Dugbe Gold Project

Disclaimer | June 2021

The content on this page is subject to updating as exploration and other activities progress. Please visit the Pasofino news page for the most recent announcements.

Overview

The Dugbe Gold Project (the “Project”) is located in southern Liberia and situated within one of the last remaining genuinely under-explored parts of the Birimian area of West Africa*‘Birimian’ aged rocks which are host to the majority of West African gold deposits. The Project area is located 70 km by road from the Greenville deep-water port.

Pasofino Gold has an agreement with Hummingbird Resources plc (“Hummingbird”) (AIM:HUM) to earn a 49% economic interest (prior to giving effect to the Government of Liberia’s 10% free carried interest) in the Dugbe Gold Project.

The Dugbe Gold Project comprises an area of 2,559 km2 and includes two large gold deposits, Tuzon and Dugbe F. In addition to the known deposits, there are a large number of gold prospects, mostly untested; of these other targets only the Sackor and Tiehnpo prospects have been drill-tested to date.

Hummingbird carried out extensive surface and airborne exploration programs between 2006 and 2014 providing a wealth of data and understanding. A large number of quality targets were identified. A renewed surface exploration began on the project in October 2020 to test and advance the existing targets and screen other prospective areas of the project area.

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Regional Geology.

Pasofino’s Objectives

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Expanding the Dugbe F and Tuzon deposits and converting Inferred Mineral Resource Estimate (MRE) to Indicated to maximise resources available for the Feasibility Study. Drilling commenced January 2021, over 11,000 m completed as of May 2021.

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Work has commenced on a Feasibility Study to investigate the potential to produce 188,000 ounces of gold per year (PEA). The Feasibility Study is planned to be completed by end Q2 2022

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A large surface exploration program commenced in October 2020, to follow-up on untested existing targets and new targets, ranging from potential extensions and ‘satellite’ targets close to the existing deposits, to new areas of gold mineralisation on the project area. The intention is to finalise the ranking of these targets and drill-test those that are deemed at drill ready stage.

Mineral Resource Estimate

An updated mineral resource estimate for Dugbe F and Tuzon was prepared by SRK Consulting (UK) Limited (“SRK”) with an effective date of August 19, 2020. The updated mineral resource estimates for these deposits are reported under NI 43-101 requirements and are presented in the table to the right.

Contained Gold

Tuzon Deposit

Indicated: 2.03 million oz Au at 1.51 g/t Au
Inferred: 439,000 oz Au at 1.31 g/t Au

Dugbe F Deposit

Indicated: 273,000 oz Au at 1.46 g/t Au
Inferred: 823,000 oz Au at 1.57 g/t Au

Further details of the updated mineral resource estimates are provided in the Company’s press release on August 5, 2020 and the report “Dugbe Gold Project, Liberia NI 43-101 Technical Report, Effective Date 19 August 2020,” prepared by SRK Consulting (UK) Limited which can be found at www.sedar.com.

Dugbe Gold Project | Mineral Resource Estimate
Category Tonnes (M) Gold Grade (g/t) Gold (M oz)
Tuzon Deposit
Indicated 41.9 1.51 2.03
Inferred 10.4 1.31 0.44
Dugbe F Deposit
Indicated 5.8 1.46 0.27
Inferred 16.3 1.57 0.82
Total Indicated 47.7 1.51 2.30
Total Inferred 26.7 1.47 1.26

Notes to Table

  1. Rounding errors may be evident when combining totals in the table but are immaterial.
  2. The effective date of the Mineral Resource Estimate is August 19, 2020 as reported in “Dugbe Gold Project, Liberia NI 43-101 Technical Report, Effective Date 19 August 2020,” a report prepared by SRK Consulting (UK) Limited.
  3. The Qualified Person is Mr. Martin Pittuck (CEng, MIMMM).
  4. The Mineral Resource has been classified under the guidelines of the Canadian Institute of Mining, Metallurgy and Petroleum (CIM) Standards on Mineral Resources and Reserves, Definitions and Guidelines prepared by the CIM Standing Committee on Reserve Definitions and adopted by CIM Council (2014), and procedures for classifying the reported Mineral Resources were undertaken within the context of the Canadian Securities Administrators National Instrument 43-101 (NI 43-101).
  5. The estimates are stated using a 0.5 g/t Au cut-off grade.
  6. Mineral Resources are not Mineral Reserves and have no demonstrated economic viability. The estimate of Mineral Resources may be materially affected by environmental, permitting, legal, marketing, or other relevant issues.
  7. Mineral Resource estimates are stated within conceptual pit shells that have been used to define Reasonable Prospects for Eventual Economic Extraction (RPEEE). The pit shells used the following main parameters: (i) Au price of US$1700/ounce; (ii) plant recovery of 90%; and (iii) mean specific gravity of 2.78 t/m3 for fresh rock and 1.56 t/m3 for oxide material for Tuzon, and for Dugbe F a mean specific gravity of 2.73t/m3.

