Glos****sary of Selected Mining Terms
“bedding” means the characteristic structure of sedimentary rock in which layers of different composition, grain size or arrangement are layered one on top of another in a sequence with oldest on the bottom and youngest at the top.
“comminution” means the process in which ore is broken into small fragments by crushing, grinding, and other processes.
“conglomerate” refers to clastic sedimentary rock that contains rounded particles that are greater than two millimeters in diameter. The space between the pebbles is generally filled with smaller particles and/or a chemical cement that binds the rock together.
“cut-off grade” means the grade (i.e., the concentration of metal or mineral in rock) that determines whether mined mineralized material will be processed or considered waste.
“deposit” is an informal term for an accumulation of mineralized material.
“development stage issuer” is an issuer that is engaged in the preparation of mineral reserves for extraction on at least one material property.
“development stage property” is a property that has mineral reserves disclosed, pursuant to S-K 1300, but no material extraction.
“feasibility study” is a comprehensive technical and economic study of the selected development option for a mineral project that includes appropriately detailed assessments of realistically assumed mining, processing, metallurgical, economic, marketing, legal, environmental, social and governmental considerations together with any other relevant operational factors and detailed financial analysis that are necessary to demonstrate at the time of reporting that extraction is reasonably justified or economically viable. The results of a feasibility study may reasonably serve as the basis for a final decision by a proponent or financial institution to proceed with, or finance, the development of a project. The confidence level of a feasibility study is higher than that of a preliminary feasibility study.
“g Au/t” means grams of gold per tonne.
“geosyncline” means a major trough or downwarp of the Earth’s crust, in which great thicknesses of sedimentary and/or volcanic rocks have accumulated.
“indicated mineral resource” and “indicated resource” mean “indicated mineral resource” defined by S-K 1300 as that part of a mineral resource for which quantity and grade or quality are estimated on the basis of adequate geological evidence and sampling. The level of geological certainty associated with an indicated mineral resource is sufficient to allow a qualified person to apply modifying factors in sufficient detail to support mine planning and evaluation of the economic viability of the deposit. Because an indicated mineral resource has a lower level of confidence than the level of confidence of a measured mineral resource, an indicated mineral resource may be converted only to a probable mineral reserve.
“inferred mineral resource” and “inferred resource” mean “inferred mineral resource” defined by S-K 1300 as that part of a mineral resource for which quantity and grade or quality are estimated on the basis of limited geological evidence and sampling. The level of geological uncertainty associated with an inferred mineral resource is too high to apply relevant technical and economic factors likely to influence the prospects of economic extraction in a manner useful for evaluation of economic viability. Because an inferred mineral resource has the lowest level of geological confidence of all mineral resources, which prevents the application of modifying factors in a manner useful for evaluation of economic viability, an inferred mineral resource may not be considered when assessing the economic viability of a mining project, and may not be converted to a mineral reserve.
“measured mineral resource” and “measured resource” mean “measured mineral resource” defined by S-K 1300 as that part of a mineral resource for which quantity and grade or quality are estimated on the basis of conclusive geological evidence and sampling. The level of geological certainty associated with a measured mineral resource is sufficient to allow a qualified person to apply modifying factors in sufficient detail to support detailed mine planning and final evaluation of the economic viability of the deposit. Because a measured mineral resource has a higher level of confidence than the level of confidence of either an indicated mineral resource or an inferred mineral resource, a measured mineral resource may be converted to a proven mineral reserve or to a probable mineral reserve.
“mineral reserve” is an estimate of tonnage and grade or quality of indicated and measured mineral resources that, in the opinion of the qualified person, can be the basis of an economically viable project. More specifically, it is the economically mineable part of a measured or indicated mineral resource, which includes diluting materials and allowances for losses that may occur when the material is mined or extracted.
“mineral resource” is a concentration or occurrence of material of economic interest in or on the Earth's crust in such form, grade or quality, and quantity that there are reasonable prospects for economic extraction. A mineral resource is a reasonable estimate of mineralization, taking into account relevant factors such as cut-off grade, likely mining dimensions, location or continuity that, with the assumed and justifiable technical and economic conditions, is likely to, in whole or in part, become economically extractable. It is not merely an inventory of all mineralization drilled or sampled.
