Cleveland Tailings Project - Positive Metallurgical Test Results

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1 4 December 2014 Highlights Cleveland Tailings Project - Positive Metallurgical Test Results Metallurgical test work supports the previous testing and proposed flow sheet designs for the Cleveland Tailings Project The rehabilitation and retreatment of the Cleveland Tailings Mineral Resource 1 will produce a concentrate from gravity and flotation processing, of between 50-55% tin at a recovery of 48-50% Submission of the Development Proposal and Environmental Management Plan is scheduled for early 2015 Lodgment of the Mining Lease Application is planned for early 2015, with a view to beginning production in 2016 Elementos Limited (ASX: ELT) ( Elementos or the Company ) is pleased to report the positive results of a metallurgical test program, which required the testing of composite samples from the two Cleveland tailings dams (TD1 and TD2). The work was performed at the ALS laboratory in Burnie, Tasmania, under the supervision of Mike Gunn, an experienced metallurgist specialising in the recovery of tin. After mass balancing of the metal content, the two tailings deposits indicated very similar overall performance. The mass balance shown in Table 1 (below) is a blend of the results achieved at each process stage for each tailings dam. Table 1: Preliminary Results for Saleable Concentrate Grade and Recovery Tonnes Per Hour Solids Grade Total Recovery Gravity Tin Product (Dressed) % 29.1% Flotation Tin Product (Dressed) % 20.5% Total Tin Product (Combined Concentrate after Leaching) % 49.6% Total Tin Tail Reject % 50.4% The results support the Company s plans to submit a Development Proposal and Environmental Management Plan in early 2015, in conjunction with the lodgement of a Mining Lease Application, with a view to beginning production in The information is extracted from the report entitled Resource Upgrade Cleveland Tailings Resource created on 17 June 2014, which is an update on previously reported work entitled Cleveland JORC Resources Significantly Expanded which was released on the 5 March Both reports are available to view at The company confirms that it is not aware of any new information or data that materially affects the information included in the original market announcement and, in the case of estimates of Mineral Resources or Ore Reserves, that all material assumptions and technical parameters underpinning the estimates in the relevant market announcement continue to apply and have not materially changed. The company confirms that the form and context in which the Competent Person s findings are presented have not been materially modified from the original market announcement.

2 Background 111 samples (~479kg) were taken as part of a sampling program at the Cleveland tailings dams. Of these samples, 33 from TD1 and 52 from TD2 were selected and composited into a main feed sample for batch gravity testing. The rejected samples were either clay cap material or remnant Hellyer tailings from a past plant trial. The composite sizing and assays were consistent with the weighted average of sample interval sizing and assays. They were also comparable with the estimate of the average tailings grade calculated from historical production data. The test work was based largely on the flow sheet used by Cleveland Tin Mining Company N.L. in pilot tests in This testing was designed to separately define the performance of each of the process steps for TD1 and TD2. No regrinding of the gravity middlings streams and no dressing of concentrates were undertaken. Flotation testing was conducted as a batch test with no retreatment of cleaner tailings. Note the arrangement of the process stages in the mass balance is distinctly different from the sequence of stages in the test work. The mass balance developed from these test results allows for the losses incurred by upgrading of concentrates. Other Material Results Other material results from the sample analysis and testing include: The data from the individual test stages was sufficiently consistent and reliable to enable a preliminary overall mass balance to be developed; All pre-dressed concentrates are carrying around 50% by mass of siderite, an iron carbonate (FeCO3), which can be leached out with acid to achieve higher product grade; Sulphide removal by flotation and Low Intensity Magnetic Separation (LIMS) and desliming at 6 microns were all carried out with an expected and acceptable loss of tin; Siderite removal from flotation feed was tested in isolation using Wet High Intensity Magnetic Separation (WHIMS) with an expected and acceptable loss of tin; As expected, samples were sticky and handling was difficult. However, these material handling characteristics can be managed through a variety of mining methods; De-agglomeration using a high shear attritioner was effective; Individual sample intervals showed a very broad range of particle sizing, emphasising the requirement for homogenisation of the plant feed; and The tailings reject showed potential to generate acid over time in the tailing storage facility. The Company plans to provide adequate controls through best practice engineering in its tailings dam design. Page 2 of 13

