Gold Price$US 1290.87
TSX.V: ORG$0.600

Block 14 Gold Project

The Block 14 gold project is located close to Sudan’s border with Egypt, 900km north of the capital Khartoum. The Block 14 concession covers 2,170km2. Access to the project is by sealed road along the eastern bank of the River Nile to the town of Abu Hamad and then via a well used desert road to the project area.

2011: Shark Metals (later became Orca Gold) acquired the right to purchase a 70% interest in the property from a local partner, Sheikh Osman Khider.

2011-2012: Exploration activity commenced immediately within this large land holding (initially 7,046 square kilometres). Due its size, initial reconnaissance work was carried out using satellite imagery to map the extensive artisanal mining within the Block. These were then systematically visited and prioritised for follow up exploration work.

This resulted in the early identification of the Galat Sufar area in mid 2012 with the first drilling taking place late in 2012 resulting in the discovery of the Galat Sufar South Resource.

A significant water aquifer that will support a much larger operation was recently discovered 85km SW of GSS.

2013-2014: Drilling continued in 2013 leading to a maiden resource being estimated in January 2014 comprising 22.2Mt grading 1.84g/t in the Indicated category for 1.31Moz and 6.6Mt grading 1.9g/t in inferred resources for 0.40Moz.

In 2014, exploration continued throughout the Block resulting in the discovery of Wadi Doum and expanded resources at Galat Sufar South.

2015-2016: A revised resource including Wadi Doum was estimated in February 2015. This comprised a total of 27.64Mt grading 1.83g/t in the Indicated category for 1.63Moz and 10.28Mt grading 1.78/t in inferred resources for 0.59Moz.

During late 2015 and the first half of 2016, work was focused on the Preliminary Economic Assessment (PEA) with extensive metallurgical test work, environmental baseline studies and water exploration in the Nubian Sandstone basin to the north of Block 14 (HA8).

The PEA, prepared by SGS Time Mining of South Africa, was published in July 2016. The study showed a strong economic project at a gold price of US$ 1,200/oz, with in-pit indicated resources of 1.22Moz and inferred resources of 0.14Moz and a pre-tax NPV7% of US$ 156 million and an IRR of 25% and an after-tax NPV7% of US$ 128 million and an IRR of 22%.

The Board of Orca approved the immediate commencement of a Preliminary Feasibility Study (PFS) on the project which was conducted by Lycopodium Pty Ltd of Brisbane, Australia.

The PFS included further metallurgical test work, environmental studies, mining and geotechnical work and critically a new water exploration programme aimed at increasing project water supply.

2017-Present: The water exploration programme which comprised a 5,000km airborne geophysical survey and follow up drilling has discovered a large, previously unknown aquifer system 85km south west of Galat Sufar South, now called “Area 5”.

Due to the expansion of the water resource available to the project and based on the engineering studies completed to date, the Company determined that it had sufficient information to proceed immediately to a feasibility study (“FS”), which would expedite the Company reaching a development decision and will also avoid costs associated with finalizing the previously planned PFS.

Accordingly, the Company elected to update its preliminary economic assessment on the Block 14 Project (“Revised PEA”) with the new information which had been generated throughout the recent phase of engineering studies, as reported below and the revised PEA was published in May 2017.

The Company is currently progressing the FS with metallurgical variability test work and a 25,000m drill programme to extend resources below the current design pits, which are restricted by lack of drilling. Plant throughput for the FS will be determined on the basis of extension drilling in the Area 5 water resource to determine the capability of the aquifer to support a higher throughput than 3.4Mtpa. The FS is scheduled for completion in Q1 2018.

Block 14 Permit History

May 2010: the Block 14 Exclusive Prospecting Permit was granted for an initial period of 4 years over an area of 7,046km2.

May 2014: a one-year extension to the initial period was granted.

May 2015: following the declaration of Mineral Discovery Areas, the Exclusive Prospecting Licence was renewed for 2 years for the area of 3,747 km2.

May 2017: the Exclusive Prospecting License was again renewed for the current area of 2,170km2.

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