original vs Lab Duplicate Check Analysis .................................................. 106
Figure 11.21: Correlation Plot for Cu Original vs Lab Duplicate Check Analysis ................................................. 107
Figure 11.22: Correlation Plot for Pb Original vs Lab Duplicate Check Analysis.................................................. 107
Figure 11.23: Correlation Plot for Ag Original vs Lab Duplicate Check Analysis.................................................. 108
Figure 11.24: Correlation Plot for Zn Original vs Field Duplicate Analysis ........................................................... 108
Figure 13.1: FEED Study – Plant Flowsheet ........................................................................................................ 116

Figure 13.2: Copper Grade-Recovery Curve ....................................................................................................... 121

Figure 13.3: Lead Grade-Recovery Curve ........................................................................................................... 121
Figure 13.4: Zinc Grade-Recovery Curve ............................................................................................................ 121
Figure 14.1: Denehurst lens model from 1997 looking south showing from left to right C Lens (magenta, under pit)
B5 Lens (dark blue, next to C), B1 Lens (green), A Lens (red), F Lens (light green, under pit edge), E Lens
(orange, below F), G Lens (green, above E), .............................................................................................. 126
Figure 14.2: 2006 lens model with drilling, looking north, showing from left to right I Lens (light green), D Lens
(dark blue), F Lens (purple), A Lens (yellow), B Lens (red), J Lens (light green), C Lens (middle green), and
as intercepts only H Lens (orange), G lens (yellow) and E lens (cyan). ...................................................... 129
Figure 14.3: Block model 2006 E/W vertical cross section 19,500mN showing Zn block grades. Note grey blocks
indicate voids where previous mining has taken place. Lenses from left to right A, B hangingwall Lenses,
B1, B2 footwall Lens (Cu rich). .................................................................................................................... 131
Figure 14.4: Typical underground level mapping – Denehurst mine mapping 1:500 scale geology backs map of
B14 level (2390mRL) showing B Lens (B1 and BC) along with the 750 fault. Massive sulphides are coloured
in Red, stringer sulphide chert in light pink, shale in brown, dolerite in yellow and rhyolite in magenta. Note
the additional observations with reference locations and resource model data in outlines and pencil lines.
(Note the WMG used at the time of mapping omitted the 10,000m addition to northings used in the current
work by Heron) ............................................................................................................................................ 134
Figure 14.5: Digitised underground mapping method. I Lens, oblique view looking north, showing
TriAusMin/Denehurst void model, backs mapping plan I20-2 level (2470mRL) with the mapping strings of
the hangingwall (red) and footwall (pink) massive sulphide contacts digitised and then projected onto the
corresponding void backs plan for each level. Note also drilling with massive sulphide shown in red, and
intersection selections in green (HW and FW) at the geological contact ..................................................... 135
Figure 14.6: Oblique view from south showing historic drilling in black, Heron and TriAusMin drilling in magenta.
.................................................................................................................................................................... 137
Figure 14.7: Previous void model (grey) against resource wireframe outline (red) showing sections of unmined
resources between levels ............................................................................................................................ 138
Figure 14.8: New Void Model (grey) against resource wireframe (red) showing shanty back profile and mining of
the resource between levels. Note the area at top right was noted on the geology plan as hangingwall
unmined (due to mineralisation being wider than the maximum permitted span of the drive. This area is
captured in the new resource model as an unrecoverable skin................................................................... 139
Figure 14.9: Graph showing the measured versus the calculated density measurements. Note the
underestimation of lower grade samples by the density regression equation. ............................................ 140
Figure 14.10: Domain boundary from mapping strings, for the I1 massive sulphide domain. Same view as for
figure 14.5 showing drilling, mapping strings and the resulting wireframe domain boundary ...................... 144
Figure 14.11: Showing grade changes in B Lens on the 2250mRL from polymetallic to copper rich across a single
sample interval. Note previous mining centered on the polymetallic mineralisation. Drill hole traces showing
lithology (massive sulphide red, dolerite dark) ............................................................................................ 145
Figure 14.12: Review of Sample Statistics by Domains - Lens A......................................................................... 148
Figure 14.13: Review of Sample Statistics by Domains - Lens B......................................................................... 149
Figure 14.14: Review of Sample Statistics by Domains - Lens D ........................................................................ 150
Figure 14.15: Review of Sample Statistics by Domains - Lens E......................................................................... 151
Figure 14.16: Review of Sample Statistics by Domains - Lens G ........................................................................ 152
Figure 14.17: Review of Sample Statistics by Domains - Lens H ........................................................................ 153
Figure 14.18: Review of Sample Statistics by Domains - Lens I .......................................................................... 154
Figure 14.19: Review of Sample Statistics by Domains - Lens J ......................................................................... 155
Figure 14.20: Review of Sample Statistics by Domains - Lens K......................................................................... 156
Figure 14.21: Cu variography............................................................................................................................... 158
Figure 14.22: Pb variography ............................................................................................................................... 159
Figure 14.23: Zn variography ............................................................................................................................... 160
Figure 14.24: ZnEq variography........................................................................................................................... 161
Figure 14.25: Au gaussian variography ............................................................................................................... 162
Figure 14.26: Ag gaussian variography ............................................................................................................... 163
Figure 14.27: Fe variography ............................................................................................................................... 164
Figure 16.1: Top Down Hydraulic Mining Method ................................................................................................ 177
Figure 16.2: Typical Dam Channel Monitoring ..................................................................................................... 179
Figure 16.3: Portal Location Options.................................................................................................................... 180
Figure 16.4: Preliminary Western Portal Decline Design ..................................................................................... 181
Figure 16.5: Underground Mine Showing New Stopes and Existing Workings .................................................... 183
Figure 16.6: Existing Development and Mined Areas .......................................................................................... 185
Figure 16.7: Drift and Half-upper Mining Method ................................................................................................. 186
Figure 16.8: Underhand Open Stoping Mining Method ........................................................................................ 186
Figure 16.9: Multi-level Continuous Fill Mining Method ........................................................................................ 187
Figure 16.10: Primary Ventilation Circuit Looking East ........................................................................................ 192
Figure 16.11: Primary Ventilation Circuit Looking South ...................................................................................... 192

Figure 16.12: Escapeway System Below 2400mRL ............................................................................................ 194

Figure 16.13: Development Schedule .................................................................................................................. 196
Figure 16.14: Production Schedule ...................................................................................................................... 196
Figure 17.1: Plant Flowsheet – Part 1 .................................................................................................................. 200
Figure 17.2: Plant Flowsheet – Part 2 .................................................................................................................. 201
Figure 17.3: Departmental Organisational Structure ............................................................................................ 218
Figure 18.1: Site Layout Schematic ..................................................................................................................... 220
Figure 19.1: Approximate revenue split post payability, pre TC/RCs ................................................................... 224
Figure 21.1: Breakdown of Mine Capital .............................................................................................................. 241
Figure 22.1: Approximate revenue split post payability, pre TC/RCs ................................................................... 249
Figure 22.2: Cost Curve Comparison (Longson et al, 2015) ................................................................................ 250
Figure 22.3: Production sources and diluted grades delivered to mill .................................................................. 255
Figure 22.4: Underground Production by Domain ................................................................................................ 256
Figure 22.5: Underground Production by Mining Type ......................................................................................... 256
Figure 22.6: Economic Model - Sensitivity Spider Diagram ................................................................................. 264
Figure 23.1: Map showing the relevant mineral prospects adjacent to the Woodlawn Project ............................. 267

List of Tables
Table 1.1: Underground Mineral Resource ............................................................................................................ 20

Table 1.2: Mineral Resource Estimate - Woodlawn Retreatment Project (WRP) ................................................... 21
Table 1.3: Detailed PEA Production Schedule by Financial Year ending June 30 ................................................. 24
Table 1.4: Annual Production by Product (combined WRP and WUP) .................................................................. 26
Table 1.5: Annual Commodity Gross Production (LOM & Steady State) ............................................................... 26
Table 1.6: Summary Capital to Peak Cash Draw ................................................................................................. 30
Table 1.7: Underground Mining Capital Breakdown Post-Peak Cash Draw .......................................................... 31
Table 1.8: Underground Mining Unit Costs ............................................................................................................ 32
Table 1.9: Plant Operating Cost Summary ............................................................................................................ 33
Table 1.10: Economic Model - Summary Economic Inputs and Outputs ............................................................... 34
Table 1.11: Economic Model - Concentrate Recoveries - Underground ................................................................ 36
Table 1.12: Economic Model - Concentrate Recoveries - Tailings......................................................................... 36
Table 1.13: Economic Model - Concentrate Recoveries - Blended Underground plus Tailings ............................. 36
Table 1.14: Economic Model - Concentrate Specifications .................................................................................... 37
Table 3.1: Report Authors and Qualified Persons .................................................................................................. 43
Table 3.2: External Reports Incorporated .............................................................................................................. 44
Table 4.1: Mine Grid Conversion Table ................................................................................................................. 49
Table 5.1: Vegetation community condition and extent of cover within the ecological survey area ....................... 55
Table 5.2: Number of species of plant recorded in the ecological survey area ...................................................... 57
Table 6.1: Woodlawn Site History .......................................................................................................................... 59
Table 9.1: Details of significant drill intercepts from 2009 to 2013 TriAusMin campaigns ...................................... 77
Table 9.2: Significant drill intercepts from 2014 to 2015 Heron drilling campaign. ................................................. 78
Table 10.1: Listing of drilling programs and drill hole numbers completed at Woodlawn (recent drilling by Heron is
included here for completeness). .................................................................................................................. 87
Table 11.1: Summary of Standards used in QAQC Programs ............................................................................. 100
Table 13.1: Summary of main testwork composites............................................................................................. 117
Table 13.2: Preliminary flotation results for the zinc-copper mineralisation sample (bracketed numbers represent
typical recoveries achieved during previous operations at Woodlawn, c. 1992).......................................... 118
Table 13.3: Preliminary flotation results for copper only mineralisation ............................................................... 118
Table 13.4: Preliminary flotation result for combined zinc-copper and tailings blend ........................................... 119
Table 13.5: Flotation result for tailings ................................................................................................................. 119
Table 13.6: Summary of comminution testwork ................................................................................................... 120
Table 13.7: Expected concentrate grades from mixed underground feed and reclaimed tailing (based on 1.5Mtpa
treatment, life of mine average) ................................................................................................................... 123
Table 13.8: Expected concentrate production profile and gross metal content from mixed underground feed and
reclaimed tailing (based on 1.5Mtpa treatment) .......................................................................................... 123
Table 14.1: Mineral Resources and Reserves reported by Denehurst, February 1997 ....................................... 127
Table 14.2: Table showing interpolation parameters used in the TriAusMin 2006 Mineral Resource model (from
Rankin, 2006) .............................................................................................................................................. 129
Table 14.3: Woodlawn 2006 Mineral Resource above 7.0% Zneq cutoff grade, excluding all blocks within 50m of
the open cut pit............................................................................................................................................ 132
Table 14.4 : Historic extraction of ore vs void models .......................................................................................... 138
Table 14.5 : Table showing values used to determine iron grades for samples without iron assays ................... 141
Table 14.6: Summary of domain constraints ........................................................................................................ 142
Table 14.7: Summary Statistics for all uncut assays used in the resource estimate ............................................ 147
Table 14.8: Model Limits for resource block model .............................................................................................. 165
Table 14.9: Variogram model simplified parameters ............................................................................................ 166
Table 14.10: Search ellipse parameters .............................................................................................................. 167
Table 14.11: Mineral Resource Estimate – WUP – Breakdown by Lens ............................................................. 169
Table 14.12: Mineral Resource Estimate – Woodlawn Underground Project (WUP) ........................................... 171
Table 14.13: Mineral Resource Estimate - Woodlawn Retreatment Project (WRP) ............................................. 174
Table 16.1: Proposed WRP Mining Schedule ...................................................................................................... 178
Table 16.2: Ramp Up Schedule ........................................................................................................................... 178
Table 16.3: WUP Process Plant Feed ................................................................................................................. 184
Table 16.4: Mine Design Parameters ................................................................................................................... 188
Table 16.5: Beck Engineering Summary of Stope Design Criteria ....................................................................... 189
Table 16.6: Range of Planned Dilution in Process Plant Feed ............................................................................ 189
Table 16.7: Unplanned Dilution Factors ............................................................................................................... 190
Table 16.8: Mining Recovery Assumptions .......................................................................................................... 190
Table 16.9: Cut-off Grade by Mining Method ....................................................................................................... 190

Table 16.10: Required Ventilation ........................................................................................................................ 191

Table 16.11: Development Productivity Rates ..................................................................................................... 195
Table 16.12: Mining Method Productivities .......................................................................................................... 195
Table 16.13: Mine Equipment Requirements ....................................................................................................... 197
Table 16.14: Personnel Requirements ................................................................................................................. 198
Table 17.1: Process Plant Design Criteria ........................................................................................................... 203
Table 17.2: Annual Reagent Consumption .......................................................................................................... 211
Table 20.1: Rehabilitation Management Plan - Closure Objectives ..................................................................... 228
Table 21.1: Annual Processing Costs (OPEX) ..................................................................................................... 231
Table 21.2: Process Plant Operating Costs by Plant Feed Type ......................................................................... 232
Table 21.3: Unit Costs by Mining Method ............................................................................................................ 234
Table 21.4: Proposed Work Rosters .................................................................................................................... 235
Table 21.5: Personnel Numbers and Labour Rates ............................................................................................. 235
Table 21.6: Reagent Usage ................................................................................................................................. 237
Table 21.7: General and Administration Costs .................................................................................................... 238
Table 21.8: Capital Cost Estimate Summary ....................................................................................................... 239
Table 21.9: Plant Capital Breakdown to WRP and WUP Components ................................................................ 240
Table 21.10: Mining Capital Cost Summary ......................................................................................................... 241
Table 21.11: Lateral Development – Capital Estimate ......................................................................................... 242
Table 21.12: Vertical Development – Capital Estimates ...................................................................................... 243
Table 21.13: Underground Mine Infrastructure - Capital Estimates ..................................................................... 243
Table 21.14: Owners' Costs - Capital Estimates .................................................................................................. 246
Table 22.1: Economic Model - Summary Economic Inputs and Outputs ............................................................. 248
Table 22.2: Economic Model - C1, C2 and C3 Costs - Zn Only Basis ................................................................. 249
Table 22.3: Economic Model - C1, C2 and C3 Costs - Zn, Cu, Pb Basis............................................................. 249
Table 22.4: Economic Model - Cost Breakdown Expressed as US$/t Plant Feed ............................................... 250
Table 22.5: Economic Model - Underground Resource Categorisation of Plant Feed ......................................... 251
Table 22.6: Economic Model - Tailings Resource Categorisation of Plant Feed.................................................. 251
Table 22.7: Economic Model - Exchange Rate Assumptions .............................................................................. 252
Table 22.8: Economic Model - Commodity Price Assumptions ............................................................................ 253
Table 22.9: Economic Model - Selling Expense Assumptions ............................................................................. 254
Table 22.10: Economic Model - Production Schedule ......................................................................................... 255
Table 22.11: Economic Model - Concentrate Recoveries - Underground ............................................................ 257
Table 22.12: Economic Model - Concentrate Recoveries - Tailings..................................................................... 258
Table 22.13: Economic Model - Concentrate Recoveries - Blended Underground plus Tailings ......................... 258
Table 22.14: Economic Model - Plant Operating Costs ....................................................................................... 259
Table 22.15: Economic Model – Initial Capital Costs Summary (to Peak Cash Draw)......................................... 260
Table 22.16: Economic Model - Post-Production Underground Capital Cost Summary ...................................... 261
Table 22.17: Economic Model – Project Pre-Finance Profit and Loss Summary ................................................. 262
Table 22.18: Economic Model – Project Pre-Finance Cash Flow Summary ........................................................ 263
Table 22.19: Economic Model – Project Pre-Finance Balance Sheet Summary ................................................. 263
Table 22.20: Economic Model - Key Sensitivities to NPV and IRR Outcomes ..................................................... 265
Table 26.1: FS Budget to 30 June 2016 .............................................................................................................. 275

Heron Resources Limited Section 1
1 Summary
1.1 Introduction and Scope
Heron Resources Limited (Heron) (ASX:HRR / TSX:HER) presents the results of a
Preliminary Economic Assessment (PEA or the Study) of its 100%-owned
Woodlawn Zinc-Copper Project (Woodlawn Project or simply the Project) in the
Goulburn district, New South Wales, Australia.
The Study was overseen by Anne-Marie Ebbels of SRK, with contributions from
other consultants discussed in Section 2.3. The Report has been prepared in
accordance with the requirements of National Instruments 43-101 (NI 43-101),
“Standards of Disclosure for Mineral Projects”, of the Canadian Securities
Administrators (CSA) for lodgment on the CSA’s “System for Electronic Document
Analysis and Retrieval” (SEDAR). The opinions contained herein and effective 29
May 2015, are based on information collected by the various consultants and
employees of Heron.
The Study considers the design and construction of an integrated processing
facility for the Woodlawn Underground Project (WUP) and the Woodlawn Tailings
Retreatment Project (WRP). It encompasses geology, resource definition, mine
design, metallurgical testing and process design, infrastructure requirements, and
associated capital and operating cost estimation, leading to a preliminary
assessment of the economic potential of the Project.
The base case “UG Starter Case” development scenario for the WUP Resource
considers the treatment of 3.8 million tonnes, representing 58% of the updated
JORC Mineral Resource. In addition, 11.2 million tonnes of Mineral Resources
from the WRP are treated, for a total Plant Feed Estimate of 15 million tonnes.
The UG Starter Case scenario reflects an initial design life of approximately 11
years based on co-treatment of WUP and WRP material through a 1.5Mtpa plant.
The UG Starter Case is a starting point for the now-commenced Feasibility Study,
which will be based on achieving attractive project returns whilst minimising
development time and cost. However, there is very strong potential for the Project
to deliver significantly greater tonnages from underground based on both the
Resource and on the exploration potential of the Woodlawn mineralised system.
Cautionary statements
The purpose of this technical report (Report) is to present the PEA findings of the
Project. The contents of this Report reflect various technical and economic
conditions at the time of writing. Given the nature of the mining business, these
conditions can change significantly over relatively short periods of time.
Consequently, actual results may be significantly more or less favourable.
The reader is cautioned that the PEA summarised in this Report is preliminary in
nature and is only intended to provide an initial, high-level review of the Project.
Further studies are required with regards to the resource, infrastructure and
operational methodologies, particularly as they relate to the WUP. The PEA
production schedule and economic model include the use of a significant portion
(29%) of Inferred Mineral Resources that are considered to be too speculative
geologically to have economic considerations applied to them that would enable
them to be characterised as Mineral Reserves. There is no guarantee that Inferred

Mineral Resources can be converted to Indicated or Measured Mineral Resources.

Hence there is no guarantee that the project economics described herein can be
achieved.
1.2 Economic Modelling Outcomes

The Woodlawn Project has been demonstrated to be economically attractive based
on the assumptions used. The Net Present Values (NPV), together with their
attractive position on the cost curve and the strong Internal Rate of Return (IRR)
provide a compelling case for pursuing the continued study and development of the
Project.
Based on the commodity price curves used, the UG Starter Case delivers a post-
tax NPV of A$300 million at a discount rate of 8.3% (post-tax real basis), with an
IRR of 46% and a payback period of two years. Preproduction capital is estimated
at A$140 million. Refer to Section 22 for details.
With zinc (Zn) as the primary product (being around 47% of revenue), costs are
expected to be in the lower half of the cost curve with a C1 costs of around
US$0.00/lb (zero) for zinc and a C3 cost of US$0.31/lb. Treating lead (Pb) and
copper (Cu) as co-products rather than by-products gives a C1 of US$0.49/lb and
C3 of US$0.66/lb expressed in terms of payable zinc. These numbers are based
on an amended methodology and hence differ slightly from those presented in the
22nd April 2015 ASX/TSX release.
The project valuation is most sensitive to the commodity price / foreign exchange
(FX) environment on the revenue side, and to grade (which in turn is driven by
dilution considerations) and recoveries. Other significant factors influencing the
project returns include the underground development capital, and the plant
operating costs.
The economic analysis strongly supports the continued study and development of
the Woodlawn Project. The recommendations and proposed forward programme
are discussed in Section 26.
1.3 Property Description and Ownership

Woodlawn is a high-grade, volcanogenic massive-sulphide (VMS) deposit situated
in New South Wales, Australia. It is located approximately 50km northeast of
Canberra, and 250km southwest of Sydney within the Southern Tablelands of New
South Wales. The region is serviced by the Federal Highway and the Hume
Highway to the west and north of the Woodlawn Site. Both of these roads provide
key transport corridors between Sydney / Melbourne and Sydney / Canberra.
The Woodlawn site is currently subject to an existing Special Mining Lease (SML
20). SML 20 has remained current since the closure of the previous operations on
the site in 1998 and title was transferred into the name of Tarago Operations Pty
Ltd, a fully owned subsidiary of Heron, in March 2014. The Mining Lease has
recently been renewed for a period of 15 years. Furthermore, the Project has
received major project approvals (statutory approval) that allows for mining
operations at the Woodlawn site until 31 December 2034.
SML 20 is surrounded by a larger exploration license (EL 7257) which is held
100% by Heron. This exploration license includes an area of 179 square km (km2)
and covers the previous Currawang Mine located 9km to the northwest of the
Woodlawn Site. Total Woodlawn Exploration Project tenure is 570km2.

Figure 1.1 : Woodlawn location map with relative population sizes
Other than standard State Government royalty arrangements, there are no

commercial encumbrances over SML 20 relating to the proposed mining
operations. The mineral rights and production is 100% owned by Heron.
A significant portion of the landholdings covering, and adjacent to, the Woodlawn
Site are owned under freehold title by Veolia Environmental Services Limited
(Veolia) (refer to Section 4.5 for further details). Heron has a Call Option
Agreement with Veolia permitting Heron to acquire the freehold title to certain
areas of the site.

Figure 1.2 below shows the layout of the site, highlighting the three existing tailings
dams, the location of the open pit where Veolia has established a bioreactor, and
the adjacent underground mineralised zones, and the proposed location for the box
cut and the plant site. The site is highly disturbed, and reprocessing activities
associated with the existing tailings dams are expected to contribute significantly to
the ongoing rehabilitation of the site.
Figure 1.2: Woodlawn site layout

1.4 History and Exploration

The Woodlawn deposit was discovered in 1969 and mined from open-pit and
underground positions between 1978 and 1998, when it was closed due to external
funding issues with the then-owner, Denehurst Limited (Denehurst).
During the operations the mine processed:
 8.0Mt @ 8.3% Zn, 3.1% Pb, 1.6% Cu and 62g/t silver (Ag) from the
Woodlawn open pit between 1978-1987;
 530,000t @ 13.0% Zn, 2.2% Pb, 1.6% Cu & 33g/t Ag from the satellite
Currawang mine between 1991-1995, and
 5.8Mt @ 10.1% Zn, 1.6% Cu, 4.1% Pb, 0.5g/t gold (Au) and 90 g/t Ag from
the Woodlawn Underground between 1987-1998.
Denehurst was placed into administration and receivership and the underground
mine ceased production in March 1998.
The Project was then acquired by entities associated with TriAusMin Limited
(TriAusMin) who completed further studies and drilling programs through to 2013.
Heron merged with TriAusMin in August 2014, bringing necessary capital and
technical expertise to allow the Project, and particularly the underground, to be
rapidly explored and progressed.
1.5 Geology and Mineralisation

The Woodlawn Project is located near the eastern margin of the Lachlan Fold Belt
(LFB), a major northnorthwest trending orogenic belt that hosts several major
metalliferous mines. The LFB extends from northeast Tasmania, into Victoria and
through much of eastern NSW. The northern, western and eastern boundaries are
masked by younger sedimentary basin cover.
The Woodlawn Project is located in the Goulburn Basin (Deyssing and Fitzherbert,
2014) which is a relatively narrow belt of volcanic and sedimentary rocks that
extends for over 300km and is one of several fault bounded Silurian to Devonian-
aged intra-cratonic rift to back arc basins which host a range of base metal and
gold occurrences on the eastern side of the LFB.
The Woodlawn VMS deposit lies on the eastern limb of the asymmetric north-
northwest plunging Woodlawn Syncline. The regional structures trend
approximately northnorthwest with the local foliation dipping moderately to steeply
to the west. The Woodlawn deposit is hosted by regionally metamorphosed
(greenschist facies) fine to coarse grained felsic to intermediate volcanic rocks,
volcanogenic sedimentary rocks and minor carbonaceous shale, known as the
Woodlawn Volcanics. The axial plane dips at about 60° to the west and is
paralleled by a strong slaty cleavage or in places a schistosity through the mine
sequence.
The VMS mineralisation is contained within a series of sub-parallel lenses dipping
moderately to steeply westwards and occupies a series of generally fault bounded
stratabound packages. In the latter stages of deposition, dolerite sills intruded the
rocks now situated above and below the Woodlawn deposit and comprise 30% to
40% of hangingwall rock in the Woodlawn deposit.

1.6 Mineral Resource and Mineral Reserves Estimates

An updated Mineral Resource estimate, as detailed in Table 1.1 below, has been
generated for the Woodlawn Underground Project compiled under the JORC 2012
Code and the NI 43-101 guidelines and incorporating the results of the Phase 1
drilling program and an extensive review of historical data. Figure 1.3 provides an
oblique view through the Mineral Resource block model.
Figure 1.3: Woodlawn Project Mineral Resource Block Model (ZnEq coloured)
The Underground Mineral Resource estimate is based on drillhole data generated

by previous owners of the Project, plus the Phase 1 drill program (September 2014
– February 2015) completed by Heron. The Phase 1 drill program comprised a
total of 20 diamond core holes (DDH) for 7,613m and 11 reverse circulation (RC)
holes for 1,201m. Drilling focused initially on the Kate Lens before drilling key
positions within the near-surface portions of other lenses. The deepest hole
(WNDD0006) was drilled to a depth of 940m and intersected multiple massive
sulphides in the I and D lens positions. It became apparent during the course of
the program that there was scope to expand the resource base within the upper

500m of the system, deferring the need to drill deeper targets. While considerable
resource potential exists in deeper parts of the system, the PEA focus has been
only on the shallower, up-dip lens positions, with the result that the underground
Mineral Resource used in the production schedule for the PEA extends the depth
of the mine only 80m below previous workings.
Heron has taken a deliberately cautious approach to areas that would be
considered remnant, which has reduced the underground Mineral Resource
compared with the previously published estimate. There are numerous areas
adjacent to historical mining which have been excluded from the new resource
estimate, and there is considerable potential to re-incorporate these zones into the
mine plan once operations are under way and underground access facilitates
closer and more detailed assessment.
The Mineral Resource has been reported undiluted to a lower cut-off grade of 7%
zinc equivalent (ZnEq – refer to section 14.6.3 for calculation details), a value that
approximates the estimated lower cut-off grade for the mining methods considered
by the PEA Study.
The tailings or Woodlawn Retreatment Project Mineral Resource estimate, detailed
in Table 1.2 below is a re-statement of the previously released estimate.
1.6.1 Current Mineral Resource
Table 1.1: Underground Mineral Resource
Reported at a 7% ZnEq lower cut-off grade Grades

Type Resource Category Quantity ZnEq(%) Zn(%) Cu(%) Pb(%) Au(g/t) Ag(g/t)
(Mt)
Polymetallic Indicated 1.6 21 10.7 1.5 4.0 0.46 78
Polymetallic Inferred 3.0 19 8.1 1.6 3.2 0.88 70
Copper Indicated 0.8 10 1.0 2.8 0.3 0.07 16
Copper Inferred 1.1 11 1.1 2.8 0.2 0.14 15
Notes to accompany Mineral Resource Table: ZnEq% refers to a calculated Zn equivalent grade the formula for which is stated in section 14.6.3;
Polymetallic Type refers to polymetallic massive sulphide mineralisation with high-grade Zn and Pb; Copper Type refers to Cu dominated massive and
stringer sulphide mineralisation; Values are rounded to two significant numbers and some rounding related discrepancies may occur in the totals; the
Mineral Resource is reported in accordance with the guidelines set out in the JORC (2012) and NI 43-101 Codes; further details of the Mineral Resources
estimation can be found in the market release of 22nd April 2015 entitled “Preliminary Economic Assessment Delivers Strong Business Case for the
Woodlawn Zinc-Copper Project” (available from ASX or SEDAR).

Table 1.2: Mineral Resource Estimate - Woodlawn Retreatment Project (WRP)
Grades
Resource Category Quantity ZnEq (%) Zn Cu Pb Au Ag
(Mt) (%) (%) (%) (g/t) (g/t)
Measured + Indicated Mineral Resources
North Dam
Measured 0.83 6.2 2.35 0.43 1.43 0.29 35
Indicated 1.38 6.7 2.68 0.45 1.44 0.29 40
Sub-Total 2.21 6.5 2.56 0.44 1.44 0.29 38
South Dam
Measured 2.43 6.0 2.60 0.48 1.19 0.22 25
Indicated 1.17 5.8 2.44 0.48 1.19 0.22 23
Sub-Total 3.60 5.9 2.55 0.48 1.19 0.22 24
West Dam
Measured 2.05 6.5 2.00 0.60 1.46 0.39 36
Indicated 1.54 6.5 1.93 0.60 1.51 0.39 37
Sub-Total 3.59 6.5 1.97 0.60 1.48 0.39 36
All Dams
Measured 5.31 6.2 2.33 0.52 1.33 0.30 31
Indicated 4.09 6.4 2.33 0.52 1.40 0.31 34
Total Measured + 9.40 6.3 2.33 0.52 1.36 0.30 32
Indicated
Inferred Mineral Resources
North Dam 0.87 5.5 2.03 0.33 1.33 0.25 37
South Dam 0.90 5.7 2.32 0.47 1.19 0.23 24
West Dam 0.48 6.3 1.83 0.61 1.47 0.38 34
Total Inferred 2.25 5.7 2.10 0.44 1.30 0.27 31
Notes to accompany Mineral Resource Table: 1) ZnEq% refers to a calculated Zn equivalent grade the formula for which is stated in section 14.6.3 and
these are different to the originally reported (May 2009) ZnEq grades which were based on a different formula; 2) Values are rounded to two significant
numbers and some rounded related discrepancies may occur in the totals; 3) The Mineral Resource is reported in a manner compliant with the JORC 2004
and NI 43-101 Codes. This information was prepared and first disclosed under the JORC Code (2004) in May 2009. It has not been updated since to
comply with the JORC Code 2012 on the basis that the information has not materially changed since it was last reported. 4) TriAusMin acquired more drill
hole data in 2008, subsequent to the Mineral Resource estimation. That data however does not materially alter the Mineral Resource estimate and due to
data collection problems it is not viable for use in a re-estimate. Nevertheless, statistics of the later assays confirm the reported estimated grades; 5) further
details of the Mineral Resources estimation can be found in the market release of 22nd April 2015 entitled “Preliminary Economic Assessment Delivers
Strong Business Case for the Woodlawn Zinc-Copper Project” (available from ASX or SEDAR) including the Competent Person Statement
1.6.2 Current Mineral Reserve
Mineral Reserves for the WRP were calculated as part of the Feasibility Study in
2008 (Intermet, 2008). For the purposes of the PEA in and in accordance with NI
43-101 guidelines, the production schedule for the reprocessed tailings elements of
the PEA plant feed has been based on the WRP Mineral Resource. Hence, the
historical Mineral Reserves for the WRP do not form a part of this Report. It is
noted that this PEA does not replace the prior studies and the previously published
tailings Mineral Reserves remain unchanged.

1.7 Mining
Beck Engineering (Beck), an east coast Australia-based specialist consultancy,
was engaged to assist with the rock mechanics input to the proposed underground
operation. As a component of their work, the extensive historical mine records
have been reviewed to better understand the ground conditions previously
encountered at Woodlawn and previous ground control practices. In addition to this
historical knowledge base, inspection and geotechnical logging of Kate Lens
diamond drill core has led Beck to note that the hangingwall appears competent for
this new lens. This, together with the use of competent backfill, are important input
parameters for the selection of an appropriate mining method that provides for
maximum recovery and high productivity.
A number of changes to historic work practices will improve the future
management of the ground conditions. These include:
 Full time geotechnical resources on site to provide timely day-to-day support to
mine operations.
 Whole-of-mine structural modelling to improve the predictive capacity for mine
planning.
 Adoption of alternative extraction techniques to minimise creation of isolated sill
pillars.
 Implementation of cemented paste fill as a competent support medium that will
enable significantly higher resource recovery whilst providing local and regional
ground support to the mine excavations.
The deposit will be accessed with a box cut located on the western side of the
existing open-pit, which provides for early access to underground material.
Stoping areas will be accessed by rehabilitating some of the existing workings and
constructing additional underground declines and levels to access the new areas.
The mining methods have been selected to mine both areas of unmined and
remnant material around the previously mined areas of the deposit. The mining
method selection takes into consideration the location of the existing open pit
above the deposit which is being used as a bioreactor by Veolia. The mine design
has assumed that some stopes will be filled with paste fill, and multi-level
continuous fill method areas will be filled using rock fill.
Production will be transferred from stoping areas to loading bays and a haulage
fleet used to deliver plant feed to the run-of-mine (ROM) pad at the proposed
process plant.
The production schedule for the underground benefits from the inclusion of
significant material discovered from the recent drilling campaigns, with
approximately 2.8 million tonnes of Inferred Mineral Resources identified from this
work. Importantly, 80% of the total underground plant feed material is away from
former mining areas and is amenable to low cost, low risk mining methods. Figure
1.4 below shows the stope designs currently planned, with stopes coloured green
being material which is away from previously mined areas and hence amenable to
lower cost, lower risk mining methods, with areas in orange being adjacent to
previously mined areas for which more conservative mining methods have been
employed.

Figure 1.4: PEA Stope Design (SRK)
Previous mining was undertaken to a depth of 620m below surface. The

underground Mineral Resource from which the production schedule for the PEA
has been derived extends this by only 80m below the previous mine development.
Considerable potential remains to investigate further depth extensions to the
mineralisation, which will best be assessed by underground drilling once access is
secured.
For tailings mining, the previously assumed high-pressure water jet monitoring
method has been employed, with unchanged design parameters compared to the
previously reported Front End Engineering Design (FEED) Study (Sara, 2012).
Total plant feed of 15.0 million tonnes has been modelled to provide an 11 year
mine life at a rate of 1.5Mtpa. Timing is assumed to deliver a commissioned
project in the first quarter of calendar year 2018. The overall tonnes / grade profile
for the plant feed estimate is illustrated in Figure 1.5 and Table 1.3 by financial
year and by source:

Figure 1.5: Plant Feed Sources and Grades Delivered to the Mil
The detailed production schedule is provided in the table below:

Table 1.3: Detailed PEA Production Schedule by Financial Year ending June 30
Financial Year LOM 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
U/G Polymetallic Tonnes Mined kt 3,060 65 341 495 634 618 624 284 - - - -
Zn Grade (Equiv.) kt 15.72% 15.72% 15.42% 17.42% 19.30% 16.34% 12.89% 10.03% 0.00% 0.00% 0.00% 0.00%
Zn Grade % 7.01% 6.28% 5.51% 6.59% 9.54% 8.31% 5.96% 3.53% 0.00% 0.00% 0.00% 0.00%
Pb Grade % 2.66% 3.19% 2.90% 2.70% 3.48% 2.76% 2.09% 1.34% 0.00% 0.00% 0.00% 0.00%
Cu Grade % 1.38% 1.21% 1.27% 1.74% 1.47% 1.31% 1.19% 1.28% 0.00% 0.00% 0.00% 0.00%
Ag Grade g/t 57.1 76.9 95.7 81.7 58.6 44.9 37.6 29.8 - - - -
Au Grade g/t 0.63 0.89 0.86 0.89 0.70 0.40 0.45 0.61 - - - -
U/G Copper Tonnes Mined kt 715 - - 58 39 90 75 316 137 - - -
Zn Grade (Equiv.) kt 9.44% 0.00% 0.00% 12.00% 11.34% 9.07% 10.50% 8.97% 8.57% 0.00% 0.00% 0.00%
Zn Grade % 1.55% 0.00% 0.00% 4.70% 3.03% 1.57% 1.53% 1.05% 0.94% 0.00% 0.00% 0.00%
Pb Grade % 0.46% 0.00% 0.00% 2.48% 1.07% 0.35% 0.41% 0.19% 0.16% 0.00% 0.00% 0.00%
Cu Grade % 2.26% 0.00% 0.00% 1.08% 2.18% 2.20% 2.61% 2.38% 2.34% 0.00% 0.00% 0.00%
Ag Grade g/t 13.8 - - 48.7 20.4 11.3 14.5 10.4 6.4 - - -
Au Grade g/t 0.07 - - 0.52 0.05 0.02 0.05 0.04 0.02 - - -
Tailings Tonnes Mined kt 11,240 479 1,140 947 827 792 801 900 1,363 1,500 1,500 990
Zn Grade (Equiv.) kt 5.99% 5.71% 5.71% 5.71% 5.71% 5.71% 6.19% 6.26% 6.26% 6.18% 6.04% 6.04%
Zn Grade % 2.22% 2.43% 2.43% 2.43% 2.43% 2.43% 1.97% 1.90% 1.90% 2.06% 2.34% 2.34%
Pb Grade % 1.31% 1.15% 1.15% 1.15% 1.15% 1.15% 1.40% 1.44% 1.44% 1.42% 1.38% 1.38%
Cu Grade % 0.49% 0.47% 0.47% 0.47% 0.47% 0.47% 0.57% 0.59% 0.59% 0.52% 0.40% 0.40%
Ag Grade g/t 31.1 23.4 23.4 23.4 23.4 23.4 33.4 34.9 34.9 35.6 36.9 36.9
Au Grade g/t 0.28 0.21 0.21 0.21 0.21 0.21 0.34 0.36 0.36 0.32 0.26 0.26
Total Tonnes Mined kt 15,015 544 1,481 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500 990
Zn Grade (Equiv.) kt 8.14% 6.46% 7.67% 9.66% 11.43% 10.46% 9.31% 7.77% 6.72% 6.18% 6.04% 6.04%
Zn Grade % 3.16% 2.71% 3.04% 3.82% 5.32% 4.89% 3.70% 2.18% 1.85% 2.06% 2.34% 2.34%
Pb Grade % 1.55% 1.30% 1.50% 1.70% 2.09% 1.81% 1.66% 1.22% 1.33% 1.42% 1.38% 1.38%
Cu Grade % 0.76% 0.53% 0.63% 0.89% 0.94% 0.92% 0.94% 1.09% 0.81% 0.52% 0.40% 0.40%
Ag Grade g/t 35.5 27.6 38.5 43.9 38.0 32.3 34.3 29.8 32.6 35.6 36.9 36.9
Au Grade g/t 0.34 0.27 0.35 0.44 0.41 0.30 0.36 0.36 0.33 0.32 0.26 0.26

The production schedule for the UG Starter Case contains 36% Measured, 35%
Indicated and 29% Inferred Resources, broken down into WUP: 32% Indicated
Resources, and 68% Inferred Mineral Resources, and WRP: 47% Measured, 37%
Indicated and 16% Inferred. Approximately 80% of the tonnes from underground
mining relate to areas which have not previously been mined. The breakdown
between remnant and new areas is illustrated in Figure 1.6 below:
Figure 1.6: Underground Production by Mining Type
The underground resources fall into two main types, a “Polymetallic” type which
refers to polymetallic massive sulphide mineralisation with high-grade Zn and Pb,
and a “Copper” type which refers to Cu dominated massive and stringer sulphide
mineralisation. The mining schedule preferentially feeds the Polymetallic material,
with the Copper material generally being skewed to the later stages of the
production profile as shown in Figure 1.7:
Figure 1.7: Underground Production by Domain

A one month stockpile on the ROM pad has been assumed for the underground
production, consistent with the previous operations. Reclaimed tailings are fed
directly into the mill after thickening.
Based on the mining schedules above, Table 1.4 presents the detailed life-of-mine
production schedule for the Woodlawn Project on an annual basis, showing
concentrate production on a dry tonne basis and gross metal content by
concentrate. Metals that are unlikely to be payable have been removed from the
table. Moisture in the shipped concentrates is expected to be around 10%.
Table 1.4: Annual Production by Product (combined WRP and WUP)
Production by Product LOM 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Zn Concentrate dry kt 779.7 21.0 73.7 96.2 136.6 125.5 94.5 54.0 42.5 46.9 53.4 35.3
Zn kt 352.7 9.5 33.2 43.3 61.5 56.5 42.5 24.4 19.6 21.6 24.6 16.2
Ag koz 2,306.1 58.2 261.1 304.3 263.5 223.7 234.7 196.4 194.3 209.3 217.2 143.4
Pb Concentrate dry kt 249.9 5.61 22.61 28.92 38.32 32.47 27.77 18.26 20.30 21.28 20.70 13.66
Pb kt 112.0 2.7 11.1 14.2 18.8 15.9 13.6 8.4 7.3 7.7 7.5 4.9
Cu kt 19.4 0.5 1.7 2.0 2.0 2.0 2.1 2.5 2.4 1.8 1.4 0.9
Ag koz 5,635.2 130.6 693.4 881.3 761.7 628.4 602.6 452.7 382.0 405.0 420.2 277.3
Au koz 37.4 0.8 4.5 7.2 6.7 4.5 4.5 3.9 1.6 1.5 1.2 0.8
Cu Concentrate dry kt 244.9 4.16 18.15 31.13 34.38 34.01 33.25 39.44 24.49 11.41 8.73 5.76
Cu kt 57.6 1.0 4.4 7.5 8.3 8.2 8.0 9.2 5.4 2.5 1.9 1.3
Ag koz 913.2 20.2 117.0 154.4 133.4 108.7 100.1 71.1 54.1 56.6 58.8 38.8
Au koz 10.9 0.2 1.3 2.1 1.9 1.3 1.3 1.1 0.5 0.5 0.4 0.2
Total Production dry kt 1,274.5 30.8 114.5 156.2 209.3 192.0 155.6 111.7 87.3 79.6 82.8 54.7
Zn kt 352.7 9.5 33.2 43.3 61.5 56.5 42.5 24.4 19.6 21.6 24.6 16.2
Pb kt 112.0 2.7 11.1 14.2 18.8 15.9 13.6 8.4 7.3 7.7 7.5 4.9
Cu kt 77.0 1.5 6.1 9.5 10.3 10.1 10.1 11.7 7.8 4.3 3.3 2.2
Ag koz 8,854.5 208.9 1,071.5 1,340.0 1,158.5 960.9 937.4 720.2 630.4 670.9 696.2 459.5
Au koz 48.3 1.1 5.8 9.3 8.7 5.8 5.9 5.0 2.1 2.0 1.6 1.1
Average annual Production Target figures are shown in Table 1.5 for the life-of-
mine (LOM) and for the four-year period where the underground is producing at
target production rates:
Table 1.5: Annual Commodity Gross Production (LOM & Steady State)
Annual Commodity LOM Average Steady State 2020-

Gross Production p.a. 2023
p.a.
Zinc Kt 32.1 50.9
Lead Kt 10.2 15.6
Copper Kt 7.0 10.0
Silver Koz 805 1,099
Gold Koz 4.4 7.4
1.8 Metallurgy & Processing

GR Engineering Services Limited (GRES) have updated the previous Woodlawn
Retreatment Project FEED Study (Sara, 2012) design for the 1.5Mtpa tailings
processing facility to deliver a plant that has been revised to accommodate a 50%
blend of fresh underground material being co-treated with 50% reclaimed tailings
over life-of-mine. The design allows initial operations to treat 100% reclaimed
tailings, whilst at the same time the development of the initial mine decline will be
undertaken to provide access for mining of fresh material. The contribution from
underground approaches 700ktpa during the middle years of the current

preliminary mine life and the mill feed blend ratio will be reviewed further in the
next stage of the project studies.
For underground production, a two stage crushing circuit has been incorporated
into the plant design, together with a primary grind ball mill. For tailings material, a
fine grind mill is planned that reduces the particle size down to 30 micron (µm), a
size which previous and current testwork confirms maximises recovery
performance from the flotation circuit. For the underground material, the initial float
(copper concentrate) is undertaken at a 75µm grind size, with a regrind of copper
tails to 30µm being employed subsequent to that stage to maximise the recoveries
from the lead and zinc flotation stages.
The flotation circuit comprises a talc, copper, lead and zinc differential flotation
sequence. The overall plant design is consistent with the design of the original
1978-1998 plant that was historically used to successfully treat Woodlawn ore.
Talc cleaner concentrate recovered from the talc flotation cleaner cell will be
discarded to final tails to remove some of the talcose gangue ahead of the
differential flotation circuit. A differential flotation circuit for copper, lead and zinc
will be utilised with concentrate regrind stages in the copper, lead and zinc circuits
to produce marketable copper, lead and zinc concentrates. The copper circuit will
also utilise a rougher and scavenger tailings regrind circuit prior to the lead flotation
stage. Tailings from the flotation plant will be thickened for recovery of process
water and underground paste fill, with slime tailings deposited into a new tailings
storage facility (TSF4).
The PEA metallurgical testwork program was undertaken by Australian Mineral
Metallurgical Laboratories Pty Ltd (“AMML”) in their Gosford testing facility with
input from GRES and focused on the underground massive sulphides at the
Woodlawn Project. This work represents the first full suite of metallurgical tests
undertaken on the underground mineralisation since the 1998 mine closure, and
also the first tests on a combination of the tailings and fresh zinc-copper
mineralisation. The overall results from this work have demonstrated better than
historical operational performance and reflect the advancements made in the field
of sulphide flotation, and in-particular fine grinding technology. The testwork
demonstrated the ability to produce three readily saleable concentrates.
Concentrates from the copper, lead and zinc flotation circuits will be thickened and
subsequently filtered for road transport. Copper and zinc concentrates will be
shipped via Port Kembla in bulk carriers. Transport of the concentrate from site will
be by road with concentrate loaded into half-height containers via front end loader
at site. The high precious metals lead concentrates will be loaded into “bulka”
bags via a bagging plant at the process plant. Loaded bags will then be
containerised for dispatch via Port Botany or Port Kembla.
Final flotation tailings will be de-slimed and used in the paste fill plant which will
generate a cemented paste that will be reticulated underground and used to
backfill completed stopes.
Outotec has completed an initial set of testwork on the paste fill, including rheology
and strength testing, using tailings samples from the recent metallurgical testing.
Whilst this is sufficient for the PEA, further work will be undertaken during the
proposed Feasibility Study (FS) including leachability tests, additional trial mix tests
to optimise binder type and mix to deliver adequate strength to mine fill, and longer
term strength and stability tests.

1.9 Infrastructure
The Woodlawn site is well supplied with infrastructure. Existing infrastructure
includes:
 a sealed access road to the mine site;
 shared (with Veolia) administration building and offices;
 an existing site laboratory;
 raw water tank;
 evaporation ponds;
 site water pipe systems and pumps, and
 electrical supply sub-station.
1.9.1 Access and Site Roads
A sealed road exists immediately adjacent to the mine site. Some 350 metres (m)
of new sealed road will be installed to cater for logistics and administrative needs.
Other roads internal to the mine site will be constructed from locally sourced
crushed aggregate.
1.9.2 Power Supply
Electrical power for the operation is estimated to be an average load of 12

megawatts (MW) for the processing plant and associated services excluding the
underground mining requirement. Electrical power for the operation will be
provided by an independent energy retailer utilising the existing grid and Essential
Energy site sub-station.
The 66 kilovolt (kV) transmission line feeding the site and the existing 66/11kV sub-
station will have sufficient capacity to meet the stated requirements of the Project.
This facility is currently utilised by the Veolia Bioreactor project. A planned
upgrade of the existing sub-station by Essential Energy will rationalise the size of
the installed transformers and provide a protected outgoing circuit for the
Woodlawn processing plant.
1.9.3 Water Supply
Raw water will be pumped from the existing Willeroo Borefield and stored in the
10,000 cubic metre (m³) raw water dam at the plant site.
Water from the evaporation ponds will be re-used in the process plant as part of
the make-up water requirements. The water has high ion content and a low pH
and will be treated before usage.
Potable water will be generated onsite from a raw water supply to a reverse
osmosis plant.
The sewerage treatment system will be of packaged proprietary form and will
consist of a number of in-ground collection pits located adjacent to the plant
buildings where waste water is generated.
1.9.4 Tailings Storage Facility
The tailings management strategy is based on construction of a new Tailings

Storage Facility (TSF4) for the initial placement of tailings, followed by Tailings

Dam South once this dam is empty. This strategy is identical to that outlined in the
previous WRP FEED Study (Sara, 2012).
As each older tailings dam is emptied for retreatment, rehabilitation of the dam will
be carried out to repair any damage created in the monitoring operation. Following
this, each dam will be recommissioned and ready to receive tailings from new
processing operations.
1.10 Environmental, Permitting & Social

1.10.1 Environmental Permits
During 2012 TriAusMin carried out an extensive Environmental Assessment (EA),

seeking Major Project approval under Part 3A(transitional) of the NSW
Environmental Planning and Assessment Act 1979 (EP&A Act) to establish the
Project. On 4 July 2013 the Company received project approval under Section 75J
of the EP&A Act from the NSW Minister for Planning and Infrastructure in relation
to the Project. The approval allows mining operations at the Woodlawn site until
31 December 2034.
Modifications to the approvals will be required to deal with changes to the
proposed operation based upon the physical characteristics of the planned
underground mining.
The NSW Department of Planning and Environment (DPE) have advised that an
application for any modification that falls within the footprint of the existing
indicated project should only require determination by DPE and other government
agencies (e.g. NSW Department of Trade and Industry-Resources and Energy).
1.10.2 Permitting Requirements
As is normal for project approvals, the NSW Department of Planning and

Infrastructure (DPI, now the DPE) imposed a number of conditions designed to:
 prevent, minimise, and / or offset adverse environmental impacts;
 set standards and performance measures for acceptable environmental
performance;
 require regular monitoring and reporting, and
 provide for the ongoing environmental management of the Project.
These conditions are described more fully in Section 20.1.
1.10.3 Social and Community Aspects, Stakeholder Consultation
The Woodlawn Project operates within an environment of strong local community

support for the Project. Social and community issues are further supported by a
single local landowner, Veolia, who operate their bioreactor on site.
Other than properties owned by Veolia, there are no residences within three
kilometres of the Project site. Hence, there is reduced scope for on-site operations
to impact on the local community. Based on the EA investigations, odour, dust and
other emissions generated during the construction and operation of the Project are
unlikely to be significant or to impact on the local community. Existing Veolia
bioreactor operations (as administered by EPA) are likely to have greater impact.
The community consultation process implemented to date has engaged
stakeholders at all levels, including government agencies, local government, the

community and non-government stakeholders, to identify relevant issues to be

addressed during the Project’s development and the EA preparation. In addition,
the stakeholder activities undertaken have addressed the consultation
requirements identified in the Director-General’s Requirements (DGRs) (2011 and
2009). Since the Project Approval was received, community consultation has
continued, with the Company leveraging Veolia’s existing Community Consultation
Committee.
1.10.4 Closure
Rehabilitation of the site is required in accordance with the proposed Rehabilitation

Management Plan described in the EA.
An amount of A$4.5 million was estimated as the net cost of closure and
rehabilitation during the BFS for the WRP (Intermet, 2008). The inclusion of the
underground does not materially affect the surface disturbance for the Project. For
the purposes of this Study, an amount of A$9 million has been allowed at project
closure for closure and rehabilitation.
1.11 Capital and Operating Costs

1.11.1 Capital Costs
Capital costs have been estimated to ±25% accuracy. Tailings retreatment

process plant capital costs have been updated to allow for installation of equipment
sized to also accommodate the underground feed, potentially allowing a staged
development of the Project to be undertaken. Initial capital costs to Peak Cash
Draw are estimated at A$101.4 million for the tailings components, with an
incremental A$38.6 million required to complete the underground access and plant
additions, for a total of A$140.0 million including contingency.
Table 1.6: Summary Capital to Peak Cash Draw
Initial Capital Item Tailings Underground Total

Components Components (A$m)
(A$M) (Incremental
A$M)
Underground Development &
Rehabilitation
Pre-commissioning 0.0 3.3 3.3
Post-commissioning 0.0 3.3 3.3
Mining Equipment & Infrastructure 1.8 0.0 1.8
Treatment Plant and Services 61.4 27.2 88.6
Infrastructure 8.6 3.6 12.2
Tailings Storage 1.6 0.0 1.6
Construction & Engineering 21.4 0.0 21.4
Subtotal 94.8 37.5 132.3
Owners Costs Pre-Production 1.9 0.0 1.9
Working Capital 4.7 1.1 5.8
Total to Peak Cash Draw 101.4 38.6 140.0

Peak Cash Draw is defined as initial capital working capital post commissioning
until the mine achieves a break-even cash position, and excludes financing costs.
Maintenance capital has been built into the operating cost estimates. No
allowance has been made for financing charges or interest, Goods and Services
Tax (GST) related cash flows, intra-period cash flows, or fluctuations in the
exchange rate (estimates were provided on the basis of a rate of 0.80 A$:US$).
The basis for the capital estimates includes:
 Engineering, Procurement and Construction model for non-mining
infrastructure.
 Owner operator processing facilities and workforce.
 Owned fixed plant, mobile surface plant, and administration buildings.
 Contract mining and leased underground mining equipment and maintenance
facilities
 Contract concentrate road haulage, port storage and handling and ship loading.
 Construction of the new tailings storage facility TSF4.
Ongoing capital of A$107.7 million is required for the underground decline and
lateral development, decline rehabilitation, ventilation raises, escapeways,
infrastructure and sustaining capital. The profile is driven by the production
schedule and is shown below starting in the second quarter post commissioning
(being the quarter immediately after Peak Cash Draw, with capital prior to that
period being shown in Table 1.6):
Table 1.7: Underground Mining Capital Breakdown Post-Peak Cash Draw

1.11.2 Operating Costs
Underground Mining Costs

Underground mining costs have been estimated by SRK based on the mining
method, vertical development, horizontal access, stoping and back fill costs, and
vary according to the physical location and characteristics of the mined material
within the underground. The capital cost profile is shown above. The operating
costs are provided below on a A$/t mill feed basis on a contract mining (and leased
equipment) basis and include maintenance costs:
Table 1.8: Underground Mining Unit Costs
Tailings Mining Costs

Tailings materials will be recovered from the three tailings dams in sequence,
utilising the proven technique of high pressure water jet monitoring (hydraulicing).
The pulped material will then be pumped to the concentrator, thickened, and
processed. The mining rate is tied to the mill feed ramp-up rate, described below,
and the resulting schedule is provided in Table 1.3. The cost assumption for
mining the tailings material is A$2.14/t whilst blended feed is processed, reducing
to A$1.67/t mill feed when the plant is running on tailings alone.

Plant Operating Costs

The operating cost estimate has been developed by GRES on the basis of a
process plant feed tonnage of 1,500,000 tonnes per annum. The operating cost
estimate is A$23.41 per tonne of feed and is shown in Table 1.9.
Table 1.9: Plant Operating Cost Summary
UG Starter Case Unit Cost A$/t

Crushing & Grinding 1.96
Tailings Reclamation & Grind 3.09
Flotation 13.03
Concentrate Handling 0.72
Plant services 0.76
Administration 3.86
Total Plant Operating Cost 23.41
The reagent component of the operating cost is subject to exchange rate
fluctuation and was based on 0.80 A$:US$. Additional fixed costs of A$4.25 million
have been estimated and applied annually and include general administration
costs, insurances, and some underground fixed costs including technical services,
fuel and power. Maintenance capital is included in the operating costs above.
1.12 Economic Analysis

1.12.1 Basis of Evaluation
The Woodlawn project economics have been assessed using the discounted cash
flow method, based on a quarterly schedule of tonnes mined and processed from
both the WUP and the WRP. Capital and operating costs are applied to mining,
processing and overheads. The processed material has recovery factors applied,
together with flotation splits to the three concentrates which make up the project
production. Shipping and logistics, product payability, treatment and refining costs,
state royalties and taxes are adjusted for to derive a Net Present Value (NPV) for
the Project.
Refer to Section 22 for further detail.
1.12.2 Summary Economics
The main inputs and outputs of the financial model for the UG Starter Case are
summarised in Table 1.10, which is based on the Forecast Commodity Price Deck.
The Project’s post-tax NPV at an 8.3% post-tax real discount rate (approximately
equivalent to a 10% post-tax nominal discount rate) is A$300 million and the IRR is
46%. Payback of start-up capital is achieved approximately two years from
commissioning.

