RESOURCE ESTIMATION

 Savijo Geo-Engineering Company Ltd has the expertise and experience to undertake the full

Minera

Mineral resource estimation and this is used to determine and define the ore tonnage and grade of

a geological deposit, from the developed block model. There are different estimation methods used

for different scenarios dependent upon the ore boundaries, geological deposit geometry, grade

variability and the amount of time and money available. A typical resource estimation involves the

construction of a geological and resource model with data from various sources. Depending on the

nature of the information and whether the data is hard copy or computerized, the principal steps of

computer resource estimation are:

1. Creation, standardization and validation of the database.

2. Section plotting and interactive geological modeling.

3. Geostatistical analysis.

4. Block modeling and block estimation.

Geological modelling

An orebody model serves as the geological basis of all resource estimation, an orebody modeling project

starts with a critical review of existing drill hole and surface or underground sample data as well as maps

and plans with current geological interpretation. Drill hole and/or sample databases are set up to suit all

the quantitative and qualitative information necessary to build a resource model. The creation of a

geological model may include the following steps:

• Computer-based 3D orebody modeling

• Sectional, longitudinal, 3D and multi-seam modeling

• Geostatistical analysis, variographic analysis of composite spatial continuity

Block model estimation

Once the geological modeling is completed, the geological envelopes are divided into block models.

Subsequently, the estimation of these blocks is done from "composites" that are point measures of the grade

of ore in the rock. Several different mathematical methods can be used to do the estimation depending on

the desired degree of precision, quality and quantity of data and of their nature.

RESERVES

In geology, a reserve is the economically mineable portion of a mineral resource. Reserves are estimated by

taking into account the cost of mining, processing, and extracting the resource.

How are reserves estimated?

Mineral resources

Concentrations of a commodity that have the potential to be economically extracted. Geologists typically

estimate mineral resources.

Mineral reserves

The economically mineable part of a measured or indicated mineral resource. Mining engineers or reserve

estimation specialists typically estimate mineral reserves.

Types of mineral reserves

Probable mineral reserve

A lower confidence estimate that is still high enough to justify developing the deposit.

Proved mineral reserve

The highest confidence estimate, which implies a high level of confidence in the geological factors.

Why are reserves important?

Mineral reserves are important because they help investors decide if it's economically feasible to mine a

resource. Proven mineral reserves are the lowest risk for investors.

SGE will provide you with the excellent service on this for right decision of your mine.