3 Figure 1: Locations used for Metallurgical Testing Tailings Dam 1 (TD1) Tailings Dam 2 (TD2) Page 3 of 13

4 Next Steps A second phase of testing will be required to finalise plant design and its performance criteria as part of a Definitive Feasibility Study, scheduled to commence in the first half of This will include collecting a bulk sample from both tailings dams and processing the material through a pilot plant (locked cycle test) to confirm plant specifications. The work will include the sub-sampling of material for testing of a Falcon Ultra-Fine Concentrator and quantification of concentrate penalty elements. For more information, please contact: Calvin Treacy Managing Director Phone: admin@elementos.com.au Elementos is an Australian, ASX-listed, exploration and development company, focused on developing the Cleveland Province, which hosts advanced stage tin and copper assets, together with a significant tungsten exploration project. Please visit us at COMPETENT PERSON STATEMENT The information in this report that relates to Exploration Targets, Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Tim McManus, a Competent Person who is a Member of The Australasian Institute of Mining and Metallurgy and a full-time employee of the Company. Tim McManus has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Tim McManus consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. Page 4 of 13

5 Appendix One Location Data Table2: Location Data Location Easting Northing ID ELMDH ELMDH ELMDH ELMDH ELMDH ELMDH ELMDH ELMDH ELMDH ELMDH ELMDH ELMDH ELMDH ELMDH ELMDH ELMDH ELMDH ELMDH ELMDH ELMDH ELMDH Page 5 of 13

6 Appendix Two Results Table3: Results Location ID ELMDH 01 ELMDH 02 Tailings Dam No. %- 38um Sn% Fe% S% Wt kg Rejected Interval Kg N/A used to test wall material and depth to determine likely wall design N/A used to test wall material and depth to determine likely wall design Reason For Rejection ELMDH 03 TD Clay Cap Material ELMDH 03 TD ELMDH 03 TD ELMDH 03 TD ELMDH 03 TD ELMDH 03 TD ELMDH 03 TD ELMDH 03 TD ELMDH 03 TD ELMDH 03 TD ELMDH 04 TD Clay Cap Material ELMDH 04 TD ELMDH 04 TD ELMDH 04 TD ELMDH 04 TD ELMDH 04 TD ELMDH 05 TD Clay Cap Material ELMDH 05 TD ELMDH 05 TD ELMDH 05 TD ELMDH 05 TD ELMDH 05 TD ELMDH 06 TD Clay Cap Material ELMDH 06 TD ELMDH 06 TD ELMDH 06 TD ELMDH 06 TD ELMDH 06 TD ELMDH 06 TD ELMDH 06 TD ELMDH 07 TD Clay Cap Material ELMDH 07 TD ELMDH 07 TD ELMDH 07 TD ELMDH 07 TD ELMDH 07 TD ELMDH 07 TD ELMDH 07 TD ELMDH 07 TD ELMDH 07 TD ELMDH 07 TD ELMDH 08 TD Clay Cap Material ELMDH 08 TD ELMDH 08 TD ELMDH 08 TD ELMDH 10 TD Clay Cap Material Page 6 of 13

7 Location ID Tailings Dam No. %- 38um Sn% Fe% S% Wt kg Rejected Interval kg Reason For Rejection ELMDH 10 TD ELMDH 10 TD ELMDH 10 TD ELMDH 10 TD ELMDH 10 TD ELMDH 11 TD Clay Cap Material ELMDH 11 TD ELMDH 11 TD ELMDH 12 TD Clay Cap Material ELMDH 12 TD ELMDH 12 TD ELMDH 12 TD ELMDH 12 TD ELMDH 12 TD ELMDH 12 TD ELMDH 13 TD Clay Cap Material ELMDH 13 TD ELMDH 13 TD ELMDH 13 TD ELMDH 13 TD ELMDH 14 TD Clay Cap Material ELMDH 14 TD ELMDH 14 TD ELMDH 14 TD ELMDH 14 TD ELMDH 14 TD ELMDH 14 TD ELMDH 14 TD ELMDH 15 TD Clay Cap Material ELMDH 15 TD ELMDH 15 TD ELMDH 15 TD ELMDH 16 TD Hellyer Tails ELMDH 16 TD Hellyer Tails ELMDH 16 TD Hellyer Tails ELMDH 16 TD Hellyer Tails ELMDH 17 TD Clay Cap Material ELMDH 17 TD ELMDH 17 TD ELMDH 17 TD ELMDH 17 TD ELMDH 17 TD ELMDH 18 TD Clay Cap Material ELMDH 18 TD ELMDH 18 TD ELMDH 18 TD ELMDH 18 TD ELMDH 19 TD Clay Cap Material ELMDH 19 TD ELMDH 19 TD ELMDH 19 TD Page 7 of 13