Table 1.10: Economic Model - Summary Economic Inputs and Outputs
Base Case
(Forecast Commodity Price Deck)
Post-tax NPV8.3 A$300 million
Post-tax IRR 46%
Initial Capital A$140M / US$112M
Payback Period 2 years from commissioning
Post-tax Cash Flow A$594M
1
C1 Cash Cost US$0.00/lb (zero) Zn
1
C3 Total Cost US$0.31/lb Zn
Plant Feed Rate 1.5mtpa
Total Underground Feed 3.8Mt
Total Tailings Feed 11.2Mt
Total U+T Feed 15.0Mt
Mine life 11 years
1
C1 and C3 (refer to Section 27 for definitions) presented in this table are based on Zn as primary product with all
other saleable commodities treated as by-product credits. Refer to Section 22.2.2 for further details.
1.12.3 Macroeconomic Assumptions
Results are based on AUD / USD Foreign Exchange (FX) trending from 0.80 to
0.73 by 2021 (forward curve as at 31 March 2015). The Forecast Commodity Price
Deck is based on the average of a number of forecasts for each commodity
resulting in prices of US$1.09/lb Zn, US$0.95/lb Pb, US$3.00/lb Cu, US$18.5/oz
Ag and US$1,200/oz Au.
The project is subject to Australian corporate tax, which has been applied at 30%.
Tax calculations are impacted by depreciation deductions for capital items.
New South Wales levies mineral royalties for extractive operations within the state.
The royalties are based on an “ad valorem” value of minerals, being 4% of the ex-
mine value less allowable deductions.
Opening capitalised exploration expenditure of A$12 million has been depreciated
on a unit of production basis.
Heron’s opening tax losses of A$60 million have been fully netted against the
project tax calculations. In addition, A$44.3 million of the A$53 million in additional
losses subject to the available fraction rule have been netted against the project
tax calculations.
The cost of transportation to port, port handling and storage charges, and ocean
freight has been estimated. The payability and Treatment Costs / Refining Costs
(TC/RC) terms vary by concentrate and commodity depending on the concentrate
specifications and the levels of by-products in each concentrate. Independent
advice has been sought to provide estimates for these based on expected
concentrate characteristics. The assumptions are in line with normal market terms.

Pre-production capital is recognised for tax and accounting purposes at

commissioning, and depreciated according to normal protocols. For major plant
items, depreciation has been based on a 15 year equipment life, and for all other
capital items depreciation is recognised based on a unit of production measure.
Goods and Services Tax cash inflows and outflows have been excluded from this
analysis.
1.12.4 Technical Assumptions
Capital Costs
Refer to Section 1.11.1 for details of the mining and plant capital costs, which
includes the costs associated with the underground mine access and rehabilitation.
Mine Production Schedule
An 18 month construction period has been assumed pre-production. A ramp-up in
capacity has been assumed, commencing at an annualised rate of 900ktpa in
quarter 1, rising to 1.43Mtpa in the third quarter, and reaching 1.5Mtpa by the
fourth quarter. The mine plan has been developed based on an underground
mining schedule, with the residual capacity then being applied to treatment of the
tailings.
The underground mine production schedules are based on a stope by stope
evaluation undertaken by SRK, taking into account the desired production profile,
tonnes and grade (with post-dilution zinc equivalent grade as the key driver), stope
access, and mining and capital development costs.
The tailings production profile is based on the FS production model, under which
the three tailings dams are treated sequentially: Tailings Dam South (TDS), then
Tailings Dam West (TDW) and finally Tailings Dam North (TDN), with a constant
grade profile assumed across each dam. For the purposes of the PEA the same
sequence has been assumed, with the plant feed tonnes being driven by the
difference between the underground feed deliveries and the capacity of the plant
(as modified by the ramp-up profile described above).
The resulting production schedule is described in Section 1.7.
Operating Costs
Refer to section 0 for details of the mining and plant operating costs.
Closure Costs
An amount of A$9 million has been assumed for the net closure costs associated
with the end of mining at the Woodlawn site for the UG Starter Case. The
economic evaluation is not sensitive to changes in the closure costs.
Plant Recoveries
Design work for the PEA has been based on start-up of operations on retreatment
of tailings from previous production, and moving to processing a blend comprising
0.75Mtpa fresh underground material and 0.75Mtpa of tailings from the previous
operations.

Refer to Section 13.3 for details of the testwork results. Based on this testwork,
the recovery outcomes to concentrates are described in the tables below, firstly as
the constituent parts, and then as a blended outcome:
Table 1.11: Economic Model - Concentrate Recoveries - Underground
Underground Concentrate Recoveries

Element Zn (conc) Pb (conc) Cu (conc)
Zn 79.4% 3.9%(*) 0.9%(*)
Pb 8.1%(*) 71.0% 5.0%(*)
Cu 4.4%(*) 9.2% 70.7%
Ag 13.9% 51.7% 9.9%
Au 6.0% 45.9% 13.0%
Table 1.12: Economic Model - Concentrate Recoveries - Tailings
Tailings Concentrate Recoveries

Zn 69.6% 5.1%(*) 1.1%(*)
Pb 7.5%(*) 35.8% 2.9%(*)
Cu 7.0%(*) 23.3% 31.8%
Ag 12.2% 23.5% 3.3%
Au 4.6% 9.8% 3.0%
Table 1.13: Economic Model - Concentrate Recoveries - Blended Underground plus

Tailings
Blended Underground Concentrate Recoveries

plus Tailings
Zn 74.2% 4.5%(*) 1.0%(*)
Pb 8.1%(*) 48.3% 3.7%(*)
Cu 5.9%(*) 17.1% 50.6%
Ag 13.4% 32.8% 5.3%
Au 6.4% 22.8% 6.7%
Items marked with a (*) are unlikely to be payable, and in the case of lead in the
copper concentrate, may attract a small penalty if levels exceed specified amounts.
Concentrates Produced
The Project will produce three concentrates, being a 45% zinc concentrate with
potentially payable silver credits, a 45% lead concentrate with payable copper,
silver and gold credits, and a 24% copper concentrate with payable silver and gold
credits. Details of the computed concentrate specifications are shown in Table
1.14, and the detailed production profile for the concentrates may be found in
Table 13.8.

The concentrate specifications are based upon the metallurgical testwork carried
out during the PEA and earlier studies as described in Section 13.2 and 13.3. They
are considered representative, though concentrate grades and by product
streaming to the concentrates will be impacted by the mix of material entering the
plant as well as by the flotation conditions at that time. Although similar to the
previous operations over 20 years, the new plant will utillise energy efficient fine
grinding machines with inert media to aid in optimisation of recovery characteristics
to the different concentrates.
Table 1.14: Economic Model - Concentrate Specifications
UG Starter Case Concentrate Specifications

(major metals only)
Zn 45.2% 8.6% 2.0%
Pb 2.4% 44.8% 3.5%
Cu 0.9% 7.8% 23.5%
Ag 92gpt 701gpt 116gpt
Au 0.42gpt 4.65gpt 1.39gpt
Further testwork will be undertaken during the FS to improve recoveries and refine
product specifications.
1.12.5 Sensitivity Study
The modelled economic case for the Project has been subject to sensitivity
analyses based on percentage movements in each driver. For the sensitivities,
only a single factor has been modified, with other factors being left unchanged
(noting that movements in some of these may in reality be correlated with
movements in the modified factor – for example, FX and commodity prices).
The factors on which sensitivities have been undertaken are:
1. commodity prices;
2. zinc price (without moving other commodity prices);
3. the exchange rate (FX);
4. pre-production capital;
5. mining costs;
6. production grade delivered to mill;
7. processing costs;
8. payability; and
9. recoveries.
NPV is most sensitive to the commodity price / FX environment on the revenue
side, and to grade (which in turn is driven by dilution considerations), and recovery.
Other significant factors influencing the project returns include the underground
development capital, and the plant operating costs. Refer to Section 22.6 for
further discussion of project sensitivities.

1.13 Conclusions
Based on the assumptions and methodology applied, to normal PEA levels of
confidence, the results of this Study demonstrate that the Woodlawn Project has
positive economics and hence should be advanced to the next stage of
development as outlined in Section 26. As such the PEA has successfully
achieved its objectives.
The key Study conclusions are:
 Recent exploration has resulted in the successful generation of a new
underground Mineral Resource focused on:
o near surface extensional positions and Kate lens;
o identification of resources suitable for mining away from areas of
previous mining; and
o seeking to build an initial production schedule to support the PEA.
 The underground Mineral Resource and resulting contribution to the Plant
Feed Estimate are sufficient to support a robust underground starter
operation with an initial life of 6-7 years.
 The tailings Mineral Resource and resulting contribution to the Plant Feed
Estimate provides additional low-cost (mining), but lower recovery material
which extends the production schedule out to around 11 years.
 Metallurgical testing for the PEA has confirmed that co-treatment of the
underground plant feed with the tailings plant feed is feasible and results in
acceptable recoveries to saleable concentrates.
 Capital and operating costs have been detailed and are acceptable.
 Current project approvals, infrastructure and local relations provide good
support for the commencement of operations at Woodlawn.
 There is potential for the Project to be developed in two stages,
commencing with construction of the tailings plant based on updating the
previous FEED Study with changes from the PEA, and followed by the
development of the underground once the FS is completed.
In addition, the Study has demonstrated that there remains significant optionality in
the Project based on:
1. the additional underground Resource outside the current PEA production
schedule;
2. the number of areas prospective for further exploration; and
3. potential enhancements to a number of key drivers to the economics,
including optimisation of the underground mining (dilution, capital
development), and process engineering costs.

1.14 Recommendations
The Company has considered the outcomes of the PEA and has determined that it
will continue with the further study of the Woodlawn Project through undertaking a
Feasibility Study (FS) on the combined underground and tailings project. This has
been approved by the Board and the work program outlined below has
commenced. The Company considers that the FS will be able to be completed
within approximately 12 months from the publication of this Report.
It is the view of the Company that the higher level of confidence associated with
the design of the processing plant, which is central to the success of the Project,
together with the mining of the tailings material, will allow the Project to be
progressed directly from PEA to FS without first going through a Pre-feasibility
Study stage, and planning is being undertaken on that basis.
The Board has approved a FS budget of A$11.0 million through to June 2016.
Within the FS budget an allocation has been made for further exploration work to
test a number of targets identified in the PEA drilling program. Within this
exploration activity, there will be an emphasis on proving up additional Resources
that can contribute to the FS. Examples of high priority targets include:
1. the newly discovered Lisa Lens;
2. potential extensions to Kate and G Lenses;
3. the poorly defined off-hole EM conductor adjacent to C Lens; and
4. the EM target identified at the Currawang satellite deposit.
Regional exploration will continue with a focus on developing and testing near mine
targets, particularly those targets which have the potential to add to the life of the
Woodlawn mine, albeit that it is unlikely that any mineralisation identified though
this exploration program will be included in the FS.

2 Introduction
2.1 Terms of Reference
The Woodlawn Project is owned and operated by Heron Resources Limited
(Heron). Heron is a public company listed on the Australian Securities Exchange
(ASX) and Toronto Stock Exchange (TSX), and registered in Australia (ASX code:
HRR, TSX code: HER). The address of the corporate office is Level 1, 37 Ord
Street, West Perth, Perth 6005, Western Australia.
This technical report was prepared for the Woodlawn Project to the standard of the
Canadian National Instrument 43-101 “Standards of Disclosure for Mineral
Projects” to summarise the findings of a Preliminary Economic Assessment (PEA)
covering the Woodlawn Underground Project and the Woodlawn Tailings
Retreatment Project.
2.2 Purpose of Report

The purpose of this Report is to demonstrate the technical and economic viability
of the Woodlawn Project through a technical and economic evaluation, at
preliminary level, taking into account the updated Mineral Resources, the existing
Mineral Reserves and the life of mine capital and operating costs.
The work covered in this report relates to exploration, drilling, metallurgical
testwork, process design and Mineral Resource estimation undertaken in the
period of December 2009 through to March 2015.
2.3 Report Preparation

This Report was prepared by Heron and the Study was overseen by Anne-Marie
Ebbels Principal Consultant (Mining), of SRK Consulting (Australasia) Pty Ltd
(SRK), with further contributions commissioned by Heron from external consultants
to review the following aspects of the Project:
 SRK – Mineral Resources, mining methods, and related capital and
operating costs;
 GR Engineering Services Limited (GRES) – recovery methods, process
plant, infrastructure, tailings storage, and related capital and operating
costs;
 Beck Engineering Limited (Beck) – geotechnical and rock mechanics,
design of portal and initial decline;
 Outotec Pty Ltd (Outotec) – paste fill test work; and
 BPTD & Co – concentrate logistics and sales & marketing.
Further contributions were generated by the staff of Heron Resources Limited.
This Report is considered current as of 29 May, 2015.
2.4 Cautionary Notes

The contents of this Report reflect various technical and economic conditions at the
time of writing. Given the nature of the mining industry, these conditions can
change significantly over relatively short periods of time. Consequently, actual
results may be significantly more or less favourable. This Report may include

technical information that requires subsequent calculations to derive subtotals,

totals, and weighted averages.
Such calculations inherently involve a degree of rounding and consequently
introduce a margin of error. Where these occur, Heron does not consider them to
be material.
The economic analysis described in this Report provides only a preliminary
overview of the Project as insufficient detailed engineering and costing work has
been done to date to present it to Feasibility Study level.
The Mineral Resources used in the underground mine plan and economic analysis
includes some Inferred Mineral Resource material. Inferred Mineral Resources are
considered too speculative geologically to have economic considerations applied to
them that would enable them to be categorised as Mineral Reserves, and there is
no certainty that the Inferred Mineral Resources will be upgraded to a higher
Resource category. Based on this, there is no certainty that the results of this
Preliminary Economic Assessment will be realised.
2.5 CIM Code Reconciliation

In compliance with Canadian NI 43-101 requirements concerning use of codes
(foreign codes) other than the “CIM Definition Standards – for Mineral Resources
and Mineral Reserves” in technical reports on mineral projects it is stated here that
the JORC Mineral Resource and Reserve categorisation used herein is directly
equivalent to the CIM categorisation.
2.6 Sources of Information

This Report is based, in part, on internal company technical reports, maps,
published government reports, company letters and memoranda, and public
information as listed in the References Section 28 at the conclusion of this Study.
Sections of the Report are based on reports and deliverables produced from the
both desktop and site-based investigation work by consultants engaged by the
Company to review key areas as part of the Study.
2.7 Units and Currency

Unless otherwise stated all units used in this report are metric. Gold and Silver
assay values are reported in grams per metric tonne (g/t) unless some other unit is
specifically stated. Where units of currency are used, these are in US dollars
(abbreviated to $) unless specifically stated as being in Australian Dollars
(abbreviated to A$).
Abbreviations and acronyms are used throughout this Report and are provided in
the Glossary and Abbreviation of Terms in Section 28 of the Report.

2.8 Site Visits

In compliance with the requirements for preparation of a 43-101 Report, the key
qualified person (QP) responsible for the Study has visited the Project and has
drawn on information from site-based personnel. In addition, the following QP
contributors have visited the project site to gather first-hand information for the
Study:
 Mr Rod Brown (SRK): 1st March 2015;
 Mr Daniel Lynch (SRK): 3rd December 2014 and 22nd January 2015;
 Ms Anne-Marie Ebbels (SRK): 22nd January 2015; and
 Mr Peter Allen (GRES): 20th to 21st February 2008.

3 Reliance on Other Experts

The author(s) has assumed and relied on the fact that all the information and
existing technical documents listed in the References section of this Report are
accurate and complete in all material aspects.
Any statements and opinions expressed in this document are given in good faith
and in the belief that such statements and opinions are not false and misleading at
the date of this Report.
3.1 Report Authors

The table below identifies the author(s) for each section of the Report.
Table 3.1: Report Authors and Qualified Persons
Section Title QP Other Contributing

Authors
1 Summary A. Ebbels (SRK) C. Kempson (Heron)
W. Taylor (Heron)
D. von Perger (Heron)
S. Jones (Heron)
2 Introduction A. Ebbels (SRK) C. Kempson (Heron)
3 Reliance on Other Experts A. Ebbels (SRK) C. Kempson (Heron)
4 Property Description and A. Ebbels (SRK) W. Taylor (Heron)
Location D. von Perger (Heron)
5 Accessibility, Climate, Local A. Ebbels (SRK) W. Taylor (Heron)
Resources, Infrastructure and
Physiography
6 History W. Taylor (Heron)
H. Sandercock (Heron)
7 Geological Setting and R. Brown (SRK) D. von Perger (Heron)
Mineralisation
8 Deposit Types R. Brown (SRK) D. von Perger (Heron)
9 Exploration R. Brown (SRK) D. von Perger (Heron)
10 Drilling R. Brown (SRK) D. von Perger (Heron)
E. Hussein (Heron)
11 Sample Preparation, Analyses R. Brown (SRK) E. Hussein (Heron)
and Security S. Jones (Heron)
12 Data Verification R. Brown (SRK) E. Hussein (Heron)
S. Jones (Heron)
13 Mineral Processing and P. Allen (GRES) R. Elvish
Metallurgical Testing
14 Mineral Resource Estimates D. Guibal (SRK) S. Jones (Heron)
15 Mineral Reserve Estimates NA NA
16 Mining Methods A. Ebbels (SRK) H. Sandercock (Heron)
D. Lynch (SRK)
17 Recovery Methods P. Allen (GRES) P. Allen (GRES)
R Elvish
18 Project Infrastructure P. Allen (GRES) H. Sandercock (Heron)
A. Ebbels (SRK)
19 Market Studies and Contracts A. Ebbels (SRK) C. Kempson (Heron)
20 Environmental Studies, A. Ebbels (SRK) H. Sandercock (Heron)
Permitting and Social or C. Kempson (Heron)
Community Impact

Section Title QP Other Contributing

Authors
21 Capital and Operating Costs P. Allen (GRES) D. Lynch (SRK)
A. Ebbels (SRK) C. Kempson (Heron)
22 Economic Analysis A. Ebbels (SRK) C. Kempson (Heron)
23 Adjacent Properties A. Ebbels (SRK) D. von Perger (Heron)
24 Other Relevant Data and A. Ebbels (SRK) C. Kempson (Heron)
Information
25 Interpretation and Conclusions A. Ebbels (SRK) W. Taylor (Heron)
C. Kempson (Heron)
26 Recommendations A. Ebbels (SRK) W. Taylor (Heron)
C. Kempson (Heron)
27 References A. Ebbels (SRK) D. von Perger (Heron)
S. Jones (Heron)
C. Kempson (Heron)
3.2 External Reports Incorporated

A number of historical technical reports have been drawn upon in the production of
this technical report as detailed in Table 3.2. These documents are referenced in
the body of this Report where used.
Table 3.2: External Reports Incorporated
Item Title
1 Rankin, R (2006). Woodlawn Underground Project Mineral Resource Estimate. Report

for Tri Origin Minerals Ltd, effective date October 2006
2 Rankin, R (2009). Woodlawn Exploration Project Technical Report (NI 43-101) report
for Tri Origin Minerals Ltd, effective date 9 October 2009.
3 Rankin, R (2008). Woodlawn Retreatment Project (WRP) Mineral Resources report for
th
Tri Origin Minerals Ltd, effective date 29 May 2008
4 Rankin, R (2013). Woodlawn Underground Project JORC (2012 Edition) Mineral

nd
Resource Re-estimate report for TriAusMin Ltd, effective date 2 December 2013.
5 Parsons Brinkerhoff (2012) Environmental Assessment TriAusMin Woodlawn Project

th
for TriAusMin Ltd, effective date 5 April 2012.

4 Property Description and Location

4.1 Location
The Woodlawn Site is located approximately 250km south of Sydney and 50km
north of Canberra within the Southern Tablelands of New South Wales, Australia
(Figure 4.1). The Woodlawn Site is located within the Sydney-Canberra Corridor
Region, which is characterised by rural countryside and an array of regional
centres, historic towns and villages. The major regional centres in this region
include Goulburn to the north, and Queanbeyan and Canberra to the south. The
Woodlawn Site is located within the Goulburn-Mulwaree local government area,
approximately 10km west from Tarago, the nearest village. It is accessed from the
sealed Collector Road to the north.
The region is serviced by the Federal Highway and the Hume Highway to the west
and north of the Woodlawn Site. Both of these roads provide key transport
corridors between Sydney / Melbourne and Sydney / Canberra.
The region is characterised by a number of key natural features, including the
Great Dividing Mountain Range (GDR) and the highly mineralised Lachlan Fold
Belt, in which the Woodlawn Site is located. The Woodlawn Site also occurs within
the Lake George and Sydney water catchments.
4.2 Property Description

The Woodlawn Project is contained within the 24.1km2 mining license, SML 20,
and consists of a highly disturbed site due to its past history of mining operations
along with the current activities of Veolia Environmental Services (Veolia).
Past mining operations (1978-1998) resulted in the mining and processing of
approximately 13.8 million tonnes of high grade base metal ore generating zinc,
copper and lead concentrates for sale into both domestic and international
markets. Upon closure of the mining operations in 1998 the assets were
dismantled and sold off with only partial site rehabilitation being completed. The
mineral rights were purchased by Tri Origin Australia in 1999 and the landfill rights
to the open pit were purchased by Collex (now Veolia) in 2000.
Landfill operations commenced in 2004, receiving Sydney putrescible waste.
Approximately 400,000 tonnes (t) of waste is placed into the pit each year (this is
expected to increase to 1.1Mtpa). Methane gas is collected from the waste and
supplies an onsite 6x1MW gas fired generation installation that feeds power back
into the NSW electricity grid. Veolia also utilise the remaining former mine offices
and workshop infrastructure.

Figure 4.1 : Woodlawn location map with relative population sizes
The site includes a number of existing features constructed during past mining
operations that will be utilised for the proposed development of the Woodlawn
Project including:
 Hickory’s Paddock, which includes a previously cleared area for agricultural
uses and is located to the immediate south of Collector Road and east of
the former plant site.
 Three tailings dams, TDN, TDS and TDW, located to the south of Hickory’s
Paddock, which are intended to be reprocessed.
 Two evaporation dams, including Evaporation Dam 1 (ED1) and
Evaporation Dam 2 (ED2) located to the west of Hickory’s Paddock
immediately south of Collector Road.
 Diamond drill core storage and processing facility.
 A number of existing formal and informal site roadways.
 Site reticulated power and pumping systems.

The land uses immediately adjacent to the Project Site includes:

 To the north: A number of existing rural properties, including Woodlawn
Farm (approximately 1.4km to the north-west), and Cowley Hills Farm
(approximately 2km to the north), both of which are included in the Veolia
Eco-Precinct and owned by Veolia. Further north of the Project Site, is
another Veolia-owned property known as Kalua; this property is a former
homestead (not currently occupied). All of these properties are accessed by
Collector Road.
 To the south: Continuation of the Veolia Eco-Precinct, which includes the
property known as Pylara occupied by Veolia employees (approximately
3.2km to the south-east). This area is characterised by agricultural rural
land.
 To the east: This area comprises rural land, which is also part of the Veolia
Eco-Precinct.
 To the west: A number of privately owned rural properties known as
Torokina (approximately 4.4km to the south-west), Willeroo (approximately
6km to the north-west) and Widgemoor (approximately 6km to the south-
west). All of these properties are located on the western side of the Great
Dividing Range (GDR), which provides a natural visual barrier to the Project
Site.
Figure 4.2: Woodlawn Site Layout

4.3 Location of Mineralised Zones

The general locations of the Mineralised Zones are shown in Figure 4.2 and
occupy the area directly below and to the northwest of the open-pit void. The
Mineralised Zones comprises a series of discrete massive sulphide lenses that dip
between 45 to 70 degrees to the west and strike from a north-northeast direction,
immediately below the pit, to a more typical northwest direction to the west of the
pit. Drill access to test the Mineralised Zones from surface is provided from
various positions along existing operation tracks and open areas directly to the
west of the open-pit.
4.4 Survey Coordinate System and Conversions

Woodlawn Local Grid Datum and Elevation calculations
The original Woodlawn Mine Grid (WMG) was established in 1970 utilising the
boundary fence between the properties of Pylara (to the east) and Woodlawn (to
the west) as the base-line with a bearing of 00, 0’, 0’’. The orientation of the grid in
terms of bearing from true north was exactly 9.54o east. In 1971 the WMG
coordinate system was changed from feet to metres and consequently the datum
for the grid was also changed from 10,000ftE, 10,000ftN to WMG coordinates of
13,000mE and 13,000mN. Elevation was given as height above sea level, plus
2000 metres. Rankin (2006) added 10,000m to the northings to differentiate them
from the eastings and this convention has remained in place.
Woodlawn Azimuth Calculations
The illustration below is currently used for converting WMG coordinates to
Magnetic, True and GDA94 grids as necessary (and vice-versa). Figure 4.3 below
contains the 2013 magnetic declination from the Australian Geoscience website of
+12.36o. Dates used for each year are 1st January. The up-to-date January 1st
magnetic declination for 2015 is +12.016 o and is to be updated to illustrate this.
Figure 4.3: Grid conversion calculations at Woodlawn

Source data for azimuth and declination calculations, Woodlawn, NSW

Using WGS84 longitude / latitude grid coordinate system, the coordinates for
Woodlawn magnetic declination calculations are as follows:
 Latitude: -35o 3’ 46” (-35.062778o)
 Longitude: 149o 34’ 14” (149.570556o)
These coordinates represent the physical location of the Woodlawn mine.
Sources used for declination calculations were taken from two different websites.
Pre 1985 calculations were sourced from: http://www.ngdc.noaa.gov/geomag-web/
(the National Geophysical Data Centre in the USA), using the International
Geomagnetic Reference Field (IGRF) Model (see below). The more locally
accurate Australian Geomagnetic Reference Field values only began in 1985.
1985 and post-1985 calculations were made using the Geoscience Australia
government website: http://www.ga.gov.au/oracle/geomag/agrfform.jsp.
Use of Map Grid of Australia (MGA) Coordinates
For the day to day surface drill-hole set-up the WMG coordinates are converted to
MGA Zone 55 coordinates so that a handheld Global Positioning System (GPS)
device (GPS) can be used. Such GPS devices are accurate to between one and
five metres which is generally sufficient for hole set-ups. When completed, the drill
hole collars are “picked-up” by a licensed surveyor. For specific critical holes, a
licensed surveyor has been used to position the hole collar prior to drilling.
The two point conversion between WMG and MGA is:
Table 4.1: Mine Grid Conversion Table
Woodlawn Mine Grid (WMG) Map Grid of Australia MGA (Zone 55)
8771.90mE 733518.60mE
19699.10mN 6117691.50mN
10497.31mE 735122.03mE
19226.63mN 6116898.23mN
The difference between True North and MGA Grid North is -1.48o (1o 28’ 38.60”) at
Woodlawn and is a constant. The MGA coordinate system is based on the GDA94
geodetic datum.
4.5 Tenure
4.5.1 Mining License – SML 20
The Woodlawn Site is currently subject to an existing Special Mining Lease (SML
20), see Figure 4.1. SML 20 has remained current since the closure of the
operations in 1998 and title was transferred into the name of Tarago Operations
Pty Ltd, a fully owned subsidiary of Heron, in March 2014. The Mining Lease has
recently been renewed for a period of 15 years with an expiry date of 16 November
2029. The conditions associated with the renewed license are standard in nature,
a summary is provided in Section 4.7.

As part of the agreements with Veolia, it is intended to excise a portion of SML 20

covering the Veolia Area of Operations. This excision will consist of a surface
veneer providing Heron with mining lease coverage below this horizon. Separation
of Veolia’s Area of Operations has been recognised as the best means of
regulatory separation of the two distinctly different businesses.
Other than standard State Government royalty arrangements, there are no
commercial encumbrances over SML 20 relating to the proposed mining
operations. The mineral rights and production is 100%-owned by Heron.
The Woodlawn Site (SML 20) is surrounded by a larger exploration license (EL
7257) which is held 100% by Heron. This exploration license includes an area of
179km2 and covers the previous Currawang Mine located 9km to the north of
Woodlawn.
North and south of EL 7257, the felsic volcanics, the prospective host for VMS
deposits, are covered by a number of other Heron exploration licenses giving the
Company access to 570km2 as a regional project area (refer to Section 9.4 for
further details).
4.5.2 Other Approved Operations
The Woodlawn Site currently includes a number of other approved operations,

namely Veolia’s Woodlawn Bioreactor (DA-31-02-99, existing facility), the Infigen
Woodlawn Wind Farm (DA-250-10-2004-I, fully operational) and Veolia’s
Alternative Waste Treatment (AWT) Facility (DA 06_0239, yet to be constructed).
Veolia has recently received approval for Project Application MP10-0012 for the
expansion of the existing Bioreactor activities to 1.1Mtpa however this is yet to be
implemented.
Agreements exist (see below) to cover the interaction of the parties to ensure
respective businesses are not unduly impacted by others.
4.5.3 Existing Veolia Agreements
A number of legal agreements between Heron and Veolia have been entered into
covering the Woodlawn Site. They are as follows:
 Call Option: This gives Heron the option to purchase the land covered by
the proposed mining operations.
 Deed of Assignment: This covers the details for assignment of SML 20 to
Heron (completed) along with the excision of the Veolia operations area
from SML 20 and interaction with the Windfarm.
 Co-operation Agreement: Veolia and Heron have agreed to co-operate and
assist each other in opportunities of mutual benefit, including (but not
limited to):
- Joint use of facilities including power connections, weighbridge,
offices and loading facilities.
- Heron and Veolia accepting sole specific responsibility for certain
rehabilitation requirements.
- Heron’s use of waste derived compost for mine site rehabilitation
from Veolia’s AWT plant.
Figure 4.4 illustrates the nominal demarcation of Heron, Veolia and Windfarm
operations and liabilities. This is included in the above agreements.

Based on the agreements and subsequent deeds these agreements are valid until
31 December 2015 to put into effect the excision of Veolia’s Area of Operations.
Figure 4.4: Demarcation of the Veolia and Heron Activities
4.6 Ownership
A significant portion of the landholdings covering, and adjacent to, the Woodlawn
Site are owned under freehold title by Veolia (refer to Section 4.2 for further
details). Heron has a Call Option Agreement with Veolia permitting Heron to
acquire certain areas of the site.
The land for purchase encompass the surface areas required to operate both the
tailings and underground projects and include Hickory’s Paddock (proposed site for
the new plant), tailings dams, existing waste rock dump, core storage area and the
evaporation dams, Evaporation Dam 1 (ED1) and Evaporation Dam 2 (ED2).
As at the effective date, surveying of the subdivision for the land purchase was well
underway. Following completion of the survey, local council approval will be
required to redefine the ‘lot’ boundaries followed by an independent valuation of
the land to be purchased. The amount of land required to be purchased will
depend on the final site design, but is expected to be a minimum of 630 hectares,
and potentially up to around 1,000 hectares.
4.7 Environmental
The Woodlawn Project site is not a pristine environment, being disturbed by the 20
years of previous mining operations. The Company has undertaken an extensive

amount of work to consider the legacy site issues along with the integration of the
proposed operational activities to provide, firstly, minimal new impacts and,
secondly, a plan to remediate the overall site. The proposed approach to the site
has been the subject of a formal State Government approval process that required
the submission of a detailed Environmental Assessment document and the
approval was provided on the basis of complying with a number of conditions.
On the 4 July 2013, Heron received State Government approvals for the
development of both the tailings and underground projects from the Department of
Planning and Infrastructure.
The conditions associated with the project approval include:
 Administrative Conditions – covering the limits of the approval, protection
requirements, staging of submissions and community contributions.
 Environmental Performance Conditions – covering tailings dams,
underground mining and rehabilitation objectives.
 Environmental Management Conditions – specific aspect management
including water, noise, blasting, air quality, land management, transport,
heritage, visual, waste and bushfire management.
 Additional Procedures – covering landowners and independent reviews.
 Environmental Management, Reporting and Auditing – requirements to
report and review, access to information.
Additional environmental conditions exist under the mining license, SML 20. The
lease conditions include:
 Rehabilitation Requirements – to be completed to satisfaction of the
Minister.
 Mining Operations Plan (MOP) & Annual Environmental Management
Report (AEMR) – covering requirements to document and obtain approval
for a Mine Operations Plan (MOP), post mining land use, apply and amend
MOP, preparation of AEMR.
 Compliance Report – annual preparation and content covering compliance
of license conditions.
 Environmental Incident Report – requirement to notify and report any
breaches of conditions or relevant Act or Regulations.
 Resource Recovery – an obligation to optimise mineral recovery (economic
constraints).
 Security – lodgment timing and quantum of the security deposit (bond).
 Cooperation Agreement – obligation to cooperate with holders of
overlapping title.
 Exploration Reporting – standard reporting requirements for exploration
activities on mineral properties.
The transfer of SML 20 to Heron required the negotiation of a security deposit and
lodgment timing with the Division of Resources and Energy. A security deposit
amount of A$3.577M was agreed based on the area of disturbance over the first
five years of operations with the lodgment of the bond required “prior to
commencement of any on ground activity”.

5 Accessibility, Climate, Local Resources, Infrastructure and

Physiography
5.1 Accessibility
The traffic and transport environment surrounding the Woodlawn Site is dominated
by road transport. The region is serviced by the Federal Highway and the Hume
Highway to the west and north of the Woodlawn Site. Both of these roads provide
key transport corridors between Sydney / Melbourne and Sydney / Canberra.
Roads to the site are sealed from the Tarago side and rated to take B-double
heavy haulage equipment.
The Sydney to Canberra rail line passes through Tarago approximately 10km to
the east of the site. The daily train services offer several options each day to
connect with Sydney (three hours) and Canberra (one hour). A rail siding exists in
Tarago and historically was used to rail concentrates to smelters in Newcastle and
Port Kembla and to a concentrate berth at Port Kembla. This siding presents an
option to recommence railing concentrates for the new operations however costing
estimates to date have suggested lower road haulage costs to deliver concentrate
directly to the Port Kembla concentrate berth.
The major form of out-bound haulage is the transportation of the three base metal
concentrates to be produced by the Project. The road transport route from the
Project Site to Port is via Tarago-Bungendore Road (referred to as Bungendore
Road), Braidwood Road, the Hume Highway, then one of the following options:
 Picton Road, Mount Ousley Road and Southern Freeway to the Port
Kembla Terminal (preferred option).
 M5 Motorway and Foreshore Road to the Port Botany Terminal.
 M7, M2, F3 and John Renshaw Drive, New England Highway, Pacific
Highway and Industrial Drive to the Port Newcastle Terminal.
An alternative haulage route was considered for the section of the haulage route
between the Project Site and Goulburn via Collector Road, Federal Highway and
the Hume Highway. However, this option requires significant road upgrades on
Collector Road between the Project Site and the Federal Highway. This route was
also not considered due to safety concerns regarding the road surface type and
road width along the route. The Collector Road / Federal Highway intersection
was also considered unsafe due to a lack of adequate storage space for large
vehicles turning right out of Collector Road onto the Federal Highway.
Aside from the concentrate haulage, connections with other local centres will be
required for in-bound resources and distances to key centres from the Woodlawn
Site:
 Tarago 10.7km
 Bungendore 32km
 Goulburn 48km
 Canberra 71km
 Port Kembla 211km
 Sydney 247km

Canberra International Airport, located 64km to the south, is the closest well
serviced airport to the Project. Given Canberra’s position as the political centre for
Australia, flight times and destinations are numerous.
As was the case for the previous operations, a key operating philosophy will be to
source the operational labour force from within the local community. Within a
55km radius of the site (being the estimated realistic limit for a daily commute)
there are in excess of 430,000 people, with the most likely sources of local labour
being the communities of Tarago (population 351, 2011 census), Bungendore
(population 3,553, 2011 census) and Goulburn (population 21,484, 2011 census).
Anecdotally, Goulburn currently appears to be the preferred residential location, as
was the case during previous mining operations.
5.2 Climate
The Woodlawn region has a cool temperate climate, with seasonal climatic
variations ranging from hot summers to cool winters. The average daily maximum
temperature ranges from 27.5ºC in January to 11.5ºC in July.
The nearest Bureau of Meteorology (BoM) rainfall station with long-term
continuous rainfall data is Lake Bathurst (Station 70036 - Somerton), which is
approximately 10km to the north-east of the Woodlawn Site. The station has
recorded data since 1931 up to the present. Monthly average rainfall is distributed
unevenly throughout the year with the summer and autumn months receiving the
highest rainfall. The mean annual rainfall at Lake Bathurst is 685mm.
Rainfall data at the Woodlawn Site is currently measured by Veolia and is available
from 1986 to date. The mean annual rainfall at the Woodlawn Site is 635mm.
Evaporation data is available from the Goulburn TAFE station. The annual
average pan evaporation is nearly twice the annual average rainfall.
5.3 Vegetation
The following has been taken from the 2012 Environmental Assessment (EA)
document compiled by Parsons Brinckerhoff.
The Project lies within the central part of the South Eastern Highlands Bioregion
which covers approximately 749,155 hectares (Thackway & Cresswell 1995).
Overall, the lower slopes and valleys of the locality have been largely cleared of
eucalypt woodlands for grazing and agriculture, with larger remaining areas of
native vegetation restricted to the hilly ridge line areas, or as roadside vegetation.
The nearest conservation reserve in the region is Morton National Park located
approximately 30km to the east.
Vegetation within the Project Site is highly fragmented with large expanses of
cleared land surrounding predominantly isolated remnants along the rocky ridges
and roadsides. Although some of the highly degraded remnant vegetation patches
are of sufficient size to maintain viable populations of some small endemic
mammals, amphibians and reptiles, they are likely to be of only limited biodiversity
value within the wider landscapes.
5.3.1 Vegetation communities
Five vegetation communities were identified within the ecological survey area
based on assessment of the dominant species and structural form:

 Hickory Wattle Low Open Forest.

 Black She-oak Low Open Forest.
 Mixed Wattle and Planted Open Scrub.
 Derived Grassland.
 Grassland / Sedgeland Soaks.
The majority of the survey area is dominated by the last three of these
communities, which are highly modified and / or artificial vegetation communities
associated with past land uses and rehabilitation (mapped by Tisdale et al (2004)
as Cleared Land). The first two communities listed above are natural regrowth
communities that comprise small, isolated remnants of the broadscale community
mapped by Tisdale et al (2004) as Western Tablelands Dry Forest.
No threatened ecological communities were identified as being commensurate with
the vegetation communities within the ecological survey area. These vegetation
communities are summarised below. The condition and size of each of the
vegetation communities found within the ecological survey area is summarised in
Table 5.1.
Table 5.1: Vegetation community condition and extent of cover within the ecological
survey area
Vegetation community Area of Community within

ecological survey area (hectares)
Hickory Wattle Low Open Forest 1.5

Black She-oak Low Open Forest 0.9
Mixed Wattle and Planted Open Scrub 11.0
Derived Grassland 60.8
Grassland / Sedgeland Soaks 4.6
Derived Grassland is the most abundant vegetation community within the

ecological survey area. This community occurs throughout the entire Woodlawn
Site, particularly on the mid to lower slopes and areas of the valley floor containing
rocky and shale loam soils. The community is dominated by a variety of exotic and
native pasture grasses, and has been significantly modified by earth movement
associated with the Project Site and a prior history of intensive agricultural
activities, including clearing, grazing and pasture improvement through the
introduction of exotic and non-endemic grasses.
The Hickory Wattle Low Open Forest and Black She-oak Low Open Forest
communities each occupy two small stands within the ecological survey area
located on the eastern side of the central rise that is geologically associated with
the sedimentary shale and outcropping sandstone.
The Hickory Wattle Low Open Forest community is predominantly an Acacia
falciformis regrowth community with very few (<5% canopy cover) remnant
eucalypts. The community has generally been highly modified by a history of
agricultural activities including clearing, grazing and pasture improvement.
The central remnant of the Black She-oak Low Open Forest community has been
significantly modified by earth movement associated with the Project Site and a

history of agricultural activities, including clearing, grazing and pasture

improvement through the introduction of exotic and non-endemic grasses.
The south-eastern remnant of the community has only been moderately disturbed
by past clearing and the construction of a telegraph easement.
The Mixed Wattle and Planted Open Scrub is an artificial and regrowth community
dominated by a canopy of remnant and cultivated native species, particularly
Acacia dealbata (Silver Wattle), Acacia mearnsii (Black Wattle) and a variety of
planted native cultivars scattered throughout. This community occupies the
majority of the lower slopes, within the central and western portions of the
ecological survey area that are generally geologically associated with the
sedimentary shale soils and the areas of modified spoil and fill heaps adjoining the
existing void.
The Mixed Wattle and Planted Open Scrub community has been significantly
modified, and in some areas, artificially created by rehabilitation and restoration
activities associated with the previous activities and tailings operations. Given the
highly degraded and partially artificial nature of the community, it no longer shares
any significant characteristics with the regionally mapped vegetation community
described by Tindall et al (2004). However, it is considered that some small
regrowth patches may have been derived from the Western Tablelands Dry Forest.
Grassland / Sedgeland Soak is an artificial and highly disturbed community
dominated by a variety of wetland and moisture tolerant plants, particularly Juncus
spp., Typha orientalis (Cumbungi) and exotic and native grasses. This community
occupies the numerous existing dams and poorly drained soils associated with
sediment control contours artificially constructed throughout the ecological survey
area.
5.3.2 Species of plant
A total of 276 species of plant, representing 39 families, were recorded within the
ecological survey area, of which 218 (79%) were native. The number of species
recorded in each community is summarised in Table 5.2.
No threatened species of plant listed under the Threatened Species Conservation
Act 1995 (TSC Act) or the Commonwealth Environment Protection and Biodiversity
Conservation Act 1999 (EPBC Act) was recorded in the ecological survey area.
No Rare or Threatened Australian Plants (ROTAP) species was recorded.

Table 5.2: Number of species of plant recorded in the ecological survey area
Community Total Number Number of Number of Number of

of species native species introduced sample sites
(% of total) species
Hickory Wattle 55 49 (89%) 6 2

Low Open
Forest
Black She-oak 66 62 (94%) 4 2
Low Open
Forest
Mixed Wattle 60 46 (77%) 14 2
and Planted
Open Scrub
Cleared 67 43 (64%) 24 5
Grassland
Grassland / 28 18 (64%) 10 2
Sedgeland
Soaks
All 276 218 (79%) 58 13
communities
combined
5.4 Local Resources and Infrastructure

Power – Electrical power for the operation will be provided by an independent
energy retailer utilising the existing Essential Energy grid and site sub-station. The
existing 66kV transmission line feeding the site (Goulburn to Bungendore) and the
existing 66/11kV sub-station will have sufficient capacity to meet the stated
requirements of the Project. Alternative sources of power include Veolia’s six 1MW
gas fired generation plant and Infigen’s Windfarm located to the immediate south of
the project site. Refer to Section 17.4.
Water – The new processing plant has been designed to recover and, to the
maximum possible extent, recirculate water used to process the plant feed. Make
up water will be sourced from the existing Willeroo borefield. Veolia currently
operate the borefield in a very limited capacity and the intention is for Heron to take
over the management and operation of this system. Some refurbishment of the
borefield will be required. Refer to Section 17.5.
Buildings – A number of the former operational offices and maintenance buildings
still exist on site. These are utilised primarily by Veolia and it is the intention to
establish new facilities within Hickory’s Paddock adjacent to the new plant site for
Heron’s operations. The existing facilities are currently in use by Veolia and
Heron, and Heron is likely to continue to use these facilities until construction is
completed.
Communications – Fixed wire communications (phone and data) are in place to
the existing office facilities and this infrastructure will be utilised through normal
commercial providers. Mobile coverage is intermittent across site. Heron is in

discussions with Veolia and with external providers with a view to improving both
fixed line and wireless services across the site.
Access – The site is accessed through a network of well-maintained heavy
haulage rated, sealed roads. Refer to Section 5.1.
Labour – Woodlawn will be a “drive in / drive out” operation. A number of small,
medium and large communities exist within daily travel distances to the site and
will form the basis for the operational labour residential requirements. Community
services and infrastructure are somewhat limited in the local village of Tarago;
however, the towns of Bungendore and Goulburn provide a wide range of services.
Supplies – The proximity to industrial centres at Wollongong (including Port
Kembla) and Sydney provide a ready access point to source major consumables,
spare parts, equipment and service providers.
5.5 Physiography
The Woodlawn Project is located within the Woodlawn Eco-precinct along with the
Veolia Bioreactor and power station and the Infigen Woodlawn Wind Farm. The Eco-
precinct is located in a valley within the Great Dividing Range (GDR) which runs from the
south in Victoria to the north in Queensland.
Regional elevations within SML 20 vary from 1,000mRL at the headwaters of
Allianoyonga Creek on the northern boundary to 750mRL on the eastern boundary.
The Bioreactor is located in the old Woodlawn open pit, the surface of which lies at an
elevation of approximately 800mRL. The open pit was developed on a ridgeline that
forms part of the GDR. The Woodlawn Windfarm is located on the ridgeline to the south
of the Bioreactor at an elevation of 850mRL.
The GDR splits the site into two water catchments, the.
 Sydney Catchment to the east, and
 the Hawkesbury Nepean Catchment to the west.
The main water stream is Allianoyonga Creek and this is split by the GDR and runs
both to the west and into Lake George and to the east into Crisps’s Creek and
ultimately to the Mulwaree River.

6 History
The Woodlawn deposit was discovered in 1970 and mined by open-pit and
underground methods between 1978 and 1998. TriAusMin then acquired the
project and completed further studies and drilling programs through to 2013.
Heron merged with TriAusMin in August 2014 and has been conducting further
drilling programs for estimation of a revised Mineral Resource and a PEA, the
subject of this Report. Further details of the project history are provided in Table
6.1 below:
Table 6.1: Woodlawn Site History
Date Details
1967 First recorded organised exploration of the region by Jododex, a joint

venture of St Joseph’s International Explorations Ltd and Phelps
Dodge Exploration Corp.
1970 Discovery Hole: Second exploration drill hole (W002) intersected

24.4m @ 18.1% Zn, 7% Pb, 1.5% Cu and 72g/t Ag.
1973 Special mining Lease 20 (SML 20) granted on 16 November 1973.
1976 Feasibility approved and mine construction started.
1978 - Production commenced from open pit operations at a rate of

1987 approximately 900ktpa. Total production from the open pit was
approximately 8.0Mt @ 8.3% Zn, 3.1% Pb, 1.6% Cu and 62g/t Ag.
1982 RAB drilling discovered high grade mineralisation at Cowley Hills,

2km north of the Woodlawn deposit.
1985 Title transferred to Australian Mining and Smelting Ltd (AMS), a CRA
subsidiary. Commencement of the underground feasibility.
1987 Denehurst Limited purchased the Woodlawn Site and undertook

underground mining operations at a rate of approximately 500ktpa.
1988 Commencement of a drilling program on Tailings Dam North and

feasibility into the retreatment of tailings.
1989- Cowley Hills Mine produced 35,000t. Metallurgical recovery issues

1990 were encountered.
1991- Currawang mining commenced at 150,000tpa. Total production from

1995 the mine was 530,000t @ 13% Zn, 2.2% Pb, 1.6% Cu and 33g/t Ag.
1991- Denehurst retreated 1.9Mt of tailings from Tailings Dam North and
1996 Tailings Dam South from a stand-alone concentrator with no re-grind
in the flow-sheet. The retreatment focused solely on the production
of a zinc concentrate.
Denehurst was placed into administration and receivership and the
1998
underground mine ceased production in March 1998. The

Date Details
underground mine produced in total approximately 5.8Mt @ 10.1%
Zn, 1.6% Cu, 4.1% Pb, 0.5g/t Au and 90 g/t Ag.
Total production for the deposit to this point was approximately
13.8Mt @ 9.1% Zn, 1.6% Cu, 3.6% Pb, 0.5 g/t Au and 74 g/t Au.
1999 Mineral rights to SML 20 acquired from Denehurst Administrator by
Tri Origin Australia NL. Collex (now Veolia Environmental Services
(Australia) Pty Ltd) purchased the landfill rights to the open pit.
2000 The Woodlawn Waste Management Facility, incorporating the

Woodlawn Bioreactor, designed to treat 500,000tpa of waste was
approved.
2004 Tri Origin Minerals listed on the ASX. Woodlawn Bioreactor began
operation.
2005 Woodlawn Wind Farm, comprising 20 turbines located on the

ridgeline that crosses the Woodlawn and Pylara properties, was
approved.
2008 Feasibility study completed by Intermet on the Woodlawn

Retreatment Project (WRP) (Intermet, 2008). In 2008 the base metal
prices dropped significantly and the project was unable to be funded.
The Woodlawn Alternative Waste Transfer Facility, designed to
receive 280,000t of waste, was approved for the Woodlawn Site.
2009 NI43-101 completed by Scott Wilson Mining consultancy on the

Woodlawn Tailings Retreatment Project.
2010 Tri Origin Minerals listed on the TSX. Name subsequently changed
to TriAusMin Ltd.
2012 GR Engineering Services completed a Front End Engineering

Design (FEED) Study on the WRP (Sara, 2012).
2013 On 4 July 2013 under the Environmental Planning and Assessment

Act 1979 TriAusMin received State Government approval for the
development of the WRP and Woodlawn Underground Project
(WUP).
2014 SML 20 transferred to Tarago Operations Pty Ltd, a subsidiary of

TriAusMin. TriAusMin entered into an agreement with Heron
Resources to merge the two companies. The merger became
effective on 5 August 2014.
2015 SML 20 renewed for a period of 15 years.

7 Geological Setting and Mineralisation

7.1 Previous Work
Since its discovery in the late 1960s the Woodlawn deposit has been the subject of
several geological studies, reports and published technical papers. Malone et al
(1975) was the earliest published geological paper and set much of the framework
for later studies and ideas. The Geological Society of Australia dedicated almost
an entire volume to the Woodlawn deposit in 1979 and included papers by Gilligan
et al (1979) on the regional geological setting; Ayres et al (1979) on the mineralogy
and chemical composition of Woodlawn deposit; Petersen and Lambert (1979) on
the mineralogical and chemical zonation around the Woodlawn deposit; amongst
others.
McKay and Hazeldene, 1987 published a seminal paper on the Woodlawn deposit
bringing together many of the ideas on ore-formation developed from the open-pit
excavation and the early underground work. McKay then completed his PhD on
the Woodlawn deposit in 1989. These workers further developed the concept of
Woodlawn as a VMS (Volcanic-hosted Massive Sulphide) system developing on or
close to the ancient sea floor.
Glen et al (1995) published a paper on Syn- and Post-Tectonic Mineralisation in
the Woodlawn Deposit, however since this time there have been no further formal
studies completed at Woodlawn.
More recent regional studies by the Geological Survey of New South Wales
(GSNSW) have focused on the regional scale architecture of the Goulburn Basin
and age dating of the key units (for example Deyssing and Fitzherbert (2014)).
7.2 Regional Geology

The Woodlawn area has been mapped by the GSNSW and is located on the
Canberra 1:250,000 map sheet SI55-16 (Best J.G. et al 1964) and the Braidwood
1:100,000 map sheet 8827 (Fitzherbert et al, 2011).
Woodlawn is located near the eastern margin of the Lachlan Fold Belt (LFB), a
major north northwest trending orogenic belt that hosts several major metalliferous
mines. The LFB extends from northeast Tasmania, into Victoria and through much
of eastern NSW. The northern, western and eastern boundaries are masked by
younger sedimentary basin cover.
The LFB is divided into a number of stratigraphic-tectonic zones commonly
referred to as anticlinorial and synclinorial zones. The boundaries between these
zones are marked by regional faults, thrusts, igneous bodies, unconformities as
well as lithological, metallogenic and tectonic contrasts. In the Woodlawn region
the synclinorial zones consist of Siluro-Devonian volcanics and sediments. These
are bounded by anticlinorial zones consisting of deep marine Ordovician sediments
generally intruded by Siluro-Devonian granites.
The Woodlawn Project is located in the Goulburn Basin (Deyssing and Fitzherbert,
2014) which is a relatively narrow belt of volcanic and sedimentary rocks that
extends for over 300km and is one of several fault bounded Silurian to Devonian-
aged intra-cratonic rift to back arc basins which host a range of base metal and
gold occurrences on the eastern side of the LFB (refer Figure 7.1).

The Goulburn Basin, together with the Hill End Trough, represents one of the
marine rift basins that opened across the Lachlan Orogen in the middle to late
Silurian under an extensional tectonic regime (Thomas & Pogson 2012).
Figure 7.1: Regional Geological Setting of the Woodlawn Project, within the
Goulburn Basin.

The sequences of the Goulburn Basin developed in a back-arc setting on a

substrate of Ordovician to earliest Silurian siliciclastic turbidite deposits and black
shale that was deformed and thickened during the preceding Benambran Orogeny.
Initial deposition of shallow conglomerates and limestones was followed by the
deposition of siltstone-dominated sequences, reflecting the deepening of the basin.
Deep-water submarine volcanism at discrete, commonly bimodal, volcanic centres
accompanied the deepening of the basin, with the volcanic deposits typically inter-
fingering with the background siltstone-rich packages. These volcanic sequences
host VMS mineralisation at Woodlawn, Currawang and Captains Flat. This
exhalation is possibly related to the contemporaneous intrusion of bimodal plutonic
rocks (Thurralilly Suite) beneath the basin sequences. Opening of the Goulburn
Basin resulted in deposition of greater than 2km of post-rift turbidite to mass flow
sequences in the late Silurian.
The termination of rifting and filling of the basin possibly resulted from uplift during
the latest Silurian Bowning Orogeny. A transition to subaerial conditions and
renewed magmatism occurred in the Early Devonian. Plutons of the Glenborg and
Candelo suites intruded close to the base of the Silurian successions along the
eastern margin of the deep-water basin and extensive ignimbrite deposits were
erupted along the eastern margin of the basin. The entire area underwent
compressional deformation during the Middle Devonian and early Carboniferous,
producing regional-scale folding and complex fault systems. These fault systems
are responsible for the uplift of the late Silurian felsic to mafic plutons that are
related to the mineralised bimodal volcanic centres, Deyssing and Fitzherbert
(2014).
In the local Woodlawn area late Silurian rocks of the Mt Fairy Group (mostly acid to
basic volcano-sedimentary sequences) unconformably overlie Ordovician
basement which consists of quartz-rich flysch sediments (Birkenburn Beds)(see
Figure 7.2). Early Devonian shallow to deep water sediments unconformably
overlie the Mt Fairy Group. The sequence is folded and regionally metamorphosed
to lower greenschist facies, and intruded by Early Devonian granites. Early
Devonian dolerites intrude the entire sequence.
East west compression has produced a series of north plunging, overturned
anticline / syncline pairs with west dipping axial planes. The Currawang
Anticlinorium in the west and Mulwaree Synclinorium in the east are the major fold
structures in the area with the Woodlawn Syncline and Pylara Anticline interpreted
as major subsidiary folds. The primary Woodlawn deposit lies in a structurally
defined zone of lineaments, termed the Woodlawn Corridor, within the LFB. The
corridor is believed to represent a major northwest trending palaeo-geographic
feature.

Figure 7.2: Interpreted solid geology for the Woodlawn area.

7.3 SML 20 (Mining Lease) Geology

The Woodlawn VMS deposit lies on the eastern limb of the asymmetric north-
north-west plunging Woodlawn Syncline. The regional structures trend
approximately north northwest with the local foliation dipping moderately to steeply
to the west. The Woodlawn deposit is hosted by regionally metamorphosed
(greenschist facies) fine to coarse grained felsic to intermediate volcanic rocks,
volcanogenic sedimentary rocks and minor carbonaceous shale, known as the
Woodlawn Volcanics. The axial plane dips at about 60° to the west and is
paralleled by a strong slaty cleavage or in places a schistosity through the mine
sequence.
The VMS mineralisation is contained within a series of sub-parallel lenses dipping
moderately to steeply westwards and occupies a series of generally fault bounded
stratabound packages. In the latter stages of deposition, dolerite sills intruded the
rocks now situated above and below the Woodlawn deposit. The dolorite
comprises 30% to 40% of hangingwall rock in the Woodlawn deposit.
The lower south and west sectors of the mine are dominated by felsic and
intermediate volcanics, while the upper north and east are dominated by felsic
volcaniclastic mudstones. The volcanic-derived rocks at Woodlawn are strongly
hydrothermally altered adjacent to the VMS lenses and display a typical array of
sericite (fine white mica), chlorite, silica, pyrite and minor carbonate which largely
obliterates primary rock fabrics.
Felsic to intermediate volcanic flows and domes are intercalated with fine-grained
volcanic mudstone (tuffaceous shales) and often exhibit complex and rapid facies
changes. Certain volcanic units have been identified as being associated with ore
and most of the lenses are in contact with these units.
Recent work by Dr Jocelyn McPhie (McPhie 2015) on the Woodlawn sequence has
provided greater insight into the volcanic processes that formed the volcanic and
volcaniclastic rocks. The following is extracted from McPhie’s (2015) report:
The host succession to the Woodlawn massive sulphide lenses includes
coherent rhyolite, bedded monomictic rhyolite breccia and quartz-crystal-rich
sandstone typical of the proximal parts of submarine rhyolitic lavas or domes.
Finer and more thinly bedded felsic volcaniclastic facies (thinly bedded
volcanic mudstone, felsic fine fiamme breccia) are also present and could
represent more distal settings or be related to different felsic volcanic centres.
Amygdaloidal basalt / dolerite and basaltic fluidal clast-breccia are also
present. Basaltic fluidal clast breccia is an extrusive facies and suggests
proximity to a volcanic vent. Tabular beds (mudstone and sandstone) and
graded beds (sandstone) are consistent with a relatively deep (below-wave-
base) depositional setting.
Relationships observed in one drill hole (WNDD0007 ‘Kate Lens’) suggest that
the massive sulphide lenses in this hole did not form at a seafloor position.
Textural preservation of the Woodlawn host succession, except very close to
the massive sulphide lenses and in strongly deformed zones, is generally
good.