“ore” means material containing minerals in such quantity, grade and chemical composition that they can be economically extracted.
“ore sorting” means technology that separates “ore” and “waste” based on physical and/or chemical properties of the material being sorted.
“oxide” means mineralized rock in which some of the original minerals have been oxidized (i.e., combined with oxygen). Oxidation tends to make the rock more porous and permits a more complete permeation of cyanide solutions so that minute particles of gold in the interior of the minerals will be more readily dissolved.
“probable mineral reserves” under S-K 1300 is the economically mineable part of an indicated and, in some cases, a measured mineral resource.
“proven mineral reserves” under S-K 1300 is the economically mineable part of a measured mineral resource and can only result from conversion of a measured mineral resource.
“qualified person” or “QP” as defined under S-K 1300 is an individual who is: (1) a mineral industry professional with at least five years of relevant experience in the type of mineralization and type of deposit under consideration and in the specific type of activity that person is undertaking on behalf of the registrant; and (2) an eligible member or licensee in good standing of a recognized professional organization at the time the technical report is prepared. For an organization to be a recognized professional organization, it must: (i) be either: (A) an organization recognized within the mining industry as a reputable professional association; or (B) a board authorized by U.S. federal, state or foreign statute to regulate professionals in the mining, geoscience or related field; (ii) admit eligible members primarily on the basis of their academic qualifications and experience; (iii) establish and require compliance with professional standards of competence and ethics; (iv) require or encourage continuing professional development; (v) have and apply disciplinary powers, including the
power to suspend or expel a member regardless of where the member practices or resides; and (vi) provide a public list of members in good standing.
“qualified person” or “QP” as defined under NI 43-101 means an individual who (1) is an engineer or geoscientist with a university degree, or equivalent accreditation, in an area of geoscience, or engineering, relating to mineral exploration or mining; (2) has at least five years of experience in mineral exploration, mine development or operation, or mineral project assessment or any combination of these that is relevant to his or her professional degree or area of practice; (3) has experience relevant to the subject matter of the mineral project and the technical report; (4) is in good standing with a professional association; and (5) in the case of a professional association in a foreign jurisdiction, has a membership designation that (i) requires attainment of a position of responsibility in their profession that requires the exercise of independent judgment; and (ii) requires (A) a favorable, confidential peer evaluation of the individual’s character, professional judgment, expertise and ethical fitness; or (B) a recommendation for membership by at least two peers, and demonstrated prominence or expertise in the field of mineral exploration or mining. Note: a professional association is a self-regulatory organization of engineers, geoscientists or both that, among other criteria, requires compliance with the professional standards of competence and ethics established by the organization and has disciplinary powers over its members.
“recovery” means that portion of the metal contained in the ore that is successfully extracted by processing and is expressed as a percentage.
“sampling” means selecting a fractional, but representative, part of a mineral deposit for analysis.
“strike” when used as a noun, means the direction, course or bearing of a vein or rock formation measured on a level surface and, when used as a verb, means to take such direction, course or bearing.
“sulfide” means a compound of sulfur and some other element. From a metallurgical perspective, sulfide rock is primary rock that has not been oxidized. Both ore and waste may contain sulfide minerals.
“tpd” means tonnes per day.
“vein” means a fissure, fault or crack in a rock filled by minerals that have traveled upwards from some deep source.
“waste” means rock lacking sufficient grade and/or other characteristics of ore.
Cautionary Note to Investors Regarding Estimates of Measured, Indicated and Inferred Resources and Proven and Probable Mineral Reserves
We are subject to the reporting requirements of the Exchange Act and applicable Canadian securities laws, and as a result we report our mineral reserves and mineral resources according to two different standards. For U.S. purposes, mineral property disclosures are reported in accordance with S-K 1300 under the Exchange Act, while Canadian disclosures are reported in accordance with Canadian National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”). Both sets of reporting standards have similar goals in terms of conveying an appropriate level of confidence in the disclosures being reported, but the standards embody slightly different approaches and definitions.
