017 Summary Tech Report NI43101 R

Voskhod Feasibility Study
43-101 Summary Technical Report
VOSKHOD CHROME DEPOSIT, KAZAKHSTAN
Report Prepared for:

ORIEL RESOURCES
1 Red Place
Mayfair
LONDON
W1K 6PL
Report Prepared by
011_Summary Tech Report_NI43-101 MAY 2006
P:\U2860 Voskhod Feasibility Study\Reports\Feasibility Study R1\01_Summary Report\017_Summary Tech Report_NI43-101.doc

May 2006
SRK Consulting
Voskhod FS Page i
Voskhod Feasibility Study

43-101 Summary Technical Report
U2860
SRK Consulting
rd
3 floor Windsor Court
1-3 Windsor Place
Cardiff, UK
CF10 3BX
Tel : +44 29 20 34 81 50
Fax : +44 29 20 34 81 99
cardiff@srk.co.uk
www.srk.co.uk
MAY 2006
Report Authors
Mike Beare

SRK Consulting
Voskhod FS Page 2
SRK Consulting
Windsor Court
1-3 Windsor Place
Cardiff
United Kingdom
CF10 3BX
e-mail: cardiff@srk.co.uk
URL: www.srk.co.uk
Tel: + 44 (0)29 20 34 81 50
Fax: + 44 (0)29 20 34 81 99
1 TITLE PAGE
2 TABLE OF CONTENTS
1 Title Page 2
2 Table of Contents 2
3 Executive Summary 8
4 Introduction and Terms of Reference 25

4.1 Terms of Reference and Purpose of Report 25
4.2 Sources of Information 25
4.3 Field Involvement 26
4.3.1 Qualifications of Consultant 26
5 Disclaimer 28
5.1 Consent and Copyright 28
6 Property Description and Location 29
7 Accessiblity, climate, local resources infrastructure and physiography 33

7.1 Topography, Elevation and Vegetation 33
7.2 Means of Access to the Property 33
7.3 Promixity of Population Centre 33
7.4 Climate & Operating Season 33
7.5 Rights, Power, Water and Personnel 35
7.5.1 Surface Ownership 35
7.5.2 Surface General 36
7.5.3 Water Supply 36
7.5.4 Power Supply 36
7.5.5 Staff 36
8 History 37
8.1 Voskhod History 37
8.1.1 Ownership History 37
8.1.2 Previous Exploration 38
8.1.3 Historical Resources Estimates 40
8.1.4 Production History 40

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9 Geological Setting 41
10 Deposit Type 57
11 Mineralization 57
12 Exploration 59
13 Drilling 61
13.1 Pre Oriel Drilling (1965-2003) 61
13.2 ORIEL DRILLING PROGRAMME 64
13.3 RESULTS OF ORIEL DRILLING PROGRAMME 67
14 Sampling Method and Approach 68

14.1 Drill core Sampling 68
14.1.1 Pre Oriel Sampling 68
14.1.2 Oriel Sampling 68
14.2 Drill Recovery Factors 69
14.3 Sample Quality / Bias 69
14.4 Description of Rock Types / Geological Controls / Widths Used to Determine
Sampling Interval 69
14.5 List of Individual Samples 69
15 Sample preparation, Analyses and Security 70

15.1 Sample Preparation 70
15.2 Sample Analysis 73
15.2.1 Quality Assurance / Quality Control (QA/QC) 75
15.2.2 Sample Security 80
15.2.3 Adequacy of Procedures 80
16 Data Verification 81
16.1 Grade Modelling 83
16.1.1 Statistical Analysis 84
16.1.2 Geostatistical Analysis 90
16.1.3 Block Modelling and Grade Interpolation 95
17 Adjacent Properties 106

17.1 Donskoy Gok 106
17.2 Karagaash Deposit 107
18 Mineral Processing and Metallurgical Testing 108

18.1 Metallurgical Testwork Samples and Ore Mineralogy 108
18.2 Metallurgical Testwork 108
18.3 Forecast Product Split 109
18.4 Process Plant 111
18.4.1 Plant Design Parameters and Process Description 111
18.4.2 Plant Description 113
18.4.3 Plant Operations 113
18.5 Infrastructure and Site Services 113
18.5.1 Electric Power Supply 113
18.5.2 Heating and Ventilation 114
18.5.3 Process Water Circuit and Potable Water Supply 114
18.5.4 Service Buildings 114

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18.5.5 Other Services 115

18.6 Plant and Infrastructure Execution Philosophy 115
18.6.1 General 115
19 Mineral Resource and Mineral Reserve estimates 116

19.1.1 Mineral Resources 116
19.1.2 Global Resources 117
19.1.3 Grade-Tonnage Curves 117
19.1.4 Mineral Resource Statement 118
19.1.5 Mineral Reserves 120
20 Other Relevant Data and Information 1

20.1 Tailings storage 1
20.1.1 Design Criteria 1
20.1.2 Capacity Assessment 2
20.1.3 Geochemical Classification of Slimes Material 5
20.1.4 Liner Design 5
20.1.5 Frost Heave 5
20.1.6 Placement of Coarse tailings 5
20.1.7 Water Balance 6
20.1.8 Sizing of Return Water Dam 7
20.1.9 Final Points 8
20.2 Geotechnical Studies 9
20.2.1 Geotechnical Characteristic of the Deposit 10
20.2.2 Mining Method 10
20.2.3 Caveability 11
20.2.4 Mining Induced Stresses 11
20.2.5 Groundwater 11
20.2.6 Support Requirements 11
20.2.7 Mine Access 12
20.2.8 Conclusions 12
20.3 Water Management 12
20.3.1 Introduction 12
20.3.2 Summary of work completed 13
20.3.3 Hydrogeological Testwork 13
20.3.4 Conceptual Model 13
20.3.5 Water Supply & Mine water management 14
20.3.6 Tailings management 14
20.3.7 Water balance 15
20.3.8 Mine Closure 15
20.3.9 Conclusions 15
20.3.10 Recommendations 16
20.4 Logistical Studies 16
20.4.2 Rail transportation 17
20.4.3 CIS 17
20.4.4 China 17
20.5 Project implementation and Permitting 23
20.6 Risks and Opportunities 25
21 Interpretation and Conclusions 29
22 Recommendations 30

