EQ Resources |Mt Carbine SCOPING STUDY REPORT 9. CONCLUSIONS AND RECOMMENDATIONS 9.1. CONCLUSIONS Prima facie, the under-pit resource appears extensive. However, a lot of the modelled ore is discontinuous (refer to Figure 4-3) and at grade that doesn’t support underground extraction. As a result, a large portion of the stated resource (at this stage) appears uneconomic from both and open pit or underground mining perspective (albeit the pit optimisation was done at a lower MTU price). This is illustrated in the waterfall diagrams shown in Figure 9-1 and Figure 9-2 (refer to APPENDIX B: for details on calculations). Figure 9-1 Resource inventory depletion (tonnes) Underground Scoping Study A Scoping Study was undertaken to see the viability of underground operations. This study was done on the green Inferred Resources shown in Figure 5. As 78% of the Resources used in the Scoping Study are in the Inferred category this does not allow for the economics of the Study to be published. EQR is significantly encouraged to move forward into the Pre-feasibility Study (“PFS”). With the planned drilling campaigns, the Company aims to further define the remaining 8.28Mt @ 0.40% WO3 of Inferred Resources (currently outside the planned Open Pit) towards Indicated Resources. This is best achieved from an Underground Drilling Program using the existing 430m decline already installed. The Scoping Study broadly consisted of: − Geological review (to understand geology, structural controls, grade distribution, resource status, inventory to be assessed for underground potential); − Stope optimiser runs (to spatially delineate stopes greater than 0.25% WO3); − Mining method review (appropriate methods, assessment and exclusion exercise); − Review and update of supplied first-principles cost build up for underground mining costs; − resourcing the ew economy for a bett r tomorrow; − Level by level, stope by stope assessment of potentially eco omic st pes; − Preliminary design, task creation, sequencing nd scheduling of concept design; and − (Internal) financial cost model and SWOT analysis. The W terfall Diagram below shows the Indicated and Inf rred Resources xamined in the Scoping Study (2.36Mt @ 1.05% WO3): Figure 7: Early Stage Design work for Underground Mining to understand potential for mining remaining resources. Operating and Financial Review continued Table 6: Resource Inventory Waterfall 24 EQ Resources Limited Annual Report 2022
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