8 Location ID Tailings Dam No. %- 38um Sn% Fe% S% Wt kg Rejected Interval kg Reason For Rejection ELMDH 19 TD ELMDH 19 TD ELMDH 20 TD Clay Cap Material ELMDH 20 TD ELMDH 20 TD ELMDH 21 TD ELMDH 21 TD Clay Cap Material ELMDH 21 TD ELMDH 21 TD Page 8 of 13

9 Appendix Three Supporting Data Tables Section 1: Sampling Techniques and Data Criteria JORC Code Explanation Commentary Sampling techniques Drilling techniques Drill sample recovery Logging Nature and quality of sampling (e.g. cut channels, random chips, or specific specialised industry standard measurement tools appropriate to the minerals under investigation, such as down hole gamma sondes, or handheld XRF instruments, etc.). These examples should not be taken as limiting the broad meaning of sampling. Include reference to measures taken to ensure sample representivity and the appropriate calibration of any measurement tools or systems used. Aspects of the determination of mineralisation that are Material to the Public Report. In cases where industry standard work has been done this would be relatively simple (e.g. reverse circulation drilling was used to obtain 1 m samples from which 3 kg was pulverised to produce a 30 g charge for fire assay ). In other cases more explanation may be required, such as where there is coarse gold that has inherent sampling problems. Unusual commodities or mineralisation types (e.g. submarine nodules) may warrant disclosure of detailed information. Drill type (e.g. core, reverse circulation, open-hole hammer, rotary air blast, auger, Bangka, sonic, etc.) and details (e.g. core diameter, triple or standard tube, depth of diamond tails, facesampling bit or other type, whether core is oriented and if so, by what method, etc.). Method of recording and assessing core and chip sample recoveries and results assessed. Measures taken to maximise sample recovery and ensure representative nature of the samples. Whether a relationship exists between sample recovery and grade and whether sample bias may have occurred due to preferential loss/gain of fine/coarse material. Whether core and chip samples have been geologically and geotechnically logged to a level of detail to support appropriate Mineral Resource estimation, mining studies and metallurgical studies. Whether logging is qualitative or quantitative in nature. Core (or costean, channel, etc.) photography. The total length and percentage of the relevant intersections logged. 21 Wacker holes provided 111 samples. Of the 111 samples, 33 from TD1 and 52 from TD2 were selected and composited into the main feed sample for batch gravity testing. The rejected samples were either clay cap material or historic Hellyer tailings. The composite sample sizing and assay were consistent with the weighted average of sample interval sizings and assays. They were also comparable with the estimate of the average tailings grade calculated from historical production data. No duplicate samples were collected and no standards were incorporated in the sample batch. Wacker sampling was used. This technique utilises a continuous sample recovery barrel, enabling a full column of sample of tailings material to be recovered. The Wacker sampling method provides a full column of sample to be recovered. However, not all samples covered the full depth of the tailings. All samples acquired were logged for material type, with full paper and electronic logs made available in the Company database. Photos were taken of all samples before they were stored in a freezer pending the above-mentioned metallurgical testing. Page 9 of 13