As part of McPhie’s (2015) work, a short traverse was completed along the
southeastern side of the Woodlawn open cut and provided a good overview of
some of the key geological units. Key observations are:
 beds dip to the west at a moderate angle;
 close to the northeastern end of the traverse, younging to the west is
indicated by graded beds (refer Figure 7.3), and
 it is assumed that the traverse obliquely crossed progressively younger
units. However, no younging indicators were observed in the remainder of
the section, and this assumption could be wrong.
McPhie’s (2015) report further went on to break the units down into facies. The
facies are briefly described below:
Facies 1
Facies 1 is identified as pale, thinly planar bedded volcanic mudstone interbedded
with thin to medium tabular beds of quartz-crystal-rich sandstone. Some
sandstone beds are graded from coarse to fine (refer Figure 7.3).
Figure 7.3: Interbedded volcanic mudstone and quartz-crystal-rich sandstone. Arrow

indicates the local younging direction
Facies 2
Facies 2 is a poorly sorted breccia composed of grey, phyllosilicate-altered,
coarsely quartz-phyric rhyolite clasts approximately 4cm to15cm (refer Figure 7.4).
On surfaces parallel to cleavage, the rhyolite clasts have equant shapes and curvi-
planar margins (refer Figure 7.5, Figure 7.6) and on surfaces perpendicular to
cleavage, they are strongly elongate. The pale matrix consists of finer (<2cm)
quartz-phyric rhyolite clasts and is more siliceous than the coarse clasts. The
breccia is (at least locally) thickly bedded and contains interbeds of graded quartz-
crystal-rich sandstone (refer Figure 7.6). Where strongly altered, the rhyolite clast
outlines are masked and this facies has a much finer apparent grainsize (“tuff”).

Figure 7.4: Monomictic quartz-phyric rhyolite breccia viewed on a surface parallel to

cleavage
Figure 7.5: Equant rhyolite clast with curviplanar margins, in the monomictic quartz-
phyric rhyolite breccia; viewed on a surface parallel to cleavage

Figure 7.6: Interbed of graded quartz-crystal-rich sandstone in the monomictic

quartz-phyric rhyolite breccia. Arrow indicates the local younging direction
Facies 3
Facies 3 contains massive quartz-phyric rhyolite that has coarse, euhedral or
rounded quartz phenocrysts evenly distributed in a fine sericite-altered
groundmass (refer Figure 7.7). Coarse quartz phenocrysts dispersed in dark
green-grey chloritic groundmass is observed and because this facies is strongly
altered, the porphyritic texture could be false.
Figure 7.7: Strongly chlorite-altered quartz-phyric rhyolite

Facies 4
Facies 4 is described as green-grey massive basalt / dolerite containing dark
green chlorite filled amygdales that are up to approximately 1cm in size (Figure
7.8). The amygdales are ovoid and weakly aligned. The groundmass around the
amygdales is equi-granular and fine-medium grained.
Figure 7.8: Massive amygdaloidal basalt / dolerite (amygdales are filled by dark
green chlorite).
McPhie’s 2015 Woodlawn Traverse Interpretation

The interbedded volcanic mudstone and quartz-crystal-rich sandstone has bedding
characteristics (tabular, locally graded beds) consistent with deposition below wave
base. This association is at least partially (and possibly entirely) derived from a
coarsely quartz-phyric rhyolite source.
The bedded monomictic quartz-phyric rhyolite breccia is probably autoclastic, and
was generated as a by-product of the effusion of a rhyolite lava or dome. Given
the underwater setting and the distinctive clast shapes, this facies could be re-
sedimented hyaloclastite. The short intervals of apparently coherent quartz-phyric
rhyolite may be representative of the coherent lobes of the lava or dome.
The section (Figure 7.9) accumulated in relatively deep water probably in proximity
to an active, coarsely quartz-phyric rhyolitic lava, dome or dome complex.
Contacts of the intervals of massive basalt and massive amygdaloidal basalt /
dolerite were not examined closely. Whether or not these intervals relate to lavas
or intrusions is unknown. If they are intrusions, then they have no direct bearing on
the character of the seafloor volcanic setting. If they are lavas, they indicate strong
bi-modality in the composition of the succession (basalt vs. rhyolite), typical of
extensional settings. Basaltic lavas can flow far from their source vents. If these
intervals are lavas, there is very little that can be said about the location of their
source vents.

Figure 7.9: Schematic section based on the Woodlawn Pit traverse. The section was
not measured but the approximate thickness is in the range of several tens of metres
to possibly 150 m. The younging direction is not confidently known but is generally
considered to be younging up the section.
7.4 Mineralisation
The Woodlawn deposit occurs in Silurian felsic volcanic rocks, volcanogenic
sediments and carbonaceous shales intruded by doleritic sills. It is considered to
be part of suite of Volcanic-hosted Massive Sulphide (VMS) deposits formed along
the eastern coast of Australia in the Paleozoic (240 to 540 Ma) (Gemmell et al
1998). Other significant VMS deposits in this suite include Mt Lyell, Rosebery, and
Hellyer in Tasmania, Stockmans in eastern Victoria, Captains Flat in NSW and Mt
Morgan and Thalanga in Queensland.
These VMS deposits tend to form in back-arc and inter-arc volcanic basins in
proximity to rift faults and host rocks range in composition from rhyolite-andesite to
basalt. Rhyolitic rocks are the common on the footwall while sediments and/or
mafic volcanics are the most common hangingwall types.
The Woodlawn deposit was extensively studied during the twenty years from its
discovery in 1968, with these studies culminating and to a large extent being
synthesised in a PhD study by W.J. McKay in 1989, with the major findings
published in an Economic Geology paper by McKay and Hazeldene (1987). Since
this time there has been little published work completed apart from a paper by Glen
et al (1995) who describe the syn- and post-tectonic mineralisation styles at
Woodlawn.

McKay (1989) and those who came before him were largely focused on the
mineralisation exposed in the open-pit and they had limited or no access to the
underground mineralisation exposed from 1987 onwards. Nevertheless, the
studies undertaken up until 1989 provide a solid foundation for the ongoing
understanding of the deposit.
McKay and Hazeldene (1987) recognised two main styles of mineralisation:
 poly-metallic “complex ore” (sphalerite, galena and chalcopyrite); and
 footwall stockwork chalcopyrite-rich “copper stringer ore”.
They described the deposit as forming essentially on the sea floor as mounds of
chalcopyrite and pyrite capped by massive sphalerite-galena sulphides. The main
lenses of poly-metallic massive sulphides comprise pyrite with variable sphalerite,
galena and chalcopyrite with minor arsenopyrite, tetrahedrite-tennantite, pyrrhotite,
marcasite and electrum.
Beneath the mounds is a network of fossil feeder channels that comprise the
copper stringer ore. The copper stringer ore is a network of fracture filling
assemblages of pyrite and chalcopyrite with subordinate to minor sphalerite,
galena, pyrrhotite, quartz, calcite, chlorite and barite.
The depositional history of the main Woodlawn lens (C Lens) is divided by McKay
and Hazeldene (1987) into three stages:
1. Precipitation and deposition of pyrite-chalcopyrite from early, hot, silica-rich
metalliferous solutions mixing with seawater to form sulphide mounds
adjacent to exhalative vents.
2. Deposition of sphalerite and galena in basinal lows north of the mounds
from cooler, fractionated, negatively buoyant ore solutions.
3. On-lapping sedimentation of sulphides over mounds choking off venting ore
solutions followed by sub-surface hydrothermal and diffusion of solutions
through unconsolidated sulphides to form zinc-lead rich chimney structures
above and to the north of the chalcopyrite mounds.
However, the important paper by Glen et al (1995) showed there are some
significant flaws in the mineralisation model described by McKay and Hazeldene
(1987) and they demonstrate the importance of ore-types related to and probably
emplaced as part of the Devonian deformation events. Relationships of the ore in
parts of the A Lens show the ore is structurally controlled and that it overprints an
earlier layered sphalerite-chert rock. Glen et al (1995) concluded that the ore at
Woodlawn is a composite of pre-, syn- and post-deformational type.
Recent studies (for example, McPhie, 2015) have also shown the original
Woodlawn massive sulphides, at least in part, probably formed sub ocean floor
with broad zones of hydrothermal chlorite, sericite and pyrite alteration extending
from both the hangingwall and footwall sides of the sulphide lenses.

Figure 7.10: Copper stringer and polymetallic massive sulphide mineralisation from
WLTD015 Kate Lens “discovery hole”, 396 to 409m with assay results

8 Deposit Types
8.1 Volcanic Massive Sulphide Deposit Model
The Palaeozoic VMS deposits of Australia have been extensively studied and a
coherent geological model has been developed. The following is adapted from a
summary of the Australian Palaeozoic VMS systems by Gemmell et al 1998.
Figure 8.1 shows a highly schematic cross section through a Palaeozoic VMS
system.
Deposit Examples:
Eastern Australia: Hellyer, Rosebery, Que River, Hercules, Mt Lyell, Woodlawn,
Thalanga, Wilga, Currawong, Balcooma, Mt Chalmers.
Other major examples include deposits from the Japanese Green Tuff belt (Kuroko
deposits), Norwegian Caledonides and Canadian Bathurst Group, New Brunswick.
Typical Size and Metal Content:
 Major deposit size: 15Mt to 90Mt.
 Median deposit size: 1Mt to 5Mt.
 Average grade for Cu / Pb / Zn deposits: 1.0% Cu, 12% Zn, 5% Pb.
 High Ag and Au credits: average 120g/t Ag and 2.0g/t Au.
Mining and Treatment:
 Massive sulphide style limits dilution effect with sharp cut-off between ore
and waste.
 Stringer zones are only mined where they are high-grade or large tonnage
(e.g. Mt Lyell).
 Polymetallic nature may cause recovery problems in fine grained ores.
 Metamorphosed - recrystallised ores are easier to treat.
 Fe content of sphalerite is moderate to high.
 Pyrite content is generally high.
Regional Geological Criteria:
 Back-arc and inter-arc rift volcanic basins.
 Preferred ages: Cambro-Ordovician and Silurian.
 Calc-alkaline submarine volcanics and sediments.
 Compositional variation: rhyolite-andesite-basalt.
 Proximity to syn-volcanic rift faults.
 Located proximal to volcanic centres (Cu -rich ores) or in distal volcanic
facies (Pb / Zn-rich ores).
 Syn-volcanic magnetite-series granites may be present.
 Rhyolite is most common footwall composition.
 Sediment and / or mafic volcanics are most common hanging-wall rock
types.
 Regional sericite ± chlorite alteration in footwall volcanics.
Local Geological Criteria:
 Mineralisation located in favorable horizon between volcanic units.
 Favorable horizon may be iron-rich exhalite, sulphide bearing epiclastic,
shale or carbonate.

 Mineralisation same age as host volcanic - sedimentary rocks.

Deposits vary in shape from blankets to lenses, to mounds and pipes.
Mineralisation Features
 Zn / Pb massive sulphide lens is stratabound.
 Massive sulphide may be banded, brecciated or massive and featureless.
 Cu-rich footwall stringer mineralisation is cross-cutting.
 Chlorite, sericite, quartz, barite, carbonate are major gangue minerals.
 Vertical (up-stratigraphy) zonation of Cu, Au, Pb, Zn, Ag, ±Ba.
 Pyrite is major sulphidic mineral plus sphalerite, galena, chalcopyrite ±
tetrahedrite, arsenopyrite.
 Magnetite and pyrrhotite are rare except for strongly metamorphosed
deposits.
Alteration Features:
 Some deposits have zoned alteration pipes below massive sulphides.
 Stratabound alteration zones are commonly developed in the footwall and
extend along strike for 2km to 6km.
 Hanging-wall alteration is weakly developed or non-existent (although this
is not the case for Woodlawn where hangingwall alteration is often intense
suggesting sub-sea floor emplacement).
 Common alteration zonation towards ore is: sericite to sericite / pyrite to
sericite / chlorite / pyrite to chlorite / pyrite to quartz / pyrite.
Geochemical Criteria:
 Alteration halo is defined by Na2O depletion and MgO enrichment.
 Alteration Index AI = 100(MgO + K2O)/(Na2O + CaO +MgO + K2O) is vector
toward ore (AI = 30 to 100).
 Ore 100Zn/(Zn+ Pb) = 60 to 80.
 As, Sb, Hg, TI as trace elements in Zn ores.
 Bi, Te, Mo, Co as trace elements in Cu ores.
 Pb isotopes form tight cluster for individual deposits that may lie on growth
curve or reflect heterogeneous U / Th / Pb source area ratios.
Geophysical Criteria:
 Regional magnetics define major volcanic units, structures and alteration.
 Regional gravity and magnetics may define position of related magnetite-
series granites.
 Ores have no magnetic signature.
 EM important in discovery of Que River, Hellyer, Wilga. EM is also an
important tool at Woodlawn.
 Most deposits have strong EM responses.
 Cu-rich ores have best EM response.
 Zn-rich, Cu-poor ores have a very weak or non-existent EM response.
 IP defines mineralisation zone and pyritic alteration halo.
Comments on Genesis
 Comparison with black smoker systems substantiates previous conclusions
that most VMS deposits are synvolcanic seafloor deposits.
 Seawater depths of 800m to 4,000m are necessary to form deposits.
 Models for seafloor sulphide formation:

- sulphide mounds develop above hydrothermal vents and grow by

upward zone refining of metals;
- sulphide sheets or lenses may form in seafloor brine pools adjacent
to vents; and
- synvolcanic sub-seafloor replacement to form stratabound massive
sulphides.
 Stringer zones and sulphide pipes form by replacement and or vein-fill
processes in sub-seafloor hydrothermal vent.
 a less-favoured model invokes syntectonic replacement unrelated to
volcanism.
Figure 8.1: Cross section through typical Palaeozoic VMS system of Eastern
Australia (after Gemmell et al 1998).

9 Exploration
This section describes the history of exploration completed at Woodlawn since its
discovery in the late 1960s. The first section has been adapted from a report
written by M. Bouffler in 1998 which summarised the exploration on SML 20 to the
end of 1997.
9.1 Early Exploration and Production History (Jododex, AMS and

Denehurst)
Modern exploration is considered to have begun in the Woodlawn area when St
Joe Minerals and Phelps Dodge Exploration Pty Ltd of the USA formed a
consortium called Jododex Australia Pty Ltd to carry out exploration in Australia.
They selected the broader Woodlawn area in 1967 as being prospective for a
Captains Flat type base metal deposit occurring in the Silurian acid volcanic and
associated rocks of the Lachlan Fold Belt.
The Woodlawn gossan was discovered through following up geochemical
programs, and diamond drilling of the gossan zone in December 1969 confirmed
the presence of a significant massive sulphide deposit. Twenty five exploration
holes were drilled over the next twelve months outlining an orebody of between five
and ten million tonnes. The original open-pit mineable resources were:
 6.3Mt of polymetallic mineralisation grading 1.7% Cu, 5.5% Pb and 14.4%
Zn; and
 3.7Mt of copper mineralisation grading 1.9% Cu, 0.1% Pb and 0.5% Zn.
Note these are historical, non JORC 2012 compliant, estimates sourced from
Bouffler (1998) that are not materially relevant to the existing Mineral Resource
estimates at Woodlawn and are provided here for historical interest only. They
have been essentially mined out and in no way provide any future potential for
further extraction of open-pittable material.
Mining from the open-pit began in 1978 and continued at a production rate of about
900ktpa until it began winding down in 1986 and eventually ceased in June 1987.
Full scale underground production began in 1987, at a rate of 500ktpa and was
continuing at a rate of 480ktpa in 1997, prior to mine closure in 1998 after
Denehurst was placed in administration in circumstances that are understood to be
largely unrelated to the Woodlawn mine.
9.2 TriAusMin Exploration 2000 to 2013

Little exploration was completed on the Woodlawn property in the late 1990s and
early 2000s. TriAusMin began drill testing the Woodlawn system in more detail
around 2006 as higher levels of funding became available.
TriAusMin completed 17 diamond core holes (WLTD series) from 2007 to 2013.
The later holes in this series were particularly significant with the discovery of the
Kate Lens (WLTD0015 in 2013) and the I Lens extensions (WLTD011 in 2012).
The key intercepts for this drilling program are shown in Table 9.1.

Table 9.1: Details of significant drill intercepts from 2009 to 2013 TriAusMin
campaigns
Down Estimate
hole Lens True
Hole No From (m) To (m) Zn (%) Cu (%) Pb (%) Au (g/t) Ag (g/t)
Width Width
(m) (m)
WLTD004B 398.5 406.6 8.1 C 6.5 0.4 2.8 0.1 0.2 12.6
WLTD004B 438.9 446.2 7.3 C 5.8 12.3 1.7 4.9 2.3 171.0
WLTD005 353.0 371.0 18.0 A 14.4 11.5 0.7 4.7 0.6 87.7
WLTD005 417.0 432.0 15.0 B 12.0 7.6 1.7 3.5 0.2 89.2
WLTD011 517.8 520.0 2.2 I 1.8 4.7 0.2 2.5 1.4 31.5
WLTD011 542.2 552.1 9.9 I6 7.9 6.1 1.6 1.2 0.7 14.1
WLTD011 849.0 853.0 4.0 D1 3.2 0.1 3.3 0.0 0.0 12.8
WLTD011 869.0 881.1 12.1 D2 9.7 0.1 4.8 0.0 0.1 14.9
WLTD011W1 551.0 565.5 14.5 I6 11.6 11.7 3.7 3.7 1.9 120.8
WLTD011W1 630.2 638.5 8.3 D1 6.6 5.6 1.7 1.6 2.6 48.0
WLTD011W1 696.6 708.0 11.4 D2 9.1 7.8 1.2 2.7 0.6 49.3
WLTD011W2 564.0 573.0 9.0 I6 7.2 8.6 2.9 4.6 2.1 167.3
WLTD011W2 648.0 656.9 8.9 D1 7.1 6.3 2.7 3.0 1.2 71.1
WLTD012 804.0 808.0 4.0 JC 3.2 0.1 3.1 0.0 0.0 8.1
WLTD014W1 543.0 549.7 6.7 IC 5.4 0.1 3.4 0.0 0.2 6.2
WLTD014W1 674.9 686.0 11.1 D2 8.9 8.3 0.9 3.6 0.5 61.2
WLTD015 377.0 409.0 32.0 Kate 25.6 4.6 1.8 1.2 0.6 21.2
WLTD017W1 450.0 453.2 3.1 I 2.5 3.3 0.4 2.0 3.0 34.7
Notes: True width is an estimate of the actual thickness of the intercept based on interpreted lens orientation (approximately
80% of down hole width); grades are weighted average grades, weighted by length of samples intervals down hole, which
are nominally 1 metre. No weighting was applied for differences in specific gravity.

9.3 Heron Exploration 2014 to 2015

Heron began exploring the Woodlawn system through a program of surface
diamond drilling in September 2014 and by the end of January 2015 had
completed 20 holes (WNDD series) for approximately 7,600m. A small program of
reverse circulation (RC) drilling was also completed to test for shallower up-dip
extensions to certain lenses. A total of 11 holes (WNRC series) for 1,146m were
completed.
The key intercepts for this round of drilling are shown in Table 9.2.
Table 9.2: Significant drill intercepts from 2014 to 2015 Heron drilling campaign.
Down Estimate
hole True
Hole No From (m) To (m) Lens Zn(%) Cu(%) Pb(%) Au(g/t) Ag(g/t)
Width Width
(m) (m)
WNDD0001 373.6 388.0 14.4 Kate 11.5 4.6 4.1 0.8 1.0 56.8
WNDD0002 368.0 370.3 2.3 Kate 1.9 12.0 0.6 5.4 1.3 116.0
WNDD0002 374.0 382.7 8.7 Kate 7.2 12.6 1.6 7.5 2.3 152.0
WNDD0006 626.1 631.8 5.7 I 4.5 13.3 0.7 5.4 1.2 25.9
WNDD0006 679.0 683.0 4.0 I 3.2 4.8 0.5 0.2 0.0 14.5
WNDD0006 699.4 707.4 8.0 D 6.5 3.0 2.3 3.1 2.6 68.8
WNDD0006 759.0 769.0 10.0 D 8.0 1.6 1.7 0.2 0.2 15.3
WNDD0007 414.3 426.6 12.3 Kate 9.8 20.0 2.1 6.1 0.8 52.9
WNDD0007 434.7 437.1 2.4 Kate 1.9 20.1 1.6 4.2 2.1 39.7
WNDD0008 434.0 439.4 5.4 Kate 4.3 11.1 1.6 0.8 0.6 11.4
WNDD0009 198.0 214.8 16.8 G 8.9 5.4 2.7 2.0 1.2 48.5
WNDD0009 308.7 316.8 8.1 Kate 6.5 7.2 1.1 2.3 0.9 28.0
WNDD0010 206.0 210.4 4.4 G 3.5 4.1 3.2 0.9 2.6 39.0
WNDD0010 353.0 354.0 1.0 Kate (Cu) 0.8 0.0 1.6 0.0 0.0 1.1
WNDD0010 360.0 361.1 1.1 Kate (Cu) 0.8 0.1 1.6 0.0 0.2 4.5
WNDD0010 365.0 366.0 1.0 Kate (Cu) 0.8 0.1 1.6 0.0 0.0 3.5
WNDD0011 348.2 354.1 5.9 Kate 4.7 6.3 3.2 1.7 1.3 73.5
WNDD0012 74.0 79.8 5.8 G 4.6 3.6 0.7 1.5 1.0 60.4
WNDD0012 135.1 139.3 4.2 E 3.4 14.8 2.2 6.2 0.7 37.2
WNDD0013 76.2 85.6 9.4 G 5.6 6.4 3.2 2.8 2.4 150.0
WNDD0014 61.2 63.3 2.1 G 1.7 3.1 6.5 1.3 1.2 146.0
WNDD0015 241.9 246.2 4.3 Lisa 3.4 17.7 1.6 5.0 1.1 28.0
WNDD0016 429.0 446.0 7.0 Kate (Cu) 13.6 0.1 1.8 0.0 0.1 2.9
WNDD0017 254.1 263.6 9.5 D 7.6 3.8 1.6 0.3 0.8 16.9
WNRC0010 37.0 45.0 8.0 G 6.4 3.6 1.3 2.6 1.0 65.4
Notes: True width is an estimate of the actual thickness of the intercept based on interpreted lens orientation (approximately
80% of down hole width); grades are weighted average grades, weighted by length of samples intervals down hole, which
are nominally 1 metre. No weighting was applied for differences in specific gravity.

The focus of the Heron drilling has been to delineate the Kate Lens and better
define the lenses in shallow positions, to provide drilling input into a revised Mineral
Resource estimate. Of the 20 diamond holes drilled in this first phase program,
some 14 intersected significant massive sulphide mineralisation, often in multiple
lenses. A brief description of each of the targets is provided below.
Kate Lens
Ten of the Heron diamond holes targeted the Kate Lens to follow-up the discovery
hole WLTD015, drilled by TriAusMin in 2013. The drill pattern was designed on
nominal 40m by 40m spacing and is shown in Figures 9.1 and 9.2, which also
show the modelled EM plate that proved to be a reliable guide to the zone of
massive sulphides. The highest grade mineralisation is towards the centre of the
lens (holes WLTD015 and WNDD0007) and becomes more copper dominated and
semi-massive towards the south in holes WNDD0010 and WNDD0016. To the
north the mineralisation becomes off-set and wrapped into the 790 fault system
(WNDD0011), and then weakens to a minor zone of sulphides in WNDD0018
where it is closed off.
While the Kate Lens has been closed in certain directions through the current
drilling, a number of positions still provide extensional possibilities. For example,
the position above and to the north of WNDD0009 where Drill-hole Electro-
magnetic (DHEM) survey modelling suggests further extensions, and in the area
below WNDD0007 and WNDD0016 where the lens is not closed off. There is
potential to find further extensions of the Kate Lens in the down plunge area to the
north where little drilling has been undertaken.
I Lens
Three diamond drill holes were drilled into the I Lens position (refer to Figure 9.3),
with WNDD0004 and WNDD0005 drilled in the up-dip position and WNDD0006
drilled in the down-plunge position. WNDD0004 and WNDD0005 intersected only
minor sulphides in the expected position of the lens, however from DHEM
modelling it appears the main lens passes between the two holes, which suggests
only a modest size potential. WNDD0006 intersected the down plunge position of
the lens.
G Lens
Five drill holes intersected the G Lens position; one RC hole (WNRC0010) and the
four diamond drill holes (WNDD00009, WNDD0010, WNDD0013 and WNDD0014),
as shown in Figure 9.4. The results confirmed the high-grade nature of the lens
and the intercept in WNDD009 has shown the potential for thicker zones of
mineralisation in what is thought to be a keel shaped structure towards the centre
of the lens.
Lisa Lens
Two diamond drill holes (WNDD0015 and WNDD0017) were drilled to test along
strike from two historical holes which recorded copper-rich intercepts in the
stratigraphic plane of the I Lens (Figure 9.3). The historical holes recorded:
 W089: 4.0m at 4.9% Zn, 2.8% Cu, 2.3% Pb, 0.8g/t Au and 25g/t Ag from
266m depth, and
 W145: 4.0m at 2.0% Cu from 234m depth.
Drill hole WNDD0015 intersected a zone of high-grade poly-metallic mineralisation
to the north of these historic results and indicated the potential for new lens in this
position.

Drill hole WNDD0017 was drilled in the up-plunge position of this intercept,
however the lens had apparently been intruded by a large volume of late stage
dolerite and no massive sulphides were intersected.
The Lisa Lens, while relatively narrow, represents the discovery of a new high-
grade lens and further drilling will be planned to delineate it. DHEM surveys of
WNDD0017 have shown the presence of a strong conductor down-plunge and
slightly to the north of this drill hole, and this provides an immediate target for
future drilling to extend and delineate the Lens.
D Lens
The D Lens was intersected in holes WNDD0006 and WNDD0017 in the down-
plunge position of the lens.
The D Lens was not a high priority for the Heron drilling program, however the
holes that did intersect it were in line with previous drilling indicating generally
broad zones of lower grade, and relatively more copper-rich material.
E Lens
Like the D Lens, the E Lens was not a high priority for the Phase 1 drill program,
however, a strong off-hole conductor modelled from WNRC0010 provided a robust
target that was tested by WNDD0012, which returned a high grade polymetallic
result.
This result allowed a more solid interpretation and connection of the E Lens up-dip,
providing greater certainty to the interpretation and additional mineralised tonnages
in this position.
A Lens
The up-dip A Lens was targeted by the early round of RC drilling (WNRC0001 to
WNRC0005), but failed to intersect any significant massive sulphide positions.
With the lack of DHEM targets from these holes, it would appear the lens is mostly
pinching out in the up-dip position. Drill holes WNDD0007 and WNDD0009 were
extended into the footwall of the Kate Lens into the potential down-plunge position
of the A Lens; however, no significant sulphides were intersected. A weak off-hole
EM response was returned from WNDD0009 and may be indicative of minor
massive sulphide lens in the down-plunge of the A Lens, but is not at this stage a
priority target.
Other Lenses
The B, C, F and H Lenses were not targeted as part of this program. All of these
lenses have good potential for down plunge extensions; however, the deeper
targets, particularly on the B Lens, were not considered a target in the current
round of drilling, with focus being on expanding the resource base in the top 500m
of the system.

Figure 9.1 Woodlawn Oblique Cross-Section looking north (top) and Figure 9.2
Woodlawn Long-section looking east in the plane of the Kate Lens (bottom).

Figure 9.3: Woodlawn lens plan view

Figure 9.4: G Lens long section looking east

9.4 Regional Exploration

The Woodlawn Project includes a 570km2 exploration portfolio, prospective for
high-grade VMS style mineralisation, similar to that found at Woodlawn. The key
prospects are described below, with their locations shown on Figure 9.5.
Figure 9.5: Woodlawn Prospects Location Plan
9.4.1 Currawang Prospect (100% Heron)
The Currawang East deposit, located some 10km north northwest of the Woodlawn
mine, was discovered directly to the east of the old Currawang copper mine. The
Currawang copper mine was first mined in the late 1800s and in 1973 Jododex
completed surface geochemical surveys. The deposit is made up of a discrete
“pod” of massive sulphides hosted within Currawang Basalt rocks (~80%) and
Woodlawn felsic volcanic rocks (20%) positioned some 100m below the surface. It
was accessed via a decline near the old Currawang workings and was mined
between 1991 and 1995 with some 553,000t being extracted at grades of
approximately 13% Zn, 2.2% Pb, 1.6% Cu and 33g/t Ag (Bouffler, 1998). The
extracted amount was roughly in line with original estimated mineable tonnage.

Further exploration for additional resources at Currawang and Currawang East is

currently being undertaken by Heron with the use of modern surface EM
techniques being employed to delineate drill targets. Given the high grade nature
of the historically mined ore and close proximity to Woodlawn, this area is a key
exploration target for the Woodlawn operation.
9.4.2 Cowley Hills Prospect (100% Heron)
The Cowley Hills deposit, located some two kilometres directly north of the
Woodlawn mine was discovered by Jododex through shallow geochemical drilling
in 1982. Like Currawang East, the mineralisation at Cowley Hills consists of a
discrete “pod” of massive sulphides hosted mostly within Woodlawn volcanic rocks,
but in close proximity to Currawang basalt units (basalt and dolerite). A small
mineable deposit was outlined with mining being undertaken between 1989 and
1991 via a short underground decline, although it is reported only some 25,000t
were extracted (Bouffler 1998).
Like Currawang East, the Cowley Hills prospect provides an immediate exploration
target in close proximity to the Woodlawn mine. Again modern EM surveys will be
employed to fast track drill hole targeting.
9.4.3 Hayshed Prospect (100% Heron)
The Hayshed Prospect is located some 4.5km southeast of Woodlawn on the

Pylara farming property. It is located on the 100% Heron owned EL7257, however,
a royalty is be payable to Variscan Mines Ltd on certain graticular blocks that make
up this tenement.
At the Hayshed Prospect a program of auger soil sampling was undertaken in the
second half of 2014 with some 350 samples collected. Assay results show a broad
zone of Cu / Pb / Zn / Au / As anomalism within which there is higher level core of
copper with results up to 203ppm. Within this zone, lead levels reported up to
358ppm, zinc up to 114ppm, gold up to 30ppb and arsenic (a base-metal
pathfinder element) up to 304ppm. These soil assay results are considered
significant given the depleted nature of the soils in the area and while not as large
as the Woodlawn footprint, the anomalism may be pointing towards a potential
zone of base-metal mineralisation.
9.4.4 Cullarin JV Project (78.9% Heron, GCR 21.1%)
The Cullarin JV Project (EL7954) is located 45km north of Woodlawn (Figure 4.1)
and covers the northern extent of the prospective Silurian felsic volcanic sequence.
Heron has earned a 78.9% interest in the project and Golden Cross Resources Ltd
(GCR) has 21.1% interest and is currently diluting its interest while Heron manages
and funds the exploration work.
The project area has demonstrated potential for VMS type deposits, intrusive
related porphyry deposits and associated skarns. Drilling by previous explorers
within the joint venture area has identified several high priority prospects where
potentially ore-grade intercepts have been reported. The tenement covers a 28km
long belt of well-mineralised north-south trending Silurian felsic sediments and
volcaniclastics fault bounded on the east by the Lake George Fault and the Cullarin
Fault on the west. EL7954 covers over 30 mineral occurrences that span an array
of mineral deposit styles, many of which were former producing mines. Prospects
include the Gurrundah barite (stratiform with VMS affinities) deposit, the Wet

Lagoon (South) gold deposit, a number of historical iron ore-copper mines

(magnetite-chalcopyrite skarns) such as the Breadalbane B2 Quarry and numerous
narrow, high-grade, shear-hosted copper mines that span a 3km section of the
Lake George Thrust. Mineralisation here consists of semi-massive chalcopyrite-
pyrite in strongly sheared metasediments.
An airborne EM survey was completed in the mid-2014 and while no high priority
targets were generated, a number of more subtle, lower priority targets are being
assessed.

10 Woodlawn Drilling
The Woodlawn deposit has, and continues to be, delineated and quantified through
drill hole information. This section describes the drilling that has been undertaken
to define the Woodlawn mineralisation, with particular focus on the more recent
drilling undertaken by Heron.
10.1 Historical Drilling

10.1.1 Timeline of Drilling
The following tabulation is of the drill holes at Woodlawn that are in or close to the
Woodlawn Underground Project area (refer Table 10.1). They include holes drilled
above, in, or through the open cut, but exclude holes drilled at the nearby satellite
Currawang and Cowley Hills deposits. Table 10.1 is approximately chronological,
and therefore commences with initial exploration drilling, proceeds through mine
operation (thus includes mine development drilling), and then covers the more
recent exploration drilling after the mine closed.
Table 10.1: Listing of drilling programs and drill hole numbers completed at
Woodlawn (recent drilling by Heron is included here for completeness).
Total Hole
Hole ID
metres Purpose Company Year Type
Woodlawn discovery
W001-W050
12,332 drilling Jododex 1969-71 DDH
W201-W286 11,655 Resource drilling Jododex 1971-72 DDH
Resource drilling
W051-W069
6,806 Underground potential Jododex 1971-79 DDH
Underground potential &
W070-089
10,632 Exploration Jododex 1980-81 DDH
W287-290 590 Resource drilling Jododex 1984 DDH
W090-W166 30,603 Woodlawn Underground AMS 1981-88 DDH
Woodlawn Underground
U001-U190
21,478 Feasibility AMS 1985-88 UDD
U194-U469 30,252 Woodlawn Underground Denehurst 1988-96 UDD
W167-W199 8,252 Woodlawn Underground Denehurst 1988-93 DDH
W300-314 4,264 Exploration Denehurst 1995-96 DDH
WLRC001-026 828 Exploration Tri Origin 2005 RC
WWTD001 232 Underground Hydrology Tri Origin 2007 DDH
Underground Met /
WLTD004-005
1,138 Geotech Tri Origin 2007-08 DDH
Underground Portal
EPBH001-005
222 Geotech Tri Origin 2007 DDH
Underground Decline
EDBH001-004
504 Geotech Tri Origin 2008 DDH
WLTD009-010 3,951 Exploration Tri Origin 2010 DDH
WLTD011-12 3,693 Exploration TriAusMin 2012 DDH
WLTD013-17 4,039 Exploration TriAusMin 2013 DDH
WNDD0001-0020 7,668 Resource / Met Heron 2014/201 DDH

Total Hole
Hole ID
metres Purpose Company Year Type
5
2014/201
WNGT0001-12
770 Geotech Heron 5 DDH
WNRC0001-11 1,147 Resource drilling Heron 2014 RC
10.2 Drilling Procedures 2014-15

10.2.1 Hole Planning, Site Preparation and Set-Up
Hole planning is undertaken by the Senior Geologists. The recent Heron program
has been designed to provide a reasonable coverage of specific lenses to provide
Inferred Mineral Resources for input into the PEA Study.
The holes are designed in standard 3D mining software. A handheld GPS is used
to site the collar positions and the collars are “picked up” by a licensed surveyor
after the holes had been completed.
The azimuth of the holes is determined by setting the rig up on magnetic
declination using a sighting compass. The sighting compass has an accuracy of
±1 degree. A north seeking gyroscopic tool was used to align the rigs in early part
of the program and had an accuracy of <0.05 degrees.
10.2.2 Down Hole Surveying
The holes are surveyed during drilling for dip and azimuth every 30m down hole
using a Pathfinder digital camera that records the dip and magnetic azimuth of the
hole. At the end of hole, an end of hole gyro survey was carried out using either:
1. a non-north seeking gyroscopic tool (IsGyro) operated inside the drill rods by
a suitably trained driller before moving the drill rig off the drill site; or
2. a north seeking gyroscopic tool (Keeper Gyro) operated inside 50mm PVC
casing inserted into the hole after removing the drill rods and drill rig from the
site, by a licenced operator (J. Buchannan from Gyro Australia Pty Ltd).
A comparison between the IsGyro down hole survey data to the Pathfinder survey
found predominately good correlation with minimum offset. Drill hole WNDD0007
was an exception, showing discrepancies between the two sets of data and a
decision was made to use Pathfinder results. A comparison between the Pathfinder
camera readings and the Keeper gyroscope readings showed very little to no
spatial offset of the drill hole trace. Figure 10.1 is an example of the correlation
between the two survey methods showing the spatial offset for drill hole
WNDD0018 (approximately 5m).

Figure 10.1: WNDD0018 comparison of Pathfinder vs Keeper Gyro down hole survey
readings
10.2.3 RC Logging Procedures
Each one metre sample is sieved and laid out in plastic chip-trays where they were
geologically logged on the drill site by the rig geologist. The geological logs were
entered directly into a spreadsheet at the drill site using Heron’s standard logging
template and codes.
10.2.4 Diamond Logging Procedures
All diamond core is stored in standard plastic core trays and the core trays are laid
out on trestles for logging by qualified geologist. The general logging procedure is
as follows:
 The core is laid out in core trays on trestles and marked up with metre marks
and core orientation line (indicating the bottom of the hole from the known
orientation marks) and wetted down to get an overview of the lithology,
alteration and major features. The key observed changes are marked with a
yellow chinagraph pencil and the depth recorded. Significant mineralisation is
marked with a red chinagraph. After all marking out is completed, starting
from the top of the hole, the geologist will record the lithology and defining
characteristics into a set of standard excel templates using a laptop computer.
 A handheld XRF Niton instrument is used to record titanium / zirconium ratios
and other elemental levels to assist the geologist with rock type identifications
(such as distinguishing siderite from low-iron sphalerite, tarnished pyrite from
chalcopyrite).
 Alteration, recorded separately to lithology, records the effect of hydrothermal
alteration on the primary lithology. The alteration minerals are recorded in
descending order of alteration intensity, for example, strong and pervasive
alteration listed before weak and patchy. A “whole of rock” alteration is also
recorded to provide an alteration grouping and an estimation of the overall
destruction of primary features.
 Sulphide minerals of hydrothermal origin are recorded with an estimate of
contained percentage over the whole logging interval. Generally only sulphide
bands greater than 5cm are recorded as a separate interval.
 Veins that are larger than 10cm or encompass a significant percentage over
an interval (i.e. 50% quartz-carbonate veins within a section of mafic intrusive)

are recorded as a lithology type. All veins greater than 2cm are recorded in
the veins worksheet;
 Point structures are recorded in a separate worksheet for geological features
that have a single point measurement, such as a foliation or geological
contact. Another worksheet, records geological features that extend over an
interval, such as a shear zone or fault gouge.
 A kinometer is used to measure the angle of a point structure to the core axis
and these measurements (alpha and beta angles) are recorded.
 All logging data is forwarded to Heron’s DBA on a daily basis for final
verification and then entry into the database.

11 Sample Preparation, Analyses and Security

The sample preparation, analyses and security arrangements can be divided into
two main sample types:
 RC and percussion samples; and
 Diamond Drilling.
Information for sampling procedures, analyses and security prior to 2000 is limited
to that contained in historical reports. As was typical at the time, QAQC and
sample security measures were limited to internal checks by the onsite laboratory.
These records have not yet been located. While it is not possible to directly
confirm the validity of individual historical samples and assays, the production
history indicates that the datasets were of sufficient accuracy to calculate
resources, reserves and concentrate production over the ten year life of the
underground mining operations.
The more recent work by TriAusMin and Heron is better documented, and follows
current industry standard best practice methods and procedures. Resampling
indicates that results from both companies work are robust and directly
comparable.
11.1 RC Drilling Sampling Methodology

Historic RC and Percussion Drilling Sampling (1969-2014):
Technical details of historical surface RC, surface percussion and underground
percussion drilling and sampling methods prior to Heron’s 2014 program have not
been located. The sample and assay data from these holes were not used in the
underground resource model for the PEA.
Heron RC Drilling Sampling (2014):
The Heron 2014 RC drilling (WNRC0001 to WNRC0011) was undertaken by a
Schramm T450WSI rig fitted with a 4.5 inch face sampling hammer. A booster and
auxiliary compressor was used to increase the volume and pressure of air. A three
tier riffled splitter was attached to the bottom of the cyclone. This riffle splitter is in-
line with “Jones Type” three tiered riffle splitter. Samples were collected in 1m
intervals by passing through the three tier riffle splitter to capture:
 a reject sample collected in green plastic bags;
 a 2-3kg split sample collected into pre-numbered calico bags and then placed
on top of the green bags for each interval; and
 1 in 30 Duplicate 2-3kg samples were taken at the time of splitting from a
secondary outlet built into the splitter unit.
Initially four metre composite samples were taken via a spear method from the
reject bags by a Heron sampler and submitted to ALS Laboratories, Orange (ALS
Orange) for multi element analysis. Where elevated results were received in the
composite, the 1m riffle split sample that was collected during drilling was retrieved
and submitted (along with relevant Quality Assurance / Quality Control (QAQC)
samples) to the laboratory.

11.2 Diamond Drilling Sampling Methodology

Historical Diamond Drilling Sampling (1969 to 1998):
All historical sampling for the underground project was carried out by previous
owners Jododex Australia Pty Ltd (Jododex), Australian Mining and Smelting Ltd
(AMS) and Denehurst Ltd (Denehurst).
The sampling by Jododex was recorded in a report by R.E. Cotton (1986). The
report indicated that half core samples of mineralised sections and up to three
metres of wall rock were typically taken from unrecorded (but thought to be
predominantly NQ) diameter core. The report also indicated that these samples
were prepared and assayed on site at the Denehurst analytical laboratory.
TriAusMin Diamond Drilling Sampling (2000 to 2013):
The sampling mainly included half NQ diameter core samples through the
mineralisation and into the hangingwall and footwall. The sampling technique for
WLTD0015 was quarter core of NQ diameter. The sample interval was nominally
one metre, with the sample terminated at geological contacts. There is no
historical documentation of sampling techniques employed for drill holes
WLTD009A, WLTD010 and WLTD010A.
Heron Diamond Drilling Sampling (2014 to 2015):
The Heron diamond core drilling was undertaken using a McCulloch DR800 rig.
HQ sized core was generally used down to between 80-200m before switching to
NQ size. The core was laid out in standard cores trays and transported to the core
shed at Woodlawn Mine Site. The diamond core was orientated and marked with
one metre down hole intervals by a field technician and checked by the responsible
geologist before sampling commenced.
The samples mainly comprised NQ sized quarter core (with a small proportion of
HQ sized quarter core) through the mineralisation and one metre into the
hangingwall and footwall. The sample interval was nominally one metre, with the
sample terminated at geological contacts.
An automatic core saw was used to cut the diamond core. For consistency, the
orientation line, sample marks and metre marks were placed on the left hand side
of the cut line, with the right-hand side of the core submitted for assaying. Care
was taken to ensure that core was loaded into the core saw in the same direction
as it was in the core trays, and not rotated during cutting. During quarter core
cutting, the right-hand side of the core was quarter cut. The sample was taken
from the right-hand side of the quarter cut core.
Once the core was cut the field technician ensured that the core was returned to
the tray aligned in the same direction that it was originally. Checks were
undertaken by pushing up against the previously cut section of core to ensure the
core breaks matched. Density tests were performed on each sample (see Section
11.6). They were then placed in green plastic bags, and then into ‘bulka’ bags
ready for submission to ALS Orange. The sample information template was
completed and submitted to Heron’s database administrator (DBA) for loading into
the Heronv3 database.
For mineralised zones, quarter core was dispatched for analysis, the half core was
stored in freezers at Woodlawn for metallurgical testing, and the remaining quarter
was retained as reference material in the core trays.

11.3 Assay Sample Preparation

Historical Assay Sample Preparation (1969 to 1998):
Assay sample preparation for Jododex, AMS (U001 to U190), and Denehurst
(U194 to U469 and W167 to W199) were conducted at the NATA registered
laboratory on site at Woodlawn. Cut diamond core was jaw crushed to less than
6mm then roll crushed to 1.5mm. A 150g subsample was obtained by the cone
and quarter method and then pulverised. A quartz flush was used between each
pulverised sample.
TriAusMin Limited Assay Sample Preparation (2000 to 2013):
The sample preparation for RC (WLRC001 to WLRC003) and diamond samples
(WLTD004, WLTD004B and WLTD005) is unknown. No source data could be
located for these drill holes.
Sample preparation of diamond core samples was conducted through ALS Orange
with certain final analysis of pulps being undertaken at the ALS Laboratory in
Brisbane, Queensland (ALS Brisbane). Core samples were crushed to 70%
passing -6mm. Samples were then pulverised to 85% passing 75 microns (m).
The pulverised samples were placed into 100g wire top Kraft packets with a
barcode identifying the sample ID, work order number and sequence number.
Heron Assay Sample Preparation (2014 to 2015):
Sample preparation and multi-element analysis of RC and diamond samples was
conducted through ALS Orange, with certain final analysis of pulps being
undertaken at ALS Brisbane.
The sample preparation protocol for ALS Orange undertaken on all diamond drill
core samples included:
 Samples were sorted, weighed and the infomation captured in the
Laboratory Information Management System (LIMS) as a work order.
 All samples were dried in the drying oven at 95 degrees Celsius for one to
two hours to remove any surface moisture. Samples that contained clay
took slightly longer to dry.
 The majority of the core samples were less than 3.2kg and did not require
splitting.
 Core samples were crushed to 70% passing -6mm.
 Samples were then pulverised to 85% passing 75m using Labtech ESSA
/ FLSmidth LM5 pulveriser. One in twenty samples pulverised were
checked for pulverisation quality by wet screening at 75m.
 Quartz flush (approximately 0.5kg of white, medium-grained sand)
samples were inserted at the start and end of a work order and processed
through the LM5 pulveriser. If sample submissions had samples listed as
massive sulphide the laboratory would insert three quartz flushes between
high grade massive sulphide samples to ensure the bowl was clean prior
to the next sample being processed. These flushes were bagged into
100g packets, with one in twenty samples assayed, or a minimum of one
flush assayed where the total batch size was less than 20 samples.
 The pulverised samples were placed into 100g wire top packets with a
barcode identifying the sample number, work order number and sequence
number.
 The remainder of the pulverised sample was stored as residue.
Sample preparation laboratory protocol was the same for RC samples with the only

differences being:
 RC samples did not need to be crushed because the particle size was
small enough to go through the pulveriser.
 RC sample drying time were generally longer (up to two to four hours).
 RC samples larger than 3.2kg were riffle split. The riffle splitter was a
stainless steel unit with riffles set to 50:50 left / right tray splitting. For
large work orders, a preparation duplicate was collected at frequency of 1
in 50 samples. The preparation duplicates were assigned a PREP DUP
suffix and assayed along with the original samples. These values were
reported on the final Certificate of Analysis (COA).
Heron senior geological staff conducted three site visits to ALS Orange during the
course of the 2014-2015 drilling to review laboratory procedures and report on
outcomes. These reviews resulted in minor refinements to sample preparation
procedures, mainly in dealing with very high grade samples. In one instance, the
first diamond hole WNDD0001, QAQC assessment required re-sampling of the
entire batch due to smearing detected during sample preparation. All subsequent
sample preparation employed additional quartz flushes to eliminate this issue.
11.4 Methodology of Sample Assay Analysis

Historical Sample Assay Analysis (1969 to 1998):
The documentation available to Heron indicates that the Jododex and AMS assay
analysis for drill holes W001-W166 and W201 to W290 included:
 Acid digestion of a pulversied aliquot and determination of copper, lead and
zinc by AAS.
 Compressing a pulverized aliquot into a button for XRD analysis for copper,
lead and zinc, as well as determining precious metals together with iron,
silicon, aluminum, magnesium and barium.
 Fire assay of any gold values that exceeded 2ppm.
AMS (U001 to U190) and Denehurst (U194 to U469 and W167-W199) sample
analysis was documented to have been conducted at the NATA registered
laboratory on site at Woodlawn. Samples were analysed by:
 Aqua regia hydrofluoric and perchloric acid digest with AAS or ICP
determination of Cu, Pb, Zn, Ag and Au.
 Gold assay reporting above 2ppm were reassayed by fire assay.
 For some samples, a second aliquot was analysed by pressed powder XRF
to determine Fe, Mg, Si, Al and Ba grades.
Open file reports indicate that W160 to W165 and W278 to W282 were analysed at
Classic Comlabs Limited and Geomin Laboratory respectively. These samples
have been analysed for Cu, Ag, Pb, Zn and Au with some samples analysed for
Ba, Al and Fe. Sample charges were subjected to an unknown digest with AAS
finish.

TriAusMin Limited Sample Assay Analysis (2000 to 2013):

The assay techniques used for the TriAusMin RC samples (WLRC001 -
WLRC003) and diamond samples (WLTD004, WLTD004B and WLTD005) are not
known. No source data could be located for these drill holes and data used was
that supplied in historical databases.
Assaying of diamond core samples from 2010 to 2013 was conducted through ALS
Orange, with some final analysis of pulps being undertaken at ALS Brisbane. For
the 2010 drilling, the following analysis was undertaken;
 Gold was determined at ALS Orange by 30g fire assay with AAS finish
analysis, with lower detection limits (LLD) ranging from 2 to 10ppb.
 Multi element assaying was conducted by ALS Brisbane using a 0.25g
sample with a four acid digest and ICPAES finish for analyses of Ag, Al, As,
Au, Ba, Be, Bi, Ca, Cd, Ce, Co, Cr, Cs, Cu, Fe, Ga, Ge, Hf, In, K, Li, La,
Mg, Mn, Mo, Na, Nb, Ni, P, Pb, S, Sb, Sc, Sn, Sr, Ta,Te, Th, Ti, Tl, U, V, W,
Y, Zn and Zr.
 If multi element assay results exceeded thresholds Ag (>=100ppm), Co
(>=10,000ppm), Cu (>=10,000ppm), Mo (>=10,000ppm), Ni
(>=10,000ppm), Pb (>=100ppm) and / or Zn (>=10,000ppm) then ore grade
four acid digest with ICPAES method analyses were run on the samples.
For the 2011 to 2013 drilling programs, the following analyses were undertaken by
ALS Brisbane:
 Multi element assaying was conducted on a 0.25g sample for aqua-regia
digest with ICPAES finish for Ag, Cu, Pb and Zn.
 If Ag (>=100ppm), Cu (>=10,000ppm), Pb (>=100ppm) and / or Zn
(>=10,000ppm) then ore grade aqua-regia digest with ICPAES method
analyses were run.
 In 2014, Heron retrieved from the laboratory 38 multi-element assay data
relating to drilling completed in 2012/13 by TriAusMin.
Heron Sample Assay Analysis (2014 to 2015):
Assaying was conducted through ALS Orange, with some final analysis of pulps
being undertaken at ALS Brisbane.
Assay analyses for diamond drill core and RC chip samples include:
 Au was determined at ALS Orange by 30g fire assay with an AAS finish
and a 1ppb LLD. If Au was greater than or equal to 100 ppm, the sample
was reassayed using a modified procedure (Au_Dil25), which entailed
diluting the solution prior to the AAS finish. This procedure has an upper
detection limit of 300ppm. No Au assay has exceeded the 300ppm
threshold to date at Woodlawn.
 ALS Orange sent pulps to ALS Brisbane for multi element and ore grade
analyses. This involved analysing a 0.25g sample taken from each pulp
for 33 element four acid digest with ICPAES finish. Analyses included Ag,
Al, As, Ba, Be, Bi, Ca, Cd, Co, Cr, Cu, Fe, Ga, K, La, Mg, Mn, Mo, Na, Ni,
P, Pb, S, Sb, Sc, Sn, Sr, Th, Tl, U, V, W, Y, Zn and Zr. If Ag (>=100ppm),
Co (>=10,000ppm), Cu (>=10,000ppm), Mo (>=10,000ppm), Ni
(>=10,000ppm), Pb (>=100ppm) and / or Zn (>=10,000ppm) then ore
grade four acid digest with ICPAES method analyses was run. Ore grade
method uses different calibration points on the ICP instrument to give a
more defined working range. Laboratory quality control standards (blanks,

reference standards and duplicates) were inserted at a rate of 5 per 35

samples during ICP work.
11.5 Assay Quality Control Measures

This section describes the QAQC procedures, data and assessment for the drill
hole assay data that form the basis for the Mineral Resources Estimation. QAQC
falls into two main categories; blind QAQC included with the samples submitted to
the laboratory by the mining company, and laboratory internal Quality Control (QC)
which is inserted by the laboratory for internal validation and reported with
individual assay batch results. QAQC material includes certified reference
standards (material of known grade and repeatability), blank material (material
containing very low or undetectable levels of the elements being assayed for) and
duplicates (a repeat sample of the material being submitted for assay, to examine
the repeatability of both the sampling and assay processes being employed).
Historical Diamond Drilling QAQC Methods (1969 to 1998):
At the time of the historical drilling and mining, blind QAQC samples were not
routinely included in sample submissions to the laboratory. No QAQC data have
been located for this period.
The NATA certified onsite laboratory carried out internal QC, which included the
insertion of certified reference standards and duplicates on a sample batch basis.
No historical hardcopy data could be sourced for validation of QC, although
resource reviews at the time indicate that internal QC was a routine part of the
laboratory assay process. Furthermore, the laboratory was required to perform
such analyses as part of its ongoing NATA accreditation. This included
independent QC testing by independent laboratories, as well as the onsite
laboratory being employed to provide umpire assays of other laboratories.
As an operating mine, the monthly mine to mill grade reconciliations provide a
qualitative QAQC regime for the historical samples. Namely the sample quality
was of sufficient accuracy to reliably predict the grade of material being produced
from the mine, process recoveries from the mill, and subsequent concentrate
production and sales.
TriAusMin Drilling QAQC Methods (1999 to 2013):
TriAusMin conducted routine QAQC insertion during their diamond drilling
programs. Drill programs before 2013 included alternate blank and certified
reference standards at the rate of 1 in 30 primary samples. In 2013, blanks were
inserted at the rate of 1 in 40 samples, and certified reference material at a nominal
rate of 1 in 20 samples. No blind duplicate sampling was completed on any of the
TriAusMin diamond drilling.
Heron Sampling RC Drilling QAQC Methods (2014 to 2015):
For RC drilling Heron routinely inserted blind QAQC into the RC sample stream.
QAQC consisted of alternating the following sample types:
 Blanks (white quartz sand) were inserted every 30 samples.
 Duplicate samples were taken from the riffle splitter at the same time as
the original sample. These were collected at the rate of 1 in 30 samples to
test the repeatability of the sample and assay methods.
 Certified reference standards were inserted at a rate of 1 in 30 samples.

