SRK Exploration Limited was commissioned by Erin Ventures Inc. to produce a Technical Report for Balkan Golds’ Piskanja Project located in Serbia. Erin owns 100% of an exclusive exploration licence covering the Piskanja Project through its wholly owned subsidiary Balkan Gold doo. The effective date of SRK ES’s technical report is July 16, 2012. The report is being filed on SEDAR.
The principal author of this technical report is Dr. Mikhail Tsypukov, Fellow of the Institute of Materials, Minerals and Mining. Dr. Tsypukov is an independent Qualified Person as defined by National Instrument 43-101. Dr. Tsypukov is a full time employee of SRK ES, with over 26 years’ experience in the mining industry. In accordance with NI 43-101 guidelines, Dr. Mikhail Tsypukov visited the project between 10 June 2012 and 15 June 2012.
Mr. Gareth O’Donovan, CEng, FGS, FIMMM is the Managing Director of SRK ES Ltd. and a Corporate Consultant (Exploration Geology) with 27 years’ experience in the industry. Mr. O’Donovan is an independent Qualified Person as defined by National Instrument 43-101. He is also a full time employee of SRK ES and has reviewed this technical report. Mr. O’Donovan did not visit the project.
There is currently no NI 43-101 compliant Mineral Resource Estimate in existence for the project and SRK ESwas not commissioned to prepare a resource estimate as drilling is still in progress.
SRK ES reports that according to information in a report by Podunavac and Vukicevic (2011) the Mining Institute of Belgrade prepared a mineral resource estimate report for the Piskanja Project in 1992. This appears to have been an unofficial resource estimate as defined by Serbian law, created using interpolation of cross sections between 200x300m and 100x100m drill holes. It does not appear to have been included in the State mineral balance. The mineral resource was said to be approximately 6.5 Mt of B2O3 in the C1+C2 categories as defined by Serbian mining regulations, though no grades have been located. SRK ES has not verified these numbers and does not know what data was used to arrive at this estimate.
In the technical documentation related to the Public Tender for Piskanja Project (Public Tender, 2005) the Ministry of Mining and Energy of the Government of the Republic of Serbia stated that “potential reserves of boron ore in Piskanja deposit are estimated to over 7,500,000 tons with an average content of useful component of 36.39% B2O3″. There are, however, no details contained within this Tender document that suggest how this estimate was calculated. It is not known if this estimate complies with the Serbian classification of mineral deposits and it is highly unlikely that this estimate conforms to Canadian Institute of Mining, Metallurgy and Petroleum (“CIM”) resource classifications. The Author has not done sufficient work to classify the historical estimate as a current mineral resource or mineral estimate and is not treating any historical estimate as a current mineral resource or reserve estimate. The historical estimates should not be relied on, but are relevant as an indication of the location and possible size of the exploration target.
There is therefore currently no NI 43-101 compliant Mineral Resource Estimate in existence for the project.
The Piskanja borate project is located in the Jarandol Basin of southern Serbia. The project covers an area of 305.7 hectares and is located some 160 km south of the Serbian capital Belgrade. Exploration undertaken by Erin over the last two years includes; the collection and analysis of all historical data available relating to the Jarandol Basin including lithology, tectonic structures and mineralisation. An assessment of the quality of this data and its reliability has also been completed by Erin.
As part of their current exploration program, Erin has planned 18,000m of drilling, and at the time of writing their report Erin had completed a total of 26 diamond drill holes totalling 9128.5m.
SRK ES comments that the drilling program is being carried out by experienced drilling crews using suitable rigs and to a high standard of environmental and health and safety procedures. SRK is confident that the drilling program is appropriate for the mineral deposit model and is being undertaken with expertise and to a suitable standard to allow reporting of Compliant Mineral Resources in the future.
The Piskanja Borate Project comprises two horizons of boron mineralisation formed in a playa lake environment. Exploration work to date has demonstrated that the project hosts mineralisation with significant grade and potential tonnages. There is some evidence to suggest that the mineralised horizons are tectonically disturbed, but as yet insufficient data has been collected to provide an opinion on the impact of this.
Overall SRK ES are of the opinion that the sampling preparation, security and analytical procedures used by Erin have not been consistent with generally accepted industry best practices thus limiting the classification assigned to any Mineral Resource Estimate reported using international guidelines. A QAQC program should be implemented as soon as possible and the results from this work should be checked on a regular basis during the assaying program to identify any sample and assaying bias.
SRK ES collected eleven samples for check analysis. For nine of the check samples the differences with the primary laboratory results are less than 10% which may be considered as acceptable. However, for two of the check samples this difference increases to around 20% which may be due to non-uniform distribution of mineralization within the sampled intervals or analytical errors in one of the laboratories.
Erin’s current data suggests an average grade of around 37% B2O3 as does the Serbian mining authorities’. However, SRK ES notes that this estimate is based upon selective sampling and that barren intercalations and interbeds have not been sampled to date. These will likely be too small to be selectively mined and will therefore constitute a dilution. SRK ES therefore suggest that an effective minimum mining width be accepted and used for sample intervals. With this in mind SRK ES suspects that an average grade, inclusive of this material, will likely be around 30-32% B2O3.
There is evidence that there may be significant bifurcation of the units leading to potentially high variations in boron grade which may be illustrated by the twin drilling. This twin drilling also highlights the possible impact from structural offsets There is currently insufficient data to fully predict the impact these structural relations will have to any resource potential or modelling but SRK ES would recommend that small scale faulting within the basin should be carefully considered in the future exploration program, aided by a careful understanding of the sequence stratigraphy and seismic surveys.
In order to satisfy the regulatory requirements for the production of an internationally compliant Mineral Resource Estimate, SRK ES recommends that Erin will need to do, at the very least, the following;
- Design and implement a robust QA/QC programme
- Use laboratories with international certification and appoint an umpire laboratory to cross check laboratory results;
- Use half core for the sampling program;
- Prepare and use 3-4 internal standards with appropriate grades of B2O3 in the range of 15% to 45%.
- Check analyses of both coarse rejects and pulp duplicates;
- The analysis of all internal waste material to assist with block modelling during the Estimation process;
- he use of geophysics, potentially shallow seismic surveys, with a view to assisting with inter-hole interpretations;
SRK ES recommends a budget of $3.5 million for continued drilling and related studies.
SRK ES concluded that the Piskanja Project is worthy of further study and can be considered a property of merit. However, in order to progress to an internationally compliant mineral resource a number of issues noted above will need to be addressed. SRK ES does not consider that any of these issues are insurmountable. Erin recognizes these issues and intends to properly address them.
On behalf of the Board of Directors,
Blake Fallis, General Manager
The technical information in this release was prepared and approved by Dennis J. LaPoint, a Registered Member of SME, a director of the Corporation, who is a Qualified Person under National Instrument 43-101.
For further information, please contact:
Erin Ventures Inc. Canada
Blake Fallis, General Manager TSX Venture: EV
Phone: 1-250- 384-1999 or 1-888-289-3746 USA
Erin’s Public Quotations:
TSX Venture: EV
SEC 12G3-2(B) #82-4432
Berlin Stock Exchange: EKV
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release
Forward Looking Statements
This release contains forward looking statements. The words “believe,” “expect,” “feel,” “plan,” “anticipate,” “project,” “could,” “should” and other similar expressions generally identify forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements. These forward-looking statements are subject to a number of risks and uncertainties including, without limitation, variations in estimated costs, the failure to discover or recover economic grades of minerals, and the inability to raise the funds necessary, changes in external market factors including commodity prices, and other risks and uncertainties. Actual results could differ materially from the results referred to in the forward-looking statements.