10 Criteria JORC Code Explanation Commentary Subsampling techniques and sample preparation Quality of assay data and laboratory tests Verification of sampling and assaying Location of data points If core, whether cut or sawn and whether quarter, half or all core taken. If non-core, whether riffled, tube sampled, rotary split, etc. and whether sampled wet or dry. For all sample types, the nature, quality and appropriateness of the sample preparation technique. Quality control procedures adopted for all subsampling stages to maximise representivity of samples. Measures taken to ensure that the sampling is representative of the in situ material collected, including for instance results for field duplicate/second-half sampling. Whether sample sizes are appropriate to the grain size of the material being sampled. The nature, quality and appropriateness of the assaying and laboratory procedures used and whether the technique is considered partial or total. For geophysical tools, spectrometers, handheld XRF instruments, etc., the parameters used in determining the analysis including instrument make and model, reading times, calibrations factors applied and their derivation, etc. Nature of quality control procedures adopted (e.g. standards, blanks, duplicates, external laboratory checks) and whether acceptable levels of accuracy (i.e. lack of bias) and precision have been established. The verification of significant intersections by either independent or alternative company personnel. The use of twinned holes. Documentation of primary data, data entry procedures, data verification, data storage (physical and electronic) protocols. Discuss any adjustment to assay data. Accuracy and quality of surveys used to locate drillholes (collar and down-hole surveys), trenches, mine workings and other locations used in Mineral Resource estimation. Specification of the grid system used. Quality and adequacy of topographic control. The samples received were weighed and sub sampled to provide material for sample characterisation, which entailed assays and particle sizing at -38um. Future work will need to assess in-situ bulk density and moisture content, as the moisture of 19% was derived from a composite of stored drill intervals, and cannot be relied upon. The comparison of sizing indicates that the individual analysis of drilled intervals is consistent with the composite sizing. 33 TD1 and 52 TD2 samples selected from the original 111 sample intervals and were composited into a main feed sample for batch gravity testwork. The rejected samples were either clay cap material or Hellyer tailings. The laboratory analysis technique utilises the entire sample. The laboratory assay procedure is considered appropriate for samples of this type. No additional quality control measured beyond the standard laboratory "checks and balances" implemented by the laboratory as part of their normal assaying procedure were conducted. Independent consultants Pitt & Sherry supervised the Wacker sampling. No twinning was deemed necessary due to the compositing of the samples for bulk determination. All data collection, verification and protocols were set under the guidance of independent consultants Pitt & Sherry. Mass balancing was used to interpret the results. This is a blend of the deportments achieved at each process stage for each tailings dam. The arrangement of the process stages in the mass balance is distinctly different from the sequence of the process stages in the testwork. The mass balance developed from these test results allows for the losses incurred by upgrading of concentrates. A hand held GPS was used to record sample locations (+/- 5m accuracy). The samples were plotted using the Map Grid of Australia (MGA) based upon the Geodetic Datum of Australia 1994 (GDA94). Page 10 of 13

11 Criteria JORC Code Explanation Commentary Data spacing and distribution Orientation of data in relation to geological structure security Audits or reviews Data spacing for reporting of Exploration Results. Whether the data spacing and distribution is sufficient to establish the degree of geological and grade continuity appropriate for the Mineral Resource and Ore Reserve estimation procedure(s) and classifications applied. Whether sample compositing has been applied. Whether the orientation of sampling achieves unbiased sampling of possible structures and the extent to which this is known, considering the deposit type. If the relationship between the drilling orientation and the orientation of key mineralised structures is considered to have introduced a sampling bias, this should be assessed and reported if material. The measures taken to ensure sample security. The results of any audits or reviews of sampling techniques and data. The spacing of sample sites was determined to best represent a consistent sampling of each of the tailings dams whilst allowing for safe and effective access. The composite sizing and assay were consistent with the weighted average of sample interval sizing and assays. They were also comparable with the estimate of the average tailings grade calculated from historical production data. The samples were taken vertically, which is more or less perpendicular to the general stratification in the tailings dam. s were collected in the field and stored in a secure lockable location until dispatched to the laboratory via company personnel and vehicle where the laboratory assumed custody of the samples. No audits or reviews have been conducted at this stage. Page 11 of 13