The above scheme means that approximately 1 in 11 samples in the sample

stream is a blind QAQC sample.
Heron Diamond Drilling QAQC Methods (2014 to 2015):
QAQC for massive sulphide mineralised zones included:
 Blanks (white quartz sand) inserted every five samples (the blanks were
testing for potential contamination anywhere in the preceding five
samples). In high grade zones blanks were placed every three to five
samples after a high grade sample.
 High grade base metal and gold certified reference standards were
inserted in sample batches from high grade zone. At least one of each
was included in a 10m wide intersection. The standards were used to test
for the expected grades in each batch. This included at least one gold
standard 0.5g/t to 2g/t and one ore grade base metal standard for the
observed estimated mineralisation (copper standard for chalcopyrite rich,
a zinc standard for sphalerite rich and a lead standard for galena rich
sample). For example, an intersection with 14 high grade samples would
have two blanks, one base metal certified reference standard and one
gold certified reference standard.
 Massive sulphide samples were clearly labeled on sample submissions to
ensure that the correct laboratory preparation was undertaken.
For the lower grade zones, background and stringer type sampling half core was
submitted for analysis with two QAQC samples in every 20 samples. The blanks
were inserted where they would be better placed to test for contamination. If low
grades were expected, low grade certified reference standards were used.
ALS Laboratory QC Methods (2014 to 2015):
Routine QC procedures for sample preparation by ALS Orange laboratory varied
depending on analytical method and are summarised as follows:
 Method Au-AA25 (25g fire-assay gold technique with atomic absorption
spectrometry (AAS) finish), assays contained one blank, three pulp
duplicates (taken from the “master” pulp packet) and three certified
reference materials (CRMs) per fusion run of 84 crucibles.
 Method ME-ICP61 (multi element by 4 acid digest with ICPAES finish)
assays contained one blank, two pulp duplicates (again taken from the
same packet) and two CRMs per digest / analytical run of 40 test tubes.
 Method ME-OG62 (multi element ore grade by four acid digest with
ICPAES finish) assays contained one blank, two pulp duplicates and three
CRMs per digest/analytical run of 40 test tubes.
The instrumentation that was used to analyse samples (AAS for fire assay gold
and ICPAES for ME-ICP61and / or ME-OG62) also inserted calibration and QC
checks into the analytical sequence.
11.5.1 Blank Material Results for TriAusMin and Heron Samples
Blank material used for the TriAusMin programe consisted of builders’ cement
aggregate pre-mix (BLANK_AGG). The majority of the cement aggregate blank
samples assayed during the drilling campaign reported within acceptable limits.
Blank material used during the Heron QAQC procedure consisted of Sydney sands
(BLANK_SS). A total of 60 blank standards were submitted during the Heron 2014

to 2015 drilling program. The majority of the blank control standards assayed
during the drilling campaign reported within acceptable limits.
The first batch of Heron samples, relating to hole number WNDD0001, was re-
sampled and re-analysed as a result of contamination evident in the blind blanks
included with the mineralised samples (third sample in graph). A total of 17 blank
aggregate samples were submitted to the laboratory during TriAusMin drilling
program in 2013. Similar issues were identified with the TriAusMin QAQC blank
aggregate and a re-assay program was undertaken.
Figures 11.1 to 11.5 show the results for the Heron blank material for Zn, Cu, Pb,
Au, and Ag. The high levels displayed for the third sample are related to the issue
in WNDD0001. As can be seen from the plots this issue was largely controlled in
subsequent batches through the insertion of quartz flushes (not used in the first
batch) after massive sulphide samples. Weakly anomalous Au values for blanks in
fire assayed Au analysis are related to laboratory precision for the chosen assay
method. Heron specified a “mine grade” fire assay method to be used for all
samples, rather than a low level geochemical assay typical in greenfields
exploration projects.
Figure 11.1: Control standard plot BLANK_SS Zn Analysis
Figure 11.2: Control standard plot BLANK_SS Cu Analysis

Figure 11.3: Control standard plot BLANK_SS Pb Analysis
Figure 11.4: Control standard plot BLANK_SS Au Analysis
Figure 11.5: Control standard plot BLANK_SS Ag Analysis

11.5.2 Reference Standard Sample Results
A total of 178 certified reference standards were submitted to the laboratory.

Table 11.1: Summary of Standards used in QAQC Programs
Standard Standard Outside

Year Standard
Standard ID Company Submitted Results Acceptable
Sampled Description
Total Returned Limit
GEOSTAT high grade
BMH TriAusMin 2010 3 2 1 Zn / Cu / Pb
GBM305-12 TriAusMin 2013 5 5 0 GEOSTAT Zn /Pb ore
OREAS high Grade
OREAS95 TriAusMin 2012 5 5 0 Cu sample
2012 to OREAS Zn/Pb/Ag
OREAS131-A TriAusMin 2013 8 8 7 sulphide ore
OREAS132b TriAusMin 2012 6 6 4 OREAS high Pb/Zn
OREAS133b TriAusMin 2012 6 6 6 OREAS high Pb/Zn
OREAS high Grade
OREAS97 TriAusMin 2012 9 9 2 Copper
GEOSTAT
GBM398- Zn/Cu/Pb/Ag massive
1_Heron TriAusMin 2013 6 6 2 sulphide ore
GEOSTAT gold low
G307-3 HERON 2014 1 1 0 grade
GEOSTAT gold high
G312-4 HERON 2014 1 1 0 grade
GEOSTAT gold high
G901-7 HERON 2014 8 6 0 grade
GEOSTAT gold low

G908-2 HERON 2014 7 7 1 grade
GEOSTAT
Zn/Cu/Pb/Ag massive
GBM309-15 HERON 2014 9 9 0 sulphide ore
GEOSTAT zinc
GEOSTAT Cu/Zn
GEOSTAT
Zn/Cu/Pb/Ag massive
GEOSTAT
Zn/Cu/Pb/Ag sulphide
GBM911-11 HERON 2014 12 12 0 ore
Total 183 178 34
The accepted threshold set for the project was ±2 Standard Deviations from the
mean. Results for standards submitted by Heron were generally within acceptable
ranges. The highest discrepancy for copper being -1.97% and gold -5.26% outside
the two standard deviation range. Figures 11.6 to Figure 11.14 are examples of
standard results for 2014 to 2015 drilling campaign.

Figure 11.6: Control standard plot GBM309-15 Zn Analysis
Figure 11.7: Control standard plot GBM309-15 Cu Analysis
Figure 11.8: Control standard plot GBM309-15 Pb Analysis

Figure 11.9: Control standard plot GBM309-15 Ag Analysis
Figure 11.10: Control standard plot GBM911-11 Zn Analysis
Figure 11.11: Control standard plot GBM911-11 Cu Analysis

Figure 11.12: Control standard plot GBM911-11 Pb Analysis
Figure 11.13: Control standard plot GBM911-11 Ag Analysis
Figure 11.14: Control standard plot G901-7 Au Analysis

11.5.3 Duplicate Sample Results
Re-Assay Program 2014

Heron undertook a re-sampling program in 2014 to test the precision of the assay
results from the TriAusMin data. A total of 59 field duplicates were submitted.
Results showed an overall good correlation between the original TriAusMin results
and the later Heron duplicate assays for two sets of data, particularly for Zn, Cu,
Pb and Ag. Gold above 1.5g/t showed a slightly poorer correlation, which may
relate to the different sample sizes (the original being half core and the duplicate
being quarter core). The following correlation shows these findings:
Figure 11.15: Correlation Plot for Zn TriAusMin (Original) vs Heron (Duplicate)

Analysis
Figure 11.16: Correlation Plot for Cu TriAusMin (Original) vs Heron (Duplicate)

Analysis

Figure 11.17: Correlation Plot for Pb TriAusMin (Original) vs Heron (Duplicate)

Analysis
Figure 11.18: Correlation Plot for Au TriAusMin (Original) vs Heron (Duplicate)

Analysis

Figure 11.19: Correlation Plot for Ag TriAusMin (Original) vs Heron (Duplicate)

Analysis
Laboratory Duplicate Checks

Routine laboratory duplicate checks are taken from the ‘master’ pulp packet, and
checks per batch vary depending on analytical method, as discussed in sample
methodology section. ALS Orange completed a total of 323 pulp duplicate checks
during the TriAusMin and Heron drilling programs. There was an overall good
correlation between the original results and duplicate check assays. This is shown
in the following correlation plots for the significant elements:
Figure 11.20: Correlation Plot for Zn Original vs Lab Duplicate Check Analysis

Figure 11.21: Correlation Plot for Cu Original vs Lab Duplicate Check Analysis
Figure 11.22: Correlation Plot for Pb Original vs Lab Duplicate Check Analysis

Figure 11.23: Correlation Plot for Ag Original vs Lab Duplicate Check Analysis
Field Duplicates
A total of 16 core field duplicate and 12 RC field duplicate samples were submitted
to the laboratory during the TriAusMin 2013 diamond drilling program and Heron
2014 RC program. A comparison of the RC field duplicates to original assay
results showed good repeatability for levels below 0.3% Zn. However, for the
higher levels, repeatability is considered to be poor for two of the three samples
recorded (Figure 11.24). Due to the limited number of samples involved it is not
possible to identify the source of the poor repeatability. As RC samples from these
programs currently make up substantially less than 1% of the assays used in the
resource model there is limited risk of any adverse effects in the resource estimate.
If further RC drilling is planned a more detailed duplicate program will be
developed.
Figure 11.24: Correlation Plot for Zn Original vs Field Duplicate Analysis

11.6 Density Determinations

Heron routinely conducted density determinations on samples before they were
dispatched to the laboratory for analysis. The water immersion / density
determination method was used to collect data. This involved using a 9kg scientific
electronic scales, balance stand, sieves, water container for submerged weights,
suspension basket for submerged weights and a stable work bench. The density
determination procedure used was:
 Scales were cleaned, leveled, and tared before weighing.
 Scales were calibrated using a known reference mass for both dry and wet
weights and density.
 After each measurement the scales were re-zeroed and checked with a
known reference mass.
 The calico sample bag of half core or quarter core (fragments larger than
20mm) was emptied into a sieve basket and placed on top of the scales.
The dry weight was recorded on the sample information sheet.
 The core was then placed in the basket suspended beneath the scales
making sure that the sample was completely covered with water. The
submerged weight was recorded on the sample information sheet.
 The core was replaced back in its calico sample bag and bagged ready for
dispatch.
 Any relevant comments were written in the ‘Comments’ section of the
sample information sheet. This was most important if the density was likely
to be higher or lower than normally anticipated for the rock type (e.g.
“numerous cavities” or “high sulphide content”).
 The wet and dry data was electronically entered into the correct columns in
the sample information template. The spreadsheet has a calculated
density field to determine the specific gravity for respective intervals. The
formula used was Density = dry weight kg / (dry weight kg – wet weight kg).
If the density was outside the set error limits then the calculation result was
highlighted in red. Any densities outside the error limits were re-tested.
 The sample information template was saved as ‘HoleID_CoreSampling’
and electronically forwarded to DBA for import into Heron database.

12 Data Management and Verification

12.1 Historical Data Sources
The historical drilling databases included the Techbase Woodlawn Mine database
and TriAusMin compiled Access (WDL Drill), Micromine, and Excel format
databases.
The Techbase Woodlawn Mine database contained the diamond drill hole data
from:
 Jododex (W001 to W089 and W201 to W290);
 AMS (W090 to W166 and U001 to U190); and
 Denehurst (U194 to U469 and W167 to W199).
The TriAusMin databases contained diamond and RC drill hole data from:
 Jododex (W001 to W089 and W201 to W290);
 AMS (W090 to W166 and U001 to U190);
 Denehurst (U194 to U469 and W167 to W199); and
 TriOrigin (WLRC001 to WLRC003, WWTD001, WLTD004 to WLTD005 and
WLTD009 to WLTD010).
The historical databases contained drill hole collar, down hole survey, geology and
assay data. There was good overall agreement between the databases, providing
some confidence in data integrity.
Three versions of database coding were used in the historical databases of the
Woodlawn Project. These were:
 Woodlog (1981 to 1989);
 DataCol (1990 to close of mine); and
 TriAusMin (2000 to 2013)
Lithology codes, alteration, minerals, mineralisation, veins and structural logging
have been converted to Heron library codes. The historical lithcode (1-4) were
retained in the Heronv3 database lithology table for future reference. The
development of the Heron lithology codes and the conversion of historical codes
between data sources is ongoing.
12.1.1 Historical Drilling Validation
Historical Data Validation (1969 to 1998):

The Jododex, AMS and Denehurst drill hole data loaded into the Heronv3
database were validated using original source data stored on site where possible.
The daily drill and survey sheets were used to validate drill hole grid coordinate
systems, collar coordinates, drilling meta-data, and down hole survey data.
Original drillhole logs were used to validate collar coordinates, lithology, and hole
depths. This work was completed for diamond drill holes W001 to W166, W201 to
W290 and U001 to 469. During this process, missing geology data was compiled
and imported into the Heronv3 database.
No hard copy laboratory files from the onsite NATA registered laboratory have
been located, so assay validation from source files for this data has not been
possible. Further research is being undertaken to locate the original assay files.

TriAusMin Limited Data Validation (2000 to 2013):

Validation of the TriAusMin diamond drill holes (WLTD013 to WLTD17W1)
included check to ensure that all data reported in WDL Drill, Micromine and Excel
database were captured in the Heronv3 database.
All collar pickups except for WLTD0010 were completed by a registered surveyor,
and were checked against the database. Down hole survey data were
crosschecked against drill plods that documented the electronic multi-shot
measurements. 10% assay validation was completed by checking data in the
Heronv3 database against certified laboratory reports supplied by ALS Orange.
Heron undertook a re-sampling program in 2014 to test the reliability of the assay
results from the TriAusMin assay data. Results showed an overall good correlation
between the original TriAusMin results and later Heron assays.
Adjustment for Changes in Magnetic Declination for Historic Data
Once validation was complete for both sets of data, an azimuth magnetic
declination transformation, using yearly magnetic declinations from Woodlawn
Project area dating back to 1960, was undertaken on all data (principally down
hole surveys).
The pre-1985 magnetic declination calculations were sourced from:
http://www.ngdc.noaa.gov/geomag-web/ (the National Geophysical Data
Centre in the USA), using the International Geomagnetic Reference Field
(IGRF) Model (see below).
The more locally accurate Australian Geomagnetic Reference Field values became
available in 1985. The 1985 and later calculations were made using the
Geoscience Australia government website:
http://www.ga.gov.au/oracle/geomag/agrfform.jsp.
The current grid conventions used at site and in the database are described in
section 4.4. The transformations were undertaken in Excel and imported into the
Heronv3 database down hole survey table.
12.2 Data Management

The Heron exploration database (Heronv3) is maintained using DataShed version
4.4.5, which is a Relational Database Management System. The Heron DataShed
database runs on Microsoft SQL Server 2012 Standard edition (Service Pack 2),
which is installed on a dedicated computer server located in Heron’s West Perth
Office. The database is maintained and updated by the Database Administrator
(DBA). Stand-alone DataShed licenses have been installed on individual desktop
computers allowing the DBA to undertake daily data management and database
development. Access to the SQL server is limited to SQL Administrators only who
remotely connect to the SQL Server to undertake database maintenance and table
structure development.
The logging geologists use a “tough book” laptop computers in the field to capture
data directly into customized templates. This includes collar, survey, drilling, meta-
data and logging information. The templates have been designed to validate data
at point of capture, and have library drop down boxes such that only pre-defined
codes can be recorded.

On a regular basis, the logging geologist provides the DBA with completed field
data capture templates which are then imported into the Heronv3 database.
Collar survey pickups and down hole survey pickups are electronically supplied by
survey contractors in text file format. The files are imported into the Heronv3
database by the DBA.
Sample Information, including QAQC and density data, are captured in Excel
templates by field technicians. The Sample Submissions are electronically
completed by the field technician and checked by the Senior Geologist. The
Sample Submission is sent to the respective laboratories in both electronic and
hard copy form with the dispatched samples. Completed sample information and
sample submission files are electronically sent to the DBA to import into the
Heronv3 database.
Assay laboratory files are electronically supplied directly to the DBA and Project
Geologists in sif and text file format. For each laboratory a data entry import object
has been designed to capture all assay data information specific to that
laboratory’s format. The sif file format is used to import assay data into Heronv3
database by the DBA. During import, a QAQC summary report is generated and
forwarded to the Project Geologist who will decide whether to accept or reject the
file. On acceptance of the file, the data are used populate the batch, assay and
QAQC tables in the database.
The drill hole plod information is manually entered daily into the Heronv3 database.
The drill hole plods are electronically scanned and saved to the Perth server for
future reference.
Core tray and field photos are provided to the DBA electronically and saved to the
Perth Heron server for future reference.
12.3 Summary of QAQC Results

The drill hole assays pre 1999 have no known QAQC data. As an operating mine,
the monthly mine to mill grade reconciliations provide a qualitative QAQC regime
for the historical samples. Namely the sample quality was of sufficient accuracy to
reliably predict the grade of material being produced from the mine, process
recoveries from the mill and subsequent concentrate production and sales.
The majority of the Blanks assayed during the Heron drilling campaigns reported
within acceptable limits. Quartz wash samples were inserted between sulphide
samples during sample preparation stage significantly reducing contamination at
laboratory sample preparation stage. The TriAusMin blanks showed potential
contamination at sample preparation stage with some results showing
discrepancies.
A re-assay campaign was undertaken to check the repeatability of the TriAusMin
2013 drilling campaign. Results showed an overall good correlation between the
original TriAusMin results and the later Heron duplicate assays for two sets of data
in particular for Zn, Cu, Pb and Ag with gold showing a slightly poorer correlation at
levels above 1.5g/t.
Heron standards were predominately within the accepted threshold set for the
project of ±2 Standard Deviations from the mean, with the highest discrepancy for
copper being -1.97% and gold -5.26% outside the two standard deviation variance.
Routine laboratory duplicate checks per batch vary depending on analytical
method as discussed in sample methodology section. Checks by ALS Orange

showed an overall good correlation between the original results and duplicate
check assays.
12.4 Independent Qualified Person Review and Verification

SRK has been given full access to the datasets and supporting information
compiled by Heron for the preparation of the resource estimation. Validation
conducted by SRK included checks against the original data sources where
available, a review of the available QAQC data for the various programs, a
comparison of the data from the recent and historical programs, checks for
consistency between data sources, and an examination of retained core samples
for selected mineralized intervals.
The validation has been somewhat constrained by the lack of detailed
documentation and QAQC information for some of the earlier programs. However,
given the work was performed by an accredited laboratory, with regular checking
with external laboratories, and with production and shipping records, SRK
considers the likelihood that significant quality issues would go undetected to be
low. SRK concludes that the datasets are sufficiently reliable for resource
estimation.
12.5 SRK Site Visit

Rod Brown (SRK) conducted a site visit in March 2015 to inspect the project site,
examine the geology, inspect core samples, and to discuss aspects of the data
acquisition and deposit geology with site personnel. The geological setting and
controls on mineralisation observed in the exposures (pit walls) and core samples
are considered to be consistent with the geological understanding that has been
used for the preparation of the geological model. There were no drill rigs operating
at the time of the site visit. However, an inspection of the core storage facilities
indicated both the historical and recent core to be of an acceptable quality, and
suitable for the preparation of resource estimates.

13 Mineral Processing and Metallurgical Testing

13.1 Introduction
The Woodlawn concentrator operated from 1978 to 1992. Initially ore was mined
by open cut and crushed through a gyratory and cone crushing circuit.
Subsequently ROM underground ore was crushed to minus 11mm in a circuit
comprising the primary gyratory crusher, a standard secondary crusher and two
short-head tertiary crushers. The fine ore was ground to a nominal P80 of 67µm in
a rod mill / ball mill circuit ahead of sequential flotation of a discard talc
concentrate, and separate copper, lead and zinc concentrates.
Extensive testwork was conducted on the retreatment of tailings from previous
operations leading to a Front End Engineering Design study (FEED) in 2012 (Sara,
2012).
Since then testwork has concentrated on fresh drill core composites of
underground Cu-Pb-Zn mineralisation, copper mineralisation and blends of these
composites with the tailings from previous production. With 11.2 million tonnes of
tailings available for retreatment the new plant feed rate has been set at 1.5 Mtpa.
0.75Mtpa fresh underground mineralisation and 0.75Mtpa of tailings from previous
operations. As described below the process flowsheet is similar to the original
flowsheet, though with some notable improvements – fine grinding technology
using inert media, and tank cells in flotation.
Based on the underground mine design work undertaken to date, future work may
vary the target proportion of underground to tailings plant feed to approximately
0.5Mtpa and 1.0Mtpa respectively. Whilst this may result in opportunities for
capital cost savings and will certainly impact on the design of the future
metallurgical test program, there is no expectation that this will fundamentally
impact on the plant operation.
The fresh underground plant feed and reclaimed tailings will be ground separately
but floated together in a common flotation circuit to sequentially produce a talc
concentrate for discard and separate sales grade copper, lead and zinc
concentrates. Tailings from flotation will be used as paste fill for underground
operations.

13.2 Testwork Program to 2012 and Woodlawn Retreatment Project

Front End Engineering Study
GR Engineering Services issued a detailed Front End Engineering Design Study
(FEED) to TriAusMin in March 2012 (Sara, 2012). The study was for the design
and construction of an integrated processing facility at the Woodlawn Tailings
Retreatment Project (WRP). The design was for the retreatment of 1.5 Mtpa of
existing Woodlawn tailings for the recovery of zinc, copper, lead, silver and gold
from the three tailings dams at the site. The FEED study undertook a detailed
review of past metallurgical testwork on samples from all three dams, as well as
the supervision of confirmation comminution, flotation, thickening and filtration
testwork on fresh samples from Tailings Dam South (TDS), the first dam to be
retreated.
Prior to the FEED Study, metallurgical testwork dates back to January 2006 when
Optimet Laboratories in Adelaide began work on the flotation of samples from all
three tailings dams. AMMTEC Ltd undertook further comminution and flotation
work in Perth from 2007, with further detailed work being undertaken at Optimet
and Metcon Laboratories during 2011.
More than a hundred flotation tests have been conducted on various variability
samples from all three tailings dams. Work has included mineralogy and has
sampled size distributions, bulk metal flotation and sequential flotation.
Throughout these work programs the preferred flowsheet invariably mirrored a very
similar flowsheet to that which was optimised during the original Woodlawn
operations. This circuit comprises a talc pre-float followed by sequential flotation of
separate copper, lead and zinc concentrates, and includes appropriate regrinding
and cleaner flotation. Emphasis has been placed on the effect of grind size and
reagents on optimising flotation results. At various times the testwork was co-
ordinated by Intermet (now Sedgman Limited), R W Nice, R D Elvish and GR
Engineering Services.
The best flotation conditions were optimised in locked cycle tests conducted by
Optimet Laboratories. The benefits of fine grinding machines using inert media,
which were not commercially available during the original Woodlawn plant
operation, have now been incorporated into the WRP flowsheet.
The process flowsheet developed for the FEED study is shown in Figure 13.1 and
will be used to process tailings at 1.5Mtpa. It incorporates grinding, sequential
flotation with regrinding and concentrate cleaning, thickening and filtration, and will
produce marketable zinc, copper and lead concentrates for transport to the east
coast for shipment to smelters.
This flowsheet will be employed until fresh feed from underground is accessed for
co-treatment with the reclaimed tailings feed under the slightly modified flowsheet
described in Section 17.3.
The FEED scope of work also included the design and construction of all
infrastructure and support facilities required by the operation.

Figure 13.1: FEED Study – Plant Flowsheet

13.3 2014 Testwork Program on Woodlawn Underground Project

13.3.1 Samples
Composites were prepared from underground core drilling to represent the two
main mineralised types (zinc-copper mineralisation with high precious metals and
copper rich mineralisation). These have been tested individually as well as in
50:50 blends with the tailings composite from TDS used the 2011-12 testwork.
The tailings composite had been in frozen storage since that work to minimise
potential oxidisation. Similarly, drill core was frozen as soon as practical after
logging and sawing. Half NQ core was used for the metallurgy testwork. In limited
cases, quarter core has been used where a second quarter of the drill core was
required for resources estimation QA/QC. Variability testing was also conducted
on separate drill hole intersection composites to ensure the developed flowsheet is
appropriate to process feed from different lenses and areas.
The head grades of the three main composites used in this testwork are set out in
Table 13.1.
Table 13.1: Summary of main testwork composites
%Cu %Pb %Zn g/tAg
Zinc-Copper
1.6 4.8 9.9 101
Mineralisation
Copper Rich
3.0 0.2 1.3 24
Mineralisation
Reclaimed
0.4 1.1 2.3 27
Tailings
Note: Zinc-Copper Mineralisation equates to Polymetallic Mineralisation

13.3.2 Results
Results from the metallurgical tests were published in a Heron ASX announcement
on 11 February 2015 and are summarised in Table 13.2, Table 13.3, and Table
13.4.
Table 13.2: Preliminary flotation results for the zinc-copper mineralisation sample
(bracketed numbers represent typical recoveries achieved during previous
operations at Woodlawn, c. 1992).
Assays % Recoveries
%
Weight g/t
% Cu % Pb % Zn g/t Ag Cu Pb Zn Ag Au
Au
Copper 4.4 25.4 5.5 2.1 227 5.8 70.8 5.0 0.9 9.9 13
Concentrate
(5.4) (22.0) (4.1) (4.9) (260) (68.0) (5.5) (2.6) (16.3)
Lead 6.5 2.3 53.2 6.0 813 14.1 9.2 71.1 3.9 51.8 46
Concentrate
(5.9) (1.0) (36.9) (19.7) (387) (3.4) (53.5) (11.7) (26.8)
Zinc 14.2 0.5 2.8 45.0 99 0.8 4.4 8.1 79.5 13.9 6
Concentrate
(14.3) (0.5) (1.9) (50.8) (80) (4.2) (6.6) (73.0) (13.4)
Head Grade 1.6 4.8 9.9 101 2

100
(1.8) (4.1) (9.0) (86)
Table 13.3: Preliminary flotation results for copper only mineralisation
%
Assays % Recoveries
Weight
% Cu % Pb % Zn g/t Ag Cu Pb Zn Ag
Rougher
12.4 19.8 0.7 1.2 71 81.7 43.5 12.1 26.5
Concentrate
Cu
9.8 24.0 0.7 1.1 69 71.8 34.1 8.5 28.2
Concentrate
Head Grade 100 3.00 0.19 1.26 24

Table 13.4: Preliminary flotation result for combined zinc-copper and tailings blend
Assays % Recoveries
%
Weight
% Cu % Pb % Zn g/t Ag g/t Au Cu Pb Zn Ag Au
Cu
2.9 23.6 3.7 1.6 180 3.4 66.1 3.6 0.7 7.6 10
Concentrate
Pb predicted
4.3 3.9 49.0 7.1 878 9.4 16.0 69.0 4.4 54.1 43
Concentrate
Zn predicted
10.4 0.5 1.5 45.0 99 0.7 5.4 5.3 73.9 15.2 7
Concentrate
Head Grade 100 1.0 3.0 6.9 68 1.0
The PEA design criteria has been based on the results set out in Table 13.4
above, taking into account that the circuit is adaptable to the processing of
reclaimed tailings only until production of feed from underground is achieved. The
required circuit changes will be achieved by the re-routing of piping.
Tailings only results generated in the FEED study are set out in Table 13.5.
Table 13.5: Flotation result for tailings
Assays % Recoveries
%
Weight
% Cu % Pb % Zn g/t Ag Cu Pb Zn Ag
Cu 0.7 22.0 5.1 3.6 150 32 2.9 1.1 3.3

Concentrate
Pb predicted 1.3 9 36 9 600 23.4 36 5.1 23.6

Concentrate
Zn predicted 3.5 1 2.8 46 115 7 7.5 70.0 12.2

Concentrate
Head Grade 100 0.5 1.3 2.3 33
13.3.3 Comminution
Comminution is used generally for the liberation of particular minerals from each
other and from gangue. During the 2014 testwork program it was confirmed that
some of the Woodlawn minerals had significantly higher flotation kinetics than
others. Supported by mineralogy this led to a change in comminution approach. A
relatively coarse grind ahead of the talc and copper rougher flotation enabled the
fast floating copper minerals to be recovered into a copper concentrate with little
gangue or other valuable minerals except those locked in composite particles.
Regrinding of the copper rougher concentrate to liberate the non-copper composite
particles resulted in higher grade copper concentrate at improved recoveries. This

change in comminution strategy was carried forward to the lead circuit where using
a similar approach increased lead concentrate grades significantly.
Similarly the talc cleaner concentrate tailing was shown to contain little copper
mineralisation allowing the talc cleaner tailings to go straight to the lead circuit.
The blending of reclaimed former tailings still applied the FEED study comminution
of regrinding this material (that was devoid of the fast floating mineralisation sent to
concentrates in previous operations) to 80% passing 30µm. Products from the two
separate grinding stages were blended ahead of flotation.
The plant design will therefore incorporate feeding crushed ROM material to a ball
mill grinding circuit operating in closed circuit with hydrocyclones to produce a
fresh underground feed sizing to flotation of P80 75µm.
Conventional Bond work indices and abrasion indices on the testwork composites
confirm the underground plant feed material to be relatively soft as shown in Table
13.6.
Table 13.6: Summary of comminution testwork
Tailings from the original Tailings Storage Facilities will be reclaimed by hydraulic
mining to a thickener. Thickened tailings will feed an IsaMill where they will be
ground to a P80 30µm and combined with the fresh ground underground material to
feed the flotation circuit.
13.3.4 Flotation Tests
Flotation testing has been conducted at Australian Minmet Metallurgical

Laboratories Pty. Ltd. (AMML). The samples used are described in Section 13.3.1
above.
Concentrate grade – recovery results are shown in Figure 13.2, Figure 13.3 and
Figure 13.4.

Figure 13.2: Copper Grade-Recovery Curve
Figure 13.3: Lead Grade-Recovery Curve
Figure 13.4: Zinc Grade-Recovery Curve

13.3.5 Talc Flotation Circuit
As in the previous Woodlawn operation, gangue from the combined ground feed
will be floated in a rougher and cleaner “talc” circuit to produce a “talc concentrate”
that will be discarded straight to final tailings. This represents about 4% of the feed
mass with a minimal loss of valuable metals. Tailings from the talc cleaner flotation
will be depleted of copper and so may go straight to the lead circuit. Talc rougher
tailings contain the bulk of the valuable metals and will feed the copper flotation
circuit.
13.3.6 Copper Flotation Circuit
Copper is present primarily as chalcopyrite. Testwork indicates that the

chalcopyrite from the underground feed is liberated at a coarser size compared to
the other minerals and that fast floating copper will be recovered from a feed grind
size of P80 75µm. Reclaimed former tailings will be separately ground to P80 30µm
and combined with the underground feed. Rougher concentrates will be reground
ahead of the cleaners to produce a relatively clean copper concentrate at around
22% to 25% Cu, with a silver grade of 150g/t to 180g/t Ag. Pyrite was the main
diluent in the copper concentrate.
13.3.7 Fine Grinding
Tailings from the copper flotation will be reground in an IsaMill M5000 to a P80 of
30µm and fed to the lead flotation circuit.
13.3.8 Lead Flotation Circuit
A conventional lead rougher, cleaner and recleaner lead circuit will float the lead,
along with the bulk of the silver into a high precious metals lead concentrate. A
feature of this circuit is the bleeding of the lead cleaner tailings to the zinc
retreatment circuit when processing the reclaimed tailing. Zinc will be depressed in
the lead circuit and report to the zinc rougher flotation.
13.3.9 Zinc Flotation Circuit
Zinc will be concentrated in a flotation circuit comprising rougher flotation with two
stages of cleaning. The rougher – scavenger concentrates will be reground to a
P80 of 15µm prior to cleaning. The zinc second cleaner concentrate will report as
the final zinc concentrate.

13.3.10 Concentrate Production
The overall production of concentrates is anticipated to be as outlined in Table 13.7

and Table 13.8. Expected concentrate production for each stream is based on the
PEA economic model described in Section 22.
Table 13.7: Expected concentrate grades from mixed underground feed and
reclaimed tailing (based on 1.5Mtpa treatment, life of mine average)
Cu Pb Zn Ag Au
% % % gpt gpt
Cu Concentrate 23.5 3.5 2.0 116 1.39
Pb Concentrate 7.8 44.8 8.6 701 4.65
Zn Concentrate 0.9 2.4 45.2 92 0.42
Table 13.8: Expected concentrate production profile and gross metal content from
mixed underground feed and reclaimed tailing (based on 1.5Mtpa treatment)
13.4 Proposed Future Testwork

The flowsheet has been demonstrated to be similar to the original Woodlawn
concentrator flowsheet. Flotation testwork will continue to optimise the application
of the circuit to different ores from the new underground lenses, particularly to the
optimisation of reagent additions to further maximise concentrate revenue by
balancing concentrate grades and recoveries. In addition, the ratio of fresh
underground feed to reclaimed tailings will be varied to determine the variability
and to maximise revenue during ramp-up.
Locked cycle testing will also be undertaken including the use of treated site water.

14 Mineral Resource Estimates

14.1 Introduction
The Mineral Resources at Woodlawn are divided into two separate resource
models:
 Woodlawn Tailings surface stockpiles; and
 Woodlawn Underground Mineral Resource.
The tailings surface stockpiles were modelled by Robin Rankin of GeoRes (Rankin,
2008) and this model has been used for this PEA study. Refer to section 14.8 for
details.
The underground Mineral Resource was previously modelled by both Denehurst,
up until the closure of mining in 1998, and Robin Rankin, GeoRes, to JORC 2004
compliance in October 2006. The latter model was re-stated to JORC 2012
compliance without a material change in the estimate in 2 December 2013 by Mr
Rankin for TriAusMin.
The Underground Mineral Resource was remodelled in March 2015 by Heron
including all recent drilling results up until the 20th March 2015.
The new underground Mineral Resource block model for the Project was
developed from a first principles “rebuild” of the model and included revised
geological modelling and new wire-framing of the mineralised outlines. The new
model includes data not used in previous models of the Underground Project,
including:
 extensive digitised historical underground geological backs mapping data
at 1:500 and 1:250 scales;
 an updated underground void model including all locatable historical
mining records and plans; and
 drilling and assay data completed by both TriAusMin and Heron between
2006 and the resource cutoff date (20th March 2015).
The 2015 underground resource model has, where sufficient data exists, been
domained into polymetallic (principally zinc, lead and copper with accessory silver
and gold) and copper (principally copper with accessory silver and gold)
mineralisation within lenses. Domaining was based primarily on geological
mapping information, with drill hole logging and assay data used in areas where
mining has not taken place. Copper, lead, zinc, silver, and gold values have been
modelled and reported for all domains. Iron was also modelled for all domains to
assist in the modelling of density by way of a regression equation.
The model incorporates re-classification of resources based on a combination of
geological, geostatistical and engineering / geotechnical confidence. Resource
blocks, including some rib and sill pillars, not considered feasible to mine by the
engineering and geotechnical studies of the PEA have been removed from the
resource inventory.
The new underground resource model excludes the F Lens, as previously
modelled by Rankin (2006). The recently discovered Lisa Lens has not been
considered in the current PEA study, but will be subject to future evaluation. The
underground resource model includes significant extensions to E, D, I, and G

lenses, and the new Kate lens, with all new mineralisation modelled being a result
of TriAusMin and Heron exploration drilling from 2010 till March 2015.
Refer to Section 2.5 for details of the reconciliation between the resource
categories used and the CIM categories.
14.2 Previous Underground Mineral Resource Models

During mining, the resource evaluation was carried out by the operators Denehurst
on a yearly basis with the last estimate published in 1997.
The Woodlawn resource was modelled from first principles by Robin Rankin
(consultant geologist) in 2006 and reported to JORC 2004 standards. The
resource model was created to assist with TriAusMin’s assessment of remaining
underground Mineral Resources at the closure of previous mining operations (in
1998). The resource model was updated to JORC 2012 compliance in December
2013 for TriAusmin.
14.2.1 Denehurst Lens Models 1988 to 1998
During previous mining operations by Denehurst, a computerised modelling system

was developed for the estimation of resources and reserves for the operating mine.
Initially the software used was Surfore, which was developed principally for
modelling of the Woodlawn deposit (Figure 14.1). By the commencement of
underground production the Surfore algorithms had been included in the mining
software database Techbase, and the last models were created using this
combined package. Outlined below is the procedures used during underground
mining by Denehurst, summarised from Fitzgerald and Singer in their 1990
presentation.
Resource models were estimated in the Woodlawn Mine Grid (WMG), which was
the day to day operating grid within the mine. No rotation was applied to the
mining block models, although most strike and dip at a moderate angle to the
WMG.
The Surfore / Techbase resource estimation method employed wireframe
modelling of lenses from drill hole pierce points and select mapping data to form
lens interpretations to determine the location and volume of mineralisation.
Originally a zinc equivalent cutoff grade was used to determine the extents of the
intercepts down hole. This approach was found to under-estimate resources, in
particular in copper rich areas, and from 1988 until end of mine life, a “natural
cutoff” approach was used to determine lens boundaries. This usually equated to
the contact between massive sulphide and host rocks. In the rare cases where a
natural break could not be determined, a 5% Zn or 2% Cu cutoff were used as
these constraints closely match the observable limits of sulphides during mining
operations.

Figure 14.1: Denehurst lens model from 1997 looking south showing from left to right
C Lens (magenta, under pit) B5 Lens (dark blue, next to C), B1 Lens (green), A Lens
(red), F Lens (light green, under pit edge), E Lens (orange, below F), G Lens (green,
above E),
Lens boundary wireframes were constructed in three dimensions using the drill
hole intercepts and points derived principally from geological interpretations of the
backs mapping. Both sets of points were often recorded on the relevant backs
mapping sheets. Orthogonal blocks based on the width of wireframed lens
interpretation (X- east) by 20m (Y-North) by 5m (Z-RL) were estimated using a
combination of the nearest drill hole bulked grades and volumes derived from the
resource wireframe. This process was reviewed in 1988, and subsequent resource
models used the inverse distance squared weighting (ID2) for estimating block
grades as this interpolation appeared to best match mining performance (a number
of different algorithms were tested at this time).
Density was assigned to the modelled blocks using a density regression
determined from a calculation derived from density determinations and assays for
drill core taken from the underground resource area. The formula was:
SG = 2.2118+(0.0552*Fe%)+(0.0487*Pb%)+(0.0226*Zn%)
The density regression was applied to the estimated block grades to assign density
values to the model.
Historically, the resultant block model was then depleted manually by the mine
geologist for mine development, stoping, collapse zones and non-recoverable
pillars to arrive at the estimated remaining resource grade and tonnes.

Classifications of Inferred, Indicated and Measured Mineral Resources were based

on the number of holes used in determining the block grades, and the distance of
those holes from the block, with Measured being three or more holes within 20m,
Indicated four or more holes within 40m, and a classification of Inferred assigned to
all other blocks modelled.
Minable Mineral Reserves were determined as those Mineral Resources which
were considered economically exploitable and available for mining after allowing
for resources already extracted, minimum mining widths (usually three metres),
and areas sterilised by mining and / or geological factors. Only Indicated and
Measured Mineral Resources were considered for minable reserves.
Recoverable Mineral Reserves represented the tonnage of minable Mineral
Reserves that it was estimated could be recovered. All mining Mineral Reserves
blocks were assessed for mining method, pillar locations, ground conditions and
geological structures. The recoverable Mineral Reserves were estimated by
applying a percentage recoverable factor based on these expected recovery
limitations and previous mining performance, where available, to each block of the
minable Mineral Reserves.
Diluted recoverable Mineral Reserves were estimated by applying an estimated
dilution factor to the recoverable Mineral Reserves. Dilution estimates were
developed from mining experience and were usually in the 8-10% range, except in
areas of poor ground conditions, where they could be up to 40%. All dilution was
added at zero grade. It was the diluted recoverable Mineral Reserves that were
reported to the Australian Stock Exchange in line with the then guidelines from the
AusIMM. No dilution factors were applied to the Inferred Mineral Resources.
Mining Mineral Reserve and Resource records were maintained in this manner
until the closure of operations in 1998.
The last Mineral Reserve and Resource statement published was on 28 February
1997. The Mineral Reserve and Resource statement was completed by Mr Gary
Davison, who was an employee of Denehurst at the time. Production continued
until the mine closure in March 1998.
Table 14.1: Mineral Resources and Reserves reported by Denehurst, February 1997
Woodlawn Mine Ore Mineral Reserves 28th February 1997

Tonnes
%Cu %Pb %Zn Ag g/t Au g/t
(Million)
Complex Ore
Proved 1.00 2.32 2.95 9.27 46.00 0.43
Probable 0.14 1.89 3.01 10.18 64.00 0.30
Sub Total 1.14 2.27 2.96 9.38 48.00 0.41
Copper Ore
Proved 0.02 3.19 0.59 1.79 20.00 0.86
Probable 0.01 3.83 0.30 0.86 20.00 0.17
Sub Total 0.03 3.51 0.45 1.33 20.00 0.52
Total Reserves
Proved 1.02 2.33 2.92 9.18 46.00 0.44
Probable 0.15 2.06 2.78 9.36 60.00 0.29
Total 1.17 2.30 2.90 9.20 47.00 0.42

Reserves are recoverable and include an allowance for 10% dilution at zero grade.
Reserves include 11,000 tonnes at 3.71%Cu, 2.39%Pb, 7.71%Zn, 42g/tAg, 0.3g/tAu in crown
pillars at the base of the open pit. These reserves may not be mined if the open pit is developed
as a waste management facility
Woodlawn Mine Mineral Resources 28th February 1997
Tonnes
%Cu %Pb %Zn Ag g/t Au g/t
(Million)
Complex and Copper Ore
Measured 0.10 1.30 2.10 6.50 33.00 0.50
Indicated 0.04 3.10 0.40 3.00 10.00 0.10
Inferred 0.12 3.40 1.00 3.50 29.00 0.70
Total 0.26 2.60 1.30 4.50 27.00 0.50
Resources quoted are in situ and undiluted
14.2.2 TriAusMin Mineral Resource Model October 2006
In 2006, Mr Robin Rankin (Rankin) of SMG Consultants (SMGC) estimated a

Mineral Resource for the remaining underground resources at Woodlawn. The
new model took the form of a “from first principles” re-interpretation and
computerised model of the available mine data to estimate the remaining
resources outside, but near the old stope areas of the historical mine.
The Rankin (2006) estimate was based completely on old mine data, principally
drilling. At the time, TriAusMin had not augmented the data set with any new
drilling, although some drilling subsequently took place. All data was transferred
by TriAusMin into a mine grid, based on the same origin and orientation of the
historical mine grid, with 10,000 added to the northing. This grid has subsequently
been used by Heron Resources.
The Rankin (2006) model used new lode (equivalent to the mine “lens”
terminology) intercepts, which would have included intercepts additional to those
used in the historical mine resource models. This was due in part to the
considerable shift in metal prices between the closure of mine in 1998 and 2006.
Additional intercepts were both along strike from the old resource model, and in a
number of “new” sub-lens positions in the immediate hangingwall and footwall to
the historic lens interpretations.
The method of interpretation was to identify mineralised intercepts in the drill holes
using a minimum 3% “calculated Zn equivalent” threshold and to correlate the
intercepts as lenses with the aid of the geological mapping (from backs mapping
level plans and cross section geological interpretations). The mine had generally
used a hard cut-off of 9% “calculated Zn equivalent” for ore delineation, and the
use of the lower 3% cut-off for the new resource estimation reflected both higher
metal prices and, more importantly, an effort to identify lode trends where “ore”
grades trailed off into sub-grade thinner extents. In coincident areas, the newer
intercepts often matched the old mine intercepts closely.
The modelling of lenses between data points was carried out in two steps. A 2m
by 2m gridding method with reference plane was employed to model the footwall.
The hangingwall was determined using an ID2 interpolation of intersection widths,
relative to the footwall. The resultant shape was compared against the backs
mapping and cross section interpretation data to ensure integrity of the algorithm

used. Lenses were constrained along strike up and down dip by a 10m boundary
from the last intersection point. Some 39 lenses in 10 major sets were interpreted
by this method to produce the Rankin (2006) resource model (Figure 14.2).
Figure 14.2: 2006 lens model with drilling, looking north, showing from left to right I
Lens (light green), D Lens (dark blue), F Lens (purple), A Lens (yellow), B Lens (red),
J Lens (light green), C Lens (middle green), and as intercepts only H Lens (orange),
G lens (yellow) and E lens (cyan).
All data flagged by lens was composited to 1m using length weighting, and
geostatistical studies were performed on Zn and Cu for all domains combined. The
block model used to model the volume within the lenses had parent cell
dimensions of 4m (X-East), 5m (Y-North) and 6m (Z-RL) with a minimum sub cell
of 1m in all directions.
A geostatistical study was carried out on Zn and Cu distributions within the deposit
(all lens domains combined). Interpolation of grades was carried using inverse
distance squared. Zn and Cu were interpolated using different parameters based
on the results of variography. All other elements were interpolated using the Zn
parameters.
Table 14.2: Table showing interpolation parameters used in the TriAusMin 2006
Mineral Resource model (from Rankin, 2006)
Grade Interpolation Parameters

Algorithm Inverse Distance
Power 2
Sample Search

Grade Interpolation Parameters

Algorithm Inverse Distance
Sectors 6
Maximum samples / sector 3
Maximum Samples 18
Minimum Samples / sector 1
Minimum sectors 1
Minimum Samples 1
Direction
X Y Z
o
Rotation ( ) 0 30 -10
(Dip 60W) (Strike 350)
Scan distances - Zinc (lead, silver, gold,
iron)
Weighting factor 2 2 1
Initial distance (m) 50 50 50
Initial Weighted distance 100 100 50
Applied Distance (m) 50 50 50
Actual applied weighted distance (m) 25 25 50
Scan distances – Copper
Weighting factor 1.5 1.5 1
Initial distance (m) 50 50 50
Initial Weighted distance 75 75 50
Applied Distance (m) 25 25 50
Actual applied weighted distance (m) 17 17 50
Density was determined for blocks within the model using the historical density
regression equation applied to the interpolated block grades. The use of the
equation was as recommended by Mr Robert Cotton (2006) for individual assays
where:
 all of Fe, Pb and Zn have been assayed for a single sample: use
SG = 2.2118+(0.0552*Fe%)+(0.0487*Pb%)+(0.0226*Zn%);
 Fe has not been assayed and Zn is less than 5%:% use the density 2.9,
and
 Fe has not been assayed and Zn equals or exceeds 5%:% use the density
3.9.
Only a few default values of 3.9t/m3 were assigned as both iron and zinc values
were virtually always present in the model. The application of density was
effectively the same as for the previous Denehurst resource and reserve models.
A zinc equivalent grade was calculated for each block using a formula based on
the block Zn, Pb, Cu, Au and Ag values. The factors used were based on metals
prices current in October 2006. The zinc equivalent was used as a cut-off for the
Resource reporting. Classification of the resource model was based on the
interpolation parameters for individual blocks with:
 Measured used a distance of < 30m and at least 4 points.
 Indicated used a distance of < 45m and at least 2 points.
 Inferred used a distance of < 60m and at least 1 point.

 Blocks >60m from points remained unclassified.

A void model, indicating which volumes had been mined, was wire-framed from
survey pick up strings. These strings were assembled by TriAusMin from mine
section and level plans, mostly on a lens and a lift basis. Most solids were created
from this data using vertical projections of the backs (using the lift height), or less
commonly, floor pickup strings. The overlap resulting from the mining method was
addressed during the wire-framing by successively over-writing the overlap
volumes. The resulting void wireframes were used to intersect the resource block
model, and flag as mined all blocks within the void solids (Figure 14.3).
Figure 14.3: Block model 2006 E/W vertical cross section 19,500mN showing Zn
block grades. Note grey blocks indicate voids where previous mining has taken
place. Lenses from left to right A, B hangingwall Lenses, B1, B2 footwall Lens (Cu
rich).
The 2006 Mineral Resource estimate was reported as all unmined blocks above a
Zn equivalent (Zneq) cutoff grade of 7%. No dilution or pillar factors were applied.
Blocks within 50m radius of the historic open cut were not reported. No Ore
Reserves were calculated.

Table 14.3: Woodlawn 2006 Mineral Resource above 7.0% Zneq cutoff grade,
excluding all blocks within 50m of the open cut pit
Classification Cut-off Tonnes Metal

Zinc (Mt) Zn Cu Pb Au Ag Zinc
equiv. (%) (%) (%) (g/t) (g/t) equiv.
(%) (%)
Inferred 7.00 1.52 9.60 1.65 4.08 0.61 86.83 16.16
Indicated 7.00 4.98 10.16 1.79 4.04 0.55 84.01 16.96
Measured 7.00 3.60 10.38 1.82 3.99 0.53 85.05 17.23
Total 7.00 10.10 10.16 1.78 4.03 0.55 84.80 16.93
The 2006 Resources were subsequently restated in October 2009 by Robin Rankin
(through consultancy firm GeoRes) for TriAusMin as a NI43-101 Technical Report
for use in Canada, termed TriAusmin Resource Model December 2013.
In December 2013 Robin Rankin (the CP, for GeoRes) restated the 2006 Mineral
Resource, adding to the documentation to bring the reporting to JORC 2012
standards. There was no material change to the Resource model or stated
Resources. No additional data, including recent TriAusMin drilling results, were
added to the resource model, facilitating JORC 2012 compliance.
Robin Rankin as CP stated that the new information would have no material effect
on the existing Mineral Resource estimate and therefore did not justify re-
estimation was not justified.. The statement included specific discussion of that
viewpoint, mentioning possible inclusion of detailed mine geological mapping,
crown pillar extraction immediately before the previous mine closure, research into
geological structure control on mineralisation by TriAusMin, and the drilling
conducted by TriAusMin in the interim.
14.3 Data Used in Heron’s 2015 Underground Mineral Resource

Estimate
Heron’s 2015 Underground Mineral Resource model developed as part of the PEA
study has been built using:
 historic surface and underground drilling;
 recent surface drilling;
 historic geological underground (principally backs) mapping, and
 survey plans of the underground workings, including long hole stope
designs.
The model was constructed using geological constraints as the primary domaining
tool, with “natural break” assay data being used where mapping data or lithology
logging data were unavailable.
The model also drew upon the mining experience of former employees of
Denehurst, who operated the underground mine from 1988 till 1998. In particular
the:
 choice of domaining methods and rationale for the resource model;
 practical experience of the grade distribution within lenses during mining;
 historical resource estimation methods and their effectiveness;

 condition of mine openings at the end of mine life; and

 the relationship of lenses to each other and mapped fault offsets .
This valuable previous mining experience was utilised in the construction of the
resource model, construction of the new void model, and the classification of in situ
material left available to be mined.
14.3.1 Backs Mapping Data
All of the backs (roof) mapping plans were created during the development of and
mining of the deposit, by both Denehurst (mining operations) and Jodoex (pre-
feasibility development mapping). The vast majority of geological maps were
prepared by two mine geologists; Mr T Ho and Mr R Hollinger.
The scale of the mapping is a mix of 1:500 (all capital development headings and
some cut and fill stope plans) and 1:250 (later cut and fill stope plans). There is
very good constancy of legend and quality between all of the geological plans. The
mapping sheets are stored in a plan cabinet at the Woodlawn site. They comprise
a mix of A0 and A3 transparency mapping sheets, in the form of hand-drawn,
drawn drafted ink, and pencil plans, projected onto the WMG for spatial reference.
Features mapped include massive sulphide boundaries, stringer sulphide domains,
dolerite boundaries, host lithologies, faults, joints, shears, foliation, and rare
primary bedding features (typically only recognised in cherty units). The mapping
sheets contain many detailed sketches of key geological features and many
thousands of dip and strike measurements taken by geologists during the mapping.
There are also notes on the geotechnical conditions of drives, local areas of
collapse, mineralogy of material within significant fault planes (gouge), and many
comments and outlines in pencil pertaining to historical Denehurst resource
models.
It is quite clear that these are the original working geological plans that contain
both “fact data” from geological mapping and “interpretative data”. While the
interpretative data and plan overlay data were examined, only the fact data has
been digitised.

Figure 14.4: Typical underground level mapping – Denehurst mine mapping 1:500
scale geology backs map of B14 level (2390mRL) showing B Lens (B1 and BC) along
with the 750 fault. Massive sulphides are coloured in Red, stringer sulphide chert in
light pink, shale in brown, dolerite in yellow and rhyolite in magenta. Note the
additional observations with reference locations and resource model data in outlines
and pencil lines. (Note the WMG used at the time of mapping omitted the 10,000m
addition to northings used in the current work by Heron)

Some 33,327 points were digitised by Heron as a part of this process into 2,767
individual strings. The geological contacts were digitised for the massive and
stringer sulphides, dolerite intrusive rocks, and faults.
Figure 14.5: Digitised underground mapping method. I Lens, oblique view looking
north, showing TriAusMin/Denehurst void model, backs mapping plan I20-2 level
(2470mRL) with the mapping strings of the hangingwall (red) and footwall (pink)
massive sulphide contacts digitised and then projected onto the corresponding void
backs plan for each level. Note also drilling with massive sulphide shown in red, and
intersection selections in green (HW and FW) at the geological contact
Digitising was completed by geologists into Micromine using the plan grid for X and
Y co-ordinates, and the historical void model to provide the RL (or Z plane).
The digitising process identified a number of wireframe and projection issues in the
historical void model. These issues were addressed by the creation of a new void
model (detailed under Section 14.3.6) from the survey plans. From a comparison
of the two void models, it was concluded that the RL control on the digitised
geological mapping data is of sufficient accuracy for resource modeling, being +/-
2m in RL.
14.3.2 Drilling Data
The drilling data was extracted from the DataShed WUP project database
Heronv3, as built and maintained by Heron. The vast majority of drilling data used
in the resource model are historical. This included 113,105m of surface diamond
drilling, 51,811m of underground drilling and 2,029m of underground face
sampling. The source of these datasets, and the validation performed on them, is
described in Section 10.1.2.
While every effort has been made by Heron to verify the historical data against
source data, to date original source data has only been located for drill hole collar,
down hole survey, and down hole geology logging data. The absence of source

sample and assay data is partially offset by the correlation of the historical
Techbase and more recent TriAusMin Excel and Micromine databases. Further
details on validation undertaken can be found in Section 12.1.1.
There has been no QAQC data located for the historical portion of the database.
However, the mine did operate successfully and profitably as both an open cut and
underground operation based on the historical Techbase drill hole database. While,
no QAQC data have been located, the quality of historical assays is considered to
be reasonable given mine to mill production reconciliation grades and tonnes were
considered to be sufficiently accurate as to support the producing underground
operations up until mine closure. Furthermore, the sample database appears to
spatially match closely with the backs mapping data, previous resource models,
plans, sections and production records.
Recent drilling by TriAusMin between 2006 and 2012, and later by Heron in 2014
has been included in the resource model. A full description of the drilling methods,
logging and sampling procedures, assay methods, QAQC and database
management is presented in Section 12 of the Report.
The cutoff date for assay results used in the resource model was 20th March 2015.
All drilling data was sourced from the Heronv3 database. It included assay results
from all of the drilling conducted in 2014 and the first quarter of 2015 by Heron at
Woodlawn.
14.3.3 Survey Control
During underground mining operations all surveys were carried out by Mine
Surveyor Mr M Fantin using conventional survey techniques during day to day
mining operations. Mr G Michl, a mining engineer with surveying experience, also
contributed to the survey of the “west wall” decline and the later stages of mine
development with the D and E Lenses subsequent to 1993. After the resignation of
Mr Fantin, Mr C Ablett, a contract surveyor oversaw the last five months of mine
life survey.
The survey was completed from each portal, by use of backs mounted survey
stations, with bearings and distances between the surveys carried out using a
Leica theodolite. Some closure surveys were completed using vent shafts, and
levels were routinely back calculated during operations. During Denehurst mining
operations, all surface exploration survey work was also carried out by Mr Fantin.
All survey work was carried out in the Woodlawn Mine Grid (WMG). The origins of
the grid and its orientation are described in Section 4.3. All surveys of
underground development were documented on hand drafted A0 and A3
transparent film plans in a mix of 1:250 and 1:500 scales. The plans are located at
the Woodlawn site office, and have been scanned and digitised to and used to
create a new void model of the underground workings.
All underground and surface drill hole collars drilled during the life of the
underground mine (as operated by Denehurst) were picked up by the underground
surveyors (personal comments Mr M Bouffler,M Fantin and G Michl 2015).
Records of the survey control and pickup of the original Jododex and AMC drilling
have not been located, but there is a reasonable down hole correlation between
these, and later drill holes in the resource area.
Subsequent to the closure of the mine, TriAusMin added 10,000m to the northings
of the WMG. All historical data has been converted to the new coordinate system.
Heron has used the new WMG in all of its resource modelling data.

14.3.4 Drill Hole Trace Locations
Figure 14.6: Oblique view from south showing historic drilling in black, Heron and
TriAusMin drilling in magenta.
14.3.5 Topography
The topographic digital terrain model of Woodlawn, used in the resource model is
of unknown origin. It appears to be adequate for resource modeling because no
potentially recoverable resource exists within less than 30m of the modelled
surface, and thus the topographic model does not directly impact on the modelled
resources.
The topographic model is of sufficient accuracy for the planning of drill holes, and
correlates well with the surveyed pickups of completed collars. It also correlates
well with man-made features such as road cuttings, ramps, pit crests, dam
causeways, and the final mined pit outline.
While the surface model is of sufficient accuracy for the purpose of PEA studies
and drill planning, it is proposed to update the model for future feasibility studies.

14.3.6 Underground Void Model
A new underground void model was constructed to capture known areas of mining
voids missing from the previous void model, and to include the shanty back profiles
that had not been modelled in the previous void model.
All of the original survey plans were scanned and all data points on the plans
digitised. A series of scripts were developed to connect the survey string, backs
and floors measurements together to form the new void model. The resulting void
model was checked against the plans, and available production data, as well the
recollections of staff onsite at the time of mining.
The new void model was checked against historical extraction figures for the
stoped areas of the mine (ore production only).
Table 14.4 : Historic extraction of ore vs void models
Tonnes
Void Model
(Million)
Historic Extraction
(milled) 6.1
SGCM 2006 Void
Model 4.5
2015 Void Model 6.1
Figure 14.7: Previous void model (grey) against resource wireframe outline (red)
showing sections of unmined resources between levels

Figure 14.8: New Void Model (grey) against resource wireframe (red) showing shanty
back profile and mining of the resource between levels. Note the area at top right
was noted on the geology plan as hangingwall unmined (due to mineralisation being
wider than the maximum permitted span of the drive. This area is captured in the
new resource model as an unrecoverable skin
14.3.7 Down Hole Surveying
Down hole surveying was carried out on all drill holes in the database. Historical
down hole surveys were by single shot camera, generally at 30m intervals. Some
underground collar surveys were done by the mine surveyor using a theodolite in
the mine local grid.
Recent drilling by Heron has been surveyed by a multi-shot electronic camera, and
upon hole completion, by MEMS gyro surveys (IsGyro) with an Azimuth aligner
used to collect the collar survey. Selected holes were further checked with a north
seeking gyro.
The majority of surveys in the database rely on magnetic surveys. These readings
have all been adjusted within the database to reflect the change in magnetic pole
declination over the life of the mine.
Although it is not possible to directly test the validity of the down hole survey
readings of historical holes, there is close correlation between intercept locations in
both the surface and underground drilling, the underground backs mapping and
recent surface drilling by Heron.
14.3.8 Bulk Density
Limited bulk density determinations were available for the model. No measured
density data was available for historical drilling. Heron routinely conducts a density
determination on all samples sent to the laboratory using the industry accepted /
water immersion density determination method for each sample (see Section 10.5).