In our public filings in the U.S. and Canada and in certain other announcements not filed with the U.S. Securities Exchange Commission (“SEC”), we disclose proven and probable reserves and measured, indicated, and inferred resources, each as defined in S-K 1300 and NI 43-101. As currently reported, there are no material differences in our disclosed proven and probable reserves and measured, indicated, and inferred resource under each of S-K 1300 and NI 43-101. The estimation of measured resources and indicated resources involve greater uncertainty as to their existence and economic feasibility than the estimation of proven and probable reserves; therefore, investors are cautioned not to assume that all or any part of measured or indicated resources will ever be converted into S-K 1300-compliant or NI 43-101-compliant reserves. Estimations of inferred resources involve far greater uncertainty as to their existence and economic viability than the estimations of other categories of resources; therefore, it cannot be assumed that all or any part of inferred resources will
ever be upgraded to a higher category. Investors are cautioned not to assume that all or any part of inferred resources exist, or that they can be mined legally or economically.
Note Regarding Forward-Looking Statement****s
This annual report, including all exhibits hereto and any documents that are incorporated by reference as set forth on the face page under “Documents incorporated by reference”, contains “forward-looking statements” within the meaning of thePrivate Securities Litigation Reform Act of 1995 and forward-looking information under Canadian securities laws that are intended to be covered by the safe harbor created by such legislation. All statements, other than statements of historical facts, included in this annual report on Form 10-K, our other filings with the SEC and Canadian securities commissions and in press releases and public statements by our officers or representatives that address activities, events, or developments that we expect or anticipate will or may occur in the future are forward-looking statements and forward-looking information, including, but not limited to, those listed below:
Operations
| ● | the results of the Mt Todd FS and its related estimates and projections, including projected free cash flow, future exchange rates and commodity prices; |
| ● | our belief that interested parties continue to maintain a cautious approach to new, large-scale development projects; |
| ● | our belief that certain exploration targets represent the closest and most immediate opportunity for growth with the appropriate investment in additional drilling; |
| ● | the feasibility of Mt Todd and the results of the Mt Todd FS; |
| ● | estimates of future operating and financial performance; |
| ● | future exploration plans; |
| ● | our expectation of Mt Todd’s impact, including environmental and economic impacts; |
| ● | plans and estimates concerning potential Mt Todd development, including access to an adequate supply of water, the availability of natural gas on acceptable terms, as well as the ability to obtain all required permits; |
| ● | estimates of mineral reserves and mineral resources; |
| ● | our intention to improve the value of our gold projects; |
| ● | the potential that development projects may lead to gold production or value-adding strategic transactions; |
| ● | our belief that we are in compliance in all material respects with applicable mining, health, safety and environmental statutes and regulations in all of the jurisdictions in which we operate and that our operations are conducted in material compliance with applicable laws and regulations; |
| ● | our belief that our investment of significant resources in water treatment and management, environmental, and social programs has benefited our relationships with the traditional landowners, local communities, and NT Government, creating a strong social license; |
| ● | our expectation that a community-based project would produce lower operating costs compared to contract mining and that a portion of the skilled workforce should be able to be sourced locally; |
| ● | our expectation that a fresh water storage reservoir would receive a two-meter dam raise and would harvest stormwater expected to exceed process water requirements for year-round operations for a 50,000 tpd operation; |
| ● | our expectation that the remaining permitting processes are relatively straight-forward and are not expected to impede, to a material extent, our exploration and future development plans; |
| ● | our expectation to follow the 6,000-7,000 meter drilling program with studies of an initially smaller-scale project at Mt Todd, targeting a significantly lower initial capital cost and operating costs close to those estimated in the |
Mt Todd FS and the plan that the studies will focus on a strategy of scalable development, allowing for throughput expansion or mine-life extension;
| ● | our belief that the drill program will add substantial value to Mt Todd by improving cash flow as a result of a more constant production profile, reduced stripping, and increased mine life for all development scenarios; |
| ● | our expectation that proposed drilling could have an all-in cost of approximately $2 million and to be completed by year end; |