12 Section 2: Reporting of Exploration Results Criteria JORC Code Explanation Commentary Mineral tenement and land tenure status Exploration done by other parties Geology Drill hole Information Type, reference name/number, location and ownership including agreements or material issues with third parties such as joint ventures, partnerships, overriding royalties, native title interests, historical sites, wilderness or national park and environmental settings. The security of the tenure held at the time of reporting along with any known impediments to obtaining a licence to operate in the area. Acknowledgment and appraisal of exploration by other parties Deposit type, geological setting and style of mineralisation A summary of all information material to the understanding of the exploration results including a tabulation of the following information for all Material drill holes: Easting and northing of the drill hole collar Elevation or RL (Reduced Level elevation above sea level in metres) of the drill hole collar Dip and azimuth of the hole Down hole length and interception depth Hole length. If the exclusion of this information is justified on the basis that the information is not Material and this exclusion does not detract from the understanding of the report, the Competent Person should clearly explain why this is the case. Exploration Licence EL7/2005 covers the Cleveland mine and Mineral Resource and is 100% owned by Elementos Ltd, through its wholly owned subsidiary Rockwell Minerals (Tasmania) Pty Ltd. Exploration and mining has been conducted in the area since Recent exploration and mining activities include, exploration by Aberfoyle Tin Development Partnership ( ), exploration and mining by Cleveland Tin NL and Aberfoyle Limited ( ), exploration by Lynch Mining Pty Ltd (2007) and exploration by Rockwell Minerals Limited (2013). Historical mining at Cleveland produced a tailings legacy that the company proposes to reprocess as part of its strategy for the Province. The tailings are stored above ground on-site in two tailings dams (TD1 and TD2). The tailings contain a substantial quantity of recoverable tin and copper due in part to operational inefficiencies and technical limitations of tin processing whilst the mine was in operation. No drilling was conducted to produce the samples for the bulk composite. s were extracted by wacker method which uses a hand-held mechanised push tube process to extract material from the tailings dams. Page 12 of 13

13 Criteria JORC Code Explanation Commentary Data aggregation methods Relationship between mineralisatio n widths and intercept lengths Diagrams Balanced reporting Other substantive exploration data Further work In reporting Exploration Results, weighting averaging techniques, maximum and/or minimum grade truncations (eg cutting of high grades) and cut-off grades are usually Material and should be stated. Where aggregate intercepts incorporate short lengths of high-grade results and longer lengths of low-grade results, the procedure used for such aggregation should be stated and some typical examples of such aggregations should be shown in detail. The assumptions used for any reporting of metal equivalent values should be clearly stated. These relationships are particularly important in the reporting of Exploration Results. If the geometry of the mineralisation with respect to the drill hole angle is known, its nature should be reported. If it is not known and only the down hole lengths are reported, there should be a clear statement to this effect (eg down hole length, true width not known ). Other exploration data, if meaningful and material, should be reported including (but not limited to): geological observations; geophysical survey results; geochemical survey results; bulk samples size and method of treatment; metallurgical test results; bulk density, groundwater, geotechnical and rock characteristics; potential deleterious or contaminating substances. The nature and scale of planned further work (eg tests for lateral extensions or depth extensions or large-scale step-out drilling). Diagrams clearly highlighting the areas of possible extensions, including the main geological interpretations and future drilling areas, provided this information is not commercially sensitive. s were composited into the main feed sample for batch gravity testing. The rejected samples were either clay cap material or historic Hellyer tailings. The composite sample sizing and assay were consistent with the weighted average of sample interval sizing and assays. Mass balancing was used to interpret the results. This is a blend of the tin deportments achieved at each process stage for each tailings dam. The mass balance developed from these test results allows for the losses incurred by upgrading of concentrates. The samples were composited for bulk assessment purposes and do not represent intersections. The results were for material characterisation and do not imply any lengths, volumes or quantitates of mineralisation. See figures in this announcement. All sampling results have been reported. The metallurgical amenability of the tin copper mineralisation was established by mining and processing operations from 1968 to No future drilling is envisaged at this time. A bulk sample is planned as part of a Definitive Feasibility Study in 2015, but a submission for approval of to take a bulk sample has not yet been submitted. Note: A detailed list of authors included in the tables above is included as References in the Company s ASX release dated 2 April 2014 and is available to view on Page 13 of 13