The historical regression equation was checked against recent drilling density
determinations and was found to be reasonable for most material types tested. An
adjustment has been made for lower grade material after examining density and
assay results for drilling performed by Heron in late 2014 and early 2015.
Figure 14.9: Graph showing the measured versus the calculated density
measurements. Note the underestimation of lower grade samples by the density
regression equation.
It is important to note that the density data from drilling available at the time of the
resource model data cutoff date came from two principal areas of the mine, the
Kate Lens area and the I/D Lens deeps area, rather than across all of the lenses
modelled. Heron is currently performing density tests on appropriate core sample
from historical drill programs samples to provide coverage in all areas relevant to
further feasibility studies.
While the density regression calculation shows a reasonable correlation of 0.91
with measured density, there is some subtle bias if the data are split into ranges.
 The regression equation underestimates density of low zinc and iron
samples. No sample in the data set (which includes waste material
either side of the mineralisation) has a measured density below 2.65.
Regressed densities for these samples are as low as 2.40 using the
historical grade regression equation. In the resource model a lower cut
off of 2.65 was applied to all calculated block densities to reflect that no
material of a density below this value is present in the areas tested.
 There is considerable scatter in the calculated versus. measured
density for stringer material types. The scatter is thought to be partially
a result of the variability in material types in actual samples (typically
these samples are stringer sulphide material, containing both silicate
and sulphide in the sample). Another likely effect is that copper grade is
not been included in the regression. Many of these samples, but not all,
are chalcopyrite + pyrite + silicate mineralogy, and no allowance is
made for chalcopyrite in the historical regression function. The scatter
does not appear to be biased overall, with samples being as likely to be

overestimated by the regression as underestimated. No adjustment

was made for this effect in the model.
 There is a slight under call of the higher calculated densities compared
to the sample test results. Because the under call is very slight, no
changes were made to the model.
The use of the regression and it components will be reviewed when a larger data
set covering all domains of the deposit has been acquired from historical core. For
the purposes of the PEA it was felt that the historical regression is sufficiently
accurate for the majority of the material types where measured data has been
taken. For low grade samples, a lower cut of 2.65 was applied to the model to
reflect the minimum measured density in the measured density set. Further work
is required on density determination for later feasibility studies.
A number of holes drilled by TriAusMin did not have any iron assays for all
samples. These samples were assigned iron grades equivalent to the average
grades of the other samples within the domain of similar tenor. This calculation
was completed on a domain by domain basis. These inserted values had no effect
on compositing (as the values were added as a constant to all assays in the
intersections concerned) but they were used in block modelling to assist in
assigning iron, and therefore density to some Inferred portions of the resource
model. There is no impact on indicated resources.
Table 14.5 : Table showing values used to determine iron grades for samples without
iron assays
Lens I6 Fe IC Fe D1 Fe D2 Fe BC JC KC
Defaults Defaults Defaults Defaults Defaults Defaults Defaults
Fe Value 22.6 25.1 24.9 22.7 9.7 14.0 28.7
Number of
holes 3 2 3 3 1 1 1
affected
Number of
samples 25 14 8 27 33 4 23
affected
14.4 Geology and Mineralised Domain Modelling

Domaining of the deposit was largely completed using geological mapping and drill
hole logging data (lithology). In the very few cases of drill holes without lithology,
assay data in conjunction with adjacent drill hole logging were used to domain the
data. The lens domains were constrained by wireframe models of mapped faults,
where appropriate.
Sample selection within individual domains was by lode coding of the samples in
the database. Samples were not selected by wireframe, allowing mapped
boundaries to control the volume of wireframe domains. All samples were
composited to one metre intervals using length and density weighted compositing
after selection. A top cut was applied to silver for the G1 domain. Top cuts were
not required for other elements or domains.
14.4.1 Mineralisation and Geological Domain Modelling Methodology
Domaining of the deposit was based on geological boundaries, with individual

domains being defined on the basis of sulphide content, grade distribution and

geometric relationships along strike and down dip. The geological logging of the
drill holes was used to build constrained domains for:
 massive polymetallic mineralisation (pyrite, sphalerite, chalcopyrite,
galena);
 copper mineralisation (pyrite, chalcopyrite);
 massive sulphide pyrite dominant (pyrite only) – not modelled, and
 mixed domains (where polymetallic and copper domains could not be
separated from the available data).
Domain boundaries were defined using mapping data, and where mining has
previously not taken place, drill hole lithology logging. All domain boundaries were
built up from string and point files into three dimensional wireframes.
The deposit has been domained into 11 individual lenses and 33 sub domains
within those lenses. The F Lens was not modelled for the PEA. Pyrite only
material has not been modelled for the PEA. Lisa Lens, although modelled, has
not been classified due to limited drilling to date and is not currently part of the
resource statement. Portions of the AC, BC, and G1 Lens where insufficient
drilling is currently available have not been classified.
A nominal cutoff grade was not used to interpret the domain boundaries, as there
is usually a clear natural break in grade between the sulphide dominant material
(both massive and stringer) and adjacent host rocks. However, in some areas,
usually along strike, the domain boundary of stringer material is gradational or
feathery and an assay cutoff of 0.5% Cu has been used to help define the domain
limits. The assay cutoff is substantially below the expected economic cutoff grade.
There are parts of D, E and Kate Lenses that appear to only contain massive pyrite
material. The cutoff between complex sulphide and pyrite only mineralisation was
found to be relatively sharp in previous mining of D and E Lenses. As a result, the
boundary between complex and pyrite only mineralisation is modelled as a sharp
domain boundary for all three lenses (note the pyrite only mineralisation was not
included in the block model).
Table 14.6: Summary of domain constraints
Sub
Lens Characteristics Data Used Contacts
Domain
A A1 Massive Polymetallic Type Mapping>Drilling AC,B7,790F,750F
AC Stringer Sulphide Copper Type Mapping>Drilling A1,790F,750F
B B1 Massive Polymetallic Type Mapping>Drilling BC,B7,750F
B5 Massive Polymetallic Type Mapping>Drilling B1,BC,B7,750F,790F
B7 Massive Polymetallic Type Mapping>Drilling A1,B1,BC,750F,790F
B8 Massive Polymetallic Type Drilling>Mapping B1,750F
BC Stringer Sulphide Copper Type Mapping>Drilling B1,B7,750F,790F
C C1 Massive Polymetallic Type Mapping>Drilling C2,C4,CC
C2 Massive Polymetallic Type Drilling>Mapping C1,CC
C4 Massive Polymetallic Type Mapping>Drilling C1,CC
C5 Stringer Sulphide Copper Type Drilling >Mapping 790F
CC Stringer Sulphide Copper Type Mapping> Drilling C1,C2,C4
D D1 Massive Sulphide Mixed Type Mapping>Drilling D2,D3
D2 Massive Sulphide Mixed Type Drilling D1
D3 Stringer Sulphide Copper Type Mapping>Drilling D1

Sub
Lens Characteristics Data Used Contacts
Domain
E E1 Massive Polymetallic Type Mapping>Drilling KC,K1,790F
E2 Stringer Sulphide Copper Type Drilling>Mapping KC,K1,790F
F Not Modelled
G G1 Massive Sulphide Mixed Type Drilling>Mapping H1,790F
G2 Stringer Sulphide Mixed Type Drilling>Mapping
H H1 Massive Sulphide Mixed Type Mapping>Drilling G1,790F
I I1 Massive Polymetallic Type Mapping>Drilling 123F
I2 Massive Polymetallic Type Mapping>Drilling 123F
I3 Stringer Sulphide Copper Type Mapping>Drilling 123F
I4 Stringer Sulphide Copper Type Drilling IC,LC
I5 Massive Sulphide Mixed Type Drilling 123F
I6 Massive Polymetallic Type Drilling IC
IC Stringer Sulphide Copper Type Drilling I4,I6
J J1 Massive Polymetallic Type Mapping>Drilling 790F
J2 Stringer Sulphide Copper Type Drilling>Mapping 790F
JC Stringer Sulphide Copper Type Drilling>Mapping 790F
Kate K1 Massive Polymetallic Type Drilling 790F,K2,E1,E2
KC Stringer Sulphide Copper Type Drilling E1,E2
K2 Not Modelled (pyrite only type) Drilling K1,KC
Lisa LC Not Classified (insufficient drilling) Drilling I4
The domain boundaries were built from wireframe plane models of:
 hangingwall contact;
 footwall contact;
 principal constraining fault planes, and
 wireframe “cookie cutters” between pyrite and complex domains where
required.
The planes were developed in three dimensions from the digitised mapping data
and drill hole intersections using the Leapfrog implicit modelling algorithm. Drill
hole intersections were used principally where mapping data were not available,
usually in areas where mining has not taken place. In areas where both mapping
and drill hole data were available, the mapping data were used in preference to
drilling data to define bounding wireframes as it was considered to be spatially
more representative of both dip and strike than the drilling pierce points. In most
cases, the two data sets were coincident and both were used.
The implicit modelling algorithm was adjusted for each domain modelled. Most
mineralisation domain boundary wireframes honored the data best by interpolating
with a 4:2:1 aspect ratio aligned along the plunge of the intersection lineation
between the principal foliation direction (and plane of lenses) and the 790 level
fault plane. This lineation has a strike of 170°, dip of -60°, and plunge of 110° to
the north. A two metre minimum triangle size was used for all wireframes to
provide a reasonably accurate representation of each lens volume and location for
the purpose of economic evaluation. All boundary wireframes were checked
against the primary mapping data to ensure the resultant wireframes were within
the two metre tolerance.

Figure 14.10: Domain boundary from mapping strings, for the I1 massive sulphide
domain. Same view as for figure 14.5 showing drilling, mapping strings and the
resulting wireframe domain boundary
The resulting wireframe models were used to domain the deposit into the
mineralised lenses and non-mineralised domains by intersecting the footwall and
hangingwall mineralised domains with bounding structures as appropriate for each
domain. This was completed using Boolean intersections in Micromine.
The non-mineralised domain was not subdivided into different lithologies and
alteration types for the PEA model.
For most lenses, sufficient data were available to further discriminate the lenses
between “polymetallic” (dominantly pyrite + sphalerite + galena + chalcopyrite),
“copper” (chalcopyrite + pyrite) and “barren” (pyrite only) mineralisation styles.
This was considered to be an important step as most historical mining was
concentrated in the polymetallic domains, leaving adjacent copper domains
unmined. Without separating the domains within a lens there was a risk that high
grade zinc and lead values could be smeared into copper and barren domains
during the interpolation of grades (refer Figure 14.11).

Figure 14.11: Showing grade changes in B Lens on the 2250mRL from polymetallic
to copper rich across a single sample interval. Note previous mining centered on the
polymetallic mineralisation. Drill hole traces showing lithology (massive sulphide
red, dolerite dark)
While the effect of not domaining polymetallic from copper and pyrite only material
would be slight on the overall deposit grades, the combining of material types into
single domains using mining cutoff grade parameters can significantly skew local
grades of remnant material that have been used as part of the PEA plant feed.
The new domain rationale reflects the large increase in the amount of data
(principally digitised backs mapping) used in the current resource model compared
to previous models. The new model also seeks to estimate both the recently
discovered lenses, and deeper portions of the deposit previously drilled but not
modelled. The additional domaining was considered to be important as the
resource model’s principal purpose was to allow the designing of stope outlines for
the PEA. This required that reliable grades be assigned to the domains based on
relatively wide spaced drilling over a significant portion of the model.

14.4.2 Sample Selection and Compositing
Samples were selected for the domains by way of lode coding of the database.
Selected drill hole interval samples were composited to one metre lengths, with the
remainder of the interval retained in the composite file. Assays were both length
and density weighted. Density weighting, where density measurements were not
available, was applied to assays using the historical regression equation as
discussed in Section 14.3.8.
A number of drill holes had samples which crossed geological domains, as logged.
These holes were principally from drilling between the end of the Jododex
feasibility study, and about half way through the grade control and exploration
drilling carried out by Denehurst, where one metre sampling was used without
consideration of geological contacts. For these holes, intersection selection was
based on the assay results in combination with the geological log, with samples
with discernibly lower grades than the adjacent mineralised domain samples being
removed from the intersection selection for that domain. Some issues were
experienced in finding sufficient samples for the copper rich domain AC. For this
domain there was an area mapped (and partially mined) as being copper stringer
material without any drill hole assays present. While the area was modelled for the
PEA the area without adequate sample support was not classified and has not
been reported as part of the resource.
Not all samples within the mineralised domains were assayed for gold. Gold
assays on historical samples were carried out at the discretion of the geologist,
generally only where significant gold mineralisation was thought to occur (personal
comment from Mr M Bouffler). Some 35% of samples within the domains do not
contain gold assays. For the purposes of the model, samples without gold assays
were assigned the grade of 0.01g/t, this being the minimum detection limit for gold
assays from the site laboratory. This conservative approach was taken to ensure
that gold was under, rather than over estimated in incompletely sampled domains.
14.4.3 Summary Statistics and Top Cut Strategy
Top cuts have not been previously used for resource models of the Woodlawn
deposit. Examination of data from all domains indicated that top cuts were not
required for zinc, copper or lead.
There is limited data for domains where top cuts may be considered for gold, and
infill sampling will be required for the I6, H1 and G1 domains to resolve this issue.
Part of the problem likely relates to historical issues with selective sampling of gold
as outlined in Section 14.4.2. No gold assays were cut in this model.
Silver distribution throughout the deposit varies from lens to lens. The G1 domain
is notably high in silver compared to other lenses. For the G1 domain a top cut of
850ppm Ag was applied to the composites of two adjacent drill holes where the
silver values were an order of magnitude greater than for the other holes in the
domain. Four composites are affected in total. No other grade cuts were applied
to silver assays in this model.

Table 14.7: Summary Statistics for all uncut assays used in the resource estimate
Field No of Coeff. of
Name Min Max Points Mean Variance Std Dev Variation Skewness
Strong Positive Skew
Au_g/t 0.01 19 7450 0.59 0.97 0.98 1.68 (7.03)
Ag_g/t 0.01 2877 9368 69.7 11162.12 105.65 1.52 (8.56)
Cu_% 0.0001 26.3 9570 1.81 5.23 2.29 1.27 (3.03)
Fe_% 0.01 46 9413 18.27 102.00 10.10 0.55 Symmetric Skew (0.22)
Pb_% 0.0001 27.81 9568 3.23 15.27 3.91 1.21 (1.55)
Moderate Positive
Zn_% 0.0001 44.3 9570 8.21 71.42 8.45 1.03 Skew (0.91)
14.4.4 Review of Composite Statistics by Domains
The statistics for each lens were calculated from the one metre density and length
weighted composites. As can be seen from the following tables the different lenses
have similar overall composite populations, with more skew evident for Ag and Au
values in some of the lenses. Some distributions are clearly bimodal (e.g. A Lens).

Figure 14.12: Review of Sample Statistics by Domains - Lens A

Figure 14.13: Review of Sample Statistics by Domains - Lens B

Figure 14.14: Review of Sample Statistics by Domains - Lens D

Figure 14.15: Review of Sample Statistics by Domains - Lens E

Figure 14.16: Review of Sample Statistics by Domains - Lens G

Figure 14.17: Review of Sample Statistics by Domains - Lens H

Figure 14.18: Review of Sample Statistics by Domains - Lens I

Figure 14.19: Review of Sample Statistics by Domains - Lens J

Figure 14.20: Review of Sample Statistics by Domains - Lens K

14.5 Domain Variography

Variograms were calculated for Zn, Pb, Cu, Au, Ag, Fe and ZnEq. Because the
number of composites per lode is often quite low, it was decided to calculate the
variograms globally using all available composites. As the lodes generally strike
N350, dipping 60° west, this was the orientation chosen for the plane in which the
variograms were calculated. In addition, the direction perpendicular to this plane
(across lodes: Azimuth 80°, Dip -30°) was considered.
For all elements with the exception of Au and Ag, the raw experimental variograms
were of sufficient quality to be used without modifications. Au and Ag, which are
more variable, are first transformed into Gaussian values (mean 0 and variance 1).
Once models are fitted to the Gaussian experimental variograms of the variables,
they are back-transformed to the statistical space of the untransformed data.
The experimental variograms and the models fitted to them are presented in the
following figures.

Figure 14.21: Cu variography
Cu is very well structured, with a very low nugget effect. The major direction of
continuity, with a range of 90m is N170° (along strike). The semi-major direction is
down dip (N260°, dip -60°). The minor direction is across lenses with a maximum
range of 23m.

Figure 14.22: Pb variography
Pb is very well structured, with a very low nugget effect. The major direction of
continuity, with a range of 130m is down dip (N260°, dip -60°). The semi-major
direction is N170° (along strike). The minor direction is across lenses with a
maximum range of 38m.

Figure 14.23: Zn variography
Zn is very well structured, with a low nugget effect. The major direction of
continuity, with a range of 100m is down dip (N260°, dip -60°). The semi-major
direction is N170° (along strike). The minor direction is across lenses with a
maximum range of 35m.

Figure 14.24: ZnEq variography
ZnEq is very similar to Zn, which is not surprising as both variables are highly
correlated. ZnEq is very well structured, with a low nugget effect. The major
direction of continuity, with a range of 180m is down dip (N260°, dip -60°). The
semi-major direction is N170° (along strike). The minor direction is across lenses
with a maximum range of 35m.

Figure 14.25: Au gaussian variography
Au, after back-transformation from the Gaussian variable, is well structured, with a
very low nugget effect. The major direction of continuity, with a large (somewhat
arbitrary) range of 900m is N300°, dip -53°. The semi-major direction is N182°, dip
-19°. The minor direction is across lenses with a maximum range of 160m. Note
that this variogram was calculated prior to setting the missing values to 0.01g/t as
used in the interpolation for gold.

Figure 14.26: Ag gaussian variography
Ag, after back-transformation from the Gaussian variable, is well structured, with a
low nugget effect. The major direction of continuity, with a range of 270m is down
dip (N260°, dip -60°). The semi-major direction is N170° (along strike). The minor
direction is across lenses with a maximum range of 50m.

Figure 14.27: Fe variography
Fe is well structured, with a low nugget effect. Within the lodes plane, the
variograms are fairly isotropic (similar ranges of the order of 150m). The minor
direction is across lenses with a maximum range of 35m.

14.6 Block Model Construction

The block model was constructed using Micromine software. A series of looped
scripts were developed for the modelling of the deposit, with parameter files being
used to set variables for each domain.
All domains were cut from the parent block model of 10m by 20m by 20m cells
using the domain wireframe to a resolution of 1m by 2m by 2m. Grades for Zn, Pb,
Cu, Fe, Ag and Au were interpolated into each domain separately using parent cell
interpolation and Ordinary Kriging algorithm in Micromine. Density was assigned
to each block based on the historical grade regression calculation with an
adjustment for recent density work by Heron.
Domains were intersected and flagged by a newly developed void model, a domain
specific wireframe model to represent interpreted non-recoverable skins to the
mining void, and domain specific resource classification models. Resource
classification was based on a combination of the Kriging parameters, saved in the
block model, and the confidence in the interpretation of the domain, which usually
related to the proximity and complexity of geological mapping. The resultant block
model was reported for Indicated and Inferred material.
14.6.1 Model Limits
The block model is defined in the Woodlawn Mine Grid as outlined in Table 14.8.
The block model was intersected with the surface topography wireframe to produce
a parent waste model. As all modelling included in the PEA occurs below the base
of oxidation, a base of oxidation model was not included in the block model,
although a wireframe has been constructed to assist with drill hole planning.
Table 14.8: Model Limits for resource block model
Minimum
Minimum Maximum Maximum
Block Size Sub-cell
Coordinate Coordinate No of
(m) Dimension
(WMG) (WMG) Sub-cells
(m)
East 8700 10320 10 10 1
North 18635 20085 20 10 2
RL 1750 2870 20 10 2
14.6.2 Selection of Optimal Parent Block
The purpose of the Mineral Resource estimate was to provide a mineralisation

model for the Woodlawn PEA. The model includes well drilled and well informed
previously part-mined mineralisation, widely spaced new mineralised lenses and
along plunge extensions to previously mined lenses.
A parent cell size in WMG of 20m in Northing, 20m in RL and 10m in Easting was
chosen.
The parent cell size was optimised to suit the widely drilled portion of the model,
using appropriate domain constraints and interpolation parameters to ensure
modelled grades reflect the characteristics of the previously mined lenses.
The mine design work carried out on the block model for the PEA was of a similar
resolution to the block model, reflecting both the preliminary nature of the
economic assessment and the high proportion of inferred material within the
evaluated areas.

14.6.3 Grade Interpolation
Ordinary Kriging was chosen for the interpolation of grades into the model. A total
of six elements were interpolated for each domain. Grade interpolation parameters
were developed from the results of the variography study for each element and
these parameters were applied to every domain. Each domain used a separate
composite file for the domain being modelled. All domain boundaries were treated
as hard boundaries for the purposes of interpolation.
Table 14.9: Variogram model simplified parameters
Variogram Parameters
Directions Structures Ranges
Element Range Range
Azimuth Plunge Nugget Partial Sill 1 Partial Sill 2 1 2
170 0 12 70
Zn % 260 60 3 35 29 12 100
80 30 5 35
170 0 7 75
Pb % 260 60 1 5 7.6 7 130
80 30 5 38
170 0 8 90
Cu % 260 60 0.3 1.5 2.6 10 30
80 30 5 23
182 19 20 170
Au g/t 245 -53 0.03 0.3 0.45 20 900
284 30 10 160
170 0 50 270
Ag g/t 260 60 2500 5000 2500 120 200
80 30 200 40
170 0 12 70
Fe % 260 60 30 35 29 12 100
80 30 5 35
A three pass elliptical search was used to interpolate grade. The search ellipse
was based on the variography. The first pass interpolated the majority of blocks,
and only sparsely drilled areas were informed by the second and third search
passes.

Table 14.10: Search ellipse parameters
Search Ellipse Parameters

Search Factors
Element Azimuth Plunge Rotation Sectors Distances
Dir 1 Dir 2 Dir 3
Zn % 170 0 -60 4 70 200 60
Pb % 170 0 -60 4 70 260 80
Cu % 170 0 -60 4 90 260 46
Au g/t 182 19 -57 4 120 1800 320
Ag g/t 170 0 -60 4 900 400 80
Fe % 170 0 -60 4 70 200 60
Search 1 Search 2 Search 3

Distance Samples Distance Samples Distance Samples
Element Max Max Max
Min Min Min
Factor Per Factor Per Factor Per
Total Total Total
Sector Sector Sector
Zn % 2 8 32 200 8 16 1200 4 4
Pb % 2 8 32 200 8 16 1200 4 4
Cu % 2 8 32 200 8 16 1200 4 4
Au g/t 2 8 32 200 8 16 1200 4 4
Ag g/t 2 8 32 200 8 16 1200 4 4
Fe % 2 8 32 200 8 16 1200 4 4
Factors in the above Table 14.10 are expansion factors applied to the original
search ellipse in a multi-pass search to locate sufficient samples with which to
compute block grades.
ZnEq was not interpolated, but was instead calculated for each block from the
estimated block grades. The ZnEq calculation takes into account, mining costs,
milling costs, recoveries, playability (including transport and refining charges) and
metal prices in generating a zinc equivalent value for each block grade for Au, Ag,
Cu, Pb and Zn.
ZnEq = Zn%+Cu%*3.12 +Pb%*0.81+*Au g/t*0.86+Ag g/t*0.03
14.6.4 Specific Gravity
Specific gravity was assigned to individual blocks in the block model using the
adjusted historical density grade regression as discussed in Section 14.3.7 applied
to the interpolated block grades. This is principally the same approach as for
previous models with the exception of the application of a lower cut applied to
material falling below the minimum measured densities from recent drilling (2.65).
SG = 2.2118+(0.0552*Fe%)+(0.0487*Pb%)+(0.0226*Zn%)
Waste material outside of the mineralised domains was assigned the same
minimum density as the mineralised domains.

14.6.5 Model Verification and Validation
Upon the completion of interpolation each domain was individually assessed for
interpolation performance of all six elements. Grades were examined:
 visually in three dimensions for comparison between original assay grades
(pre compositing) and interpolated block grades;
 the slope of regression and Kriging error were also checked against the drill
hole intercept spacing, and
 swath plots were generated for composite grades and block grades on a
20m RL level spacing (i.e. in the long axis of the mineralisation) for each
domain.
The visual comparison of the grades between the model and the original drill hole
assay data was found to be acceptable. There is inherent in the use of Kriging,
some smoothing of high and low grades. The effect was negligible in the well
drilled areas of the model (usually classified as Indicated), and moderate in areas
of broader spaced drilling, which have been classified as Inferred. Because of the
tight geological domaining employed in the modelling there was no significant
smearing between mineralisation types.
With the search parameters employed, the slope of regression and Kriging errors
for almost all of the modelled domains was well within acceptable limits. Only on
the edges of domains, or domains with limited sample information were there some
issues with interpolation confidence. This has been reflected in the classification of
resources.
The main domain where this was an issue was the Lens AC domain, where, while
there is extensive geological mapping information to define the domain, there is
limited drilling and assay data available to estimate grades. The domain was
downgraded to Not Classified in areas of poor sampling information, and resources
have not been reported for this portion of the domain.
14.7 Resource Classification

14.7.1 Classification
Mineral Resource classification took into account the geological confidence of the
interpretation, the results of the interpolation performance and the engineering
assessment of recoverability of resources.
Material was classified on a domain by domain basis according to the results of the
assessment as being:
 MN – Mined: mineralisation inside the revised and updated void model.
 SK – Skin: mineralisation outside of the void model which is either
considered to be unrecoverable prior to future mine re-entry validation
(such as pillars or skins to waste rock filled historic openings), or within a
zone of known ground failure.
 ID – Indicated: mineralisation with geological mapping supporting
interpretation and sufficient assay data to be considered to be ± 15%
overall accuracy. This corresponds to areas of the deposit with a drill
spacing of 30m or less and good geological confidence of geometry
between intersections, including most remnant areas of the previous
operations. All of the blocks in the domain were interpolated in the first
pass of the interpolation.

 IF – Inferred: mineralisation with sufficient assay data to be considered to

be ±35% overall accuracy. This corresponds to areas of 50m or less drill
spacing, with reasonable correlation between assays in adjacent holes.
Mapping data may not be available, but there is good confidence in the
continuity between holes and domains are constrained by known major
faults along strike and plunge.
 NC – Not classified: Areas with insufficient drilling or mapping to define the
extents of the domain, or where there is good mapping data, but
insufficient assay data, or drilling has not been sampled sufficiently to
indicate continuity. These areas, while modelled, have not been reported
as resources.
Classification areas were domained and flagged using wireframes. Only Indicated
and Inferred Mineral Resources have been reported as part of the Mineral
Resource and considered for the plant feed.
Refer to Section 2.5 for details of the reconciliation between the resource
categories used and the CIM categories.
14.7.2 Estimate
The resources are reported insitu, without dilution, but depleted for previous
mining. A lower cutoff grade of 7% ZnEq has been applied.
Table 14.11: Mineral Resource Estimate – WUP – Breakdown by Lens

Quantity
Domain Type Class ZnEq(%) Zn(%) Pb(%) Cu(%) Au(g/t) Ag(g/t)
(1,000 t)
A1 Polymetallic Indicated 97.9 26.7 13.1 5.4 1.63 0.59 120

A1 Polymetallic Inferred 245.0 19.5 10.3 4.0 1.01 0.63 77
B1 Polymetallic Indicated 425.0 24.1 12.6 4.8 1.37 0.33 101
B1 Polymetallic Inferred 176.9 19.9 9.8 4.0 1.16 0.38 96
C1 Polymetallic Indicated 135.1 22.7 12.5 4.0 1.42 0.53 68
C1 Polymetallic Inferred 65.4 17.4 9.9 1.5 1.57 0.12 44
D1 Polymetallic Indicated 227.6 13.0 6.3 2.2 1.11 0.50 33
D1 Polymetallic Inferred 320.8 11.2 3.6 1.6 1.38 1.13 34
D2 Polymetallic Indicated 60.9 23.6 10.0 5.4 1.99 0.32 92


Quantity
Domain Type Class ZnEq(%) Zn(%) Pb(%) Cu(%) Au(g/t) Ag(g/t)
(1,000 t)
E1 Polymetallic Indicated 55.2 20.0 7.6 4.1 1.73 0.88 99
E1 Polymetallic Inferred 93.9 23.8 10.8 5.4 1.71 0.93 83
E2 Polymetallic Indicated 8.0 8.1 1.9 0.6 1.57 0.63 11
E2 Polymetallic Inferred 67.3 12.5 5.6 2.1 1.18 1.06 22
G1 Polymetallic Indicated 26.1 37.1 11.9 5.8 1.86 2.46 420
G1 Polymetallic Inferred 324.7 22.3 4.6 2.5 3.14 1.61 150
G2 Polymetallic Indicated 15.3 22.5 11.4 5.4 1.45 0.40 63
H1 Polymetallic Indicated 29.8 22.9 4.6 2.9 3.74 1.95 88
H1 Polymetallic Inferred 18.9 21.1 3.5 2.4 3.86 1.79 72
I1 Polymetallic Indicated 8.8 18.7 4.6 1.7 3.12 1.08 66
I2 Polymetallic Inferred 38.0 27.6 6.7 4.9 4.04 1.81 91
I3 Polymetallic Indicated 41.9 8.8 2.5 0.7 1.49 0.49 22
I6 Polymetallic Inferred 221.9 26.2 11.1 3.7 2.57 1.68 89
J1 Polymetallic Indicated 72.4 28.4 14.3 4.1 2.98 0.04 49
J1 Polymetallic Inferred 4.4 28.5 14.5 5.1 2.56 0.06 61
Kate Polymetallic Inferred 487.5 22.1 11.4 3.7 1.65 1.02 58
Total Polymetallic Indicated 1,574.6 21.3 10.7 4.0 1.47 0.46 78
Total Polymetallic Inferred 2,950.6 18.6 8.1 3.2 1.61 0.88 70
AC Copper Inferred 138.3 11.2 1.6 0.5 2.73 0.12 19

BC Copper Indicated 351.5 10.2 1.1 0.3 2.71 0.04 13
BC Copper Inferred 701.5 10.0 0.8 0.1 2.80 0.03 11
C5 Copper Indicated 139.7 11.2 0.9 0.3 3.04 0.18 16
C5 Copper Inferred 33.3 12.7 0.7 0.3 3.58 0.15 16
CC Copper Indicated 94.1 11.3 0.7 0.1 3.16 0.13 15
CC Copper Inferred 42.4 12.3 0.8 0.1 3.49 0.11 15
I4 Copper Inferred 81.7 11.9 2.7 0.7 2.21 0.70 37
I5 Copper Inferred 13.5 12.7 1.6 1.3 2.01 2.97 41
J2 Copper Indicated 44.4 10.7 1.6 0.4 2.32 0.03 50
JC Copper Indicated 174.6 9.8 1.0 0.2 2.65 0.03 13
JC Copper Inferred 73.0 10.3 0.9 0.1 2.87 0.07 11
Total Copper Indicated 804.3 10.5 1.0 0.3 2.78 0.07 16
Total Copper Inferred 1,083.8 10.5 1.1 0.2 2.79 0.14 15
Woodlawn Zinc-Copper Project” (available from ASX or SEDAR) Appendix 1 and in the JORC Code (2012) Table 1 Appendix 2.

Table 14.12: Mineral Resource Estimate – Woodlawn Underground Project (WUP)

Type Resource Quantity ZnEq(%) Zn(%) Cu(%) Pb(%) Au(g/t) Ag(g/t)
Category (Mt)
Polymetallic Indicated 1.6 21 10.7 1.5 4.0 0.46 78
Polymetallic Inferred 3.0 19 8.1 1.6 3.2 0.88 70
Copper Indicated 0.8 10 1.0 2.8 0.3 0.07 16
Copper Inferred 1.1 11 1.1 2.8 0.2 0.14 15
Woodlawn Zinc-Copper Project” (available from ASX or SEDAR).
14.7.3 Adequacy of Resource Estimation Methods
The Mineral Resource estimate has been reviewed by Mr D Guibal of SRK

Consulting. This review included the following steps:
 Regular discussions with Heron Resource geologist during the building of
the geological model.
 Visual examination of the final geological model against existing drillhole
and mapping data.
 Variography of the major elements: Zn, Cu, Pb, Ag, Au and Fe, as
described in section 14.5.
 Review of the kriging parameters used by Heron.
 Review of the resulting block model (Visually and statistically).
 Review of the quality of the estimation through an evaluation of kriging
quality parameters (slope of regression and kriging efficiency).
 Review of the classification criteria and results.
The overall conclusion of the review is that the model and resource estimates are
sound, based on a thorough analysis of the geology and the data. If anything, the
results are conservative, as a number of zones are eliminated from the resources
based on fairly strict criteria of confidence in the geology, data density and
mineability.
14.7.4 Discussion
There are a number of differences between the reporting of Mineral Resources in

2006 and the current 2015 model. These relate to a change of focus of the
resource modelling. The previous 2006 model attempted to estimate the total
remaining in ground Mineral Resource at Woodlawn as at the close of mining in
1998. Whereas, the 2015 Mineral Resource was designed to define the likely
recoverable resources within the Woodlawn system for input into the current PEA
study.
The key differences between the two estimates are:
 The F Lens was not modelled in the current estimate, but was modelled in
the 2006 estimate.
 The 2006 model included 43 domains whereas the 2015 model has 33
domains. The difference in domain numbers reflects the non-modelling of
some domains as outlined above, the inclusion of geological mapping

connecting previously separated domains, the splitting of some domains

into copper and complex mineralisation and the bounding of domains by
major through-going faults.
 The void model was rebuilt from the survey plans, adding previously
omitted development and stopes. The void model was built to reflect the
shanty backing of the hangingwall where appropriate.
 The 2015 model was assessed for minability. Material which is contained in
skins to existing stopes, non-recoverable pillars and areas of known
collapse have been removed from the resource inventory (such areas may
be recoverable in a future paste fill operation). The assessment was
carried with mining engineers as a part of the PEA study.
 Parent cell sizes were adjusted to reflect long-hole mining methods
recommended in the PEA study. The 2006 model used smaller blocks
appropriate for jumbo cut and fill mining methods previously considered.
 Kriging was used for interpolation in the 2015 model. All previous models
have used inverse distance interpolation methods. Anecdotally, Kriging is
used for interpolation in most operating VMS mines in Australia.
 Where sufficient data exists domains have been constrained by geological
mapping, modelled fault planes, and mineralisation style. The previous
models used grade cutoff constraints and drilling to define domains.
Geological section and plan interpretations were used, but the mapping
was not digitised into three dimensions as for the 2015 model.
 New drilling since 2006 has been incorporated into extensions of I, D, E, B,
J and G Lenses. In addition the Kate Lens has been modelled for the first
time.
 Although modelled, the Lisa Lens (LC Domain) was not classified or
reported due to the limited number of significant intercepts to date (three).
Further drilling is required to firm up the dimensions and grades of the Lisa
Lens.
A number of refinements of the resource model are recommended for future economic
studies, up to and including feasibility studies. These include:
 Fault model wireframes have been constructed from mapping data for the
major fault planes in the mine. A more detailed fault model should be
created from the available mapping and drilling data, both to improve the
domaining of mineralisation, and to assist with the development of the
geotechnical model as a part of future feasibility studies.
 Waste domains, alteration domains and geotechnical domains have not
been modelled as part of the PEA study. However it is recommended for
further economic assessments, including feasibility studies that a full
geological model of the deposit and surrounding rock mass be developed.
 A structured drill out of resources to Indicated classification based on the
required production schedule to support operation construction and ensure
profitability. The recent drilling and modelling has highlighted the presence
of a number of economically significant, near surface, unmined resources
accessible from new underground development. Drilling of these shallow
resources from surface to indicated status should, combined with remnant
material, provide sufficient resource inventory to justify redevelopment of
the underground mine.
 The resource is not currently considered to be geologically closed off at
depth, or along strike to the north and south. Further exploration drilling

may locate other mineralised lenses within the immediate mine area,
consistent with VMS mining camp resource distributions.
14.8 Mineral Resource Estimates (Tailings)

The Woodlawn Retreatment Project mineral resource is contained in three tailings
dams on SML20. The resource represents all of the tailings discharge from the
open pit and underground mining carried out on the Woodlawn deposit, the satellite
Currawang and Cowley Hills deposits between 1978 and March 1998, when the
operation was closed.
The resource estimate used in this PEA study was prepared by Mr Robin Rankin of
GeoRes in “Woodlawn Retreatment Project (WRP) – Mineral Resources”, May
2008 to JORC 2004 guidelines. They were also published as part of NI 43-101
technical reports for Tri Origin Exploration (TOE) in Canada, June 2008 and again
in October 2009.
The resource model was based on assay and density data from the drilling of the
tailings deposits by both Denehurst and Tri Origin Exploration. The model
reconciled reasonably well with the historical processing production records for the
dams.
While some drilling has been carried out on the resource area, post 2008, by
TriAusMin, for metallurgical samples, it is not envisaged that the results of the
drilling will have a material impact on the size or grade of the resource as
previously modelled. As a result the existing model is suitable for the purposes of
the PEA study.
Heron plans to review the resource model for the retreatment project during the
planned future FS study.

Table 14.13: Mineral Resource Estimate - Woodlawn Retreatment Project (WRP)
Grades
Resource Category Quantity ZnEq (%) Zn Cu Pb Au Ag
(Mt) (%) (%) (%) (g/t) (g/t)
Measured + Indicated Mineral Resources
North Dam
Measured 0.83 6.2 2.35 0.43 1.43 0.29 35
Indicated 1.38 6.7 2.68 0.45 1.44 0.29 40
Sub-Total 2.21 6.5 2.56 0.44 1.44 0.29 38
South Dam
Measured 2.43 6.0 2.60 0.48 1.19 0.22 25
Indicated 1.17 5.8 2.44 0.48 1.19 0.22 23
Sub-Total 3.60 5.9 2.55 0.48 1.19 0.22 24
West Dam
Measured 2.05 6.5 2.00 0.60 1.46 0.39 36
Indicated 1.54 6.5 1.93 0.60 1.51 0.39 37
Sub-Total 3.59 6.5 1.97 0.60 1.48 0.39 36
All Dams
Measured 5.31 6.2 2.33 0.52 1.33 0.30 31
Indicated 4.09 6.4 2.33 0.52 1.40 0.31 34
Total Measured + 9.40 6.3 2.33 0.52 1.36 0.30 32
Indicated
Inferred Mineral Resources
North Dam 0.87 5.5 2.03 0.33 1.33 0.25 37
South Dam 0.90 5.7 2.32 0.47 1.19 0.23 24
West Dam 0.48 6.3 1.83 0.61 1.47 0.38 34
Total Inferred 2.25 5.7 2.10 0.44 1.30 0.27 31
Notes to accompany Mineral Resource Table: 1) ZnEq% refers to a calculated Zn equivalent grade the formula for which is stated in section 14.6.3 and
these are different to the originally reported (May 2009) ZnEq grades which were based on a different formula; 2) Values are rounded to two significant
numbers and some rounded related discrepancies may occur in the totals; 3) The Mineral Resource is reported in a manner compliant with the JORC 2004
and NI 43-101 Codes. This information was prepared and first disclosed under the JORC Code (2004) in May 2009. It has not been updated since to
comply with the JORC Code 2012 on the basis that the information has not materially changed since it was last reported. 4) TriAusMin acquired more drill
hole data in 2008, subsequent to the Mineral Resource estimation. That data however does not materially alter the Mineral Resource estimate and due to
data collection problems it is not viable for use in a re-estimate. Nevertheless, statistics of the later assays confirm the reported estimated grades. 5)
Further details of the Mineral Resources estimation, including Competent Person statements can be found in the market release of 22nd April 2015 entitled
“Preliminary Economic Assessment Delivers Strong Business Case for the Woodlawn Zinc-Copper Project” (available from ASX or SEDAR) including the
Competent Person Statement.

15 Mineral Reserve Estimates

Mineral Reserves for the tailings retreatment process were estimated as part of the
WRP Feasibility Study in 2008 (Intermet, 2008). The Mineral Reserves were
based on Mineral Resources estimated by Mr Robin Rankin of GeoRes consulting
in 29 May 2008.
For the purposes of the PEA, and in accordance with NI 43-101 guidelines, the
production schedule for the reprocessed tailings elements of the plant feed have
been based on the WRP Mineral Resource, not the Mineral Reserve. Hence, the
historical Mineral Reserves for the WRP do not form a part of this Report.
It is noted that this PEA does not replace the prior studies and the previously
published tailings Mineral Reserves remain unchanged.

16 Mining Methods
16.1 Introduction
The Woodlawn Retreatment Project (WRP) will treat reclaimed tailings material
from the tailings dams deposited during the previous operations of the Woodlawn
mine prior to closing down in 1998. These tailings will initially be reclaimed in
sequence at a rate of up to 1.5 million tonnes per annum (Mtpa) by hydraulic
monitoring from the Tailings Dam South (TDS), Tailings Dam West (TDW) and
Tailings Dam North (TDN).
The tailings reclamation strategy will be by “top down” hydraulic monitoring system
(Figure 16.1). The slurry collected will be screened to remove trash prior to
thickening and pumping to the feed stock tanks. The water for monitoring will be
provided from the mining thickener overflow with makeup from the process water.
Hydraulic mining operations will operate on a 24 hour per day basis.
The Woodlawn Underground Project (WUP) will be accessed by a new portal and
decline. Currently two locations for the portal are being considered:
 One adjacent to the treatment plant located in Hickory’s Paddock.
 The other on the western side of the open pit and just to the north of the up
dip E and G Lenses.
The WUP is scheduled to produce at a maximum of 690 kilotonnes per annum
(ktpa) using three different mining methods:
 Drift and half uppers;
 Underhand Longitudinal and Transverse Open Stoping; and
 Multi-level continuous fill.
16.2 WRP Mining

16.2.1 Production Rate
Two main mining studies were undertaken on the tailings reclaim process by
TriOrigin in 2007-8. An initial study was undertaken by an independent consultant,
which provided technical and economic assessments for project scoping,
technology applications and broad production rationale. This work was then
followed up with more detailed assessment, including the involvement of Fraser
Alexander Tailings, which is the world’s largest tailings recovery contractor. Under
a monitor-based hydraulic mining scenario the principal drivers for determination of
the optimum throughput are the overall project economic parameters. The low
capital intensity of this mining method, and the relative flexibility in throughputs,
allows relatively linear scalability in determination of production scale alternatives.
There is also no shortage of potential working faces around the dams and
production rates of up to 2.0 million tonnes per annum (Mtpa) are considered easily
achievable with overall hydraulic mining costs on a per tonne basis remaining
similar across the range of throughputs.

Figure 16.1: Top Down Hydraulic Mining Method
16.2.2 Mining Factors
A 2008 study was carried out into the appropriate factors (dilution and ore loss) for
converting the resource into a practical mining plan.
Dilution and recovery assumptions adopted are based on an average vertical loss
of 200mm tailings material on the extremities of the dams in the course of
recovering the material by the monitors. Of the remaining material, the assumed
amount of dilution is equivalent to 100mm average vertical gain of the original
block, at no grade. Effectively this material is added back to the product stream
delivered to the sump. In some areas, material with grade will be lost and in other
areas, material with no grade will be added to the product stream. Applying these
criteria, the overall mining loss has been calculated at 3.5%, and the dilution factor
at 3.1%.
16.2.3 Mining Schedule
The nature of the tailings dam resources and the significant body of historical
information available from earlier operations suggest that the Inferred component
of the resource estimate will be converted to Measured or Indicated resource
category as further drilling and metallurgical test work is conducted. Drilling access
has been restricted in some parts of the dams due to standing water, which varies
depending on local rainfall patterns. The final mining schedule, however, includes
all resource categories of tailings and is presented in Table 16.1.

Table 16.1: Proposed WRP Mining Schedule
Financial Year LOM 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
South Dam Tonnes Mined kt 4,290 479 1,140 947 827 792 104 - - - - -
Zn Grade (Equiv.) kt 5.71% 5.71% 5.71% 5.71% 5.71% 5.71% 5.71% 0.00% 0.00% 0.00% 0.00% 0.00%
Zn Grade % 2.43% 2.43% 2.43% 2.43% 2.43% 2.43% 2.43% 0.00% 0.00% 0.00% 0.00% 0.00%
Pb Grade % 1.15% 1.15% 1.15% 1.15% 1.15% 1.15% 1.15% 0.00% 0.00% 0.00% 0.00% 0.00%
Cu Grade % 0.47% 0.47% 0.47% 0.47% 0.47% 0.47% 0.47% 0.00% 0.00% 0.00% 0.00% 0.00%
Ag Grade g/t 23.4 23.4 23.4 23.4 23.4 23.4 23.4 - - - - -
Au Grade g/t 0.21 0.21 0.21 0.21 0.21 0.21 0.21 - - - - -
West Dam Tonnes Mined kt 3,930 - - - - - 697 900 1,363 970 - -
Zn Grade (Equiv.) kt 6.26% 0.00% 0.00% 0.00% 0.00% 0.00% 6.26% 6.26% 6.26% 6.26% 0.00% 0.00%
Zn Grade % 1.90% 0.00% 0.00% 0.00% 0.00% 0.00% 1.90% 1.90% 1.90% 1.90% 0.00% 0.00%
Pb Grade % 1.44% 0.00% 0.00% 0.00% 0.00% 0.00% 1.44% 1.44% 1.44% 1.44% 0.00% 0.00%
Cu Grade % 0.59% 0.00% 0.00% 0.00% 0.00% 0.00% 0.59% 0.59% 0.59% 0.59% 0.00% 0.00%
Ag Grade g/t 34.9 - - - - - 34.9 34.9 34.9 34.9 - -
Au Grade g/t 0.36 - - - - - 0.36 0.36 0.36 0.36 - -
North Dam Tonnes Mined kt 3,020 - - - - - - - - 530 1,500 990
Zn Grade (Equiv.) kt 6.04% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 6.04% 6.04% 6.04%
Zn Grade % 2.34% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 2.34% 2.34% 2.34%
Pb Grade % 1.38% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 1.38% 1.38% 1.38%
Cu Grade % 0.40% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.40% 0.40% 0.40%
Ag Grade g/t 36.9 - - - - - - - - 36.9 36.9 36.9
Au Grade g/t 0.26 - - - - - - - - 0.26 0.26 0.26
Tailings Tonnes Mined kt 11,240 479 1,140 947 827 792 801 900 1,363 1,500 1,500 990
Zn Grade (Equiv.) kt 5.99% 5.71% 5.71% 5.71% 5.71% 5.71% 6.19% 6.26% 6.26% 6.18% 6.04% 6.04%
Zn Grade % 2.22% 2.43% 2.43% 2.43% 2.43% 2.43% 1.97% 1.90% 1.90% 2.06% 2.34% 2.34%
Pb Grade % 1.31% 1.15% 1.15% 1.15% 1.15% 1.15% 1.40% 1.44% 1.44% 1.42% 1.38% 1.38%
Cu Grade % 0.49% 0.47% 0.47% 0.47% 0.47% 0.47% 0.57% 0.59% 0.59% 0.52% 0.40% 0.40%
Ag Grade g/t 31.1 23.4 23.4 23.4 23.4 23.4 33.4 34.9 34.9 35.6 36.9 36.9
Au Grade g/t 0.28 0.21 0.21 0.21 0.21 0.21 0.34 0.36 0.36 0.32 0.26 0.26
The mining schedule is based on a nominal 1.5Mtpa tailings recovery and

processing rate equivalent to an average 125,000 tonnes per month or 190 dry
tonnes per hour at 90% availability. The initial phase of operations is a ramp-up
period and will be marked by reduced throughput and recovery. Estimated mining
rates have been adjusted downwards (discounted) according to the ramp-up
factors given in Table 16.2. These data are the assumptions developed for the
process plant’s ability to meet both production and recovery nameplate criteria, as
it build up to its production capacity.
Table 16.2: Ramp Up Schedule
Months after commissioning on tailings

Item Unit
1-3 4-6 7-9 10-
Throughput rate % of Design 75 90 95 100
Availability % of Design 80 90 100 100
Tonnes treated % of Design 60 85 95 100
16.2.4 Mining Strategy
A “top down” hydraulic mining approach (Figures 16.1 and 16.2) has been
designed and will use multiple monitors on two faces, with possibly a third unit on
standby backup.
Tailings Dam South is the first dam to be mined, followed by TDW and then TDN.
This selection is based on a Net Smelter Return (NSR) analysis undertaken, which

involved assessing the different dams value on a comparative basis. This aided in
understanding the NSR of each dam, relative to one another. The assumptions
adopted for the NSR calculation were based on the Project’s economic evaluation
model data at that time. Another advantage of mining TDS first is that it liberates a
larger storage capacity for returned tailings, than either TDW or TDN.
The mining method for TDS is based on taking two lifts. The first lift being a full
width extraction to a single mid-dam located channel and sump arrangement at a
low point in the southwest corner of the dam wall.
Tailings will be monitored back to the channel, flowing to the sump and pump
arrangement. The location of the channel has also been placed to maximise the
use of an existing drainage channel on the surface of the dam.
A second lift involving three cells and associated channels has been designed to
maximise recovery and use floor contours to benefit material flow. Bench cleanup
of the floor is planned to progress behind extraction of each cell in the bottom lift.
A floating pontoon, fitted with two submersible pumps, will be installed in the
southern end of the TDS in the standing water on the dam surface. A dual
containment pipeline corridor will be installed on an easement corridor to the
planned plant location and then onto Evaporation Dam 1 (ED1). Standing water
and drain-down water will be transferred to ED1.
Mining of TDW will involve taking 5m high benches, subdivided into two cells with
an associated channel for each cell. The final lift will involve final floor clean up to
the base of the dam.
Figure 16.2: Typical Dam Channel Monitoring
Mining of TDN will involve five cells based on sections delineated by existing
internal walls constructed during placement of original tailings.
Although the resource model work identified two horizontal domains in TDN, a
mining method that selectively mines these sections has not been designed and
scheduled. It is assumed that the two parts will be bulk mined together.

16.3 WUP Access

16.3.1 Underground Mine Access
As the original portals and declines were located within the open pit which Veolia is
using as a bioreactor to generate gas to fire a power station, the Woodlawn
Underground Project (WUP) will be accessed by a new portal and decline from the
surface and outside the open pit.
Two potential areas to locate the decline portal were considered (Figure 16.3)
however geotechnical drilling and testing of Option 1 indicated relatively poor
ground conditions to the east of the open pit which would require considerable
support in the decline.
Option 1 was abandoned in favour of a site located on the eastern side of the
open-pit where ground conditions are known to be more favourable.
Option 2 is immediately to the west of the open-pit. There are a number of sub-
options at this location. Each sub-option will be considered in light of infrastructure
that Veolia require within the defined Veolia Area of Operations for development of
Veolia’s Mechanical Biological Treatment (MBT) facility which is to be constructed
further to the west of the proposed portal location.
Figure 16.3: Portal Location Options
The MBT is a secondary processing plant designed to remove non-putrescible

waste from the delivered waste stream and recycle any waste product streams into
potentially saleable products (glass, metals etc.) and generate an organic waste
mulch which can be used as a rehabilitation product for the mining project.

These sub-options require a much shorter decline to access the upper sections of
E and G Lens stopes and the mine in general. However, they do require material
to be hauled on surface across or around Veolia’s area of operation. During the
next stage of study Heron plans to investigate the options for hauling material from
the portal location to the processing facility in Hickory’s Paddock, or if relocation of
the processing facilities to the north of the open pit in the area bounded by
Collector Road, the existing Veolia Administration Building, Evaporation Dam 1 and
Veolia’s access road to the MBT Plant is warranted.
16.3.2 Option 2 Portal and Decline Geotechnical Reviews
Option 2 portal sites west of the open pit not been evaluated in a geotechnical
study but will be included in future work for the FS.
Apart from offering a shorter decline length into the upper reaches of E and G
Lenses, past drilling indicates that there is significant dolerite in this area which
would offer better ground conditions for the development of the portal and decline.
Development of the portal boxcut will be by earthworks contractor whilst
development of the decline will be by mining contractor.
16.3.3 Option 2 Western Portal Preliminary Design
A preliminary design for the western decline spirals on the north side of G Lens
and places the decline as close as practical to both E and G Lenses.
With the portal located closer to the top of E Lens, access to the upper levels of E
and G Lenses can be achieved without any additional incline development.
Figure 16.4 shows the preliminary decline design to access the upper orebodies
west of the open-pit.
Figure 16.4: Preliminary Western Portal Decline Design

16.3.4 Decline Temporary Construction Facilities
The following temporary facilities will be provided by the mining contractor as part
of the decline development contract.
 Site offices including temporary connection to water, power and
communications.
 Muster and crib room.
 Cap lamp room.
 First aid & emergency response room.
 Ablution block and change rooms.
 Workshop & store.
 Refuelling and lubrication bay.
 Power supply including backup emergency generator.
 Surface fans.
 Mine pumping system.
 Underground communications (leaky feeder).
 Compressor.
 Water main.
 Shotcrete system.
16.4 WUP Mining

16.4.1 Introduction
The WUP involves the re-opening of the Woodlawn underground mine that was
closed in 1998 for predominantly economic factors with other mines held by
Denehurst. The Woodlawn mine, under administration at the time, was unable to
provide sufficient guarantee to the administrator on the immediate production
future. During final operations by Denehurst a number of the accessible remnant
ore pillars were systematically extracted whilst other blocks were left untouched.

Figure 16.5: Underground Mine Showing New Stopes and Existing Workings
The Woodlawn mine is scheduled to produce at a maximum of 690ktpa using three

different mining methods:
 Drift and Half-uppers;
 Underhand Longitudinal and Transverse Open Stoping; and
 Multi-level Continuous Fill.
Table 16.3 presents the proposed process plant feed design for the WUP.

Table 16.3: WUP Process Plant Feed
Proposed
Resource Zinc Lead Copper Gold Silver
Domain % plant
classification (%) (%) (%) (g/t) (g/t)
feed (Mt)
Polymetallic Indicated 26% 0.98 16.1 7.9 2.9 1.3 0.3
Inferred 55% 2.10 2.10 15.5 2.6 1.4 0.8
Copper Indicated 6% 0.24 0.24 10.2 0.8 2.1 1000.1
Inferred 13% 0.48 9.1 9.1 0.3 2.4 0.1
Total 100% 3.80 14.5 6.0 2.2 1.5 0.5
These figures include dilution and ore losses as discussed in Sections 16.4.9 and
16.4.10.
16.4.2 Existing Workings
The existing workings (Figure 16.6) for the Woodlawn mine primarily access A, B
and C Lenses. The original mine was accessed by two declines from within the
open pit. These accesses have been plugged and Veolia have commenced
constructing a methane bioreactor within the pit. Consequently an alternative mine
access is required. In the latter stages of the mine operation there are limited
records of what was mined and this has been pieced together from drill designs
and interviews with employees employed at the site during that period. Where
there is any uncertainty to whether the ore block has been mined, the block has
been excluded from the proposed mill feed.
The historic operation generally placed unconsolidated waste to backfill stopes.
The surface ventilation shafts have been backfilled from the surface. No records
regarding the quantities placed in the shafts have been sourced and it is known
that the ladder ways were not removed from the shafts prior to backfilling.
The PEA design, where possible, aims to rehabilitate the mine development where
appropriate to access the remaining Woodlawn deposit.
16.4.3 Mining Method Selection
The mining method has been selected to mine both areas of previous unmined
material and remnant material around the previous mined areas of the deposit.
The mining method selection takes into consideration the location of the existing
open pit above the deposit which is being used a as bioreactor by Veolia.
The mining methods that have been considered are:
 Drift and Half-uppers (Figure 16.7).
 Underhand Longitudinal and Transverse Open Stoping (Figure 16.8).
 Multi-level Continuous Fill (Figure 16.9).

Figure 16.6: Existing Development and Mined Areas
Drift and Half-uppers Stoping
The drift and fill half uppers mining method is planned to be mined in the remnant
areas of the A Lens, B Lens, D Lens, G Lens, H Lens and J Lens.
The stopes are typically 10m to 20m along strike with the shorter strike lengths in
the vicinity of the major faults and between 3m and 20m wide.
The production cycle for the drift and fill half uppers includes the following:
 Tight fill old workings below.
 Develop footwall drive along the top of the old workings using probe holes in
the face, floor and backs with every cut.
 Probe backs along drive to determine old workings location and proposed sill
pillar stability.
 Drill and blast backs to required height leaving the new sill pillar.
 Construct bulk head and paste fill drive / stope.
 Mine next drive adjacent to the paste filled drive / stope and repeat process
across the width of the orebody.