Project History

Hummingbird was the first company to explore the region systematically, covering 12,000 km2 of central and southern Liberia before closing-in on the Dugbe Project area. Between 2006 and 2014 Hummingbird collected and tested 1,400 stream sediment samples and 25,000 soil samples on the Project and completed 258 trenches totalling 33,600 metres. A 17,500 km airborne magnetic/radiometric survey was also completed. In addition, Hummingbird drilled diamond core holes totalling approximately 75,000m mostly at the Dugbe F and Tuzon deposits.

The Tuzon and Dugbe F deposits were discovered by Hummingbird in 2009 and 2011 respectively. Both outcrop at surface for most of their strike length. A Preliminary Economic Assessment (PEA) was carried out for the Dugbe F and Tuzon deposits by Wardell Armstrong International in 2013 and metallurgical, geotechnical and hydrological work continued up until July 2014. This prior study work provides a foundation for the updated PEA and Feasibility Study currently underway.

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Examples of gold mineralization.

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Geology & Mineralization

The host rock at both deposits is sulphide-bearing orthopyroxene gneiss and is largely stratiform layer ‘sandwiched’ between a thick sequence of quartz-feldspar biotite gneiss with or without garnet, or lesser barren orthopyroxene gneiss affected by shear folding. The rocks are high grade metamorphic; gold mineralisation is interpreted to occur before peak metamorphism. Both deposits are cut by barren pegmatite intrusions.

The Tuzon Deposit

Tuzon is the larger of the two deposits. It has an Indicated MRE of 41.9 Mt with an average grade of 1.51 g/t Au containing 2,032 k oz gold. The Inferred MRE is 10.4 Mt with an average grade of 1.31 g/t Au containing 439 k oz Au (see MRE table). The host rock is sulphide-bearing orthopyroxene gneiss which has been folded into a recumbent fold with an approximate 20-degree plunge to the southwest. The northern limb is referred to as Zone A and the southern limb as Zone B. The full length of Zone B is unknown – it is open beyond the extent of previous drilling.

The Dugbe F Deposit

The Dugbe F deposit has an Indicated MRE of 5.8 Mt with an average grade of 1.46 g/t Au containing 273 k oz gold. The Inferred MRE is 16.3 Mt with an average grade of 1.57 g/t Au and has contained gold of 823 k oz. The deposit length as defined by the dimensions of the conceptual pit is 2.5 km. The host rock is the same as at Tuzon. The width of the deposit ranges from 1.3 km in the south to 200-300 m in the north. The gold is hosted by a flat to undulating layer of sulphide-bearing orthopyroxene gneiss which outcrops along the western side of the deposit and dips gently southeast to a maximum of 120 m below surface within the conceptual pit (see MRE table footnotes).

Current Exploration Campaign

The current program has three main objectives:

1 To expand the existing Tuzon and Dugbe F deposits.
2 To increase the proportion of Indicated Mineral Resources.
3 To identify and drill-test other exploration targets.

In October 2020, Pasofino re-started exploration on the project, the first exploration on the project since Hummingbird Resources work ended in 2014. Since October 2020, the following has been achieved:

At the Dugbe F deposit, the infill and geotechnical drilling program has been completed; 6800 m have been drilled for 80 holes. The results of this drilling include some thicker than expected intersections of the gold-bearing layer, including:

  • 43.5 m grading 0.85 g/t gold from 52.0 m downhole in DFDC349
  • 32.1 m grading 1.45 g/t gold from 86.9 m downhole in DFDC338
  • 10.0 m at 1.48 g/t gold from 67.9 m, and 14.6 m at 1.30 g/t gold from 102.0 m in DFDC335

These results were reported in announcements dated March 11 and March 29, 2021.

