Ghana Geology

Exploration History

Reports of gold mining in the Upper West Region of Ghana date back to the 1920's and 1930's, when the Gold Coast Geological Survey recorded numerous gold occurrences while mapping in the area, although they noted that at the time there was relatively little artisanal activity in the region compared to southern Ghana. In the 1960's a Russian-sponsored geological mapping and prospecting programme was undertaken, but more detailed reports of the gold occurrences in the region were only published in 1991. These reports include mention of a concentration of gold associated with extensive quartz veining near Wa, and narrow, discontinuous north-south-trending veins that were believed to be the cause of stream sediment anomalies close to the villages of Duri and Lambussie, located 20 kilometres and 50 kilometres north of Azumah’s Kunche deposit, respectively.

The first systematic exploration of the region was undertaken by BHP-Utah in the early 1990's. BHP completed a regional bulk leach extractable gold (BLEG) soil survey of the entire Wa-Lawra Belt at 2 kilometre traverse intervals along strike, and several clusters of point anomalies were identified, including most of the currently recognised historical prospects. In the late 1990's, AGEM (a joint venture between Ashanti Goldfields and IAMGOLD of Canada) held prospecting rights over most of the Wa-Lawra Belt, and further wide spaced geochemical sampling was undertaken (of stream sediments, soils, anthills, laterite and rock chips), together with geological mapping and Landsat image interpretation. AGEM defined several anomalous trends, mostly from soils above a 30 ppb Au threshold, with most of the best anomalies reporting values in the 70 ppb to 200 ppb Au range.

Four PL applications were submitted in 1997 over the best anomalies in the central part of the Wa-Lawra Belt, to allow for further follow-up. AGEM refined the anomalies by more multimedia geochemical surveys, trenching and rotary air blast (RAB) drilling, and the northsouth oriented, 40 kilometre long, Kunche-Atikpi trend was identified running parallel to the main Jirapa Fault. Eight targets were tested by reverse circulation (RC) and diamond drilling (DD), namely Kunche Main, Kunche West, Kunche North, Boiri South, Nyari, Doggo (Atikpi), Tanchera, and Duri. Despite some significant gold intercepts in both trenches and drill holes, the tenements were optioned by AGEM to the Canadian company, Semafo, in late 1999. Semafo did little work on the tenements other than outlining some more low-level soil geochemical anomalies between the Kunche-Atikpi trend and the Tanchera Granite, and they allowed the tenements to lapse.

Azumah Exploration

Azumah commenced exploration on the Wa Gold Project in 2006. This has led to the successful discovery of significant gold mineralisation and estimation of substantial gold resources at Kunche-Bepkong and Julie. A large number of additional gold prospects remain to be fully tested.

Exploration and discovery on the Wa Gold Project has been driven primarily by geochemistry and shallow percussion drilling (RAB and aircore). The earlier shallow soil surveys were followed up by deep Toyota-mounted power-auger sampling with regolith logging to control results. ). For auguring, a single sample is routinely collected from the bottom of each hole. Infill shallow-soil sampling is utilised where the regolith is erosional. Mapping of both regolith and bedrock geology has been carried out in areas of interest, incorporating interpretation of remote sensing and geophysical data.

Aircore drilling has generally been used in preference to RAB for geochemically focused testing of the regolith. For most holes, four metre composite samples have been collected from the entire regolith profile. Over the main target zones, holes are generally drilled at 50 to 200 metre intervals along 400 metre spaced traverses with infill follow-up of anomalous results.

The Azumah database contains data for 51,680 samples from 228,673 metres of auguring and aircore drilling, combined.

A detailed aeromagnetic and radiometric survey was completed in 2010 over the central part of the Wa-Lawra Belt (over the Vapor PL) and the Wa East area (the latter co-funded with Castle Minerals), with line spacing of 100 metres and sensor height of 40 metres. Two additional surveys, at 200 metre line spacing, were flown at the northern and southern ends of the Wa-Lawra Belt, to complete coverage of the complete Azumah tenement portfolio; all data are of high quality.

The geophysical data have been interpreted at 1:100,000 scale by Southern Geoscience Consultants Ltd and CSA. This interpretation also incorporated regional-scale airborne aeromagnetic and EM data. A geological interpretation of spatially enhanced (using ALOS Prism data) Landsat TM imagery for Wa East by Nick Lockett & Associates also incorporated the aeromagnetic data.

Due to low magnetic contrast, the mineralised structures along the Bepkong-Basabli shear zone cannot be resolved by the airborne magnetic data. Unfortunately, none of the local structures in the Kunche-Bepkong District can be resolved from the aeromagnetic data. However, the processed imagery has provided an excellent base for a new regional geological interpretation and targeting, and is very effective in structural targeting at Wa East.

In 2006, SAGAX Afriques undertook a gradient-array induced polarisation survey (IP) over the Kunche deposit. The processed data demonstrates that gold mineralisation is associated with coincident linear anomalies of high chargeability and high apparent resistivity, which are interpreted to be caused by disseminated sulphides and quartz veining, respectively.

In 2010, this first gradient array IP survey was extended to cover the Bepkong deposit, north of Kunche. In 2011, 32 traverses of 50 metre dipole-dipole array IP were surveyed over prospects at Kunche-Bepkong, Yagha and Atikpi (all in the Vapor PL), and the Julie, Collette and Josephine PL's in the Wa East area. The IP data, especially resistivity, provide excellent resolution of structure and lithology in the Kunche-Bepkong relay zone. This is due to the strong conductivity contrast between conductive variably carbonaceous phyllite and more resistive wacke. This has been an important input to targeting in this area.

Routine drill testing of targets has generally utilised RC drilling, but recently more extensive diamond drilling has been undertaken at most deposits and prospects. This provides valuable geological information for prospect evaluation and targeting.

Azumah has completed more than 200,000 metres of RC and diamond drilling, specifically aimed at target testing, with an additional 50,000 metres on infill drilling for resource definition.

Resource and Reserve Estimation

Mineral Resource Estimates (MRE's) have been completed for Kunche, Bepkong, Aduane, Julie, and Collette. MRE updates were completed in late 2012 to August 2014, incorporating additional infill drilling completed during 2012 and 2013. Ordinary Kriging (OK) was used to estimate grades into all block models for Kunche, Bepkong, Aduane and Collette, and each was validated with the inverse distance squared methodology. The MRE's have been reported at a 0.5 g/t Au cut-off in compliance with the Australian JORC Code. CSA Global estimated the Mineral Resources for Kunche, Bepkong, Aduane and Collette.

MRE for Julie was undertaken using Multiple Indicator Kriging (MIK) which was viewed as more appropriate taking into account factors such as the style of mineralisation and the interpreted controls of mineralisation which are different at Julie compared to the other deposits.  Importantly the MIK process incorporates a relatively broad mineralised envelop as interpreted to constrain the estimate in contrast to the numerous tightly interpreted constraints of the OK methodology.  This has the practical effect of introducing mining dilution and makes the direct comparison between an OK estimate and an MIK estimate inappropriate. Brian Wolfe estimated the Mineral Resources for the Julie deposit.

The Ore Reserves for the Wa Gold Project were determined by Kirk Mining Associates as part of a Feasibility Study Update that is being completed in 2014.  The Ore Reserve estimate is reported under the JORC 2012 code.

For details of Mineral Resource and Ore Reserve Estimates and Supporting information as per JORC Code 2012 Table 1 see ASX Announcement of 2 September 2014