| ● | our belief that using contract mining and power generation, and construction practices commonly used in Australia, creates an opportunity to maintain high capital efficiency at a smaller initial project scale; |
| ● | our estimates with respect to historical mine production at Mt Todd; |
| ● | our expectation that plus 5/8” high pressure grinding roll (“HPGR”) crusher product at Mt Todd is harder than the minus 5/8” crushed product and that the hardness of ore in the Batman deposit is relatively consistent; |
| ● | our expectation that the use of HPGR crushers at Mt Todd will produce a product that can be ground more efficiently and reduce energy requirements as compared to a SAG Mill design; |
| ● | our belief that the Mineral Development Taskforce estimates that changes in the NT royalty scheme, if enacted in legislation, will have significant positive economic impacts for Mt Todd and other mineral projects in the Northern Territory |
| ● | the expectation that reclamation of the heap leach pad at Mt Todd will include disposal of pad liner and regrading of the area occupied by the heap leach pad only as the material on the existing heap leach pad will be processed through the mill at the end of mine life; and |
| ● | our expectation that existing infrastructure at Mt Todd will reduce initial capital expenditure and significantly reduce capital risk related to infrastructure construction. |
Business and Industry
| ● | Our belief that our Working Capital as of December 31, 2023, the $7,000 received in February 2024 under the Royalty Agreement, and remaining proceeds expected from the Royalty, together with other potential future sources of financing and sales of non-core assets, will be sufficient to fund our currently planned corporate expenses; |
| ● | our belief that the ATM Program (as defined below) will provide additional financing flexibility at a low cost; |
| ● | the potential monetization of our non-core assets, including a royalty interest in the U.S. and our used mill equipment which is for sale; |
| ● | planned or potential expenditures, funding requirements and sources of capital, including near-term sources of additional cash; |
| ● | our expectation to fund our 2024 activities from existing cash and cash equivalents and anticipated additional proceeds from its grant of the Royalty on Mt Todd, which is expected to provide total proceeds of $20,000; |
| ● | our expectation that the Company will continue to incur losses and will not pay dividends for the foreseeable future; |
| ● | our belief that the current market value of the common shares in the capital of the Company (the “Common Shares”) does not reflect the fair value of the Company’s assets; |
| ● | our belief that we maintain reasonable amounts of insurance; |
| ● | our expectations related to potential changes in regulations or taxation initiatives; |
| ● | our belief that we are possibly a passive foreign investment company; |
| ● | the potential that we may grant options and/or other stock-based awards to our directors, officers, employees and consultants; |
| ● | preliminary estimates of the reclamation and other related costs that would be incurred if we were to notify the NT Government that we intend to proceed with development and assume rehabilitation liability for Mt Todd; and |
| ● | the potential that future expenditures may be required for compliance with various laws and regulations governing the protection of the environment. |
Forward-looking statements and forward-looking information have been based upon our current business and operating plans, as approved by the Board of Directors; our cash and other funding requirements and timing and sources thereof; results of preliminary feasibility and feasibility studies, the accuracy of mineral resource and reserve estimates and assumptions on which they are based; the results of economic assessments and exploration activities; current market conditions and project development plans. The material assumptions used to develop the forward-looking statements and forward-looking information included in this annual report on Form 10-K include: our expectations of metal prices; our forecasts and expected cash flows; our projected capital and operating costs; accuracy of mineral resource estimates and resource modeling and preliminary feasibility and feasibility study results; expectations regarding mining and metallurgical recoveries; timing and reliability of sampling and assay data; anticipated political, economic, and social conditions; expected Australian national, provincial and local government policies, including legal reforms, successful advancement of the Company’s required permitting processes; and ability to successfully raise additional capital. The words “estimate”, “plan”, “anticipate”, “expect”, “intend”, “believe”, “will”, “may” and similar expressions are intended to identify forward-looking statements and forward-looking information. These statements involve known and unknown risks, uncertainties, assumptions and other factors which may cause our actual results, performance or achievements to be materially different from any results, performance or achievements expressed or implied by such forward-looking statements and forward-looking information. These factors include risks such as:
Operating Risks
| ● | feasibility study results and the accuracy of estimates and assumptions on which they are based; |