At the Tuzon deposit drilling started on the 5th April 2021 following completion of the bridge over the Geebo River. Step-out and infill drilling is well underway. A total of approximately 6,000 m is planned to be completed by August 2021.

It is anticipated that the additional drilling at Dugbe F and Tuzon may support a larger Indicated MRE for Dugbe F and Tuzon deposits. Currently the Indicated MRE is 2.3 Moz with an average grade of 1.51 g/t Au.

Exploration at other targets commenced in October 2020 and is ongoing to follow up on previous targets and new targets generated from an updated compilation of all airborne and surface exploration data. To date the following has been completed:

  • 3260 soil samples from 5 new soil grids.
  • 2600 m of trenching at a number of target areas

The soil sampling has identified quality new soil anomalies and analysis of this and anomalies in the trenching is underway – follow-up trenching and drilling if required is planned to test these new targets.

Central License

On the 10th of November the Company announced that it had exercised its option to acquire the "Central License" located and encompassed centrally within the Project area, adding an addition 204 km2 making the total Project Area 2,559 km2. This Central License area is encompassed under the MDA.

Mining has taken place in the area since the 1930's mostly extracting gold from alluvium or colluvium from workings up to several metres deep and but at two locations pits have been developed to depths of over 25 metres and are currently extracting fresh rock for crushing and gold recovery. These are referred to as the 99-steps and the S/SPMC pits.

During 2011 ASX-listed Equator Resources carried out drilling within the area over two phases**. Phase 1 was completed in 2012, comprising 52 holes (4,417 m) as described in an ASX announcement. Highlights of the drilling programme were:

  • 2 m @ 61.80 g/t Au from 74 m (BRC050);
  • 10 m @ 6.20 g/t Au from 11 M (BRC037);
  • 7 m @ 5.69 g/t Au from 10 m (BRC019); and
  • 5 m @ 3.55 g/t Au from surface (BRC035).
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Phase 2 was completed in 2013, comprising a further 28 holes, as described in an ASX announcement. Highlights were:

  • 1 m @ 9.72 g/t Au from 86 m (BRC054)
  • 1 m @ 16.6 g/ Aut from 40 m (BRC056)
  • 1 m @ 9.82 g/t Au from 75 m (BRC066)
  • 1 m @ 8.66 g/t Au from 40 m and 1 m @ 6.55 g/t Au from 128 m (BRC059)
  • 9 m @ 1.23 g/t Au from 92 m, including 1 m @ 5.31 g/t Au from 96m (BRC063)
  • 3 m @ 2.32 g/t Au from 7 m (BRC062)
  • 6 m @ 2.03 g/t Au from 33 m, including 1 m @ 8.35 g/t Au from 37 m (BRC074)
  • 1 m @ 2.46 g/t Au from 14 m (BRC075)

Work in the area ceased in 2013.

** References: Equator (2012). 15 September 2012. ASX Market Announcement, 'Encouraging RC Drilling
Results from Bukon Jedeh' and; Equator (2013). 20 August 2013. ASX Market Announcement, ‘Bukon Jedeh Phase 2 Drilling Results Extends Mineralisation'.

Mineral Development Agreement

Hummingbird signed a 25-year Mineral Development Agreement ("MDA") with the Government of Liberia which provides the necessary long-term framework and stabilization of taxes and duties for development and operation of the Dugbe Gold Project. Under the terms of the MDA, the royalty rate on gold production is 3%, the income tax rate payable is 25% (with credit given for historic exploration expenditures), the fuel duty is reduced by 50% and the Government of Liberia is granted a free carried interest of 10% in the Project.

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Project Development Plan

Project Development Plan

A 48 km section of the Greenville to Tuzon road has been rehabilitated including 25 new bridges which services the Dugbe exploration camp housing up to 100 people. The road and camp are critical in serving the exploration and feasibility work which is ongoing. DRA Global has been awarded the lead consultancy role on the Feasibility Study (FS) to investigate the potential to produce 188,000 ounces of gold per year at the Dugbe Project. SRK (UK) has been awarded the Environmental and Social Impact Assessment (ESIA) Study and Synergy Global has been awarded a contract for the provisional resettlement action plan (RAP). All three workstreams are expected to be completed in Q2 2022.