Figure 16.7: Drift and Half-upper Mining Method
Underhand Open Stoping
The underhand stoping mining method is proposed to be applied in both the

transverse and longitudinal layouts depending on the width of the stopes. Stopes
greater than 15m across strike will be mined as transverse stopes.
The sub level spacing has been designed at 20m as recommended by Beck. The
stopes are typically 10m to 30m along strike with the shorter strike lengths in the
vicinity of the major faults. The larger stope lengths are located in Kate Lens.
The production cycle for the underhand open stoping is as follows:
 Mine ore drives longitudinally or transversely at regular level spacings.
 Mine top level stopes on retreat placing paste fill in each stope.
 Mine stopes in level below when paste has had adequate curing time.
 Continue for each level going down.
Figure 16.8: Underhand Open Stoping Mining Method

Multi-level Continuous Fill
The Multi-level Continuous Fill method has been selectively applied in the B Lens
where there are production areas over multiple levels within the existing mined
area.
The sublevel spacing is governed by the existing development and any new
sublevels are mined at 20m spacings.
The production cycle for the underhand open stoping is as follows:
 Tight fill old workings below.
 Develop a drive along the top of the old workings using probe holes in the
face, floor and backs with every cut.
 Probe backs along drive to determine old working location.
 Begin to mine drive on top of old workings.
 Drill and blast the lower level stope to the bottom of the old workings.
 Retrieve the stope for feeding to the plant while filling with waste rock form the
above drive.
 Continue to fill with waste rock to the floor level of the upper drive.
 Advance the upper drive and place waste fill as lower level stope is retreated.
 The fill drive is used to extract the next crown, becoming the drill drive.
Figure 16.9: Multi-level Continuous Fill Mining Method

16.4.4 Vertical Development
The vertical development design includes:

 Exhaust ventilation raises to the surface from the lower sections of the
declines, the maximum size for the raises is planned to be 3m diameter.
 Emergency egress system has also been designed at 1.5m diameter which
will also be used as a fresh air intake.
16.4.5 Material Handling
Plant feed will be transferred from production areas to loading bays with
underground loaders and then loaded onto articulated trucks to be hauled to the
surface via the decline and from there on surface to the run-of-mine pad (ROM) at
the processing plant.
16.4.6 Mine Design Guidelines
The underground mine design has been completed based on the Mineral Resource
Model (BMFinal Classified 20150412 Mined.csv).
16.4.7 General Design Parameters
Table 16.4 summarises the design parameters applied for the underground mine
design.
Table 16.4: Mine Design Parameters
Description Units Value
Decline m (H) x m (W) 5.5 x 5.5

Level accesses m (H) x m (W) 5.5 x 5.0
Waste drives m (H) x m (W) 5x5
Ore drives m (H) x m (W) 5x5
Return air accesses m (H) x m (W) 5x5
Egress access m (H) x m (W) 5x5
Stockpiles m (H) x m (W) 5x5
Sumps m (H) x m (W) 4x4
Return airway m diameter 3
Escapeway m diameter 3
Sublevel spacing m 20
Drift and Half-uppers
Minimum mining height M 5
Stope strike length m 10 – 30
Minimum mining width m 3
Underhand stoping - transverse
Minimum length across strike m 10 – 30
Minimum mining width m 3
Multi-level continuous fill
Minimum mining height m 5

Stope strike length m 10 – 30

Minimum mining width. m 3
Unplanned Dilution % 20
Mining recovery % 85
16.4.8 Stope Design Criteria
Beck Engineering estimated hangingwall dilution using the equivalent linear

overbreak/ slough (ELOS – Clark & Pakalnis 1997). This uses a stability number
N’ and a hydraulic radius rH. For footwalls, 1.0m ELOS was assumed on the fault-
affected slopes and 0.5m ELOS for other areas. Table 16.5 includes hangingwall
and footwall estimates.
Table 16.5: Beck Engineering Summary of Stope Design Criteria
HW hydr
Vert Typical HW HW
Typical Strike rad. @ HW FW
Location Method height HW dip [rH] dip
N’ length spec. ELOS ELOS
(m) (deg) crit extent
dimensions
Overhand 25 60 0.83 3.5 28.9 10 3.7 1.5 1.0
Around major faults
Underhand 20 60 23.1 10 3.5
Remnant areas Underhand 15 65 4.0 16.6 15 3.9 1.5 1.0
Kate Lens Overhand 25 73 13.7 9.1 26.1 30 7.0 0.5 0.5

(exc faults) Underhand 20 73 20.9 30 6.2
Other lenses above Overhand 25 65 4.0 6.0 27.6 20 5.8 1.0 0.5
2300mRL (exc faults) Underhand 20 65 22.1 20 5.2
Other lenses below Overhand 25 53 2.6 5.2 31.3 15 5.1 1.5 0.5
2300mRL (exc faults) Underhand 20 53 25.0 15 4.7
The highlighted cells indicate marginally stable cases. Estimating dilution is

notoriously difficult and the ELOS values in the above table provide an initial guide.
With strong controls on the stoping process and favourable parting between ore
and host rocks it may be possible to reduce ELOS estimates by up to 25%
16.4.9 Dilution
Two types of dilution have been included in the WUP design:

 Planned dilution which is the non-ore material that is included in a designed
stope boundary.
 Unplanned dilution is that due predominately to blast overbreak and sloughing
of unstable walls.
The following tables identify the dilution values adopted in calculating ore feed
grades.
Table 16.6: Range of Planned Dilution in Process Plant Feed
Description Value
Minimum 0%
Maximum 50%
Average 7%

Table 16.7: Unplanned Dilution Factors
Area Unplanned Dilution
Kate Lens 9%
Lower D& I 16%
Other Lenses 12%
Around Major Faults 20%
Multi-level Continuous Fill 20%
16.4.10 Mining Recovery
Mining recovery has been calculated based on the shape of stopes and the
mineralisation that is not expected to be recovered. An angle of repose of 45° was
assumed in the calculations. The multi-level continuous fill recovery is based on
the mining recovery typical in a sub-level cave.
Table 16.8: Mining Recovery Assumptions
Mining Recovery
Stope Type
(%)
Stope width < 10m 97.5%
Stope width > 10m 95%
Multi-level Continuous Fill 85%
16.4.11 Cutoff Grades
Table 16.9 presents the cutoff grades used by SRK for each of the mining
methods.
Table 16.9: Cut-off Grade by Mining Method
Mining Method Cut-off Grade- ZnEq (%)
Drift and Half-upper and Transverse 5.25%

Underhand Stoping and Transverse 5.1%
Multi-level Continuous Fill 4.7%
Zinc equivalence is based on the formula:

ZnEq(%) = Zn(%)+0.81*Pb(%)+3.12*Cu(%)+0.86*Au(g/t)+0.3*Ag(g/t)
16.5 Mine Services and Infrastructure

16.5.1 Ventilation
Required Air Flow
Total primary airflow requirement has been estimated based on 0.06 m3/s for every
kilowatt power of mobile equipment according to Section 71.3 of the Work Health

and Safety (Mines) Regulation 2014 (NSW). Table 16.10 shows the estimated
peak production required airflow.
In the first year of production only the South Ventilation Rise will be required.
Production from A and B Lens commence after approximately 18 months; at this
stage the North Ventilation Rise will be required. The ventilation requirement will
be evenly distributed between the rises during years 3 to 5 and after the fifth year
the majority of the ventilation requirement will be from the North Ventilation Rise.
Table 16.10: Required Ventilation
3
Equipment Power rating (kW) Units Total power (kW) Total airflow required (m /s)
Truck AD55 439 3 1,317 79

LHD R1700 262 2 524 31
LHD R2900 333 2 666 40
Service Vehicles 125 1 125 8
Light Vehicles 75 3 225 14
Total 172
Primary Ventilation
The primary ventilation system consists of the decline portal as the main air intake
coupled with the northern and southern egress systems. Mine air is exhausted
through two rises connecting to the surface. There are three ventilation circuits;
the South, the Upper North and the Lower North. The maximum capacity of the
designed ventilation circuit is 183m3/s.
The South ventilation system utilises fresh air from the decline and southern
escape way to service primary air to E, G, H and Kate Lenses. The air is returned
through the South ventilation rise as shown in Figure 16.10.
The Upper North ventilation system utilises fresh air from the decline and northern
escape way to provide primary ventilation to A and B Lenses above 2400mRL. Air
from the North Decline is returned though a series of crosscuts to a ventilation rise
system that links back to the Northern ventilation rise. The ventilation circuit ends
at 2400mRL, where the Lower North ventilation system continues.
The Lower North ventilation system provides primary ventilation to the D, I and J
Lenses and the A and B Lenses below 2400mRL. Air from the North Decline is
returned through the Northern ventilation rise. Figure 16.11 shows the interactions
between the North Decline and the two northern ventilation systems.
Secondary Ventilation
Secondary ventilation will be supplied from fans located in the decline via ducting
to the working areas.

Figure 16.10: Primary Ventilation Circuit Looking East
Figure 16.11: Primary Ventilation Circuit Looking South

16.5.2 Backfill
The mine design has assumed that stopes will be filled with paste fill and the multi-
level continuous fill method using rock fill.
Waste rock and mineralised waste will be identified in the stopes and, where
possible directed to an existing open stope requiring filling.
Preliminary test work undertaken by Outotec has indicated that suitable paste fill
will be able to be made from the Project tailings when combined with lime and low
heat cement.
The paste will be manufactured at the process plant, pumped to and piped down
the decline or delivery holes into the mine for reticulation to the stopes to be filled.
See Section 17.3.10 for further details.
16.5.3 Water
Mine water will be supplied underground via the decline and service holes.
Dewatering of the underground mine will consist of a series of pump stations linked
via service holes, utilising the decline where required.
16.5.4 Compressed Air
Compressed air will be supplied underground from a surface compressor via the
decline to each sublevel.
16.5.5 Power
The underground mine will require a 1,000V power supply. The power will be
distributed underground via the decline and service holes where required. The
installation of underground substation has been allowed for in the design.
16.5.6 Emergency Egress
An emergency egress ladder way system is included in the mine design. Coupled
with the decline, personnel will have a second means of egress from all sublevels
within the mine.
During initial development it is recommended that refuge chambers be advanced
along with the decline development face. Decline stockpiles can be converted to
fixed refuge chambers as necessary to enable all personnel to be within close
proximity of a refuge chamber or fresh air source.
There are two secondary ladder way rises that connect to the surface. The
northern ladder way provides secondary egress to the A and B Lenses above
2400mRL. The southern ladder way provided secondary egress to all other areas
of the mine.
E, G, H and Kate Lenses production areas connect directly in to the southern
ladder way. D, I and J Lenses and A and B Lenses below 2400mRL connect to
the southern ladder way via a rehabilitated drive at 2440mRL that crosses between
A and Kate Lenses and connects to the Kate Lens decline and ladder way.
Figure 16.12 show the two surface connection ladder ways and the escape way
path from below 2400mRL.

Figure 16.12: Escapeway System Below 2400mRL
16.6 Mining Schedule

16.6.1 Scheduling Strategy
The scheduling strategy for the WUP is:

 Stope production to commence as soon as possible.
 Development to be mined on a “just-in-time” basis.
 Stope production is prioritised by zinc grade then zinc equivalent grade.
 Completion of return air and escape way rises for the level before stoping
commences.
16.6.2 Scheduling Parameters and Rates
SRK have applied typical development rates base on previous experiences. Table
16.11 presents the lateral and vertical development rates including the overall
monthly lateral development capacity.
Table 16.12 summarises the productivities for each mining method. The
underhand stoping longitudinal mining method has separate productivities based
on the strike length and across strike width of the mining panels. The productivities
are the maximum production per year per location and include ore development
tonnes.

Table 16.11: Development Productivity Rates
Rate
Development
(m/mth)
Single Heading
Decline 120
Rehabilitation 300
Rise 3
General development 60
Multiple headings
Lateral development capacity 720
Rehabilitation capacity 300
Table 16.12: Mining Method Productivities
Rate
Mining Method
(kt/yr)
Drift and half-upper/longhole 44
Drift and half-upper/transverse 45
Multi-level continuous fill 159
Paste fill beam 39
Underhand stoping/transverse 109
Drift and fill 105
Jumbo mining 5m (W) x 5m (H) 194
Jumbo mining 4m (W) x 4m (H) 124
Jumbo mining 3.5m (W) x 3.5m (H 95
16.6.3 Development Schedule
Figure 16.13 shows the annual development profile for the WUP. Ore
development within the stopes is not included in the development schedule
because the ore development is included in the stope production rates and costs.
The lateral development peaks at 5,000m per year excluding rehabilitation in the
second and third year of mining operation.

Figure 16.13: Development Schedule
16.6.4 Production Schedule
The production schedule targets an annual production rate of 750kt. However,

due to mining methods and work area availability, a peak production rate of 690 kt
is achieved and maintained for three years. The production comprises
development and stope ore. Figure 16.14 summarises the WUP production
schedule with associated grades.
Figure 16.14: Production Schedule

16.7 WUP Equipment, Infrastructure and Manpower Requirements

16.7.1 Mine Equipment Fleet
The mine equipment requirements for the WUP are presented in Table 16.13.
Table 16.13: Mine Equipment Requirements
Equipment No of Units
Truck AD 55 3
LHD R1700 2
LHD R2900l 2
Jumbos 3
Production Drills 3
Service vehicles 1
Light vehicles 3
16.7.2 WUP Infrastructure
The following permanent mine infrastructure will be provided:

 Permanent mine offices serviced by water, power and communications.
 Muster and crib room.
 First aid and emergency response room including underground ambulance.
 Ablution block and change house, including underground toilets.
 Workshop and store.
 Refuelling and lubrication bay.
 Vehicle washdown bay.
 Explosives magazine and delivery truck.
 Surface primary fans including gas monitoring.
 Mine dewatering system and
 Underground communications including leaky feeder.
 Underground power system including permanent 11kV
 Underground compressed air system.
 Fresh water system.
 Paste backfill system, boreholes and delivery pipelines.
 Shotcrete system including batch plant and delivery vehicle.
 Second egress and refuge chambers
16.7.3 Personnel
Shift Schedule
The mining costs have been estimated using a continuous mining operation, 24
hours a day, 365 days per year. All employees will be residential in the
communities surrounding the operation.
The WUP is planned to have a 4 days on and 4 days off, 12 hour shifts, roster for
operators and maintenance personnel and a 5 days on and 2 day off, 8 hour shifts,
roster for staff personnel

Personnel Levels
The personnel requirements for WUP are summarised in Table 16.14. All on-costs
for annual / sick leave and training have been estimated in the operating costs. All
equipment has been assigned with one operator per crew per machine.
Table 16.14: Personnel Requirements
Staff Number
Mine Manager 1
Underground Supervisors 4
Mine Technical Services Personnel 7
Jumbo Operators 12
Loader Operators 16
Truck Drivers 12
Longhole Drillers 8
Blasting Personnel 4
Services Crew 12
Grader Operators 2
Maintenance Planner 1
Leading Hand Fitter 1
Fitters 8
Leading Hand Electrician 1
Electricians 4

17 Recovery Methods
17.1 Introduction
The selected process recovery method has been based on co-treatment of the
underground resource and the retreatment of process tailings from the existing
tailings storage dams (TDs). A Front End Engineering Design (FEED) study was
completed on the Woodlawn Tailings Retreatment Project in 2012 (Sara, 2012)
and the metallurgical testing regime conducted as part of the FEED has laid the
basis for the co-treatment flowsheet design. The process plant will consist of both
conventional and fine grinding circuits then utilise differential flotation for the
extraction of copper, lead and zinc concentrates. The concentrates will be filtered
on-site for export via either Port Kembla or Port Botany. The proposed flowsheet
allows for the operation commencing with the plant feed of 100% tailings
reclamation as the underground mining operation ramps up to full production.
A simplified process flow diagram is shown in Figure 17.1 and Figure 17.2 for the
co-treatment plant design. Based on flotation test results achieved, as outlined in
Section 13.0, minimal changes to the original flowsheet design were needed and
this thereby provides for flexibility within the plant to treat a blend of 50% fresh
underground feed with 50% reclaimed tailings.

Figure 17.1: Plant Flowsheet – Part 1

Figure 17.2: Plant Flowsheet – Part 2

17.2 Process Design Basis

The plant has been designed on the basis of a 50% blend of fresh underground
feed being co-treated with 50% reclaimed tailings from the three existing tailings
dams located adjacent to the process plant location.
Initial operation will treat 100% tailings reclamation feed, whilst the mining
operations develop the decline to mine the fresh underground material.
The process plant has used the following key criteria as the basis of design
development.
Key Criteria Units Process Values
Annual throughput (50/50 basis) tpa 1,500,000
Feed Grades
- Copper % 1.21
- Lead % 2.34
- Zinc % 5.50
- Silver g/t 49
- Gold g/t 0.56
Copper Concentrate
- Copper Grade % 22
- Copper Recovery % 68
- Recovery of Silver to Concentrate % 10
Lead Concentrate
- Lead Grade % 45
- Lead Recovery % 65
Zinc Concentrate
- Zinc Grade % 45
- Zinc Recovery % 70
Operating Hours
- Crushing Circuit - Underground Feed h 6,132
- Milling Circuit - Underground Feed h 7,998
- TSF Regrind Circuit h 7,998
Treatment Rate
- Crushing - Underground Feed t/h 150
- Milling Circuit - Underground Feed t/h 95
- TSF Regrind Circuit t/h 95
- Combined Flotation Feed t/h 190

Underground Feed Primary Grind Size (P80) µm 75
TSF Reclaim Material Primary Grind Size (P80) µm 30
Concentrate Regrind Grind Size (P80) µm 20

Table 17.1: Process Plant Design Criteria
17.3 Process Plant Description

17.3.1 Overview
Feed to the new treatment plant will consist of both fresh sulphide underground
material and reclaimed tailings on a nominal 1:1 blend ratio. Following completion
of the PEA, the blend ratio may be refined during future studies.
Underground Plant Feed
Fresh underground mineralisation will be mined and delivered to a Run of Mine

(ROM) pad for processing through a two stage crushing circuit designed to provide
a crusher product size suitable as feed to a ball mill.
Crushed feed will be stored in a fine ore bin prior to reclaim via a conveyor system
to the primary ball mill. The primary ball mill will run in a closed circuit with
hydrocylones to produce a flotation feed P80 classification size of 75µm. The circuit
has been designed to provide 50% of the required feed rate to the flotation plant.
TSF Reclamation
The tailings will be reclaimed from the three existing tailings storage dams, Tailings
Dam South (TDS), Tailings Dam West (TDW) and Tailings Dam North (TDN) via a
hydraulic mining method with the material then being screened and pumped to the
process plant. The reclaimed tailings will be thickened and ground to a P80 of
30µm prior to the co-treatment flotation circuit.
Co-treatment Flotation Circuit
The co-treatment flotation circuit employed will utilise a talc, copper, lead and zinc
differential flotation sequence. Talc cleaner concentrate recovered from the talc
flotation cleaner cell will be discarded to final tails to remove some of the talcose
gangue ahead of the differential flotation circuit. A differential flotation circuit for
copper, lead and zinc will be utilised with concentrate regrind stages in the copper,
lead and zinc circuits to produce sales grade copper, lead and zinc concentrates.
The copper circuit will also utilise a rougher and scavenger tailings regrind circuit
prior to the lead flotation stage. Tailings from the flotation plant will be thickened
for recovery of process water and to provide underground paste fill material, with
slime tailings deposited into a new tailings dam, Tailings Storage Facility No 4
(TSF4).
Flotation concentrates from the copper, lead and zinc differential flotation circuit will
be thickened and subsequently filtered for road transport. Copper and zinc
concentrate will be shipped via Port Kembla in bulk carriers. Transport of the
concentrate from site will be by road with concentrate loaded into half height

containers via Front End Loader (FEL) at site. The high precious metals lead
concentrates will be loaded into bulka-bags via a bagging plant at the process
plant. Loaded bags will then be containerised for dispatch via the Port Botany
container port or via the container port at Port Kembla.
Raw water will be supplied to the process plant from the Willeroo borefield. No
water will be discharged from site with excess process water collected in
evaporation dams. The process water circuit will incorporate a water treatment
system for recovery of evaporation dam waters.
17.3.2 Crushing - Underground Plant Feed
A two stage crushing circuit has been selected based on similar applications and
on the historical data from Woodlawn operations. Fresh underground material will
be reclaimed by a FEL to a ROM bin. Feed will be reclaimed by a vibratory grizzly
pan feeder which will screen out undersize material and feed to the primary jaw
crusher. Underground feed will be reduced in size to a P80 of 105mm at the
primary crushing stage, based on a close side setting of 100mm on the jaw
crusher.
Primary crushed feed will be conveyed to a product screen with oversize directed
to a secondary cone crusher. The secondary crusher will provide for the additional
size reduction with a close side setting of 22mm.
The secondary crushing stage will be closed circuited with the product screen. The
final product size will be controlled by the product screen bottom deck to generate
a ball mill feed sized material with a P80 of 10.5mm.
Product sized material will be conveyed to a fine ore bin (FOB) for subsequent
reclaim to the primary ball mill.
17.3.3 Grinding - Underground Plant Feed
Crushed underground feed will be milled in a ball mill circuit closed by

hydrocyclones. Fresh underground feed will be reclaimed from the FOB by a
variable speed conveyor for mill feed rate control to a fixed speed mill feed
conveyor. The primary ball mill will be an overflow ball mill (4.42m diameter by
5.0m equivalent grinding length equipped with a 1,600kW mill motor. The circuit
will be closed with hydrocyclones to provide for a flotation feed size P80 of 75µm
and will be designed to operate at a recirculating load of up to 300%.
A fixed speed mill has been selected for the sulphide mineralisation and will
operate at 75% critical speed with a 35% ball charge. A primary cluster of 250mm
cyclones will be used to obtain the required flotation feed classification size.
Overflow from the hydrocylones will be pumped to the talc flotation conditioning
tank where it will be combined with reground tailings product prior to the flotation
stages. Cyclone underflow will gravitate back to the primary ball mill for further
comminution.
Lime will be added when required in the primary mill stage to ensure a pH prior to
flotation of 5.5 to 6.0.

17.3.4 Grinding – TSF Reclaim
Reclaimed tailings, hydraulically mined from the existing tailings dams will be
screened and pumped to the processing plant, where it will be thickened in an 18m
diameter high rate feed preparation thickener to achieve an underflow density of
between 60% and 70% solids (w/w). Thickener overflow will gravitate to the
process water dam for reuse in the hydraulic mining process and process plant.
Thickener underflow will be pumped to the IsaMill feed surge tank by one of two
thickener underflow pumps in a duty / standby configuration. The IsaMill feed
surge tank will provide a 2,200m3 storage capacity, prior to the milling circuit.
Thickened slurry from the surge tank will be diluted to approximately 50% solids
within the mill feed sump and then be pumped by centrifugal slurry pump to the
horizontal type grinding mill. The grinding mill selected is an IsaMill M10000 unit
that will have a volume of 10m³ and will be equipped with a 3.0MW drive. Mill feed
slurry will be ground from an average feed size F80 of 106µm to a product size P80
of 30µm using ceramic grinding media. The grinding mill will be configured in open
circuit. Lime is added to the mill feed to maintain a pH of 5.5 to 6.0.
17.3.5 Talc Flotation Circuit
Product discharged from both the underground grinding stage and tailings reclaim
grinding stage will be transferred to the talc flotation circuit consisting of a
conditioning stage, roughing stage and one stage of cleaning. The final talc
concentrate will be pumped to the flotation tailings sump for disposal. Talc flotation
rougher tails will feed the copper flotation circuit.
The cyclone overflow from the fresh underground milling stage and the tailings
IsaMill will discharge into a 35m³ agitated talc flotation feed conditioning tank. The
tank volume will provide a three minute conditioning residence time at the design
processing conditions.
Reagent additions in the talc flotation circuit include:
 Sodium Meta-bisulphite (SMBS) and lime will be added to the talc
conditioning tank.
 Frother added to the feed box of the talc rougher flotation stage.
Slurry will gravitate from the talc conditioning tank to the feed box of the first talc
rougher flotation cell. Flotation will take place in forced aspiration flotation cells.
The talc flotation circuit will comprise:
 five 10m³ talc rougher tank cells,and
 one 10m³ talc cleaner tank cell.
The recovered talc rougher concentrate will be pumped to the talc cleaner flotation
cell and the talc rougher tailings will discharge into the copper feed sump and then
be pumped to the copper flotation circuit.
Talc cleaner concentrate will be pumped to the final tails sump and the talc cleaner
tailings will gravitate from a tails box fitted with dart plugs to either the head of the
talc rougher flotation circuit or to the talc cleaner tail sump for transfer to the copper
conditioning tank.

17.3.6 Copper Flotation Circuit
The talc rougher tailings collected in the copper feed sump will be pumped to the
copper conditioning tank. The copper flotation circuit will comprise a conditioning
stage, roughing and scavenger stages followed by a regrind and two stages of
cleaning on the concentrate and a regrind stage on the circuit tail stream. The final
copper concentrate will be pumped to the copper concentrate dewatering circuit
and the copper flotation tailings will be pumped to a tail regrind circuit ahead of
lead flotation.
The copper feed pump located at the tail section of the talc rougher circuit will
discharge pulp into a 35m³ agitated copper rougher conditioning tank. The tank
volume will provide a three minute conditioning residence time at the design pulp
flow.
Reagent additions in the copper flotation circuit include:
 SMBS and lime will be added to the copper feed sump;
 copper collector will be added to the copper conditioning tank and the head
of the copper rougher and the copper cleaner cells;
 frother added to the feed of the copper rougher cells and the head of the
copper cleaners; SMBS and lime will also be added to the head of the
copper cleaner flotation cells; and
 CMC dispersant / depressant will be used as required.
Slurry will gravitate from the copper conditioning tank to the feed box of the first
copper rougher flotation cell. Flotation will take place in forced aspiration type
flotation cells. The copper flotation circuit will comprise the following:
 one 10m³ copper tank cell;
 two 10m³ copper rougher tank cells;
 four 10m³ copper scavenger tank cells;
 one SMD Detritor 355kW copper regrind mill;
 five 1.5m³ conventional copper cleaner cells;
 three 1.5m³ conventional copper recleaner cells, and
 one IsaMill M5000 copper tail regrind mill fitted with a 1,500kW motor.
The copper rougher concentrate will be pumped to a regrind mill circuit closed with
hydrocyclones for concentrate size reduction to a P80 of 20µm. Cyclone underflow
will be reground in the Detritor mill while, overflow will gravitate to the copper
cleaner cells. The discharge from the Detritor mill will report back to the cyclone
feed pump, closing the regrind circuit.
Copper scavenger tailings and copper cleaner tailings will discharge into the
copper scavenger tails sump and thence to the secondary cyclone cluster for
classification to produce an overflow P80 of 30µm. Underflow from the cyclone will
be treated by the secondary regrind mill (IsaMill) and will discharge ground product
to the copper tails sump, prior to being pumped to the lead flotation circuit.
The copper cleaner concentrate will be pumped to the copper recleaner flotation
cells and the copper cleaner tails will be open circuited and pumped to the copper
scavenger tails sump combining with tails prior to regrinding ahead of lead
flotation. The copper recleaner concentrate will be pumped to the copper

concentrate thickener and the copper recleaner tailings will gravitate to the copper
cleaner feed box. The recleaner flotation circuit has been designed as a closed
circuit with the first stage cleaning circuit.
17.3.7 Lead Flotation Circuit
Classified and reground tails from the copper scavenger and copper cleaner will be
pumped to the lead conditioning tank. The lead flotation circuit will comprise a
conditioning stage, roughing/scavenger stage followed by lead regrind and two
stages of cleaning. The final lead concentrate will be pumped to the lead
concentrate dewatering circuit and the lead rougher / scavenger flotation tailings
and lead cleaner tailings will be pumped to the zinc flotation circuit.
The copper tail regrind product will discharge into a 35m³ capacity agitated lead
rougher conditioning tank. The tank volume will provide a four minute conditioning
residence time at the design pulp flow rate.
Reagent additions in the lead flotation circuit include:
 lead collector, Sodium Isobutyl Xanthate (SIBX), added to the lead
conditioning tank, the lead rougher / scavenger circuit and the lead cleaner
flotation cells;
 frother added to the feed of the lead roughers and at the head of the lead
cleaners;
 lime added to the lead conditioning tank and lead cleaner feed;
 zinc sulphate (zinc depressant) added to the lead cleaner circuit;
 SMBS (zinc and pyrite depressant) added to the lead cleaner circuit; and
 CMC dispersant will be used as required.
Slurry will gravitate from the lead conditioning tank to the feed box of the lead
rougher. Flotation will take place in forced aspiration type flotation cells. The lead
flotation circuit will comprise the following:
 two 20m³ lead rougher tank cells;
 five 20m³ lead scavenger tank cells;
 one SMD Detritor lead regrind mill (355kW model fitted with a 500kW motor);
 one 5m³ lead cleaner agitated conditioning tank;
 six 4.25m³ conventional lead cleaner cells, and
 five 1.5m³ conventional lead recleaner cells.
The recovered lead rougher concentrate will be pumped to the lead regrind mill
and the lead rougher/scavenger tailings will discharge into the lead scavenger
tailings sump along with the lead cleaner tailings which are then pumped to the
zinc flotation circuit. The lead rougher concentrate size will be reduced to a P80 of
20µm in the lead regrind mill in closed circuit with classifying cyclones. The lead
regrind cyclone overflow will gravitate to the lead cleaner conditioning tank.
Lead cleaner concentrate will be pumped to the lead recleaner cells and the lead
cleaner tails will report to the lead rougher / scavenger tailings sump. Lead
recleaner concentrate will be pumped to the lead concentrate thickener and the
lead recleaner tailings will gravitate to the feed box of the lead cleaners.

17.3.8 Zinc Flotation Circuit
The lead rougher / scavenger tailings and lead cleaner tailings from the lead
flotation circuit will be pumped to the zinc flotation circuit. The zinc flotation circuit
will consist of a zinc roughing and scavenger circuit, a cleaner circuit and a cleaner
scavenger circuit. The zinc concentrate will be pumped to the zinc concentrate
thickener and the final tailings will be pumped to the tailings thickener circuit.
Lead rougher / scavenger tailings and lead cleaner tailings from the lead flotation
circuit will discharge into the first of two 35m³ agitated zinc rougher conditioning
tanks. The tank volume will provide 3.5 minutes of conditioning residence time
each, with a total of 7 minutes for the circuit.
Reagent additions in the zinc flotation circuit include:
 lime pH modifier added to the first zinc conditioning tank, the zinc
rougher/scavenger circuit, zinc cleaner conditioning tank and as stage
additions to the zinc cleaner circuit;
 copper sulphate activator added to the second zinc conditioning tank;
 SIBX collector added to the second zinc conditioning tank; and
 frother added to the head of the first zinc rougher, and the zinc cleaner
circuit as stage additions.
Slurry will gravitate from the second zinc conditioning tank to the head of the zinc
roughers. Flotation will take place in forced aspiration type flotation cells. The zinc
flotation circuit will comprise the following:
Zinc Rougher Scavenger Circuit:
 three 20m³ zinc rougher tank cells;
 five 20m³ zinc scavenger tank cells;
 five 10m³ zinc scavenger (2) tank cells, and
 an 1100 kW SMD zinc regrind mill.
Zinc Cleaner and Cleaner Scavenger Circuit:
 one 5.0m³ zinc cleaner agitated conditioner tank;
 seven 4.25m³ zinc 1st cleaner conventional cells;
 six 4.25m³ zinc 2nd cleaner conventional cells, and
 nine 1.5m³ zinc 1st cleaner scavenger conventional cells.
Zinc Rougher Scavenger Circuit
Slurry from the zinc conditioning tanks will report to the zinc rougher and extended
scavenger circuit. The circuit will use the zinc scavenger 2 cells as zinc retreat
rougher cells when treating only tailings feed. Concentrate from each stage is
combined for regrind, whist the tails are treated in sequence down the bank. Zinc
scavenger 2 tail then forms the bulk of the flow of the final tail.
The zinc rougher and scavenger concentrate will be reground by a SMD mill to
produce a product size P80 of 20µm prior to the zinc cleaner circuit. The mill will be
closed circuited with a cluster of cyclones.

Zinc Cleaner Circuit and Zinc 1st Cleaner Scavenger Circuit
Classified concentrate from the regrind will then be pumped to the zinc 1 st cleaner
and the tailings from the first cleaner will be pumped the zinc 1st cleaner
scavenger. The zinc 1st cleaner concentrate will be pumped to the zinc 2nd cleaner.
The zinc 2nd cleaner concentrate will be pumped to the zinc thickener as final zinc
concentrate. Tails from the second cleaner stage will be recycled in closed circuit
back to the first zinc cleaner in combination with the zinc 1st cleaner scavenger
concentrate.
The zinc 1st cleaner cells may be used as zinc retreat cleaners allowing the circuit
to be reverted to the original tailings feed only flotation circuit ahead of
underground feed being available for processing. Concentrate from each
scavenging bank is combined with the zinc 2nd cleaner tail stream and pumped
back to the zinc 1st cleaner in closed circuit. Tails from the first bank of zinc 1st
cleaner scavengers will report to the next bank with the final zinc 1 st cleaner
scavenger tail being combined with the zinc scavenger 2 tails as final tails.
17.3.9 Concentrate Production
Concentrate Thickening
Final copper, lead and zinc concentrates from the flotation circuits will be pumped
to 6, 7 and 10m diameter high rate concentrate thickeners respectively. Flocculant
will be added to increase the settling rate and underflow density to 60% solids.
Underflow will then be pumped to the associated copper, lead and zinc agitated
concentrate storage tanks by thickener underflow peristaltic pumps. To protect the
copper, lead and zinc filters, in-line strainers will be installed on the discharge lines
from the thickener underflow pumps to remove trash. Overflow from the each of
the concentrate thickeners will gravitate to the retreatment water rapid mix tank.
The control systems for all thickeners will include bed level indication to control the
flocculant addition rates and bed mass pressure indication to control the thickener
underflow pump speed. Rake torque will be measured and the system will be able
to automatically raise or lower the rakes as required.
Concentrate Filtering
The filtration section will be similar for copper, lead and zinc concentrates and will
comprise concentrate storage tanks, filter feed pumps and three pressure filters.
The concentrate storage tanks will be 100m³ agitated tanks for the copper and lead
duties and 200m3 for the zinc concentrate duty. The copper concentrate storage
tank will provide an operational surge time of 15 hours while the lead will provide
17.5 hours and the zinc 13 hours capacity prior to the filtration stage.
Thickened concentrate slurries will be pumped in batches from the respective
concentrate storage tanks for dewatering in the pressure filters. Provision will be
made for the slurry to be recycled to the concentrate storage tank whilst the filter is
in a dewatering cycle or off-line for routine maintenance. The respective filtration
area requirements will be:
 28m² expanded to 32m2 for the copper concentrate filter;
 16m² expanded to 25m2 for the lead concentrate filter, and
 48m² expanded to 60m2 for the zinc concentrate filter.

The pressure filter will dewater the slurry to produce a filter cake containing
nominally 9 to 10% (w/w) moisture and a filtrate. The filtrate will be pumped to its
respective concentrate thickener to reclaim the water. The copper and zinc filter
cakes will be discharged automatically from each filter press into the respective
sections of the concentrate storage shed with lead concentrate discharging to a
lead storage bin.
Concentrate Load-out Facility
The copper and zinc filter cakes will be stored on separate stockpiles inside the
concentrate storage shed. The lead concentrate will be stored in a lead storage
bin. The concentrate storage structure will be sized to accommodate inventory for
both the copper and zinc filter cakes with provision to move the stockpiles within
the enclosed building to extend the storage inventory or to provide a drying
mitigation area, should the concentrates not meet Transportable Moisture Limit
(TML) specifications and require further drying.
The concentrate load-out facility will comprise of a direct load-out truck
weighbridge for the copper and zinc concentrates. Both copper and zinc
concentrate will be loaded into half height containers equipped with tarpaulins for
road transport to the bulk freight terminal at Port Kembla.
Lead concentrate from the lead filter will gravitate via a chute to the lead
concentrate bin. The bin will be of a mass flow design with 50m3 of storage
capacity. Concentrate stored in the storage bin will be reclaimed via a feeder to the
lead bagging facility. The lead bagging facility will bag the lead concentrate into
one tonne bulka-bags for transfer to a sea container. Containerised bulka-bagged
lead concentrate will be dispatched either through the container port at Port Botany
or Port Kembla.
17.3.10 Paste Backfill Plant
Final flotation tailings from the zinc circuit will be pumped to a cluster of de-sliming
cyclones. Cyclone underflow will gravitate to a paste filter feed tank. Cyclone
overflow will report to the tailings thickener.
The underflow from the de-sliming cyclones will be transferred to a 500m3 capacity
paste filter feed tank. A variable speed paste filter feed pump will transfer the
material to a single horizontal belt vacuum filter at a feed density of 60% solids.
Filtrate recovered as part of the filtering process will be pumped to the tailings
thickener for process water recovery. Cake generated by the filter will discharge to
a paste mixer feed conveyor.
Dry mass flow of material fed to the paste mixer will be estimated in the plant
control system by using the calculated mass flow to the filter (from a nucleonic
density gauge and magnetic flowmeter) and the weightometer reading along with
an assumed moisture content of the “dry” material. This dry mass flow will be used
for the ratio control of cement addition.
Filter cake will be discharged into the feed chute of the dual shaft continuous paste
mixer along with binder dosed at a proportion of the measured dry weight of the
feed.
Mixed paste will gravitate from the paste mixer to a conical discharge paste
hopper. The paste hopper is to be mounted on load scales and discharged via a
level control valve to the underground reticulation system.

A 30m3 paste plant flush water tank and a 15m3 air receiver are located near the
paste hopper to aid in flushing the borehole and delivery pipe system.
Binder Storage and Dosing
Binder will be transported to site via bulk tankers and pneumatically conveyed
using a truck mounted compressor and pneumatic conveyor to a 300t capacity
binder silo. The storage silo will be installed on an independent support structure.
A set of high rate screw feeders will be used to transfer and lift binder from the
storage silo to a loss in weight hopper installed above the paste mixer feed
conveyor head chute. Load scales on the hopper and a variable speed screw
feeder will be used to accurately dose binder to the paste mixer based on a ratio of
the calculated dry mass of solids being conveyed to the mixer.
17.3.11 Tailings Thickening
The final tailings, consisting of the talc cleaner concentrate and the de-sliming
cyclone overflow will be transferred to an 18m diameter high rate final tailings
thickener. Additional streams from the water treatment rapid mix tank, the paste
thickener filtrate and tailings dam return water will also feed the thickener with
evaporation dams ED1 and ED2 treated water to a pH of 4-5 against the high pH of
the zinc circuit tail. This will allow for the thickener overflow to reach a more
neutral pH prior to reporting to overflow water. Flocculant will be added to increase
the settling rate and underflow density to between 45 and 55% solids (w/w).
Underflow will then be pumped to the TSF4. Thickener overflow will gravitate to
the process water dam.
17.4 Reagents
Treatment of the sulphide material from undeground by the differential flotation
process will require a specific suite of flotation reagents to ensure activation and
depression of mineral species as well as frothers for froth stability and collectors for
mineral recovery. A summary of the reagents usage is listed in Table 17.2.
Table 17.2: Annual Reagent Consumption
Reagent Consumption Consumption

kg/t t/yr
Flotation Reagents
SMBS 5.62 8,433
Frother (MIBC) 0.35 521
Copper Sulphate 0.73 1,102
Copper Collector (A3894) 0.10 146
Zinc Sulphate 0.37 551
Sodium Isobutyl Xanthate 0.08 126
CMC 0.00 0
Flocculant (Magnafloc 342) 0.04 66

Reagent Consumption Consumption

kg/t t/yr
Antiscalant 0.01 9
Hydrated Lime 3.60 5,400
Binder / Cement 17.97 26,955
Grinding Media
Grinding Media (2.5mm) 0.25 371
Grinding Media (3.5mm 0.21 312

MTX)
Grinding Media (85mm 0.80 1,200

Steel)
17.4.1 Aero 3894
The copper collector will be a dithiophosphate with the trade name Aero® 3894.
The collector is an organic compound that changes the surface chemistry of
sulphide particles thereby making them hydrophobic (water repellent) and
promoting the attachment of the mineral particles to air bubbles via the flotation
cell. The copper collector will be supplied as a 100% concentrated solution in
1,000 litre bulk boxes.
Copper collector will be pumped undiluted to a head tank for distribution to the
copper flotation circuit. Flow control will be provided using variable speed dosing
pumps. Flow rates will be manually measured.
17.4.2 MIBC
The frother will be Methyl Isobutyl Carbinol (MIBC). Frothers are organic
compounds that promote the formation of a stable froth when mixed with air and
water in a flotation cell. The frother will be supplied as a 100% concentrated
solution in 1,000 litre bulk boxes.
Frother will be pumped undiluted to a head tank for distribution through the flotation
circuits. Flow control will be provided using variable speed dosing pumps. Flow
rates will be manually measured.
17.4.3 Sodium Metabisulphite (SMBS)
SMBS is a pyrite and sphalerite depressant. The surfaces of pyrite and sphalerite
can absorb sulphite ions, which prevent collector adsorption, and the reducing
action of the sulphite ions can prevent oxidation and dissolution of copper, hence
preventing activation of zinc and iron minerals. SMBS will be supplied in 1,100kg
bulk bags.
Bulk bags will be lifted by the reagents hoist, split and stored in a SMBS silo.
SMBS will be automatically mixed with raw water on a batch basis to generate a
20% (w/v) solution. A dust collector will be fitted to the SMBS silo. The mixed
SMBS solution will be automatically transferred from the mixing tank to the storage
tank.

The SMBS solution will be automatically transferred from the storage tank to a
head tank for distribution to the talc, copper and lead cleaner flotation circuits.
SMBS solution will be distributed via variable speed dosing pumps. Flow rates will
be manually measured.
17.4.4 Sodium Isobutyl Xanthate (SIBX)
SIBX is a collector for sulphide minerals. Collectors are typically organic

compounds that change the surface chemistry of sulphide particles thereby making
them hydrophobic (water repelling). SIBX will be supplied as solid pellets in 160kg
drums.
SIBX mixing will be completed manually by the operator. The drums will be lifted
by forklift, emptied by a drum tipping device and then mixed with raw water to
generate a 20% (w/v) solution. The hood over the mixing tank will be fitted with an
extraction fan.
The SIBX mixing tank is divided into separate mixing and storage sections. The
mix section is larger and agitated while the smaller storage section is not. The
SIBX solution will be automatically transferred from the mixing tank to a head tank
for distribution to the lead and zinc flotation circuits. The SIBX transfer pump
normally draws from the agitated section of the tank but when a low level is
reached, the draw point is changed to the storage section of the tank. Excess
solution overflows to the storage section of the dual purpose tank.
SIBX will be pumped to a head tank for distribution. Flow control will be provided
using variable speed dosing pumps. Flow rates will be manually measured.
17.4.5 Hydrated Lime
Lime will be used to increase the pH of process streams and neutralise the acidic
condition of the stream and to form hydroxides of particular metals. The lime will
be supplied as hydrated lime (Ca(OH)2) in bulk as a powder. Upon receipt at site,
it will be pneumatically transferred into a 200t capacity silo. The hydrated lime will
then be added with water into a lime mixing tank to produce hydrated lime slurry.
Lime will be automatically mixed with raw water on a batch basis to generate a
20% (w/v) slurry of hydrated lime. The hydrated lime slurry will be automatically
transferred from the mixing tank to the storage tank. Both the mixing and storage
tanks will be agitated. Hydrated lime slurry will be pumped via a ring main for
distribution throughout the plant. Individual addition points will be controlled by an
automatic valve and timer.
17.4.6 Copper Sulphate
Copper sulphate is an activator used to promote the flotation of zinc sulphide

minerals. Activators change the surface chemistry of selected minerals to enhance
the action of collectors in flotation. Copper sulphate will be supplied in granular
form in 1,200kg bulk bags.
Copper sulphate mixing will be completed manually by the operator. The bulk
bags will be lifted by the reagents hoist, split and then mixed with raw water to
generate a 17% (w/v) solution.
The copper sulphate stainless steel mixing tank will be divided into separate mixing
and storage sections. The mix section will be larger and agitated while the smaller
storage section will not be agitated. The copper sulphate solution will be

automatically transferred from the mixing tank to a stainless steel head tank for
distribution to the zinc flotation circuits. The copper sulphate transfer pump
normally draws from the agitated section of the tank but when a low level is
reached, the draw point will be changed to the storage section of the tank. Excess
solution overflows to the storage section of the dual purpose tank.
The mixed copper sulphate solution will be distributed to the plant via a variable
speed dosing pumps. Flow rates will be manually measured.
17.4.7 Anti-Scalant
Anti-scalant will be added to the discharge of both the process water pumps and
mining slurry water pump to inhibit the formation of gypsum (CaS04). The anti-
scalant will be supplied as a solution in 1,000 litre bulk boxes.
Anti-scalant will be distributed undiluted to the discharge of process water pumps
and mining slurry water pump via variable speed dosing pumps. Flow rates will be
manually measured.
17.4.8 Zinc Sulphate
Zinc sulphate is a depressant for zinc sulphide minerals. Depressants change the
surface chemistry of selected minerals to depress the action of collectors in
flotation. Zinc sulphate will be supplied in granular form in 1,000kg bulk bags.
Zinc sulphate mixing will be completed manually by the operator. The bulk bags
will be lifted by the reagents hoist, split and then mixed with raw water to generate
a 15% (w/v) solution. The hood over the mixing tank will be fitted with an
extraction fan.
Zinc sulphate will be pumped to a head tank for distribution. Flow control will be
provided using variable speed dosing pumps. Flow rates will be manually
measured.
17.4.9 Flocculant
The flocculant will be an anionic flocculant with a trade name Magnafloc 342.
Flocculants are long chain molecules that aid solids settling by causing individual
particles to stick together thereby forming larger, heavier particles. Flocculant will
be supplied as a powder in 800kg bulk bags.
The flocculant mixing system will be a proprietary packaged plant comprising a dry
flocculant hopper, powder feed and wetting system, mixing tank, transfer pump and
storage tank. Flocculant will be mixed automatically with raw water on a batch
basis to generate a 0.25% (w/v) solution. The flocculant solution will be
automatically transferred from the mixing tank to the storage tank.
Flocculant solution will be pumped by individual progressive cavity dosing pumps
for distribution to the thickeners. Additional dilution water is injected into a mixing
device located in the dosing pump discharge lines near the flocculant dose point.
Flow rates will be manually measured.
17.4.10 Sodium Carboxymethyl Cellulose (CMC)
CMC is not required for the co-treatment process; however it will be required for
the full tailings retreatment process for the depression of talc.

CMC is a water soluble polymer that is used as a depressant for talc (silicate) type
minerals. CMC is naturally hydrophobic (water repellent). The addition will be
controlled at a slow and steady rate to permit wetting of individual particles and
minimise viscosity build up and prevent agglomeration during the mixing stage.
The CMC will be supplied in bulk bags and mixed in a proprietary packaged plant
comprising a dry CMC powder hopper, powder feed and wetting system, mixing
tank, transfer pump and storage tank. CMC will be mixed automatically with raw
water in batches to generate a 0.2% (w/v) solution. The mixed CMC solution will
be automatically transferred from the mixing tank to the storage tank. CMC
solution will be pumped by dedicated variable speed progressive cavity dosing
pumps to the copper flotation feed conditioning tank, copper cleaner flotation cells
and lead regrind mill. Flow rates will be manually measured.
17.4.11 Binder
Boral stabilment binder (ground granulated blast furnace slag (GGBFS) and
hydrated lime 85:15) will be used in the paste plant as the binder for the de-slimed
sands returned to the underground stopes. The binder will be added at a ratio to
dry tonnes of mine backfill and will be mixed in a paste mixer prior to being
pumped back down to the required backfill stope.
17.5 Services
17.5.1 Control Systems
The Woodlawn Co-treatment plant will be run on a continuous basis. Operators

will monitor and run the plant from PC based human-machine interface (HMI)
systems located in the process plant control room. Operations will be monitored
and controlled from the process plant control room via PC based Supervisory
Control and Data Acquisitioning (SCADA) screens using Citect software. The
ability to remotely start and stop plant equipment from the operator screens via
start and stop sequences or by “manually” starting or stopping individual equipment
will be provided. Recording of plant data by operations personnel will be required
on a shift by shift basis, with the Courier system providing online assay results.
Motor starters, main isolators and distribution board feeders will be located in the
Motor Control Centres (MCCs). Each MCC will contain a programmable logic
controller (PLC) which with the SCADA system, will make up the Process Control
System (PCS). The PCS will provide the interface between drives and
instrumentation and the operators. Hardwired outputs and inputs for plant
equipment and field devices will be interfaced through these PLCs in which plant
startup/shutdown sequences and interlocks will be programmed. The plant
functions will be controlled automatically by the PLC and the operators will be
required to monitor the system performance and perform manual checks.
All equipment will be equipped with local start and stop buttons. Start and stop will
also be possible from HMI. It is intended that there will be two modes of operation
for each piece of equipment: local and remote. The status of each piece of
equipment (i.e. whether in local or remote mode) will be displayed at the HMI.
Local or remote mode will be selected using a switch mounted on the local control
panel. The stopped/started status of each piece of equipment will be displayed at
the HMI.

17.5.2 Online Analysis
The performance of the flotation circuits will be monitored by an On Stream

Analysis (OSA) system – an Outotec Courier 5i SL. There will be two 12 stream
OSA units in the process plant; one will service the talc and copper flotation circuit
streams and the other will deal with the lead and zinc flotation circuit streams.
Samplers, mostly pressure pipe samplers, will direct representative slurry samples
to the OSA for analysis and where not possible the streams will be pumped to the
OSA by dedicated sample pumps. The OSA will be located with sufficient
elevation to allow streams to gravitate to their destination and where not possible
the streams will be pumped to their destination by dedicated pumps.
The OSA will measure the copper, lead, zinc, iron and silver concentrations and
slurry density of each of the following sample streams:
 talc pre-float feed;
 talc pre-float concentrate;
 copper rougher feed;
 copper rougher / scavenger concentrate;
 copper scavenger tail;
 copper final concentrate;
 copper cleaner tail;
 lead rougher feed;
 lead rougher / scavenger concentrate;
 lead scavenger tail;
 lead final concentrate;
 lead cleaner tail;
 zinc rougher / scavenger concentrate;
 zinc scavenger tail;
 zinc final concentrate ;
 zinc cleaner tail;
 zinc scavenger 2 feed;
 zinc scavenger 2 tail;
 zinc 1st cleaner scavenger concentrate;
 zinc combined final concentrate, and
 final tails.
A dedicated PC will be provided for the OSA system to provide continuous
monitoring of assays and allow system development and calibration tasks to be
undertaken. Assays will be updated every 5 to 10 minutes. A mimic page on the
SCADA PCs will also be provided to show the status of the OSA systems and the
assay results obtained which will also appear on the pages for the relevant flotation
circuit.

A multiplexer will be fitted to the OSA to provide for metallurgical samples on each
stream analysis for shift composite samples for metallurgical accounting. The
sample cut timing will be adjusted from the dedicated OSA PC and the sampling
will occur automatically. There will be provision to manually operate the cutter to
obtain samples for calibration.
17.5.3 Compressed Air
Plant and instrument air are a combined compressed air system. Plant and
instrument air to the processing facility will be supplied by two screw compressors
arranged as one duty and, one standby machine and via a dedicated air dryer and
plant air receiver.
An additional dedicated air compressor will provide air services to the filter presses
as high pressure air for drying purposes and a separate receiver will be housed at
the filter building for this duty.
Flotation air to the flotation circuits will be supplied by two dedicated blowers
arranged in a duty-standby configuration.
17.5.4 Raw Water
Raw water will be sourced from the Willeroo Borefield and stored in the existing
10,000m³ raw water dam at the plant site. Raw water will then pumped to the raw
water tank at the process plant or process water dam as required. Raw water will
be used for:
 process water make up;
 reagent mixing;
 flocculant dilution;
 cloth washing in filtration;
 gland water
 IsaMill flushing;
 regrind milling cooling water;
 potable water treatment plant feed, and
 fire water.
Raw water will be pumped to the raw water tank and process water dam via the
raw water submersible pumps and the raw water booster pump.
Two raw water distribution pumps arranged in a duty-standby configuration will be
located at the raw water tank. These pumps will distribute the raw water
throughout the entire processing facility. In addition, there will be two dedicated
pumps, arranged in a duty-standby configuration, for gland water.
The lower portion of the raw water tank will provide a dedicated fire water reservoir
for the fire water system. The fire water system will include two pumps, an electric
fire water pump and a diesel driven fire water pump to ensure a continuous supply
of water to the fire system in the event of a power failure.
Raw water will also provide feed supply for a potable water treatment plant.

17.5.5 Potable Water
Potable water will be provided by a reverse osmosis plant designed for 1.5m³/hr
consumption rate and will provide for the potable water services to amenities and
toilets.
17.6 Processing Labour Force

The Project will use locally sourced employees from within New South Wales,
Australia for most of the processing requirements with senior management
appointments from within Australia.
The Project will be operated with a departmental structure as shown in Figure 17.3.
The total direct workforce requirement for operation of the processing plant will be
50 employees with 10 tailings reclamation contractors.
The personnel numbers listed are total numbers, inclusive of personnel that would
be off site on their R&R break.
Metallurgy
Manager
HMS Concentrator Logistics/ Maintenance Accounts and

Operations Foreman Procurement Supervisor Administration
Manager
HMS Processing Maintenance

Reclamation Team Team
Team
Figure 17.3: Departmental Organisational Structure
The processing team will be made up of a three panel roster working on a four
days on and four days off basis. The roster will be a split nightshift to dayshift
rotation based on 12 hour shift cycles which allows for the four panel alignment
and continuous coverage.

18 Project Infrastructure
18.1 Existing Infrastructure and Services
Woodlawn will operate as a shared site with Veolia operations, while maintaining a
separation of the two operations. There will be no shared personnel between
Heron and Veolia; however, there will be site interaction (including invitee to daily
mine meeting) between the two parties for access to pipelines, and the provision of
raw water to the existing Veolia site operations. Woodlawn Project labour
requirements are based on direct personnel only with no allowance for a liaison
officer role with Veolia operations.
Existing infrastructure includes:
 a sealed access road to the mine site;
 shared administration building and offices;
 an existing site laboratory;
 raw water tank;
 evaporation ponds;
 site water pipe systems and pumps, and
 an electrical supply sub-station.