| ● | mineral resource and reserve estimates, the accuracy of such estimates and the accuracy of sampling and subsequent assays and geologic interpretations on which they are based; |
| ● | technical and operational feasibility and the economic viability of deposits; |
| ● | our ability to raise sufficient capital on favorable terms or at all to meet the substantial capital investment at Mt Todd; |
| ● | our ability to obtain, renew or maintain the necessary licenses, authorizations and permits for Mt Todd, including its development plans and operating activities; |
| ● | market conditions supporting a decision to develop Mt Todd; |
| ● | delays in commencement of construction at Mt Todd; |
| ● | our reliance on third-party power generation for the construction and operation of Mt Todd; |
| ● | increased costs that affect our operations or our financial condition; |
| ● | delays or disruptions in supply chains; |
| ● | our reliance on third parties to fulfill their obligations under agreements with us; |
| ● | whether projects not managed by us will comply with our standards or meet our objectives; |
| ● | whether our acquisition, exploration and development activities, as well as the realization of the market value of our assets, will be commercially successful and whether any transactions we enter into will maximize the realization of the market value of our assets; |
| ● | the success of any future joint ventures, partnerships and other arrangements relating to our properties; |
| ● | perception of the potential environmental impact of Mt Todd; |
| ● | known and unknown environmental and reclamation liabilities, including reclamation requirements at Mt Todd; |
| ● | potential challenges to the title to our mineral properties; |
| ● | opposition to construction or operation of Mt Todd; |
| ● | future water supply issues at Mt Todd; |
| ● | litigation or other legal claims; and |
Financial and Business Risks
| ● | fluctuations in the price of gold; |
| ● | inflation and cost escalation; |
| ● | lack of adequate insurance to cover potential liabilities; |
| ● | the lack of cash dividend payments by us; |
| ● | our history of losses from operations; |
| ● | our ability to attract, retain and hire key personnel; |
| ● | volatility in our stock price and gold equities generally; |
| ● | our ability to obtain a development partner or other means of financing for Mt Todd on favorable terms, if at all; |
| ● | our ability to raise additional capital or raise funds from the sale of non-core assets on favorable terms, if at all; |
| ● | general economic conditions adverse to Mt Todd development or operation; |
| ● | the potential acquisition of a control position in the Company for less than fair value as a result of industry consolidation or otherwise; |
| ● | lack of success in our efforts to find an acceptable partner, external financing or other acceptable alternatives to move forward with development of Mt Todd; |
| ● | evolving corporate governance and public disclosure regulations; |
| ● | intense competition in the mining industry; |
| ● | tax initiatives on domestic and international levels; |
| ● | potential changes in regulations of taxation initiatives; |
| ● | fluctuation in foreign currency values; |
| ● | our possible status as a PFIC (as defined below) for U.S. federal tax purposes; |
| ● | cybersecurity breaches that threaten or disrupt our information technology systems; |
| ● | anti-bribery and anti-corruption laws; and |
| ● | potential conflicts of interest arising from certain of our directors and officers serving as directors and officers of other companies in the natural resources sector. |
Industry Risks
| ● | inherent hazards of mining exploration, development and operating activities; |
| ● | a shortage of skilled labor, equipment and supplies; |
| ● | the accuracy of calculations of mineral reserves and mineral resources and mineralized material and fluctuations therein based on metal prices, estimated costs, and inherent vulnerability of the ore and recoverability of metal in the mining process; |
| ● | changes in environmental regulations to which our exploration and development operations are subject could result in increased operating costs or our ability to operate at all; and |
| ● | changes in greenhouse gas emissions regulations and standards could result in increased operating costs or our ability to operate at all. |
For a more detailed discussion of such risks and other important factors that could cause actual results to differ materially from those in such forward-looking statements and forward-looking information, please see “Item 1A. Risk Factors” below in this annual report on Form 10-K. Although we have attempted to identify important factors that could cause actual results to differ materially from those described in forward-looking statements and forward-looking information, there may be other factors that cause results to be materially different than anticipated, estimated or intended. There can be no assurance that these forward-looking statements will prove to be accurate as actual results and future events could differ materially from those anticipated in the statements. Except as required by law, we assume no obligation to publicly update any forward-looking statements and forward-looking information, whether as a result of new information, future events or otherwise.
