I know it's old news, but I just can't stop reading it and thinking it can come true.
ON THE GOLD DEPOSITS AT CANGALLI,
BOLIVIA
goldeneagle-mine.com
goldeneagle-mine.com
I
studied, which would have been in any event
less than half of the claims under contract,
contain an Indicated Resource of 60,771,704
troy
ounces of gold and an Inferred Resource of
111,414,800 troy ounces of gold. While I
understand that such numbers are staggering,
I
cannot change the sampling results; my
observations in the field; the huge body of
literature and studies which have been
produced about this area which support my
observations; and the centuries of
gold-producing history in the Tipuani Mining
District. It becomes apparent that if these
resources can be confirmed as reserves, which
I
believe is just a matter of carrying out a more
detailed sampling program and applying
currently-used cyanide leaching technology
in
testing the recoveries, the claims under the
control of the Company's subsidiary may
produce an exceptional world-class gold
deposit.
RESULTS
8.1. The results are shown on the laboratory
certificates, (See, Attachment 3, Lab Assay
Results), and the 16 tables accompanying this
report. (See, Attachment 2, Mineral Sampling
Results.) Column 3 of those mineral sampling
results shows the gold grades in grams per
cubic meter, separated in groups for the
different sectors of the claims under the
Company's subsidiary's control. These values
were calculated in the usual way--from pan
concentrate grades and their weights--together
with the weights of the field samples. A figure of
1.8 was used for the specific gravity of these
field weights.
The average gold grades for each sector vary
from a minimum of approximately .100 g/m3 to
approximately 6 g/m3, with an overall average of
1.499 g/m3. This grade is certainly good enough
for massive types of mining, an open-pit
techniques are highly recommended.
8.2.
Up to this point standard methods were used to
establish the grades resulting from the
sampling program. However, a striking fact
showed up in the sampling: the batea (conical
pan) fine tailings (the under-sized fraction)
assayed with an average gold grade of 27.068
g/m3, meaning that this is by far the richest
fraction in the Cangalli deposits. Obviously,
from ancient times through to the present
mining operations, this fraction has always
been ignored and discarded. A similar
phenomenon happens with the rock samples
(the over-sized fraction) -- with an average assay
of 5.657 grams per cubic meter -- of course also
traditionally being discarded.
From the over-sized fraction, or rock samples, I
have calculated a conservative grade of 2.419
g/m3 for the pan gross tailings. The results from
the assays of the over and under-sized fraction,
plus those for the pan concentrates previously
calculated, are combined for the total average
gold grades shown on the tables' column 4 (See,
Attachment 2, Mineral Sampling Results). These
total results run from an approximate low of 10
g/m3 to a high of 19 g/m3 with an average of
14.049 g/m3, which is very high for these types
of gold deposits. It is my opinion that this may
even increase once better sampling can be
carried out on the over-sized fraction.
In formulating a mine plan for the near-term, the
first thing that becomes apparent is that these
deposits can and must be worked by open-pit
mining methods. The recovery of the
"microscopic" gold has to be accomplished by
agitated vat cyanide leaching techniques. I
believe that very significant and far-reaching
discoveries will be made in the remainder of the
Cangalli gold deposits specifically, and the
balance of the Tipuani River Basin deposits in
general, as a result of this concept.
9. RESOURCES
The qualitative and quantitative knowledge regarding the
Cangalli gold deposits is sufficient to satisfy the standards
and requirements of the worldwide mining industry relative
to definitions of Resources and Reserves. For evaluating and
quantifying those Resources established in this report, the
author has used the following definitions:
Resource.
A concentration of naturally occurring
material in such form and amount that
economic extraction of a commodity from
the concentration is currently or potentially
feasible. Location, grade, quality, and
quantity are known or estimated from
specific geologic evidence. To reflect
varying degrees of geologic certainty,
resources can be subdivided into
Measured, Indicated and Inferred.
Measured --
Quantity is computed from dimensions
revealed in outcrops, trenches, workings,
or drill holes. Grade and/or quality are
computed from the result of detailed
sampling. The sites for inspection,
sampling, and measurement are spaced so
closely and the geologic character is so
well defined that size, shape, depth and
mineral content of the resource are well
established.
Indicated --
Quantity and grade, and/or quality, are
computed from information similar to that
used for Measured Resources, but the sites
for inspection, sampling, and measurement
are farther apart or are otherwise less
adequately spaced. The degree of
assurance, although lower that for
Measured Resources, is high enough to
assume geologic continuity between points
of observation.
Inferred --
Estimates are based on geologic evidence
and assumed continuity in which there is
less confidence that for Measured or
Indicated Resources. Inferred resources
may or may not be supported by samples
or measurements but the inference must
be supported by reasonable geo-scientific
data.
Reserve.
A Reserve is that part of the Resource that
meets minimum physical and chemical
criteria related to the specified mining and
production practices, including those for
grade, quality, thickness, depth; and can be
reasonably assumed to be economically
and legally extracted or produced at the
time of the determination. The feasibility of
the specified mining and production
practices must have been demonstrated or
can be reasonably assumed on the basis of
tests and measurements.
Proven Reserve --
That part of a Measured Resource that
satisfies the conditions to be classified as a
Reserve.
Probable Reserve --
That part of an Indicated Resource that
satisfies the conditions to be classified as a
Reserve.
The resources previously estimated for the
claims under the Company's subsidiary's
control at Cangalli were calculated with a
conservative average grade of .500 g/m3. This
calculation, on the basis of the sampling
program reported in this report, will have to be
increased by approximately 28 times, for an
average grade of 14.049 g/m3 of gold. Using the
definitions set out above, and the overwhelming
evidence of geologic continuity, it is my opinion
that the portion of the Cangalli claims that I
studied, which would have been in any event
less than half of the claims under contract,
contain an Indicated Resource of 60,771,704 troy
ounces of gold and an Inferred Resource of
111,414,800 troy ounces of gold. While I
understand that such numbers are staggering, I
cannot change the sampling results; my
observations in the field; the huge body of
literature and studies which have been
produced about this area which support my
observations; and the centuries of
gold-producing history in the Tipuani Mining
District. It becomes apparent that if these
resources can be confirmed as reserves, which I
believe is just a matter of carrying out a more
detailed sampling program and applying
currently-used cyanide leaching technology in
testing the recoveries, the claims under the
control of the Company's subsidiary may
produce an exceptional world-class gold
deposit.
I also confirmed the fact that Golden Eagle's
subsidiary has entered into a Public Contract for
the mining and development rights to 2,004
hectares of claims owned by the Unidas
Cangalli Gold Mining Cooperative, (See,
Attachment 1, Figure 2: Claims Map), which has
been protocolized, or publically recorded, in the
Bolivian Government's Notary of Mines. The
claims which are the subject of the Contract
were the target area of this report.
It is my opinion that the gold resources
mentioned above can be economically and
legally extracted, and that further study will
show that open-pit techniques, with initial
milling of the head ore, and a combination of
gravity and leaching circuits, will result in the
feasibility of large portions of the resources
being converted to proven reserves in the very
near-term.
LaPaz, Bolivia
January 20,
1997
Ing.
Guido
Paravicini P, M.A. Mining
Engineer-Geophysicist
Mr Metals |