18.2 Site Schematic Layout
Figure 18.1: Site Layout Schematic

18.3 Buildings
New site buildings will be required to support the operation and will include:
 administration office including plant and mining offices;
 underground support and geology offices;
 plant workshop and store;
 plant maintenance and stores offices;
 laboratory;
 training facility;
 plant control room;
 plant switchrooms;
 crib room facilities;
 shower house / ablution facilities, and
 a new car park facility.
All of the buildings apart from the workshop / stores sheds will be transportable
style sandwich panel buildings constructed on a steel sub frame. The buildings will
be pre-wired for telephone, data, light and 240V power. The location of these
buildings is shown on the site plan.
The plant workshop and stores sheds will be of steel framed and clad construction.
18.4 Power Supply

18.4.1 Load
Electrical power for the operation, estimated to be an average load of 12MW for
the processing plant and associated services, and excludes the underground
mining requirement.
18.4.2 HV Power Distribution
Electrical power for the operation will be provided by an independent energy

retailer utilising the existing Essential Energy grid and site sub-station.
The existing 66kV transmission line feeding the site (Goulburn to Bungendore) and
the existing 66/11kV sub-station will have sufficient capacity to meet the stated
requirements of the Project. This facility is currently utilised by the Veolia
Bioreactor project. A planned upgrade of the existing sub-station by Essential
Energy will rationalise the size of the installed transformers and provide a protected
outgoing circuit for the Woodlawn processing plant.
Power for the Project will be reticulated throughout the site at 11kV. Where
possible the existing secondary distribution network of overhead lines will be re-
utilised for the reticulation of power to the processing plant, tailings dams and
satellite pumping stations within the new site. As part of the new plant construction
works, secondary transformers will be installed to further reduce the voltage to

415V (3 phase supply) for the plant equipment and to 240V for single phase supply
as required.
Power factor correction equipment will be installed as part of the new works to
ensure a minimum power factor of 0.95 lagging.
18.5 Water Supply

18.5.1 Raw Water
Raw water will be sourced from the Willeroo Borefield and stored in the existing
10,000m³ raw water dam at the plant site.
Borefield raw water transfer pumps will be located at the Willeroo Borefield. The
pumps will be dedicated to supplying water to the raw water dam.
18.5.2 Evaporation Pond Water
Water from the evaporation ponds will be re-used in the process plant as part of
the make-up water requirements. The water has high ion content and a low pH
and will be mixed and treated in a water treatment rapid mix tank using lime from
the process plant system to neutralise the pH and drop out ion species. The water
is then pumped from the rapid mix tank to the tailings thickener for clarification and
recovery as thickener overflow water to the process water dam.
18.5.3 Potable Water
Potable water will be generated onsite from a raw water supply to a reverse
osmosis plant.
18.5.4 Sewage
A sewerage system is required to convey and treat wastewater produced from

toilets, showers, and sinks at the site. Sewerage systems are regulated by the
local district council in accordance with the NSW Building Codes and the
Department of Health.
The options available to the mine for the treatment of wastewater are to:
 negotiate the use of the existing Veolia owned treatment facility;
 build a holding tank and haul the sewage by truck to a disposal site;
 build a wastewater treatment plant (WWTP), and
 build a septic system.
Based on an assessment of capital cost outlay and operating cost the estimate has
been based on the installation of a packaged proprietary sewerage treatment
system. This system will consist of a number of in-ground collection pits located
adjacent to the plant buildings where waste water is generated. Waste water will
be plumbed into the pits from where it will be will be pumped to the main treatment
unit collection tank using submersible macerator pumps. Each pump will be
automatically started and stopped by float switches to prevent overflow and
maximise pump life.
The packaged treatment system will be located to the north of the plant site to
utilise the natural fall of the land for drainage of the feed lines. Clear effluent

produced by the plant will be discharged to the new TSF4. Ongoing operation of
the system will require only general maintenance of the pumps, agitators and air
blower.
18.6 Mining Contractor’s Infrastructure

Establishment and maintenance of the mining contractor’s infrastructure is built into
the mining contractors unit costs.
18.7 Communications
Telecommunication land lines are currently available adjacent to the site. It is
proposed to connect the plant offices PABX to the existing Telstra cable to
establish reliable voice communications.
There are a number of wireless providers, for mobile telephone coverage in the
area. During the site visit it was observed that mobile coverage was sporadic and
only particular carriers provided a service that takes in the plant site. To ensure
reliable mobile wireless coverage of the site for broadband internet connectivity it is
proposed to install a radio repeater at the site.
For internal communications on site it is proposed that mobile radios be used to
supplement the copper wire telephone systems.
18.8 Accommodation
No accommodation will be provided; all employees will reside in local townships or
will commute from the regional cities of Goulburn or Canberra.
18.9 Security
New security fencing will be erected around the process plant, administration and
mine office areas. No allowance has been made for front gate access security
boom gates.
18.10 Roads
18.10.1 Site Access Road
A new access road approximately 350m in length will be required to access the
plant site from Collector Road. This new road will enable two B-double trucks to
pass and will also cater for the operations’ light vehicle traffic. A tee junction
intersection will be provided on Collector Road in accordance with the
requirements of the local authority. This is a public road and it is currently used by
the trucks and light vehicles accessing the adjacent Veolia waste treatment site.
Due to the lifespan of the mining operation, maintenance cost considerations and
the issue of fugitive dust from an unsealed road; it is proposed to pave the full
length of the new road and the main traffic loop within the plant site.
18.10.2 Haulage and General Site Roads
Internal roads will not be sealed, but will be made from crushed aggregate locally
sourced.

19 Market Studies and Contracts

19.1 Market Studies
The Woodlawn Project’s revenues are derived from sales of three concentrates
containing payable levels of zinc, lead, copper, silver and gold. The estimated net
revenue split after payability, but pre-Treatment Costs/Refining Costs (TC/RC) is
approximately:
Figure 19.1: Approximate revenue split post payability, pre TC/RCs
The Project provides greatest exposure to zinc, followed by copper then lead.
Based on an internal review of forecast prices for the payable commodities, Heron
has selected price series for the economic analysis which align with consensus
expectations of metals prices during the modelled period during which the mine will
operate. These assumptions are detailed in Section 22.4.2.
Heron commissioned an independent report on Marketing and Logistics which was
prepared by BPDT & Co Pty Ltd (2015). The report examined the movement of
product from site to port, storage, ocean freight, expected TC/RCs for the three
concentrates, and marketability.
Based on indicative product specifications, all three products are considered
readily marketable. There is potential for a penalty charge to be applied to lead in
the copper concentrate. Otherwise, it is expected that concentrates will be sold to
smelters or traders on normal industry terms.
The author has reviewed the concentrate treatment charges, payabilities and
commodity prices projected by Heron and the results support the assumptions
used in this technical report.
19.2 Contracts
There are no contracts in place for the Woodlawn Project at this stage.

20 Environmental Studies, Permitting and Social or Community

Impact
20.1 Environmental Permits
20.1.1 Project Approvals
During 2012 TriAusMin carried out an extensive Environmental Assessment (EA),

seeking Major Project approval under Part 3A(transitional) of the NSW
Environmental Planning and Assessment Act 1979 (EP&A Act) to establish the
Project. The EA included a public exhibition stage during which a total of 17
submissions were received, including 11 from public agencies, 2 from special
interest groups and 4 from the general public.
Project approval was received on the 4 July 2013 under Section 75J of the EP&A
Act from the NSW Minister for Planning and Infrastructure in relation to the Project,
covering both:
 the Woodlawn Retreatment Project (WRP) — involving the establishment of
an processing facility and the processing of existing tailings material stored
within three existing tailings dams, and
 the Woodlawn Underground Project (WUP) — involving excavation of a
new box cut and underground mining development to extract metalliferous
sulphide mineralisation, subject to successful exploration.
The approval allows mining operations at the Woodlawn site until 31 December
2034.
Heron recognises that the very advanced stage of development of the
environmental planning and permitting is somewhat unusual for a PEA stage
project, and that having these approvals in place substantially de-risks the project
development timeline compared to projects which are yet to go through the
environmental approvals process.
Modifications to the approvals will be required to deal with changes to the
proposed operation based upon the physical characteristics of the planned
underground mining. These changes include modifications to the underground
portal location and modifications to the underground mining approvals in proximity
(within 200m) to the open pit.
The NSW Department of Planning and Environment (formerly DPI, now DPE) have
indicated that an application for any modification that falls within the footprint of the
existing approved project should only require determination by DPE and other
government agencies (e.g. NSW Department of Trade and Industry-Resources and
Energy). As such, Heron expects the process for approval of the modifications
required will realistically be achievable within the planned timeframe for the
Feasibility Study.
20.1.2 Approval Conditions
As is normal for such approvals, the DPE imposed a number of conditions on the
approval including to:
 prevent, minimise, and / or offset adverse environmental impacts;

 set standards and performance measures for acceptable environmental

performance;
 require regular monitoring and reporting, and
 provide for the ongoing environmental management of the project.
The conditions include provisions for:
 implementation of all reasonable and feasible measures to prevent and/or
minimise any material harm to the environment that may result from the
construction, operation or rehabilitation of the project;
 restrictions on the volume of concentrates transported, and transportation
routes approved;
 a road maintenance charge of A$0.043 per tonne kilometre applicable to
local council-owned roads, together with community enhancement
payments required during the project life totalling A$1.26 million;
 applicable construction and operating standards;
 hours of operation during construction and operation;
 conditions on site operations, including blasting, safety, noise and air
quality controls, and
 ongoing community consultation.
Aside from these conditions, the Company must also:
 design existing and new tailings dams to prevent seepage of contaminated
material off-site;
 implement a water management system to ensure zero discharge of
contaminated water from the site;
 establish a comprehensive surface water and groundwater monitoring
network on the site and surrounds;
 identify and implement a passive system for treatment of potential acid
forming seepage from the existing waste dump;
 provide to the DPE a technical report on paste fill including stability and
leach performance;
 ensure the design of the underground workings achieves negligible
subsidence beneath the landfill and evaporation dams as well as stabilizing
underground voids and restricting operations in proximity to the landfill
operation, and
 progressively rehabilitate the site, including the tailings dams, in
accordance with strict performance criteria.
20.1.3 Ongoing Reporting Requirements
As is normal for such approvals, the DPE imposed a number of planning and
reporting requirements, including development, submission to DPE for approval,
and maintenance of its Environmental Management Plan.
In June 2014 the Company submitted its Environmental Management Strategy
(EMS) required under the Project Approval. The EMS:
 provides the strategic framework for the environmental management of the
project;
 identifies the statutory approvals that apply to the project;
 describes the role, responsibility, authority and accountability of all key
personnel involved in the environmental management of the project;
 describes the procedures that would be implemented to:

- keep the local community and relevant agencies informed about the
operation and environmental performance of the project;
- receive, handle, respond to, and record complaints;
- resolve any disputes that may arise during the course of the project;
- respond to any non-compliance, and
- respond to emergencies,
 and includes:
- copies of any strategies, plans and programs approved under the
conditions of this approval, and
- a clear plan depicting all the monitoring required to be carried out
under the conditions of this approval.
Under the EMS, the main plan relevant at this stage of the development of the
Project is the Construction Environmental Management Plan and the Construction
Mining Operations Plan. It is noted that the EMS will be updated as required to
incorporate the provisions of operational management plans and ultimately provide
and overarching framework for the management of the Woodlawn Mine.
The subsidiary plans which will fall under this EMS are, as required by the Project
Approval:
 Construction Environmental Management Plan.
 Tailings Rehabilitation Strategy.
 Extraction Plan (for underground mining).
 Subsidence Monitoring Program (included in Extraction Plan).
 Water Management Plan, including: Surface Water Management Plan,
Groundwater Management Plan, Surface and Groundwater Response Plan.
 Noise Management Plan.
 Blast Management Plan.
 Air Quality Management Plan.
 Waste Rock Management Plan, with particular emphasis on the
management of potential acid forming material.
 Vegetation Management Plan.
 Rehabilitation Management Plan.
 Road Transport Protocol.
 Heritage Management Plan.
The subsidiary timing of the management plans are at an advanced stage and
relate to the stage of development, with 11 of the plans fully drafted and the
remainder being works in progress. The operational plans are required prior to
construction commencing while the Extraction Plan and Subsidence Monitoring
Program are required prior to the commencement of the Woodlawn Underground
Project.
20.2 Social and Community Aspects, Stakeholder Consultation

The Woodlawn Project operates within an environment of strong local community
support for the Project. Social and community issues are aided by the fact that the
project has a single local landowner, Veolia, who operate their bioreactor on site.
Other than properties owned by Veolia, there are no residences within three
kilometres of the Project site. Hence, there is reduced scope for on-site operations
to impact on the local community. Based on the EA investigations, odour, dust and
other emissions generated during the construction and operation of the Project are

unlikely to be significant or to impact on the local community. Existing Veolia

bioreactor operations (as administered by EPA) are likely to have greater impact.
Some impact may exist in relation to increases in traffic and related noise within
the local communities. Transport operations will be governed by the Road
Transport Protocol, and the EA assessment found that road capacity and
intersection performance would not be materially impacted by the operation.
The community consultation process implemented to date has engaged
stakeholders at all levels, including government agencies, local government, the
community and non-government stakeholders, to identify relevant issues to be
addressed during the Project’s development and the EA preparation. In addition,
the stakeholder activities undertaken have addressed the consultation
requirements identified in the Director-General’s Requirements (DGRs) (2011 and
2009). Since the Project Approval was received, community consultation has
continued, with the Company leveraging the Community Consultation Committee
which meets regularly to discuss the impacts of the Veolia bioreactor operations on
the local community.
In relation to Aboriginal heritage, it is noted that the Woodlawn Site is freehold title
and has been significantly impacted by European pastoral and agricultural
activities prior to 1978, as well as the establishment and operation of the
Woodlawn Mine between 1978 and 1998; and the establishment and operation of
Veolia’s Bioreactor since 2004. Due to the extensive impacts from past
agricultural, extractive and industrial operations, the heritage survey area has no
potential to contain Aboriginal or historic (non-Aboriginal) archaeological sites
and/or places.
20.3 Mine Closure and Bond Requirements

Rehabilitation of the site is required in accordance with the proposed Rehabilitation
Management Plan described in the EA to comply with stated objectives:
Table 20.1: Rehabilitation Management Plan - Closure Objectives
Feature Objective
Mine Site (as a whole) Safe, stable and non-polluting with no final voids on
the surface. Integrated with the rehabilitation of the
Woodlawn Landfill. Re-vegetated with plant
species characteristic of Western Tablelands Dry
Forest vegetation community.
Underground workings No measurable subsidence effects on the

Woodlawn Landfill, evaporation dams and tailings
dams on the site.
Surface infrastructure To be decommissioned and removed.
Waste rock dumps Any seepage from the waste rock dumps to be
contained and treated on the site.
Tailings dams All tailings contained with no seepage. Final

landform and vegetation cover to be stable, self-
sustaining, free draining and consistent with

Feature Objective
surrounding rehabilitated areas.
Evaporation dams Final landform and vegetation cover to be stable,

self-sustaining, free draining and consistent with
surrounding rehabilitated areas.
Rehabilitated slopes All rehabilitated slopes to be less than 10 degrees

and free draining (except for the dam walls which
are permitted to have a final slope of up to 18
degrees).
Drainage lines Hydraulically and geomorphologically stable, with

vegetation that is in the same condition or better
than that which existed prior to mining under the
approval.
Re-vegetation area Establish at least 71 hectares of the Western

Tablelands Dry Forest vegetation.
Community Minimise the adverse socio-economic effects

associated with mine closure.
An amount of A$4.5 million was estimated as the net cost of closure and
rehabilitation during the BFS for the WRP (Intermet, 2008). The inclusion of the
underground does not materially affect the surface disturbance for the Project. For
the purposes of this study, an amount of A$9 million has been allowed at project
closure for closure and rehabilitation.
On 19 March 2014 the Company was notified that the Division of Resources and
Energy, NSW Trade and Investment, had approved the transfer of title in SML 20
into the name of Tarago Operations Pty Ltd, a 100%-owned subsidiary of Heron.
The approval includes the lease terms and conditions including a security bond of
A$3.577 million that will need to be provided prior to operations commencing.

21 Capital and Operating Costs

21.1 Operating Costs
21.1.1 Introduction
SRK prepared the estimates for the mine operating and associated administration
costs. GRES prepared estimates for the processing plant, maintenance and
infrastructure costs, together with their associated overheads. Heron provided
estimates for owner’s costs. These estimates are described below.
Operating costs for the co-treatment plant have been estimated to an accuracy of
±25%. The costs are presented in Australian dollars (A$) and are based on prices
obtained during the first quarter of 2015 (1Q15) and exclude the GST cost
component.
The costs cover the reclamation mining process but exclude the underground
mining costs. Both the tailings retreatment and the additional underground
crushing and milling requirement costs have been captured as part of the main
processing plant. This also includes all the flotation, dewatering, materials
handling and service and administration costs.
21.1.2 Summary
Processing Plant Operating Costs
Operating costs have been developed using the parameters specified in the
process design criteria. Annual operating costs and costs per tonne of co-
treatment (50/50 basis) have been developed and are summarised in Table 21.1.
The operating cost estimate has been developed on the basis of a process plant
feed tonnage of 1.5Mtpa.
The operating cost estimate is A$35.11 million per annum or A$23.41 per tonne of
feed.
fluctuation and was based on 0.80 A$:US$.

Table 21.1: Annual Processing Costs (OPEX)
Cost Centre Annual Cost Unit Cost

A$ million A$/t
Processing Costs
Underground Crushing 0.71 0.47
Fine Ore Storage and Handling 0.05 0.03
Grinding and Classification 2.19 1.46
Tailings Reclamation 0.94 0.63
Grinding Isa Mill Tailings Retreatment 3.68 2.46
Flotation (Includes Regrinding Stages) 19.55 13.03
Concentrate Dewatering 0.13 0.09
Concentrate Filtering 0.73 0.49
Concentrate Loadout 0.20 0.14
Reagent Mixing and Dosing 0.08 0.05
Process Water 0.22 0.15
Raw Water 0.17 0.11
Tailings Thickening and Disposal 0.34 0.23
Tailings Return & Water Treatment 0.09 0.06
Air Services Supply & Reticulation 0.23 0.16
Processing Administration 5.72 3.81
Lighting and Workshop 0.08 0.05
TOTAL 35.11 23.41

For the purposes of enabling the feed blend to be varied throughout the life of
mine, the cost estimates have been split into Underground and Tailings related
components. For the PEA economic model these splits have been applied to the
relative amounts of plant feed. The breakdown shown as a unit cost per tonne of
plant feed is shown in Table 21.2.
The production schedule, and the deviation of the plant feed profile (which
approximates a blend of 25% underground to 75% tailings over the life of the mine)
from the 50:50 blend on which the global estimate is based, results in a difference
between the blended unit cost above and the blended overall unit cost calculated
by the model as described in Section 22.2.2.

Table 21.2: Process Plant Operating Costs by Plant Feed Type
Cost Centre Underground Tailings

A$/t Plant Feed A$/t Plant Feed
Processing Costs
Underground Crushing 0.95
Fine Ore Storage and Handling 0.06
Grinding and Classification 3.21 0
Tailings Reclamation 0.87
Grinding Isa Mill Tailings Retreatment 4.41
Flotation (Includes Regrinding Stages) 14.00 14.05
Concentrate Dewatering 0.09 0.09
Concentrate Filtering 0.49 0.49
Concentrate Loadout 0.13 0.13
Reagent Mixing and Dosing 0.05 0.05
Process Water 0.11 0.11
Raw Water 0.09 0.09
Tailings Thickening and Disposal 0.23 0.23
Tailings Return & Water Treatment 0.05 0.05
Air Services Supply & Reticulation 0.15 0.15
Processing Administration 3.81 3.81
Lighting and Workshop 0.05 0.05
TOTAL 23.48 24.59
21.1.3 Qualifications and Exclusions
The operating costs presented have been calculated from first principles and
budget quotations for supply of chemicals, materials and services. Process plant
operating costs are considered to have an accuracy of ±20%. The following items
have been excluded from the operating cost estimate:
 Royalties – included in financial analysis.
 All head office costs and corporate overheads.
 Exchange rate variations.
 Escalations.
 Project financing costs.
 Interest charges.
 Political Risk Insurance.

The Australian Goods and Services Tax (GST) will not be a cost to the Project as
an income generated by the Project in the form of product sales is GST free (as the
products are considered export commodities) and will not attract output credits.
However, the GST has cash flow implications for the Project, as GST will be
applied to most inputs, including consumable costs. Any GST payable on the
following inputs can be claimed back from the Australian Taxation Office (ATO):
 Land compensation / land owners costs.
 Subsidies to the local community.
 Rehabilitation costs.
 Amortisation and depreciation charges.
Tailings Reclamation
Tailings reclamation costs are split into direct tails mining costs (sluicing and
screening) as part of HMS supply and processing related tails reclamation costs
associated with the tailings feed preparation thickener.
TSF4 construction costs are described in the capital cost estimate.
Product
Product transport from site by truck in proprietary lined sea containers has been
excluded from operating cost estimates.
Product marketing costs have been excluded.
Treatment and refining of the concentrate smelters by have been excluded.
Tailings Storage
Future wall lifts on TSF4 have not been included within the operating cost.
Environmental
Plant site rehabilitation costs have been excluded from the operating cost estimate.
Tailings rehabilitation costs have been excluded from the operating cost estimate.
Environmental sampling and monitoring costs have been estimated as an
incremental allowance to the existing environmental costs and include additional
assay costs, additional contracts/ consultants costs and general consumables.
Labour
Overtime allowances have been excluded.

Union fees have been excluded.
The labour schedule and roster are based on four days on - four days off shift
rosters for operations and five days on – two days off for management and
administration.
An on-cost rate of 17.62% has been applied.
No accommodation costs have been allowed for within the operating estimate for
camp facilities as the workforce will be drawn from local communities, as per the
original plant operation.

Consumables
The consumption of reagents and other consumables are based on rates from the
metallurgical testwork and GRES experience.
All reagent and consumable costs have been sourced from suppliers and are
calculated as free-in-store at the Project site.
Utilities
The power schedule is based on the equipment list prepared by GRES. GRES has
calculated the power draw based on utilisation factors.
The power cost is based on grid power at a unit rate of A$0.113/kWh.
Laboratory
An allowance has been made for metallurgical laboratory facility only with an offsite
lab to conduct daily assay and environmental work. No onsite allowance has been
made for a chemist or wet laboratory staff.
General and Administration
General and administration costs have been estimated from other similar
operations.
21.1.4 Underground Mine Operating Costs
SRK developed the operating costs by mining method. The unit costs for each
mining method include the lateral development, drill and blast, bogging, haulage
cost to the ROM pad, rock backfill and paste fill. Table 21.3 presents the unit cost
for each mining method.
Table 21.3: Unit Costs by Mining Method
Mining Method Unit Cost (A$/t)
Drift and Half-upper 50.60
Multi-Level Continuous Fill 43.94
Underhand Stoping - Longitudinal 47.92
Underhand Stoping - Transverse 44.92
21.1.5 Tailings Mining Operating Costs
Tailings mining operating costs are based on the mining cost estimates for the
WRP FEED Study (Sara, S. 2012), amended to allow for the change in scale of the
mining. For the purposes of the PEA, it a mining cost of A$1.67 per tonne of
tailings plant feed is assumed when the plant is being fed on tailings alone (i.e. at a
maximum rate of 1.5Mtpa), and this has been increased to A$2.15/t of tailings plant
feed when the tailings material is being co-treated with underground material.

21.1.6 Processing and Maintenance Costs
Labour
The workforce will reside locally and drive in and out to the operations on a daily /
shift roster basis. Working cycles have been established to provide to the
minimum number of total employees by using current Australian shift cycles.
Woodlawn reclamation personnel will work the following proposed rosters:
Table 21.4: Proposed Work Rosters
Management and Administration five days on two days off (weekends);
Processing Foreman five days on two days off (weekends);
Processing Shift Operators four on four off, four panel roster;
Maintenance Crew five days on two days off (weekends);
Processing Metallurgists five days on two days off (weekends).
The labour rates and personnel numbers used for the salary cost estimate are
summarised in Table 21.5.
Table 21.5: Personnel Numbers and Labour Rates
Position Number Salary Total On-Cost Total

Cost
Each A$ A$ Factor
A$
Production
Plant Metallurgist 2 115,000 230,000 1.176 270,526
Metallurgical Technicians 1 65,000 65,000 1.176 76,453
Concentrator Foreman 1 100,000 100,000 1.176 117,620
Day Crew (Process) 2 65,000 130,000 1.176 152,906
Shift Supervisor 4 95,000 380,000 1.176 446,956
Process Technicians 20 72,500 1,450,000 1.176 1,705,490
Maintenance
Mechanical Leading Hand 1 112,500 112,500 1.176 132,323
Electrical Leading Hand 1 112,500 112,500 1.176 132,323
Fitter/BM 3 102,500 307,500 1.176 361,682
Electricians 3 105,000 315,000 1.176 370,503
Trades Assistant 2 70,000 140,000 1.176 164,668
Apprentices 2 38,500 77,000 1.176 90,567
Shared Resources

Position Number Salary Total On-Cost Total

Cost
Each A$ A$ Factor
A$
Metallurgy Manager / General 1 190,000 190,000 1.176 223,478

Manager
Maintenance Supervisor 1 170,000 170,000 1.176 199,954
Maintenance Planner 1 115,000 115,000 1.176 135,263
Logistics / Store / Procurement 2 80,000 160,000 1.176 188,192
Payroll / Account 1 55,000 55,000 1.176 64,691
Administration / HR Training 2 45,000 90,000 1.176 105,858
TOTAL 50 4,199,500 1.176 4,939,452

Note: 1. Personnel pay rates supplied by HAYS 2014 Recruiting, rates include annual leave
(7.7%), sick leave (3.82%) and public holidays (3.82%).
2. Residential and drive in-drive out workforce.
3. On-cost factor includes superannuation (9.5%), NSW payroll tax (5.45%), workers
compensation insurance (1%), and long service leave provision (1.67%).
Power
The power demand has been calculated to be 11.8MW, with an annual usage of
86,000MWh for the processing plant. A figure of A$11.3 cents per kWh has been
generated from the current agreed tariffs, but is not a final contract price for power.
The calculated total power cost for the Woodlawn Project is A$9.7 million per year.
Consumables
Reagents and media consumption make up the largest part of the operating cost
estimates and have been based on the previous testwork regime for the WRP and
current flotation results for the 50/50 blend of fresh underground feed to reclaim
tailings.
All reagent costs have been based on dry powder bulk delivery to site with onsite
mixing required. Some of the reagents such as MIBC and A3984 will be supplied
in liquid form in 1,000 litre liquid bulk containers.
The grinding media consumption and cost have been based on similar applications
and advised by the vendor in the case of IsaMill ceramic media and the Metso
SMD ceramic media costs. The grinding media steel consumption is based on
similar operations and previous abrasion index figures and equates to 0.8kg/t.
The unit costs and consumptions used for the reagent cost estimate are
summarised in Table 21.6.

Table 21.6: Reagent Usage
Reagent Unit Cost Consump- Consump- Cost Cost

A$/kg tion kg/t tion t/y A$/y A$/t
SMBS 0.63 5.62 8,434 5,313,309 3.54
Frother (MIBC) 4.05 0.35 521 2,108,025 1.41
Copper Sulphate 3.30 0.73 1,102 3,637,837 2.43
Copper Collector (A3894) 6.13 0.10 146 893,529 0.60
Zinc Sulphate 1.25 0.37 551 688,776 0.46
Sodium Isobutyl Xanthate 2.38 0.08 126 299,262 0.20
Flocculant (Magnafloc 342) 5.25 0.04 66 346,368 0.23
Antiscalant 3.00 0.01 9 27,000 0.02
Hydrated Lime 0.223 3.60 5,400 1,203,174 0.80
Binder / Cement 0.235 17.97* 26,955* 5,604,286 3.73
Sub-total 20,121,566 13.41
Grinding Media (2.5 mm Ceramic 1.50 0.25* 371* 556,531 0.37

Beads)
Grinding Media (3.5mm MTX Ceramic 5.50 0.15* 230* 1,267,905 0.85
Beads)
Grinding Media (85mm balls) 1.42 0.40* 600* 852,632 0.57
Sub-total 2,677,068 1.78
Total 22,798,633 15.20

Binder cement is based on 452,518 tonnes of tailings being used as underground
paste, the related kg/t rate is then 52.6kg/t. The reported rate reflects the kg/t used
against plant feed annual tonnage.
Ceramic grinding media is based on the total concentrate tonnage for the
concentrate regrind circuit and is 1.55kg/t. The reported rate reflects the kg/t used
against the plant feed annual tonnage
Ceramic MTX media is based against the tailings reclamation regrind usage and
the copper tailing regrind usage and has a usage rate of 0.11kg/t. The reported
rate reflects the kg/t used against the plant feed annual tonnage.
Ball mill grinding media of 0.8kg/t milled is based against the WUP fresh feed rate
of 750,000 tonnes per annum. The reported rate reflects the kg/t used against the
plant feed annual tonnage.

Plant Maintenance
Plant maintenance has been based on an estimated spares and consumables cost
for each section of the plant and equates to 5.05% of the operation cost at A$2.15
million.
Laboratory
An allowance has been made for a metallurgical laboratory facility only with an
offsite lab to conduct daily assay and environmental work. Contract wet assaying
costs have been estimated at A$552,000 per annum and are included within the
Processing Administration costs.
21.1.7 General and Administration Costs
Heron has estimated general administration costs having regard to comparable

mining operations within management’s experience. These costs total A$1.36
million per annum and have been applied across the life of the mine.
Table 21.7: General and Administration Costs
General and Administration Cost Area Fixed A$ per annum
Management and administration A$380,000

Insurances A$300,000
Government charges A$110,000
Audit A$15,000
Environmental A$50,000
Office costs A$286,000
Other & contingency A$220,000
Total Annual G&A Costs A$1,361,000

A number of further elements of the cost structure that could be considered
overheads have been captured in the operating costs. These include:
 Mine administration and plant administration costs which have been
included in the mining operating costs and processing plant operating costs
respectively; and
 Payroll / accounts and logistics / stores costs have been included in the
processing plant operating costs.

21.2 Capital Cost Estimate

21.2.1 Introduction
A capital cost estimate has been prepared as part of the scope of works and
covers the areas of design, supply, fabrication, transport, construction and
commissioning of the processing plant and support infrastructure facilities
proposed for the development of the Woodlawn Process Plant
Allowances have been made in the estimate where necessary for the upgrade of
existing infrastructure required to support the new processing plant. These items
of existing infrastructure include the high voltage power reticulation network, raw
water harvest and storage system and waste water evaporation / storage facilities.
Estimates have been based upon commodity quantity estimates developed from
preliminary engineering design, budget price quotations for major process
equipment and current market costs for site labour, construction equipment and
construction materials. Unit rates developed from tenders recently received from
the market place were applied to develop costs for the various construction and off-
site fabrication activities.
The quantity of man hours and therefore costs for engineering design,
procurement, construction management and commissioning were all estimated
from first principles using in-house data and experience gained from similar
projects.
The capital cost estimates presented in this document are considered to have an
overall accuracy of ± 25%. All estimates are presented in Australian dollars (A$)
and have been based on pricing obtained during the first quarter of 2015 (1Q15).
21.2.2 Summary
Processing Plant Capital Summary
Table 21.8 details a summary by processing area of the capital cost estimate for
the design, construction and commissioning of the new processing facilities.
Table 21.8: Capital Cost Estimate Summary
Process Plant Area Capital Cost

Area 200 – Plant Site Bulk Earthworks A$ 513,600
Area 310 – Crushing and Screening A$ 7,809,497
Area 311 – Reclamation and Screening A$ 1,587183
Area 320 – Fine Ore Storage and Handling A$ 3,313,908
Area 330 – Grinding and Classification A$ 4,116,559
Area 334 – Regrind A$ 9,832,267
Area 334 – Flotation A$ 27,832,982
Area 338 – Concentrate Thickening A$ 1,941,611
Area 342 – Concentrate Filtration & Dewatering A$ 3,727,965
Area 346 - Concentrate Storage A$ 1,885,236
Area 360 – Reagents A$ 3,087,435
Area 370 – Power and Reticulation A$ 14,319,608

Process Plant Area Capital Cost

Area 391 – Raw Water Supply A$ 638,466
Area 400 – Tailings A$ 1,465,432
Area 402 – Tailings Return Water A$ 226,928
Area 405 – Paste Plant A$ 6,326,626
Area 420 – Compressed Air A$ 463,782
Area 430 – Administration Building A$ 1,228,271
Area 440 – Workshop / Stores A$ 1,147,785
Area 442 – Laboratory A$ 205,576
Area 499 – Plant Piping A$ 9,119,815
Area 804 – Construction Equipment A$ 3,827,945
Area 500 – Engineering A$ 10,207,231
Area 510 – Commissioning A$ 1,592,804
Area 600 – Preliminaries and General A$ 5,800,594
Total Capital Estimate ± 25% A$ 122,259,104
Further, to allow the assessment of potential staged development scenarios for the
processing plant, commencing with the tailings plant and adding additional
components to support the underground at a later date, the capital estimate has
been broken down in Table 21.9 into:
1. elements required to support a tailings only operation, together with those
other elements required to support the underground operation whose
installation cannot practically be deferred; and
2. additional elements over and above those in item 1 above required to
support the underground operations.
Table 21.9: Plant Capital Breakdown to WRP and WUP Components

Scope Components Components (A$M)
(A$M) (Incremental
A$M)
Total 91.4 30.8 122.2
Mining Capital Summary
SRK derived the mining capital costs from benchmarking of similar sized
operations and first principle calculations.
Table 21.10 and Figure 21.1 summarise the mining capital.

Table 21.10: Mining Capital Cost Summary
Item Total
(A$M)
Boxcut & Portal 1.0
Development 78.51
Rehabilitation 8.85
Vertical Development 10.23
Mine Infrastructure 6.29
Mine Sustaining Capital 6.10
Total 110.98
Figure 21.1: Breakdown of Mine Capital
Other Capital Summary
Refer to Section 21.2.11 for details of additional capital items which have been
detailed in the owners’ costs.

21.2.3 Estimate Basis
The capital cost estimate presented in this study relate to capital works required to
construct a new processing plant and support infrastructure facilities. Design
criteria and flowsheets for the process plant and infrastructure were developed
using historical data, metallurgical testwork data and in-house experience.
From the developed processing route, plant equipment selections were made and
plant layouts were developed. Sufficient preliminary engineering design was
undertaken to ensure the functionality of the proposed layouts, suitability of
equipment specifications and to enable construction material quantities to be
estimated.
21.2.4 Qualifications and Exclusions
The following qualifications and exclusions apply to the capital cost estimate
presented in this Study:
 No allowance has been made for interest charges or capital financing costs.
 No allowance has been made in the estimate for exchange rate fluctuations
with respect to equipment sourced from outside Australia.
 No allowance has been made for Goods and Services Tax or sales tax.
 The estimate assumes power supplied to the incoming terminals of the new
66kV/11kV substation transformer from the Essential Energy local grid
supply.
 All equipment pricing included in the estimate assumes the purchase of
new equipment.
 All freight costs included in the estimate are Free on Transport (FOT) site.
 Messing and accommodation costs for the construction workforce have
been included at A$125 per man day. The estimates assume that the
workforce will be accommodated in local towns.
 The estimate assumes that plant assays will be undertaken by a contracted
(off site) analytical facility.
21.2.5 Mine Development
Box Cut & Portal
An allowance of A$1M has been made for surface works associated with
establishing the box cut and portal for the commencement of the underground
decline.
Lateral Development
The lateral development has been assumed to be undertaken by contract mining

services. The breakdown of the mine capital development is presented in Table
21.11.
Table 21.11: Lateral Development – Capital Estimate
Item Unit Rate Total

(A$M)
Decline A$4,950/m 40.39
Rehabilitation A$2,750/m 8.85

Level and Ventilation Access A$4,200/m 38.12

Total 87.36
Vertical Development
The vertical development has been assumed to be undertaken by contract mining

services. The breakdown of the mine vertical development is presented in Table
21.12.
Table 21.12: Vertical Development – Capital Estimates
Item Unit Rate Total

(A$M)
Ventilation Raise (3.0 m diameter) A$4,900/m 5.8
Emergency Egress A$4,100/m 4.4
Total 11.4
Mine Infrastructure
The allowance for the underground mine infrastructure for the WUP is detailed in
Table 21.13.
Table 21.13: Underground Mine Infrastructure - Capital Estimates
Description Unit Rate Quantity Total

(A$M)
Surface Magazine 1 0.12
Underground Pumping Stations A$150,000 each 3 0.45
Underground Electrical A$140,000 each 6 0.84
Substations
11 kV cabling and reticulation A$150/m 1,500 0.18
1000 V cabling 1 0.21
Refuge Chambers A$90,000 each 3 0.27
Ladder installations A$1,500/m 960 1.44
Surface Ventilations Fans A$500,000 each 3 1.50
Auxiliary Ventilation Fans A$50,000 each 10 0.50
Underground Workshop fit out 1 0.30
Mine compressor 1 0.18
Shotcrete / Batch Facility 1 0.30
Total 6.29
Underground mining sustaining capital has been allowed for in the mining
operating costs.

21.2.6 Mining Equipment
The mining equipment fleet described in Section 16.7.1 is assumed provided by

the mining contractor. Estimates for the operating costs incorporate these mining
contractor rates.
21.2.7 Processing Plant
The capital cost estimate presented in this study relates to capital works required
to construct a new processing plant as defined by the process design criteria,
process flowsheets and plant layout. This estimate has been compiled on the basis
that the design and construction of the processing plant is executed under a lump
sum, turnkey (EPC) style of contract.
Preliminary equipment sizing for the selected duties was undertaken and has been
used in the plant layout and for vendor supplied capital equipment costs.
Estimates for structural steel requirements and allowances for plant process and
service piping have been based on similar sized plants and the proposed layout.
Plant sustaining capital costs have been allowed for in the plant operating costs.
21.2.8 Infrastructure
The capital cost estimate compiled for the plant services components of the Project
were based on requirements dictated by the preliminary process plant design, the
level of existing infrastructure available to the Project and investigations carried out
to determine the most suitable and economic solutions for the Project.
No allowance has been made in the estimate for supply of the power line from the
Essential Energy local grid to site. All new power to site will be provided by the
Essential Energy local grid. The major plant services included in the capital cost
estimate were:
 Site process water reticulation system (excluding bore field).
 Tailings thickening and slurry disposal pumping system (TSF4 design and
construction cost estimate to be completed by others).
 Site wide 11kV power reticulation system within the Project site.
 Potable water reticulation system (shared with the existing development).
 Plant internal access roads and local site drainage system.
 Tailings return water pumping system.
 Site communications.
An allowance has been made in the capital estimate for the purchase of mobile
equipment required to operate the processing plant.
21.2.9 Contingency
The contingency allowances adopted for the estimate were based on the Project
scope outlined in this study document and do not include for changes to the
process flowsheet, process plant design or major equipment selections.
Contingencies in this regard are defined as an allowance for errors and omissions
based upon data assumed and equipment detailed as the basis for this study.

21.2.10 Indirect Capital
Engineering, Procurement and Construction Management (EPCM)
The estimate for EPCM services was developed from first principles for the
personnel required to perform all activities associated with the Project, for the
planned duration of the Project. The involvement of each team member was
individually estimated based on the complexity of the task and benchmarked
against the EPCM costs incurred on recent similar projects. The design,
procurement and management aspects of this work will be undertaken off site in
the offices of the EPC engineer.
The capital cost estimate contains an allowance for a site based construction
management team and site supervisors to be engaged for the duration of the site
works. Travel, site vehicles and site accommodation costs for these people have
been included in the study estimate.
Commissioning
Applicable engineering labour rates have been adopted for the commissioning
team. The team will consist of engineers from various disciplines, the relevant
vendor commissioning representatives and a team of tradesman selected form the
construction workforce. A travel allowance has been made to transport the
dedicated commissioning team to and from the site.
Certain items of major equipment such as the IsaMill, regrind mills, flotation cells,
filters and the thickeners will require vendor representation on site during final
commissioning. A vendor commissioning hire cost and travel allowance have been
included in the estimate for this purpose. This expenditure will ensure that
equipment warranties are preserved and any early operating issues are resolved
ahead of hand over. The vendor commissioning rates used in the capital estimate
were supplied to GRES with the equipment tenders.
Contractors Equipment and Temporary Construction Facilities
An allowance has been made for the hire, establishment, operation and removal of
temporary construction offices, crib rooms and ablutions for the construction
workforce.
An allowance has also been made for site vehicles for the construction
management team and construction trades personnel.
Mobilisation and Demobilisation
Estimates of the mobilisation and demobilisation costs for each of the construction
contractors have been included in the capital cost estimates. These costs have
been based on data sourced from recent projects and make allowance for
materials, equipment and personnel.

21.2.11 Owner’s Cost
Owner’s costs during construction have been estimated by Heron based on an 18

month project build schedule and are shown in Table 21.14. No allowance has
been made for owner’s sunk costs prior to project implementation. Owner’s costs
do not include corporate overheads.
Table 21.14: Owners' Costs - Capital Estimates
Item Cost A$M

Labour 1.149
Vehicles 0.063
Insurance 0.450
Accommodation 0.055
Office 0.117
Lease fees 0.083
Subtotal 1.916
TSF4 construction 1.57

Tailings monitoring equipment 1.82
Subtotal 3.39
Total Owner’s Costs ±30% 5.306

22 Economic Analysis
The economic evaluation for the Woodlawn Project has been prepared based on
the mining schedules and mining costs estimates prepared by SRK and described
in Section 21, the process and infrastructure costs for a 1.5 million tonne per
annum plant prepared by GRES and described in Section 21, from information
contained within the WRP BFS (Intermet, 2008) and FEED Studies (Sara, S.
2012), from an independently prepared market study (BPDT & Co, 2015), and from
management estimates.
References to the relevant sections of this report or to other reports published by
Heron are provided in the subsections below.
22.1 Basis of Evaluation

The Woodlawn Project economics have been assessed using the discounted cash
flow method, based on a quarterly schedule of tonnes mined and processed from
both the WRP and the WUP. Capital and operating costs are applied to mining,
processing and overheads. The processed material has recovery factors applied,
together with flotation splits to the three concentrates which make up the project
production. Shipping and logistics, product payability, treatment and refining costs,
state royalties and taxes are adjusted for to derive a net present value (NPV) for
the Project.
For the purposes of the PEA the economics are presented pre-financing.
To demonstrate the potential economics of the project, an “UG Starter Case” has
been modelled based on development as a combined underground project
together with a tailings retreatment project, with feed processed through a single
plant designed for co-treatment, with a total Plant Feed Estimate of 15Mt.
Whilst the UG Starter Case presents a strongly positive economic outcome for the
project and will form the basis for the future FS in order to minimise development
time and costs, there is potential for the Project to deliver significantly greater
tonnages from underground based on both expansion of the current resource and
on the broader exploration potential of the Woodlawn mineralised system.
With plant, underground access and development costs included for mining to a
depth of 700m below surface under the UG Starter Case, the incremental net
present value associated with new discoveries and / or conversion of additional
resource tonnes into the future mine plan has the potential to be very positive.
Tables within this section are presented in annual summary form. The
presentation currency is Australian dollars (A$) unless stated.
22.2 Summary Results

The main inputs and outputs of the financial model for the UG Starter Case are
summarised in Table 22.1 below, which is based on the Forecast Commodity Price
Deck. The Project’s post-tax NPV at an 8.3% post-tax real discount rate
(approximately equivalent to a 10% post-tax nominal discount rate) is estimated to
be A$300 million with an IRR of 46%. Payback of start-up capital is achieved
approximately 2 years from commissioning.

Table 22.1: Economic Model - Summary Economic Inputs and Outputs
Base Case
(Forecast Commodity Price Deck)
Post-tax NPV8.3 A$300 million
Post-tax IRR 46%
Initial Capital A$140M / US$112M
Payback Period 2 years from commissioning

1
Post-tax Cash Flow A$594M
1
C1 Cash Cost US$0.00/lb (zero) Zn
1
C3 Total Cost US$0.31/lb Zn
Plant Feed Rate 1.5Mtpa
Total Underground Feed 3.8Mt
Total Tailings Feed 11.2Mt
Total U+T Feed 15.0Mt
Mine life 11 years

1
C1 and C3 (refer to Section 27 for definitions) presented in this table are based on Zn as primary product with all
other saleable commodities treated as by-product credits. Refer to Section 22.2.2 for further details.
The Project has been demonstrated to be economically attractive based on the

assumptions used. The NPV together with the Project’s potentially attractive
position on the cost curve (refer to Section 22.2.2) and the strong IRR provide a
compelling case for pursuing their continued study and development.
NPV is most sensitive to the commodity price / FX environment on the revenue
side, and to grade (which in turn is driven by dilution considerations). Other
significant factors influencing the project returns include the underground
development capital, and the plant operating costs. Refer to Section 22.6 for
further discussion of project sensitivities.
The economic analysis strongly supports the continued study and development of
the Woodlawn Project. The recommendations and proposed forward program are
discussed further in Section 26.
22.2.1 Revenue Splits
The project is highly leveraged to commodity prices. In particular, zinc makes up

around 47% of expected total payable metal value for the project under the Base
Case. Hence the Project provides excellent exposure to what is anticipated to be a
market where demand will exceed supply, with positive potential implications for
the future price of zinc.

For the Base Case and in particular noting the expected metals prices described in
Section 22.4.2, the chart below shows the estimated breakdown of revenues by
commodity across all concentrates on a post-payability basis, but pre-TC/RCs.
Figure 22.1: Approximate revenue split post payability, pre TC/RCs
22.2.2 Cash Costs
Refer to Section 27 for definitions of the C1, C2 and C3 costs described herein.
The costs for the project in the Base Case, expressed in relation to Zinc in
concentrate shipped, are estimated to be:
Table 22.2: Economic Model - C1, C2 and C3 Costs - Zn Only Basis
Costs (Zn only basis) US$/t Zinc US$/lb Zinc
C1 -7 0.00
C2 574 0.26
C3 693 0.31
The negative C1 cost is driven by the significant cost credits associated with the
by-product streams (Cu, Pb, Ag and Au). If the two major by-products Cu and Pb
are expressed in zinc equivalent tonnes and treated as primary product (with the
by-products then being Ag and Au only), the resulting costs are estimated to be:
Table 22.3: Economic Model - C1, C2 and C3 Costs - Zn, Cu, Pb Basis
Costs (Zn/Cu/Pb as Zn) US$/t Zinc US$/lb Zinc
C1 1,076 0.49
C2 1,395 0.63
C3 1,460 0.66

Figure 22.2 shows the marginal cost of production for zinc since 1981 to the
present, with a forecast to 2018, referenced from Morgan Stanley’s Commodity
Manual (Longson et al, 2015). Based on the 2017 forecast data, it can be seen
that the Woodlawn Project’s expected costs are expected to place the Project in an
attractive position on the cost curve.
The calculations above are based on an adjusted methodology and hence differ
from the numbers released to the market on 22nd April 2015.
Figure 22.2: Cost Curve Comparison (Longson et al, 2015)
Table 22.4 by category of expense, expressed per tonne of plant feed. These costs
are presented as the average across both the underground and tailings
components of the 15Mt of plant feed.
Table 22.4: Economic Model - Cost Breakdown Expressed as US$/t Plant Feed
Costs US$/t Plant Feed Base Case
Mining 10.9
Processing 17.4
G&A 2.3
Operating Cash Costs 30.7
Royalties 2.4
Realisation 22.5
Total Cash Costs 55.6
Capital 11.6
All-in-Costs 67.2

22.3 Cautionary Notes & Resource Categorisation

Note that in viewing these results that the Preliminary Economic Assessment is
preliminary in nature, that it includes some Inferred Mineral Resources considered
too speculative geologically to have the economic considerations applied to them
that would enable them to be categorised as Mineral Reserves, and that there is no
certainty that the Preliminary Economic Assessment will be realised.
22.3.1 Underground Resource Categorisation of Plant Feed
A total of 3.8Mt of underground material has been included in the production

schedule for the PEA, broken down by resource category in Table 22.5:
Table 22.5: Economic Model - Underground Resource Categorisation of Plant Feed
Category % Contribution
Measured 0%
Indicated 32%
Inferred 68%
Total 100%
22.3.2 Tailings Resource Categorisation of Plant Feed
A total of 11.2Mt of tailings material has been included in the production schedule
for the PEA, broken down by resource category in Table 22.6:
Table 22.6: Economic Model - Tailings Resource Categorisation of Plant Feed
Category % Contribution
Measured 47%
Indicated 37%
Inferred 16%
Total 100%
This PEA includes only the tailings material previously classified as a Mineral
Reserve under the WRP BFS (Intermet, 2008); however, it is included here on a
Mineral Resource basis as described below. Additional Inferred material
comprising approximately 400,000 tonnes of Resource has not been included in
the Plant Feed Estimate for this PEA (but was included in the WRP BFS).
22.4 Macroeconomic Assumptions

The key macroeconomic assumptions are summarised in tables within the
subsections below and, where appropriate, explanatory notes have been added
under the tables for clarity.

As a general rule, forward looking economic assumptions have been chosen using
fixed values considered representative rather than using time varying forward
assumptions.
22.4.1 Exchange Rates, Inflation and Discount Rates
Much of the cost base associated with the Woodlawn operation will be based in
Australian dollars, whilst the revenues will be principally earned in US dollars
(US$). Hence the exchange rate between the US$ and the A$ has a material
impact on the project cash flows.
A stepped exchange rate has been assumed by Heron based on the forward curve
as at 31 March 2015 according to Table 22.7:
Table 22.7: Economic Model - Exchange Rate Assumptions
Year A$:US$
Capital costs 0.80
2016 0.76
2017 0.75
2018 0.75
2019 0.75
2020 0.74
Long Term 0.73
Lower exchange rates generally benefit the project economics; higher ones have
an adverse impact. Naturally, the project NPV sensitivity to the exchange rate is
approximately equivalent to the sensitivity to changes in commodity prices (though
in the opposite direction). As at 29 May 2015 the exchange rate was
approximately 0.77 A$:US$.
For the purposes of the model, no inflation has been applied either to costs or to
revenues. As a result, a real, post-tax discount rate has been applied to the
Project.
The selected discount rate of 8.3% is approximately equivalent to a post-tax
nominal discount rate of 10%, based on an inflation rate of 2.5% p.a.
No terminal value has been associated with the Project.
22.4.2 Expected Metal Prices
The metals prices assumed by Heron in the modelling are shown in Table 22.8.
These prices have been based on analysis of forecast commodity price data from a
number of different sources, with the selected prices being in the middle of the
range of expected outcomes. Nominal prices have been deflated for inflation at
2.5%, are expressed below in 2015 dollar terms, and have been held constant for
the duration of the model.

Sensitivities have been run on these assumptions, with an upwards and

downwards move in across the board commodity prices by 10%. In addition, a
zinc only sensitivity has been run using the same flexes.
Table 22.8: Economic Model - Commodity Price Assumptions
Commodity Modelled Price per Unit Spot Price as at 20 May Delta

2015 basis, flat 2015 (for comparison)
Zinc US$2,400/t US$2,255/t 6.4%
Lead US$2,100/t US$1,936 /t 8.4%
Copper US$3.0/lb US$2.84/lb 5.6%
Silver US$18.5/oz US$17.1/oz 8.1%
Gold US$1,200/oz US$1,210/oz -0.8%
22.4.3 Taxes and Royalties
The project is subject to Australian corporate tax, which has been applied at 30%.
Tax calculations are impacted by depreciation deductions for capital items.
New South Wales levies mineral royalties for extractive operations within the state.
The royalties are based on an “ad valorem” value of minerals, being 4% of the ex-
mine value less allowable deductions.
Allowable deductions are confined to the direct costs incurred in upgrading the
mineral, after the first stockpile, and bringing it to market, and include crushing and
milling, concentration, assaying and analysis, realisation costs, and a depreciation
allowance. When applied to the project costs, the equivalent royalty expressed as
a percentage of net smelter revenue averages approximately 3.0% over the life of
mine.
Opening capitalised exploration expenditure of A$12 million has been depreciated
on a unit of production basis.
Heron’s opening tax losses of A$60 million have been fully netted against the
project tax calculations. In addition, A$44.3 million of the A$53 million in additional
losses subject to the available fraction rule have been netted against the project
tax calculations. These losses reflect accumulated losses for the group companies
and are based on preliminary independent advice received following the merger
between Heron and TriAusMin.
Goods and Services Tax (GST) cash inflows and outflows have been excluded
from this analysis.
22.4.4 Selling Expenses
The cost of transportation to port, port handling and storage charges, and ocean
freight has been estimated assuming that the concentrates will be shipped with a
moisture content of 10%.
The payability and TC/RC terms vary by concentrate and commodity depending on
the concentrate specifications and the levels of by-products in each concentrate

Independent advice has been sought to provide estimates for these based on
expected concentrate characteristics. The assumptions are in line with normal
market terms, and are equivalent to the values shown in Table 22.9:
Table 22.9: Economic Model - Selling Expense Assumptions
Realisation Costs US$/t Plant Feed
Transportation 6.1
Treatment 15.3
Refining 1.2
It is assumed that 90% of revenue will be received 30 days following concentrate

production, and the remaining 10% after a further 90 days. Payment terms are
assumed to be 30 days.
22.5 Technical Assumptions

22.5.1 Mine Production Schedule
An 18 month construction period has been assumed pre-production. A ramp-up in

capacity has been assumed, commencing at an annualised rate of 900ktpa in
quarter 1, rising to 1.43Mtpa in the third quarter, and reaching 1.5Mtpa by the
fourth quarter. The mine plan has been developed based on an underground
mining schedule, with the residual capacity then being applied to treatment of the
tailings. It should be noted that the plant is able to be commissioned on tailings
only.
The underground mine production schedules are based on a stope by stope
evaluation undertaken by SRK, taking into account the desired production profile,
tonnes and grade (with post-dilution zinc equivalent grade as the key driver), stope
access, and mining and capital development costs.
The tailings production profile is based on the FEED study (Sara, 2012) production
model, under which the three tailings dams are treated sequentially (TDS, then
TDW and finally TDN), with a constant grade profile assumed across each dam.
For the purposes of the PEA the same sequence has been assumed, with the plant
feed tonnes being driven by the difference between the underground plant feed
deliveries and the capacity of the plant (as modified by the ramp-up profile
described above).
The resulting production schedule can be summarised in Figure 22.3 below, and is
provided in more detail in Table 22.10:

Figure 22.3: Production sources and diluted grades delivered to mill
Table 22.10: Economic Model - Production Schedule
The underground Resources falls into two main types, a “Polymetallic” type which
refers to polymetallic massive sulphide mineralisation with high-grade Zn and Pb,
and a “Copper” type which refers to Cu dominated massive and stringer sulphide
mineralisation. The mining schedule preferentially feeds the Polymetallic material,

with the Copper material generally being skewed to the later stages of the
production profile as shown in Figure 22.4.
Figure 22.4: Underground Production by Domain
The mining from underground is split between areas away from previous mining
(“New Areas”) and areas around previous mining (“Remnant”). Approximately 80%
of the underground production schedule is based upon the mining of the New
Areas, with the breakdown over time as shown in Figure 22.5 below.
Figure 22.5: Underground Production by Mining Type

22.5.2 Concentrates Produced
The UG Starter Case will produce three concentrates, being a 45% zinc
concentrate with potentially payable silver credits, a 45% lead concentrate with
payable copper, silver and gold credits, and a 24% copper concentrate with
payable silver and gold credits. Details of the concentrate specifications, based on
the inputs described in this Section are shown in Table 13.7 and Table 13.8 in
Section 13.3.10.
The concentrate specifications are based upon the metallurgical testwork carried
out during the PEA and the previous WRP BFS (Intermet, 2008) as described in
Section 13. They are considered representative, though concentrate grades and by
product streaming to the concentrates will be impacted by the mix of feed entering
the plant as well as by the flotation conditions at that time. Although similar to the
previous operations over 20 years, the new plant will utillise modern energy
efficient fine grinding machines with inert media to aid in optimisation of recovery
characteristics to the different concentrates.
Further testwork will be undertaken during the FS to improve recoveries and refine
product specifications.
22.5.3 Recoveries to Concentrates
0.75Mtpa fresh underground material and 0.75Mtpa of tailings from the previous
operations. Refer to Heron’s announcement of 11 February 2015 titled “Successful
Metallurgical Testwork” for details of the flotation results from the PEA testwork
programme for the polymetallic and the blended underground & tailings samples.
Based on the testwork, the recovery outcomes to concentrates are described in
Table 22.11, and Table 22.13, firstly as the constituent parts, and then as a
blended outcome, all summarised over the life of the mine.
Table 22.11: Economic Model - Concentrate Recoveries - Underground
Underground Concentrate Recoveries

Element Zn Pb Cu
Zn 79.4% 3.9%(*) 0.9%(*)
Pb 8.1%(*) 71.0% 5.0%(*)
Cu 4.4%(*) 9.2% 70.7%
Ag 13.9% 51.7% 9.9%
Au 6.0% 45.9% 13.0%

Table 22.12: Economic Model - Concentrate Recoveries - Tailings
Tailings Concentrate Recoveries

Element Zn Pb Cu
Zn 69.6% 5.1%(*) 1.1%(*)
Pb 7.5%(*) 35.8% 2.9%(*)
Cu 7.0%(*) 23.3% 31.8%
Ag 12.2% 23.5% 3.3%
Au 4.6% 9.8% 3.0%
Table 22.13: Economic Model - Concentrate Recoveries - Blended Underground plus
Tailings
Blended Underground Concentrate Recoveries

plus Tailings
Element Zn Pb Cu
Zn 74.2% 4.5%(*) 1.0%(*)
Pb 8.1%(*) 48.3% 3.7%(*)
Cu 5.9%(*) 17.1% 50.6%
Ag 13.4% 32.8% 5.3%
Au 6.4% 22.8% 6.7%
Items marked with a (*) are unlikely to be payable, and in the case of lead in the
copper concentrate, may attract a small penalty if levels exceed specified amounts.
A ramp-up in recoveries has been assumed based on 80% of design recoveries
being achieved in the first quarter post commissioning, 90% in the following
quarter, thus allowing for a ramp up to 100% of design recoveries over a 6 month
period. This ramp up is reflected in the life-of-mine averages provided above.
It should be noted that the life of mine recoveries presented are impacted by the
ramp-up assumptions. The steady state recoveries once ramp up is complete are
slightly higher than those presented.
22.5.4 Operating & Closure Costs
Refer to Section 21.1 for details of the mining and plant operating costs.
Underground Mining
Underground mining costs have been developed by SRK from first principles
based on the mining method, vertical development, horizontal access, stoping and
back fill costs, and vary according to the physical location and characteristics of the
mined material within the underground. The capital cost profile is shown in Table
22.16. The operating costs generally range between A$49/t and A$54/t on a mill
feed basis based on contract mining (and leased equipment) and including
maintenance costs, with variations based on the mining style chosen and individual
stope characteristics.

Tailings Mining
Tailings materials will be recovered from the three tailings dams in sequence,
utilising the proven technique of high pressure water jet monitoring. The pulped
material will then be pumped to the concentrator, thickened, and processed. The
mining rate is tied to the mill feed ramp-up rate, described below, and the resulting
schedule is provided above. The cost assumption for mining the tailings material is
A$2.14/t whilst blended feed is processed, reducing to A$1.67/t mill feed when the
plant is running on tailings alone.
Operating Costs
The operating cost estimate has been developed on the basis of a process plant
feed tonnage of 1,500,000 tonnes per annum. The operating cost estimate is
A$23.41 per tonne of feed and is shown in Table 22.14.
Table 22.14: Economic Model - Plant Operating Costs
UG Starter Case Unit Cost A$/t

Crushing & Grinding 1.96
Tailings Reclamation & Grind 3.09
Flotation 13.03
Concentrate Handling 0.72
Plant services 0.76
Administration 3.86
Total Plant Operating Cost 23.41
fluctuation and was based on 0.80 A$:US$. Additional fixed costs of A$4.25 million
have been estimated and applied annually and include general administration
costs, insurances, and some underground fixed costs including technical services,
fuel and power. Maintenance capital is included in the operating costs above.
Closure
An amount of A$9 million has been assumed for the net closure costs associated
with the end of mining at the Woodlawn site for the UG Starter Case. The
economic evaluation is not sensitive to changes in the closure costs.
22.5.5 Capital Costs
Refer to Section 21.2 for details of the mining and plant capital costs, which
includes the costs associated with the underground mine access and rehabilitation.
Capital costs have been modelled in Australian dollar terms, with no allowance
made for movements in exchange rates for items supplied from overseas.
Pre-production capital is recognised for tax and accounting purposes at
commissioning, and depreciated according to normal protocols. For major plant
items, depreciation has been based on a 15 year equipment life, and for all other
capital items depreciation is recognised based on a unit of production measure.
A summary of the initial capital cost estimates (±25%) and inclusive of a 7.7%
contingency is provided in Table 22.15.

Table 22.15: Economic Model – Initial Capital Costs Summary (to Peak Cash Draw)

Scope Components Components (A$M)
(A$M) (Incremental A$M)
Underground Development &

Rehabilitation
Pre-commissioning 0.0 3.3 3.3
Post-commissioning 0.0 3.3 3.3
Mining Equipment & 1.8 0.0 1.8
Infrastructure
Tailings Storage 1.6 0.0 1.6
Subtotal 94.8 37.5 132.3
Owners Costs Pre- 1.9 0.0 1.9
Production
Working Capital 4.7 1.1 5.8
Total to Peak Cash Draw 101.4 38.6 140.0
Peak Cash Draw is defined as initial capital working capital post commissioning
until the mine achieves a break-even cash position, and excludes financing costs.
Maintenance capital has been built into the operating cost estimates. No
allowance has been made for financing charges or interest, GST related cash
flows, or fluctuations in the exchange rate (estimates were provided on the basis of
a rate of 0.80 A$:US$).
The basis for the capital estimates includes:
 Engineering, Procurement and Construction model for non-mining
infrastructure.
 Owner operator processing facilities and workforce.
 Owned fixed plant, mobile surface plant, and administration buildings.
 Contract mining and leased underground mining equipment and
maintenance facilities.
 Contract concentrate road haulage, port storage and handling and ship
loading.
 The construction of the new tailings storage facility TSF4.
Ongoing capital of A$107.7 million is required for the underground decline and
lateral development, decline rehabilitation, ventilation raises, escapeways,
infrastructure and sustaining capital. The profile is driven by the production
schedule and is shown in Table 22.16 starting in the second quarter post
commissioning (being the quarter immediately after Peak Cash Draw, with capital
prior to that period being shown in Table 22.15 above):

Table 22.16: Economic Model - Post-Production Underground Capital Cost Summary

22.5.6 UG Starter Case Financial Statements
Financial statements are shown post-tax but pre-financing. They are for the Project only and do not include corporate overheads
or income / expenditure from other projects held by the Company. The financial statements are based on management’s
preliminary assessment of the Australian accounting treatment for each item.
Profit and Loss
Table 22.17: Economic Model – Project Pre-Finance Profit and Loss Summary
P&L Total 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Zinc Concentrate Revenue A$m 987.7 - - 25.8 91.3 119.4 170.3 157.9 119.5 69.1 56.1 61.9 70.1 46.2
Lead Concentrate Revenue A$m 550.6 - - 13.1 57.4 75.4 84.9 70.9 64.9 46.8 38.3 38.3 36.4 24.0
Copper Concentrate Revenue A$m 538.6 - - 9.3 41.8 70.7 77.4 75.8 74.4 84.6 49.3 24.1 18.8 12.4
Gross Payable Revenue Net Credits
A$m 2,076.9 - - 48.2 190.5 265.5 332.6 304.6 258.9 200.6 143.8 124.2 125.3 82.7
O/S Transport etc. costs A$m (125.2) - - (3.0) (11.0) (15.2) (20.3) (18.7) (15.4) (11.4) (8.9) (7.9) (8.1) (5.4)
Treatment costs A$m (313.2) - - (7.7) (28.2) (37.8) (52.3) (48.1) (38.2) (24.9) (20.2) (20.1) (21.5) (14.2)
Refining costs A$m (24.1) - - (0.5) (2.0) (3.1) (3.2) (3.1) (3.1) (3.4) (2.3) (1.4) (1.2) (0.8)
Net Smelter Revenue A$m 1,614.3 - - 37.0 149.2 209.4 256.8 234.8 202.3 160.9 112.4 94.7 94.5 62.3
Mining costs A$m (224.2) - - (4.2) (19.7) (31.3) (38.0) (40.2) (39.1) (33.8) (11.2) (2.5) (2.5) (1.7)
Benefication costs A$m - - - - - - - - - - - - - -
Processing costs A$m (357.7) - - (17.9) (35.9) (36.1) (36.0) (36.1) (35.0) (34.9) (35.2) (34.1) (34.1) (22.5)
Marketing costs A$m - - - - - - - - - - - - - -
Other Realisation costs A$m - - - - - - - - - - - - - -
Royalties paid A$m (48.9) - - (0.7) (4.3) (6.8) (8.7) (7.8) (6.6) (4.9) (3.0) (2.3) (2.3) (1.5)
Variable overhead costs A$m - - - - - - - - - - - - - -
Fixed and Closure costs A$m (47.7) - - (2.6) (5.3) (5.3) (5.3) (5.3) (5.3) (4.3) (1.4) (1.4) (1.4) (10.4)
Total costs A$m (678.4) - - (25.4) (65.2) (79.4) (88.0) (89.4) (85.9) (77.9) (50.7) (40.3) (40.3) (36.0)
EBITDA A$m 935.9 - - 11.6 84.0 130.1 168.9 145.4 116.4 83.0 61.6 54.5 54.2 26.3
EBITDA margin A$m n/a 0% 0% 24% 44% 49% 51% 48% 45% 41% 43% 44% 43% 32%
Depreciation Expense A$m (238.5) - - (3.5) (15.4) (21.4) (32.2) (34.6) (29.9) (22.2) (20.0) (21.1) (22.6) (15.8)
Amortization of Exploration Expense
A$m (12.0) - - (0.3) (1.1) (1.5) (2.1) (1.9) (1.4) (0.8) (0.7) (0.7) (0.8) (0.6)
EBIT A$m 685.4 - - 7.8 67.5 107.2 134.6 108.9 85.1 60.0 41.0 32.7 30.8 9.9
Interest & Borrowing Expense A$m - - - - - - - - - - - - - -
Interest Income A$m - - - - - - - - - - - - - -
Profit Before Tax A$m 685.4 - - 7.8 67.5 107.2 134.6 108.9 85.1 60.0 41.0 32.7 30.8 9.9
Income Tax A$m (205.6) - - (2.1) (19.8) (32.0) (40.3) (32.7) (25.5) (18.3) (12.9) (9.8) (9.2) (3.0)
Profit After Tax A$m 479.8 - - 5.7 47.7 75.2 94.3 76.2 59.5 41.7 28.0 22.9 21.5 6.9

Cash Flow Statement

Table 22.18: Economic Model – Project Pre-Finance Cash Flow Summary
Cash Flow Statement Total 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Receipts from customers A$m 1,740 - - 25.1 153.8 221.3 271.8 252.4 223.3 181.5 119.9 107.9 98.1 81.5
Payments to suppliers / employeesA$m - 804 - - - 24.0 - 75.7 - 94.0 - 107.7 - 108.5 - 101.9 - 90.1 - 59.9 - 48.2 - 48.4 - 42.3
Net interest received A$m - - - - - - - - - - - - - -
Net tax paid A$m - 103 - - - - - - 15.0 - 25.2 - 19.2 - 14.3 - 10.0 - 7.0 - 6.5 - 5.7
Operating Cash Inflow/(Outflow) A$m 833 - - 1.1 78.1 127.3 149.1 118.7 102.3 77.1 50.0 52.7 43.3 33.6
Capital Expenditure A$m - 239 - - 77.0 - 61.0 - 29.3 - 30.9 - 23.2 - 11.0 - 4.2 - 1.7 - 0.2 - - -
Proceeds from sale of PP&E A$m - - - - - - - - - - - - - -
Acquisitions A$m - - - - - - - - - - - - - -
Other Investments A$m - - - - - - - - - - - - - -
Net Investing Cash Inflow/(Outflow)
A$m - 239 - - 77.0 - 61.0 - 29.3 - 30.9 - 23.2 - 11.0 - 4.2 - 1.7 - 0.2 - - -
Net increase in cash A$m 594 - - 77.0 - 59.9 48.8 96.4 125.9 107.6 98.1 75.4 49.8 52.7 43.3 33.6
Balance Sheet
Table 22.19: Economic Model – Project Pre-Finance Balance Sheet Summary
Balance Sheet Opening 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Current Assets
Cash A$m - - - 77.0 - 137.0 - 88.2 8.3 134.2 241.8 339.9 415.4 465.2 517.9 561.2 594.8
Accounts Receivable A$m - - 12.2 17.6 24.6 29.7 23.6 23.2 14.5 9.4 12.1 8.4 2.8
Inventory A$m - - 2.7 3.7 0.1 0.3 7.4 2.1 1.6 8.0 0.1 8.2 -
Total Current Assets A$m - - 77.0 - 122.0 - 66.8 33.0 164.2 272.8 365.3 431.4 482.6 530.1 577.8 597.6
Non Current Assets
Property, Plant and Equipment A$m - - - 134.6 148.5 158.0 149.0 125.4 99.7 79.2 59.4 38.3 15.8 - 0.1
Mining / Pre-Prodn Costs Capitalised
A$m - 77.0 0.9 2.4 2.8 3.1 3.2 3.1 2.2 - - - -
Tax assets A$m 114.7 114.7 114.7 112.6 92.8 60.8 43.5 33.7 26.0 20.5 16.6 13.7 10.9 12.0
Capitalised Exploration A$m 12.0 12.0 11.7 10.5 9.1 7.0 5.1 3.7 2.8 2.1 1.4 0.6 -
Total Non Current Assets A$m 126.7 126.7 203.7 259.8 254.2 230.7 202.6 167.3 132.5 104.7 78.2 53.4 27.3 11.9
Total Assets A$m 126.7 126.7 126.7 137.7 187.4 263.6 366.7 440.2 497.8 536.2 560.8 583.6 605.1 609.5
Current Liabilities
Accounts Payable A$m - - - 5.3 - 7.3 - 8.4 - 9.2 - 8.8 - 8.2 - 6.4 - 4.0 - 4.0 - 4.0 - 3.1
Deferred Tax Liability A$m - - - - - - 7.9 - 5.5 - 4.2 - 2.7 - 1.8 - 1.6 - 1.6 -
Total Current Liabilities A$m - - - 5.3 - 7.3 - 8.4 - 17.1 - 14.4 - 12.4 - 9.1 - 5.7 - 5.6 - 5.6 - 3.1
Total Liabilities A$m - - - 5.3 - 7.3 - 8.4 - 17.1 - 14.4 - 12.4 - 9.1 - 5.7 - 5.6 - 5.6 - 3.1
Net Assets A$m 126.7 126.7 126.7 132.4 180.1 255.3 349.6 425.8 485.4 527.1 555.1 578.0 599.5 606.4

22.6 Sensitivity Analysis

The modelled economic case for the Project has been subject to sensitivity
analyses based on percentage movements in each driver. For the sensitivities,
only a single factor has been modified, with other factors being left unchanged
(noting that movements in some of these may in reality be correlated with
movements in the modified factor – for example, FX and commodity prices). The
outputs are shown in Figure 22.6 and Table 22.20.
The factors on which sensitivities have been undertaken are:
1. commodity prices;
2. zinc price (without moving other commodity prices);
3. the exchange rate (FX);
4. pre-production capital;
5. mining costs;
6. production grade delivered to mill;
7. processing costs;
8. payability; and
9. recoveries.
22.6.1 UG Starter Case Sensitivities
Figure 22.6: Economic Model - Sensitivity Spider Diagram

Table 22.20: Economic Model - Key Sensitivities to NPV and IRR Outcomes
NPV / IRR -20% -10% 0% 10% 20%
Commodity prices $115.2M / $207.9M / $299.9M / $391.6M / $483.2M /

24% 36% 46% 56% 65%
Zinc price $212.9M / $256.4M / $299.9M / $343.2M / $386.6M /

36% 41% 46% 51% 55%
Exchange rate (FX) $485.1M / $382.3M / $299.9M / $232.3M / $175.8M /

65% 55% 46% 39% 32%
Pre-production capital $334.8M / $318.3M / $299.9M / $279.5M / $257.1M /

65% 55% 46% 39% 34%
Mining costs $321.5M / $310.7M / $299.9M / $289.1M / $278.3M /

49% 47% 46% 45% 44%
Grade delivered to mill $155.4M / $227.4M / $299.9M / $370.9M / $442.5M /

29% 38% 46% 53% 61%
Processing costs $330.7M / $315.3M / $299.9M / $284.5M / $269.0M /

50% 48% 46% 45% 43%
Recoveries $155.4M / $227.4M / $299.9M / $370.9M / $442.5M /

29% 38% 46% 53% 61%
Limits - Worst $115.2M / $207.9M / n/a $391.6M / $483.2M /

24% 36% 56% 65%
Limits – Best $485.1M / $382.3M / n/a $232.3M / $175.8M /

65% 55% 39% 32%
22.6.2 Sensitivity Discussion
Based on the data in Table 22.20, it is apparent that in ranking of potential to

impact the Project’s economics, for both cases presented, the five most influential
variables are:
1. AUD / USD exchange rate.
2. Zinc price (and commodities prices more generally).
3. Plant feed grade.
4. Metallurgical Recoveries.
5. Operating costs (including underground mining costs).
6. Capital costs (including underground development costs).
Historically exchange rates and metal prices have acted as offsetting forces i.e.
when metal prices are strong, the Australian economy strengthens and exchange
rates move up.
Whilst historically it has been unusual to experience a combination of high metals
prices with low exchange rates, it is noted that with the positive outlook for zinc
prices, driven by a fundamental decline in output from a number of major mines
contributing a significant proportion of global supply, coupled with weakness in the
Australian dollar exchange rate (driven in part by lower iron ore, coal and energy
prices), there is potential for this scenario to occur.
Conversely, high exchange rates together with low commodity prices are not a

common occurrence and therefore probably represent a relatively low risk to the
project. In terms of the impact of exchange rate and metal prices on the Project’s
economics, the Company does have the option to mitigate against adverse
movements in currency or metal pricing by entering into hedging contracts with
appropriate counterparties.
Project operating costs and in particular the costs of consumables, labour, power
and materials handling logistics have a material impact on economics. An across
the board rise in costs would have a significantly negative impact on project
economics. While not all of the individual components of operating costs are
expected to move in unison, it is possibly that one or more of the cost centres
could fluctuate more sharply than others.
The cost of consumables represents a significant proportion of operating costs and
to the extent that they are imported, could be subject to price movements driven by
foreign exchange fluctuations. FX hedging could be employed to mitigate against
the downside risk of movements to this component of operating costs.
Similarly, whilst having a lower overall impact on the project economics, increases
or reductions in capital costs, including both the plant costs and the underground
capital, have the potential to impact on economics. Further work is warranted to
improve the confidence associated with the estimates, as well as to optimise
through commercial negotiation with vendors as the project advances towards
production.
Given the steepness of the sensitivity curves for metal prices, exchange rates and
operating costs, small movements in a combination of variables could have the
same impact as a large movement of any single variable. Similarly, strong
movements in one variable could also trigger an equally strong movement of other
variables in an opposite direction.

23 Adjacent Properties
23.1 Introduction
The Silurian felsic volcanic rocks of the Woodlawn area and the broader Goulburn
Basin (see Section 7) are prospective for VMS with a number of significant
prospects and deposits present. This Section briefly describes the relevant
mineral properties that are adjacent to the Woodlawn Project area, as shown on
Figure 23.1.
Figure 23.1: Map showing the relevant mineral prospects adjacent to the Woodlawn
Project

23.2 Captains Flat Deposit (Ironbark Zinc Ltd 50%, Glencore plc 50%)
The Captains Flat Deposit is located some 100km south of Woodlawn towards the
southern extent of the Goulburn Basin. It is owned via a 50:50 joint venture
between Ironbark Zinc Ltd (Ironbark) and Glencore plc, with Rutila Resources Ltd
retaining a small production royalty.
The deposit was first mined as the Lake George Mine from 1882 to 1889 and then
between 1937 to 1962 and is believed to have produced approximately four million
tonnes of ore at grades of 10% Zn, 6% Pb, 0.7% Cu and 55g/t Ag. The main
deposit is hosted in a north-south trending sequence of Silurian felsic volcanic
rocks enclosed within a broader sequence of Ordovician shales, sandstones and
siltstones. Mineralisation is considered by Ironbark to open at depth beneath the
old mine working, where there may be repeats of the existing mineralisation.
The project covers some 39 kilometres strike of prospective volcanic rocks which
contain several base-metal occurrences. Apart from the Captains Flat mine itself,
several other prospects are noted.
Vanderbilt Hill Prospect
The Vanderbilt Hill Prospect is located to the east of the Lake George Mine and
drilling has returned results such as 3.9m @ 10% zinc, 5.3% lead. The prospect is
considered to be highly prospective with open ended historic high grade drill results
yet to be followed up.
Jerangle Prospect
The Jerangle Prospect is located some 30 kilometres south of Captains Flat and
has returned some significant results including:
 43.3m @ 1.9% Zn, 0.3% Pb, 0.14% Cu and 3.8g/t Ag from 355.5m down
hole, and high grade zones including, 2.2m @ 8.0% Zn and 4.4m @ 5.0%
Zn 378.0 and 386.8m down hole respectively.
Source: Ironbark website, 2015.
23.3 Dargue’s Reef (Unity Mining Ltd 100%)

The Dargue’s Reef gold mine owned by Unity Mining Limited is located 50km
southwest of the Woodlawn mine. Gold occurs in quartz veins or with
hydrothermal alteration minerals within the host I-type Braidwood Granodiorite.
Dargue’s Reef has a reported (Unity, 2014) Measured, Indicated and Inferred
resource (JORC compliant) of 1,615,000t @ 6.3g/t Au for 327,300oz Au (using a
2g/t cut-off) and the deposit is reported to be open laterally and at depth.
The project area covers a significant portion of the Majors Creek (Elrington)
goldfield, the Jembaicumbene alluvial goldfield and a portion of the Araluen alluvial
goldfield. This area represents the largest alluvial goldfield in NSW, with gold
production at the turn of last century of 1.25Moz.
During the 19th century high grade, structurally controlled, primary gold
mineralisation was discovered and mined from a number of localities in the “roof
zone” of the prospective Braidwood Granodiorite. Dargue’s Reef, the principal
exploration target, was mined from 1870-1891 and again from 1914-1916 reaching
a maximum depth of 70m. The Dargue’s Reef represents only one of the potential
sources of the regions extensive alluvial gold occurrences. The Majors Creek area
contains at least 24 other historic hard rock mines, including Snobs, United Miners,

Dunsheas, Big Hill, Rise & Shine and Camages, all which have verified historic
head grades ranging from 0.25 to 4.0oz/t.
Mineralisation occurs in quartz veins in the form of free gold, or associated with
altered quartz-sericite-calcite-pyrite felsic and phyllic lodes and occasional
quartz/calcite veining. Gold is frequently associated with pyrite and chalcopyrite
with higher grade mineralisation often restricted to discrete ore shoots, true widths
range between 5 and 15 metres, surrounded by a large medium grade mineralised
envelope. Drilled intercepts include contained sectional grades of up to 25g/t Au
over the widths of up to 3m. Interpretation of the geological data indicates an
extensive multi-lode ore system ranging from 3m to 20m in width comprising high-
grade gold bearing ore shoots that remain open at depth (+500m).
Gold mineralisation at Dargue’s Reef occurs in the footwall and the hangingwall as
a steeply dipping, fracture controlled lode systems within zones of intense
alteration in the host Braidwood Granodiorite. The lodes follow a well-developed
fracture system adjacent to an intrusive dolerite dyke. At Dargue’s Reef, the two
main lodes thicken where they intersect creating a broad steep easterly plunging
ore shoot.
Mining at Dargue’s Reef is reported to target 50,000 ounces per year with an initial
5 year mine life. Mine development was stalled at the end of 2013 with much of
the mine infrastructure including the boxcut, ROM Pad and access roads having
been completed. The site is on care and maintenance whilst further technical
studies on processing onsite are finalised.
Source: Unity website, 2015 and from DIGS GSNSW.
23.4 Mayfield Prospect (Capital Mining Ltd earning in)

The Mayfield gold-copper-base metals joint venture between majority Capital
Mining Ltd (Capital) and Forge Resources Ltd is a skarn gold-copper deposit 30km
north of Braidwood and approximately 30km south east of Woodlawn.
The Mayfield gold-base metal skarn mineralisation is hosted by metasomatised
limestone units of a Silurian sedimentary and volcanic sequence in the region that
has been intruded by mineralising granites of Early Devonian age. The main zone
of interest at the Mayfield Prospect is a 300m long strike segment with shallow
resource potential that lies within an underexplored 1500m long prospective
corridor of mineralisation. The project area has been covered by a high-resolution
airborne geophysical survey and by stream sediment, soil and rock chip sampling
programmes in the past. Selected areas have been RAB drilled and tested
variously by aircore, RC and diamond drilling in the past. Capital (2009).
Drilling was carried out from December 2011 through to January 2012 with seven
holes for a total of 420 metres drilled at the Mayfield Prospect and three holes for a
total of 156 metres were drilled at the Limekilns Prospect. A small, low grade Cu /
Au resource is reported from the project area.
Source: Capital website, 2015.

23.5 Collector Prospect (Centrex Metals Ltd 100%)

The Collector Prospect is part of the larger Goulburn Base Metal Project and is
located some 70km north of Canberra and some 20km north of the Woodlawn
Mine. The project is now owned 100% by Centrex Metals Ltd (Centrex) after a
joint venture with a Chinese group was dissolved in the second half of 2014.
The focus of Centrex’s work has been on a series of iron/base-metal skarn
occurrences. Centrex state the project has been extensively explored for VMS
base metal mineralisation by a number of companies using traditional geochemical
and geophysical methods. However, historical exploration has not specifically
targeted iron-rich skarn related mineralisation although a number of explorers note
the presence of skarns and magnetite. The regional geological setting is
considered to represent a prime locality for locating iron and base metal-rich skarn
mineralisation.
Exploration to date within the project area has focused on the Collector Deposit, an
iron-rich exoskarn stratabound within a sub-vertical limestone unit. The discovery
hole DDH2 drilled in the early 1990s by past explorers intersected mineralisation
from 59m to 318m down hole including:
 25.2m @ 4.1% Zn, 0.8% Cu, 0.1% Pb from 86m depth, including 6.3m @
9.9% Zn, 0.7% Cu;
 25.2m @ 3.3% Zn, 0.2% Cu from 113m depth, including 3.8m @ 6.7% Zn,
0.3% Cu, 0.1% Pb; and
 35.2m @ 2.3% Zn, 0.3% Cu from 141m depth, including 7.6m @ 4.6% Zn,
0.2% Cu, 0.1% Pb.
The Collector Prospect is considered to represent the distal zone of the skarn
given the magnetite content with the proximal mineralisation yet to be discovered.
Further exploration at the deposit to find proximal extensions by past explorers was
hindered by land access. Centrex is the first company in 20 years to gain access
for ground-based exploration in the area. Since being granted the project Centrex
has completed an air-borne gravity and magnetic survey over the entire project
area as well as a ground based IP geophysical survey over the Collector Deposit
area identifying further drill-ready targets along strike and on the edge of a regional
gravity feature thought to be a large intrusive; Centrex, 2014.
Centrex has completed a dipole-dipole IP survey over the prospect area and was
planning a drill program to test certain targets; Centrex 2015.
Source: Centrex website, 2015

24 Other Relevant Data and Information

To the knowledge of the authors of this report, other than as described above there
is no other material relevant data or information related to the Woodlawn Project
that is required to ensure that this technical report is understandable and not
misleading.

25 Interpretation and Conclusions

25.1 Study Conclusions
This PEA is based on industry standard mining, processing and development
practice as well as standard economic evaluation methodology. The quality of
geological and other relevant data is adequate for the purpose of generating a
PEA. In addition, it is noted that many of the technical inputs that relate to the
WRP have been drawn from the previously completed WRP FEED Study (Sara,
2012), and are hence have a higher degree of confidence associated with them.
The key study conclusions are:
 Recent exploration has resulted in the successful generation of a new
underground Mineral Resource focused on:
o near surface extensional positions and Kate Lens;
o identification of resources suitable for mining away from areas of
previous mining; and
o seeking to build an initial production schedule to support the PEA.
 The underground Mineral Resource and resulting contribution to the Plant
Feed Estimate are sufficient to support a robust underground starter
operation with an initial life of 6-7 years.
 The tailings Mineral Resource and resulting contribution to the Plant Feed
Estimate provides additional low-cost (mining), but lower recovery material
which extends the production schedule out to around 11 years.
 Metallurgical testing for the PEA has confirmed that co-treatment of the
underground plant feed with the tailings plant feed is feasible and results in
acceptable recoveries to saleable concentrates.
 Capital and operating costs have been detailed and are acceptable.
 Current project approvals, infrastructure and local relations provide good
support for the commencement of operations at Woodlawn.
 There is potential for the Project to be developed in two stages,
commencing with construction of the tailings plant based on updating the
previous FEED study with changes from the PEA, and followed by the
development of the underground once the FS is completed.
Based on the assumptions and methodology applied, to normal PEA levels of
confidence, the results of this study demonstrate that the Woodlawn Project has
positive economics and hence should be advanced to the next stage of
development as outlined in Section 26. As such the PEA has successfully
achieved its objectives.
In addition, the study has demonstrated that there remains significant optionality in
the Project based on:
1. the additional underground Resource outside the current PEA production
schedule;
2. the number of areas prospective for further exploration; and
3. potential enhancements to a number of key drivers to the economics,
including optimisation of the underground mining (dilution, capital
development), and process plant capital costs.

25.2 Opportunities
The following opportunities may improve the project economics and warrant further
investigation during the next phases of study:
1. Resource inclusion: Inclusion of additional underground Resource outside
the PEA production schedule.
2. In-mine exploration potential: Following up a number of areas
prospective for further near surface exploration and which have the
potential to be included in the future production schedule.
3. Near-mine exploration potential: Following up exploration targets within
the local area (within 10km) of the Woodlawn Project area.
4. Staged development: the development of the Woodlawn Project may
benefit from staged development, particularly with regards staging the
tailings treatment plant construction in advance of underground mining and
the process plant additions required to treat the underground material.
5. Mining optimisation: Potential enhancements to mining design
parameters, particularly considering mining methods, dilution control,
smoothing the production profile and grade delivered to the mill, and capital
development optimisation.
6. Stope Design: Further stope design optimisation will lead to reduced
internal dilution and increased plant feed head grades.
7. Mine Planning: Further detailed mining planning work has the potential to
increase the extraction factor by bringing more mineralised material into the
mine plan.
8. Capital cost optimisation: Optimisation of capital costs associated with
the process plant, which have not yet been through a competitive tender
process.
9. Process Plant Performance: The plant design is considered to be of
conservative nature and there is the potential to operate at a higher
throughput once the plant is optimised and the latent capacity can be
exploited.
25.3 Risks
The following elements summarise the main areas of risk identified for the Project.
These risks are described more fully in Appendix 1.
1. General economic factors.
2. Resource estimates and exploration.
3. Mining performance and plant feed characteristics.
4. Capital costs.
5. Operating costs.
6. Metallurgical performance.
7. Veolia interactions.
8. Working capital requirements.
9. Permitting modifications.
10. Paste fill generation.
11. Environmental management.

26 Recommendations
26.1 Development Timetable
The Company has considered the outcomes of the PEA and has determined that it
will continue with the further study of the Woodlawn Project through undertaking a
Feasibility Study (FS) on the combined underground and tailings project. This has
been approved by the Board and the work program outlined below has
commenced.
The Company considers that the FS will be able to be completed within
approximately 12 months from the publication of this Report. Further stages of
development post completion of the FS will be contingent upon positive results
from this stage of work.
26.2 Feasibility Study Considerations

A PEA generally contains input estimates that are subject to a wide margin of error,
and whose outputs remain subject to significant uncertainty.
Whilst this is certainly the case for the underground components of the Woodlawn
Project (in particular under this PEA, the underground Mineral Resource,
underground mine design, comminution circuit design, processing plant
performance and paste fill production have all been estimated for the first time), the
inputs that relate to the WRP have been drawn from the previously completed
WRP FEED Study (Sara, 2012), and are hence have a higher degree of
confidence associated with them.
It is the view of the Company that the higher level of confidence associated with
the design of the processing plant, which is central to the success of the Project,
together with the mining of the tailings material, will allow the Project to be
progressed directly from PEA to FS without first going through a Pre-feasibility
Study stage, and planning has been undertaken on that basis.
The major drivers of cost and schedule for the FS are expected to be:
1. The drilling to convert Inferred Resources that will be included in the mine
plan (and hence potentially converted into Proven & Probable Reserves).
2. The continuation of the metallurgical testwork in relation to the underground
ores, with a particular focus on variability testing and on optimising the
behavior of the circuit with different blends of feed types.
3. Optimisation of the mine planning including application of geotechnical
considerations on a stope by stope basis, and determining the position for
the surface box cut and portal, and supporting surface infrastructure.
4. Optimising the capital and operating costs associated with the Project
development.
5. Continuing with an element of exploration, with a focus on those areas
which can contribute to the FS outcome or otherwise enhance the value of
the Project.
The budgeted cost associated with the FS from April 2015 to June 2016 is
approximately A$11 million and is shown in below.

Table 26.1: FS Budget to 30 June 2016
Item Cost (A$M)

Drilling Program 4.3
Labour / Salaries 2.4
Other Programmes / Studies 2.8
Ancillary / Support 1.5
Total 11.0
26.3 Exploration
Within the FS budget an allocation has been made for further exploration work to
test a number of targets identified in the PEA drilling program. Within this
exploration drilling program comprising approximately 1,900m of diamond drilling,
there will be an emphasis on proving up additional Resources that can contribute
to the FS. Examples of high priority targets include:
1. the newly discovered Lisa Lens;
2. potential extensions to Kate and G Lenses;
3. the poorly defined off-hole EM conductor adjacent to C Lens; and
4. the EM target identified at the Currawang satellite deposit.
Regional exploration will continue with a focus on developing and testing other
near mine targets, particularly those targets which have the potential to add to the
life of the Woodlawn mine, albeit that it is unlikely that any mineralisation identified
though this exploration program will be included in the FS.

27 List of Abbreviations Used

Abbreviation Used Meaning
% Percent or Percentage
m Micron, or micrometre
< Less than
> Greater than
>= Greater than equal to
A$ Australian dollar
a Annum or year
AAS Atomic absorption spectrometry
Ag Silver
Al Aluminum
ALS Brisbane ALS Laboratory located at 32 Shand Street Brisbane, Queensland
ALS Orange ALS Laboratories located at 10 Leewood Drive, Orange, NSW
AMS Australian Mining and Smelting Ltd
ASX Australian Stock Exchange
Au Gold
Au-AA25 25 g fire-assay gold technique with atomic absorption spectrometry
(AAS) finish
Au-Dil25 Further dilution of resultant Au-AA25 solution and re-run on the
AAS using higher grade calibration standards.
AusIMM Australian Institute of Mining and Metallurgy
AWT Alternative Waste Treatment (proposed Veolia mulch
manufacturing facility)
B-double A prime-mover towing two semi-trailers
Ba Barium
Beck Beck Engineering Limited
BHID Drill hole Identifier
C1 Direct cash operating costs produced, net of by-product credits,
divided by the amount of payable zinc produced. Direct cash
operating costs include all mining and processing costs, mine site
overheads and realisation costs (including transport costs,
treatment and refining costs and smelter recovery deductions)
through to refined metal, net of revenue credits from sale of by-
products.
C2 Include C1 costs plus a depreciation charge
C3 Include C1 and C2 costs plus royalties
CIM Canadian Institute of Mining, Metallurgy and Petroleum
CMC Sodium Carboxymethyl Cellulose
COA Certificate of analysis
CP Competent Person per JORC 2012
CRM Certified Reference Material
Cu Copper
DBA Heron’s Database Administrator
DDH Diamond Core Drilling or Drill hole
Denehurst Denehurst Ltd
DPE NSW Department of Planning and Environment
EA Environmental Assessment (part of NSW project approval process)
EGL Equivalent Grinding Length
EL Exploration Licence
ELOS Equivalent Linear Overbreak / Slough
EM Electro-Magnetic, a form of surveying (ground, airborne or
downhole) which can identify or delineate drill targets
EPCM Engineering, Procurement and Construction Management
Fe Iron
FEL Front End Loader

FS Feasibility Study
FW Footwall
g Gram
g/t Grams per tonne, same as ppm
GDR Great Dividing Range
GeoRes GeoRes Consulting
GEOSTATS Geostats Pty Ltd
GPS Global Positioning System
GRES GR Engineering Services Limited
GSNSW Geological Survey of New South Wales
GST Australian Goods and Services Tax
h Hour
Ha Hectare
Heron, HER, HRR Heron Resources Limited
HW Hangingwall
ICPAES Inductively Coupled Plasma Atomic Emission Spectroscopy
ID Identifier
IGRF International Geomagnetic Reference Field
IP Induced Polarisation
IRR Internal Rate of Return
IsGyro Inertial Sensing Down hole Gyroscope
Jododex Jododex Australia Pty Ltd
JV Joint Venture
k Kilo or 1,000
km Kilometre
2
km Square kilometre (unit of area)
ktpa Kilotonnes per annum
L Litre
LFB Lachlan Fold Belt
LIMS Laboratory Information Management System
LLD Lower detection limit
LOM Life of Mine
m Metre
M Million
mm Millimetres
Mtpa Million metric tonnes per annum
ME-ICP61 Multi element by 4 acid digest with ICPAES finish
ME-OG62 Multi element ore grade by four acid digest with ICPAES finish
Mg Magnesium
MGA Map Grid of Australia
NATA National Association of Testing Authorities (Australia)
NI 43-101 Canadian National Instrument 43-101 Standards of Disclosure for
Mineral Projects
NPV Net Present Value
NSR Net Smelter Return
NSW New South Wales
OG62 Ore grade by four acid digest with ICPAES finish
OREAS Ore Research & Exploration Pty Ltd
Pb Lead
PEA A Preliminary Economic Assessment (PEA) is a formal study in
standard form prescribed by NI 43-101 which includes an economic
analysis of the potential viability of Mineral Resources, but which is
not a pre-feasibility study or feasibility study
ppb Parts per billion (by weight)
ppm Parts per million (by weight)
PVC Polyvinyl Chloride (plastic generally used for piping)
QAQC Quality Assurance and Quality Control
QC Quality Control
QLD Queensland

QP Qualified Person per NI 43-101

RC Reverse Circulation (drilling)
RL Relative to sea level
ROM Run of Mine
Si Silicon
SG Specific gravity
SMBS Sodium Meta-Bisulphite
SMGC SMG Consultants
SML20 Special Mining Lease 20 also known as S(C&PL)L 20 which
denotes Special Crown and Private Land Lease 20
SRK SRK Consulting (Australasia) Pty Ltd
t Metric tonne
Tpa Metric tonne per annum
3
t/m Tonnes per metres cubed (unit of weight)
TAFE Technical and Further Education tertiary education college
TC/RC Treatment and Refining Charges
TDN Tailings Dam North (existing tailings storage facility at Woodlawn)
TDS Tailings Dam South (existing tailings storage facility at Woodlawn)
TDW Tailings Dam West (existing tailings storage facility at Woodlawn)
TriAusMin TriAusMin Limited, which merged with Heron Resources in August
2014
TSF4 Proposed new Tailings Storage Facility 4 at Woodlawn
TSX Toronto Stock Exchange
US$ United States dollar
VMS Volcanic-hosted Massive Sulphide - which denotes massive
sulphide mineralisation associated with volcanic successions and
volcanic processes
WEP Woodlawn Exploration Project
WMG Woodlawn Mine Grid
WRP Woodlawn (Tailings) Retreatment Project
WUP Woodlawn Underground Project
XRF X-Ray Fluorescence – related to sample analysis
Zn Zinc
ZnEq Zinc equivalent grade (%) derived from Zn, Cu, Pb, Au and Ag
grades

28 References
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29 Certificates of Authors

10 Richardson Street
West Perth WA 6005, Australia
PO Box 943
West Perth WA 6872, Australia
T: +61 8 9288 2000

F: +61 8 9288 2001
E: perth@srk.com.au
www.srk.com.au
CERTIFICATE OF AUTHOR
Daniel R. Guibal
Corporate Consultant (Geostatistics & Resources)
SRK Consulting (Australasia) Pty Ltd.
Email: dguibal@srk.com.au
I, Daniel Rene Guibal, FAusIMM(CP), do hereby certify that:

1. I am a Corporate Consultant (Geostatistics & Resources) with SRK (Australasia) Pty Ltd, trading as
SRK Consulting, which is an international firm of consulting geologists and engineers, which has been
practicing in this profession since 1974. I hold office at 10 Richardson Street, West Perth, WA 6005,
Australia and have been employed as such since 1999.
2. I graduated from the Ecole Nationale Superieure de la Metallurgie et de l’Industrie des Mines de
Nancy, France with an Engineering Degree (Ingenieur Civil des Mines de Nancy, 1971) and I have
continually practiced my profession since that time.
3. I am a Fellow and Accredited Chartered Professional (Mining) of The Australasian Institute of Mining
and Metallurgy, a Member of the Mineral Industry Consultants Association, Inc. and a Life Member of
the Geostatistical Association of Australasia.
4. I have worked as a Mining Geostatistician for a total of 40 years since my graduation from University.
5. I have read the definition of “qualified person” set out in National Instrument 43-101 of the Canadian
Securities Administrators (“NI 43-101”) and certify that by reason of my education, affiliation with a
professional association (as defined in NI 43-101) and past relevant work experience, I am a “qualified
person” for the purposes of NI 43-101.
6. I am responsible for the preparation of Section 14 of the technical report titled “Preliminary Economic
Assessment of the Woodlawn Project, New South Wales, Australia” and dated May 29, 2015 (the
“Technical Report”) relating to Heron Resources Limited Woodlawn Base Metals Project. I have not
visited the Project.
7. I have had no prior involvement with the property.
8. As of the date of this certificate, to the best of my knowledge, information and belief, the Technical
Report contains all scientific and technical information that is required to be disclosed to make the
Technical Report not misleading.
9. I am independent of the issuer applying the test in section 1.4 of NI 43-101.
10. I have read NI 43-101 and Form 43-101F1, and the Technical Report has been prepared in
compliance with that instrument and form.
11. I consent to the filing of the Technical Report with any stock exchange and other regulatory authority
and any publication by them for regulatory purposes, including electronic publication in the public
SRK Consulting (Australasia) Pty Ltd Australian Offices: Group Offices:

ABN 56 074 271 720 Brisbane +61 7 3832 9999 Africa
Trading as SRK Consulting Melbourne +61 3 8677 1900 Asia
Newcastle +61 2 4922 2100 Australia
Perth +61 8 9288 2000 Europe
Sydney +61 2 8079 1200 North America
South America
HRN007_Certificate_NI 43 101.docx
SRK Consulting Page 2
company files on their websites accessible by the public, of the Technical Report.
Dated May 29, 2015
(“signed”)
Daniel Guibal, Min Eng, FAusIMM (CP), MMICA, MGAA
Corporate Consultant (Geostatistics & Resources)
Author DG HRN007_Certificate_NI 43 101.docx 28 May 2015

CERTIFICATE OF QUALIFIED PERSON
To accompany the report entitled: Technical Report Preliminary Economic

Assessment of the Woodlawn Project, New South Wales, Australia having an
effective date of 29 May 2015.
I, Rodney Brown, do hereby certify that:
1) I am a Principal Geologist with the firm of SRK Consulting (Australasia) Inc., with an office at Level 1,
10 Richardson Street, West Perth, Western Australia;
2) I graduated from the Ballarat University College, Victoria with a Bachelor of Science (Geology) in 1989,
and have practiced my profession continuously since 1989. This includes nine years in mining
operations and over 16 years in consulting on a range of commodities including, base metals, gold, iron
ore, manganese, nickel, bauxite, mineral sands, and industrial minerals;
3) I am a professional Geoscientist, registered with the Australian Institute of Geoscientists, membership
number 5483;
4) I have personally inspected the subject project site on 11 March 2015.
5) I have read the definition of Qualified Person set out in National Instrument 43-101 and certify that by
virtue of my education, affiliation to a professional association, and past relevant work experience, I fulfill
the requirements to be a Qualified Person for the purposes of National Instrument 43-101 and this
technical report has been prepared in compliance with National Instrument 43-101 and Form 43-101F1;
6) I, as a Qualified Person, I am independent of the issuer as defined in Section 1.5 of National Instrument
43-101;
7) I am the co-author of this report and responsible for Sections 7 to 12 and accept professional
responsibility for those sections of this technical report;
8) I have had no prior involvement with the subject property.
9) I have read National Instrument 43-101 and confirm that this technical report has been prepared in
compliance therewith;
10) SRK Consulting (Australasia) Pty Ltd was retained by Heron Resources Limited to prepare a technical
report of the Woodlawn Project in accordance with National Instrument 43-101 and Form 43-101F1
guidelines;
11) I have not received, nor do I expect to receive, any interest, directly or indirectly, in the Woodlawn Project
or securities of Heron Resource Limited; and
12) That, as of the effective date of this technical report, to the best of my knowledge, information and belief,
this technical report contains all scientific and technical information that is required to be disclosed to
make the technical report not misleading.
Western Australia [“signed and sealed”]

29 May 2015 Rodney Brown]
Principal Consultant Geology
30 Appendices
30.1 Appendix 1: Summary of Risks
The following is a non-exhaustive list of some of the risks which will need to be
managed for the Project as it moves into production.
General Economic Factors
The Woodlawn assets are subject to certain inherent risks and opportunities, which
apply to some degree to all participants of the base metals mining industry. These
risks, including fluctuations in base metal prices, silver price, exchange rates,
inflation rates and supply input prices are largely outside the direct control of
Heron; however, they can be reduced by having suitable mitigating plans in place.
Resource Estimates and Exploration
As with any resource estimate, there are risk associated with the geological
interpretation and grade / geological continuity based on generating resources from
limited data. These risks and technical factors are reflected in the JORC (2012)
and NI 43-101 Inferred and Indicated Resource classifications which have been
applied to the Mineral Resource estimate in this report.
As noted in Section14, the Mineral Resource estimation methods have been
reviewed by SRK. They concluded that the model and resource estimates are
sound, based on a thorough analysis of the geology and the data. If anything, the
results are conservative, as a number of zones are eliminated from the resources
based on fairly strict criteria of confidence in the geology, data density and
mineability.
Mining Performance and Plant Feed Characteristics
There is a risk that external dilution may be increased beyond that which is
planned and the mining recovery reduced as a result of mining practices employed
or due to factors including geotechnical conditions associated with the
underground deposit. This would have an adverse effect on mill head grade and a
negative impact on revenue.
For the tailings mining operation, the mining has been carefully designed to
minimize fluctuations in grade and particle size received at the plant entry point.
However, poor control in the mining operations could impact upon the tailings plant
feed, which could impact upon the plant head grade and/or recovery performance.
More generally, the availability of suitable mining equipment can impact on mining
rates and mining unit costs. Careful attention to equipment specifications and
equipment maintenance, as well as contractor management, will be key to
managing this risk, which is inherent to all mining operations.
Capital Costs
The capital cost estimate has been developed to a ±25% accuracy level and
contingency allowances have been calculated and are included within the estimate
total. Project risks that have an impact on the potential of capital cost overrun

include:
 Schedule slippage (which often causes capital overrun and delays revenue
generation).
 Incorrect trade contractor selection or contracting strategy.
 Poor or poorly implemented project management and project controls
systems.
 Inadequately understood environmental risks that require reactive design.
 Health and safety risks.
 Weather.
 Soil / geotechnical / hydrogeological anomalies.
 Permit issues.
 Risk of project team integration problems / project management and site
control issues.
 Input quality issues.
 Social impact of construction workforces.
 Import risks and unforeseen taxes.
 Timely award of equipment supply contracts for certified vendor information
being available for detailed design to commence and proceed on schedule.
 Ensuring consistent and timely payment of domestic and international
invoices for services and equipment to avoid interest claims or withholding
of supply.
Operating Costs
The operating cost estimate has been developed to a ±20% accuracy level and
contingency allowances have been calculated and are included within the estimate
total.
As with any ore processing operation, risks that manifest in increased unit cost boil
down to adequate and appropriate manning, poor control of reagents and poor
maintenance practices. Additional reagent demand may occur which will drive up
operating costs, but the impact is expected to be relatively minor. Latent
conditions that may drive up operating costs may also relate to harder or more
abrasive ores than anticipated; these characteristics have been tested but are
subject to experimental error and sample representivity issues.
Metallurgical Performance
The processing plant has been designed against conservative criteria to

accommodate a 1.5Mtpa feed rate comprising a blend of underground and tailings
feed. The design criteria reflect the requirements for production of more
concentrate when processing higher grade underground material and the variability
in other mass flows for different mill feeds. Equipment selection and flowsheet
design remained the same for both processing 100% tailings feed and a 50:50
blend of tailings and underground feed, though with additional equipment where
higher mass flows will occur. Sufficient capacity has been allowed for within the
plant design for varying head grades and or ratios of underground ore to tailings
reclamation.
A design utilisation of 91.3% (7,998 operating hours per year) for the process plant
has been assumed and this target is readily achieved in similar plants globally.
Standby equipment has been provided in critical areas to enable meeting this
target, however, in practice it will get down to the incumbent operations team to
apply diligent asset management and maintenance practices to achieve this
outcome. By design the crushing system has significant in-built latent capacity (as
equipment selection has been driven by physical characteristics) but the overall
result will be dependent on grinding mill maintenance.
The process design criterion was developed from testwork and benchmarked data
from similar projects. Plant equipment selection is based on well proven
technology and equipment has been sized to allow for variable mass flows dictated
by variable plant feeds.
In order to facilitate this, the following issues will need to be monitored by
operations management:
 Good industrial relations are maintained.
 A strong safety and training culture is employed on site.
 Maintenance is programmed and well managed to ensure plant availability.
 The mining contractor(s) keep up with plant demand consistently.
 Plant control systems remain calibrated.
Recoveries have been calculated from the flotation tests conducted as part of the
co-treatment option and referred to under Section 17.2 Process Design Basis.
All material types that have been included in the proposed production schedule
have been subject of at least some preliminary metallurgical testwork. Flotation
results for both fresh copper and zinc-copper mineralisation have been examined
with and without tailings retreatment and have shown good metallurgical recoveries
in line with expected historical values.
It should be noted that none of the current flotation tests have used site water. The
risk associated with metal ions within the site water has been ameliorated by the
inclusion of a water treatment plant. This should alleviate the possibility of lower
than expected concentrate grades due to unwanted activation of mineral species or
the increased requirement for depression reagents to counter the activation of
sulphide minerals outside of the required differential floatation process.
Given the conservative design that has been developed, there should be sufficient
latent capacity within the flotation circuit and concentrate regrind circuits to handle
variations in feed grade. As with any flotation operation, good material blending
practices will be key to maximising operational efficiency and recovery.
Other than risks associated with a change in responsiveness (hence recovery) due
to unidentified variability, risks associated with other aspects of plant performance
outcomes will remain until either further metallurgical and physical characterisation
testwork is complete or assumptions tested in the plant as constructed. Risks that
have been identified to date include:
1. As lime is being used as the primary pH modifier, calcium may reach
concentrations high enough to cause scale issues within the plant.
2. Limited Bond Mill Rod and Ball Mill Work Index tests have been conducted
on the fresh zinc-copper sulphide material. These results generated a
lower value for both index figures as opposed to the values generated for
finer grinding in the tailings retreat project. The higher values for work
index as detailed in Section 17.2 were used for sizing the ball mill
component. In the unlikely event that the unit proves to be undersized, this
would be relieved by a slightly higher grind size target which may realise
slightly reduced recovery, or throughput could be wound down.
3. Although vendor testing of the IsaMill™ and the Metso SMDDetritor on
fresh underground mineralisation has not been possible due to sample
constraint, the units selected have used previous specific energy test

results generated as part of the tailings retreat study. In the unlikely event
that the unit proves to be undersized, this would be relieved by a slightly
higher grind target which could realise slightly reduced recovery, or
throughput could be wound down. If the latter was selected the net
reduction of output could possibly be negated by further optimisation of the
flotation circuit.
4. Site surface waters from the evaporation pond and tailings dams presently
have extremely low pH values (in the range of 2 to 3). These will be used
as part of the initial plant make up water requirements. Although the pH in
these dams will rise with time a water retreatment circuit and the
introduction of a bleed stream into the tailings thickener has been proposed
to neutralise the water and return the process water to a pH value of 7.
Therefore, there is a risk that operational performance of the process plant in terms
of throughput and metallurgical recoveries to the three concentrate streams may
not meet planned levels. For high levels of contamination, penalties may be
applied by purchasers of the concentrate according to standard benchmarks. In an
extreme case this could result in one or more of the product streams being
rendered unsaleable for a period of time.
Veolia Interactions
The mine site is shared with Veolia, who use the old open pit for storage of waste.
Heron has an excellent working relationship with Veolia. The Veolia relationship is
a long term one and is governed by a number of cooperation agreements between
the parties. The interests of the two parties are aligned on a number of levels, and
the two parties continue to work together under agreed protocols to ensure that site
operations are effectively managed.
Veolia operates under a zero discharge policy in relation to their in-pit operations.
Both in-pit portals have been sealed using engineered plugs, and the pit itself is
fully lined, including a large plastic lined sump at the base of the pit. To the extent
that gaseous or aqueous discharge occurs into the underground workings, Veolia
is responsible for its clean-up and / or management. Nevertheless, such discharge
has the potential to impact significantly upon the underground operations, and
Heron will, during the FS stage, consider what additional safeguards will be put into
place to manage this risk, as well as to quantify whether there is a material
discharge issue.
Working Capital Requirements
Working capital requirements are affected by factors including the production and
processing schedule, shipping and payment timing and cost assumptions, and
mining and operating factors including plant feed grade, throughput and recoveries.
Careful attention will need to be given to these factors, particularly as the plant
moves through the commissioning stage to a position where it is cash flow
breakeven. Adverse impacts in the areas above could delay peak cash drawn and
result in a need for the company to find additional working capital. This risk will be
taken into account in the planned funding for the project as well as in the
commissioning management plan.
Permitting Modifications
As described in section 20.1, modifications to the project approvals under Section

75J of the EP&A Act will be required to deal with changes to the proposed

operation based upon the physical characteristics of the planned underground

mining. These changes include modifications to the underground portal location
and modifications to the underground mining approvals in proximity (within 200m)
to the open pit.
These modifications are required in relation to the underground operation only;
Heron believes that approvals which are in place are sufficient to commence
operations on the tailings components of the project without modification.
Paste Fill Generation
The plant tailings characteristics comprise fine particles. Whilst the testwork
undertaken to date demonstrates that a portion of the tailings can be used to
generate paste fill with adequate strength characteristics for the underground
mining, further testwork is required during the FS stage to confirm the chemical
composition of the proposed paste. If adequate strength paste cannot be
generated from the tailings, additional costs may be incurred in sourcing a
replacement source of paste fill feed.
Environmental Management
The Woodlawn site environment has been managed effectively over the past 20+
years without material issue. Nevertheless, environmental issues will need to be
continually monitored and addressed in the future, with key areas including:
1. Site water balance and storage: the site is a zero discharge site. However,
failure to adhere to discharge requirements could result in sanctions
including fines and, in extreme circumstances, a loss of licence to operate.
The site has operated successfully under these requirements since 1978.
The site water balance is managed using extensive existing evaporation
ponds. Additionally, Heron notes that despite the tight nature of the country
rock, there is a high probability that the existing underground workings
contain significant quantities of water, which will need to be extracted and
managed on surface, using the existing water management infrastructure.
2. Spillage and acid drainage management: Waste stored on site, including in
particular the rehabilitated waste dumps and the tailings dams, have the
potential to discharge water containing high levels of acid. Management of
these issues has been ongoing for many years, and is well understood.
Runoff capture, storage and evaporation are currently used mitigants. For
the processing plant, the site will drain into the process water pond, and the
plant itself will be fully bunded.
3. Water supply quality and availability: The process plant requires significant
quantities of high quality water to operate. Processing throughput or plant
flotation performance could be adversely impacted, with a consequent
impact on costs and / or the quality of concentrates produced, if sufficient
water is not available. To address this issue, recycling of water within the
site will be maximised. The existing borefield will be utilised. Other sources
of water may be utilised if required. Finally, a water treatment plant has
been costed to ensure suitable quality water is available for the process
plant.
4. Site rehabilitation: rehabilitation requirements are noted in section 20.3.
Whilst the project economics are not sensitive to closure costs,
nevertheless the ongoing remediation requirements and closure
requirements will need to be adequately planned for and monitored in the
long term. The initial disturbance area for the tailings retreatment is

covered by government bonding. In addition, the rehabilitation is aided (1)

reprocessing of the tailings, which reduces the acid generating ability of the
material (as well as being used for paste fill production for disposal
underground) and (2) Veolia through an agreement to supply composting
material suitable for the rehabilitation of the tailings dams. To the extent
that rehabilitation requirements are more onerous than expected, the cost
associated with meeting these obligations could be higher than planned.


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Heron Resources Limited Title & Contents

TECHNICAL REPORT (NI43-101) PRELIMINARY

Prepared by: Anne-Marie Ebbels

Effective date: 29 May 2015

Date and Signature Page

Heron Resources Limited © 2

Heron Resources Limited © 3

4.5.2 Other Approved Operations ............................................................................................................ 50

Heron Resources Limited © 4

13 Mineral Processing and Metallurgical Testing ................................................................. 114

Heron Resources Limited © 5

16.3 WUP Access ................................................................................................................................ 180

Heron Resources Limited © 6

17.4.7 Anti-Scalant ............................................................................................................................... 214

Heron Resources Limited © 7

21.2.5 Mine Development ................................................................................................................... 242

Heron Resources Limited © 8

Heron Resources Limited © 9

Figure 13.2: Copper Grade-Recovery Curve ....................................................................................................... 121

Heron Resources Limited © 10

Figure 16.12: Escapeway System Below 2400mRL ............................................................................................ 194

Heron Resources Limited © 11

Table 1.1: Underground Mineral Resource ............................................................................................................ 20

Heron Resources Limited © 12

Table 16.10: Required Ventilation ........................................................................................................................ 191

Heron Resources Limited © 13

Heron Resources Limited © 14

Mineral Resources can be converted to Indicated or Measured Mineral Resources.

1.2 Economic Modelling Outcomes

1.3 Property Description and Ownership

Heron Resources Limited © 15

Figure 1.1 : Woodlawn location map with relative population sizes

Other than standard State Government royalty arrangements, there are no

Heron Resources Limited © 16

Heron Resources Limited © 17

1.4 History and Exploration

1.5 Geology and Mineralisation

Heron Resources Limited © 18

1.6 Mineral Resource and Mineral Reserves Estimates

The Underground Mineral Resource estimate is based on drillhole data generated

Heron Resources Limited © 19

1.6.1 Current Mineral Resource

Table 1.1: Underground Mineral Resource

Reported at a 7% ZnEq lower cut-off grade Grades

Heron Resources Limited © 20

Table 1.2: Mineral Resource Estimate - Woodlawn Retreatment Project (WRP)

1.6.2 Current Mineral Reserve

Heron Resources Limited © 21

Heron Resources Limited © 22

Figure 1.4: PEA Stope Design (SRK)

Previous mining was undertaken to a depth of 620m below surface. The

Heron Resources Limited © 23

The detailed production schedule is provided in the table below:

Heron Resources Limited © 24

Figure 1.6: Underground Production by Mining Type

Figure 1.7: Underground Production by Domain

Heron Resources Limited © 25

Annual Commodity LOM Average Steady State 2020-

1.8 Metallurgy & Processing

Heron Resources Limited © 26

Heron Resources Limited © 27

1.9.1 Access and Site Roads

1.9.2 Power Supply