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23 References 30
24 Date 30
25 Additonal Requirements for Technical Reports on Development Properties

and Production Properties 31
25.1 Mining 31
25.1.1 Production Rate 31
25.1.2 Mining Method 31
25.1.3 Mining Recovery 31
25.1.4 General 32
25.1.5 Ground Subsidence 32
25.1.6 Main Ramp and Boxcut 33
25.1.7 Contractor Works 34
25.1.8 Ore Transportation 35
25.1.9 Mucking and Trucking 1
25.1.10 Lateral development 1
25.1.11 Vertical Development 1
25.1.12 Production 1
25.1.13 Mine Services 1
25.1.14 Ventilation 1
25.1.15 Underground Equipment Requirements 1
25.1.16 Mine Labour Requirements and Organisation 2
25.1.17 The Mining workforce in Summary: 2
25.1.18 Summary of Total Project Workforce 2
25.2 Recoverablity 4
25.3 Markets 4
25.4 Contracts 5
25.5 Environmental Considerations 6
25.5.2 Environmental Legislation 6
25.5.3 Environmental Assessment Requirements 6
25.5.4 Environmental and Social Impacts 7
25.5.5 Public Consultation 8
25.5.6 Closure and Costs 9
25.5.7 Conclusion 9
25.6 Taxes 9
25.7 Capital and Operating Costs 10
25.7.1 Capital Costs 10
25.7.2 Operating Costs 12
25.8 Economic Analysis 17
25.9 Payback 19
25.10 Mine Life 19
26 Certificates 21
List of Figures
Figure 6.1 Concession Boundaries 31
Figure 6.2 Site Plan 32

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Figure 9.1: Idealized Ophiolite Stratigraphy 42

Figure 9.2 Geological map of the Kempirsai massif, showing the locality of the
Voskhod deposit within the Main Ore Field of the massif. 44
Figure 9.3: The Kempirsai Ultramafic Complex 45
Figure 9.4: Surface Geological Plan Based on Pre-Oriel Drilling 46
Figure 9.5: Typical example of the Cumulate Dunite (CDUN) lithology 49
Figure 9.6: Typical example of the PDUN lithology 49
Figure 9.7: Harzburgite with ovoid poikiloblasts of bastite 50
Figure 9.8: Alteration selvage around a deformed vein of massive chromite 50
Figure 9.9: Altered Hartzburgite (AHRZ) 51
Figure 9.10: Altered Harzburgite with abundant veins and homogeneous Altered
Dunite (ADUN) 51
Figure 9.11 Contour map of vertical thickness – 2D ore zone 52
Figure 9.12 : Hangingwall elevation (RL) contour map showing main faults 54
Figure 9.13 : Diagrammatic Representation of Lithological Setting of Orebody 56
Figure 13.1: Drill Hole Collars (Pre-Oriel) 63
Figure 13.2: 2005 Resource Drilling 66
Figure 15.1 Flow Sheet for Sample Preparation at Aktobe 71
Figure 15.2 Flow Sheet for Sample Preparation at Karaganda 72
Figure 15.3 Flow Sheet for Sample Preparation at Kostanai 73
Figure 16.1: Comparative histograms of assay data (Pre-Oriel and Oriel) 86
Figure 16.2: Q-Q plots for 2m Composites (Pre-Oriel versus Oriel) 89
Figure 16.3: Omni-directional Variogram for Cr2O3 (Filtered – High Grade Zone) 91
Figure 16.4: Down the hole variogram (High Grade Zone – Cr2O3) 92
Figure 16.5: Blocks on Domain Boundaries 103
Figure 16.6: High and Low Grade Blocks in Domain 2 103
Figure 16.7: Block Model showing Cr2O3 distribution within Domain 3 in section 13N 104
Figure 16.8 Comparison of Block Grades (Cr2O3 - Low Grade Blocks) 105
Figure 16.9 Regression plot OK versus IDW for Low Grade Blocks 106
Figure 18.1 Forecast Production 111
Figure 19.1 Grade –Tonnage Curve for Cr2O3 117
Figure 19.2 Grade-tonnage Curves by Sublevel 118
Figure 20.1 Tailings Dam – Phase 1 4
Figure 25.1 Expected Zone of Subsidence 32
Figure 25.2 General Schematic of the Conceptual Access Ramp 34
Figure 25.3 Production transport flowsheet 1
Figure 25.4 CAT-1700 LHD 1
Figure 25.5 CAT AD45 1
Figure 25.6 NPV Sensitivity Graph 19
Figure 25.7 Summary of Project Cashflows 20
List of Tables
Table 3.1 Mineral Resources 9
Table 3.2 Mineral Reserves 9
Table 3.3 Forecast Product Split over LoM 11
Table 3.4 Operating Costs (mine site) 16
Table 3.5 Post Processing Costs 17
Table 3.6 Summary of Mine Workforce 18
Table 7.1 Rainfall and Evaporation Data 35
Table 8.1 Pre Oriel Drilling Campaigns 38

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Table 8.2 2005 Drilling Summary 40

Table 8.3 Geoinvest Resources Estimates 40
Table 8.4 SRK Preliminary Assessment Study 40
Table 9.1: Lithological and Mineralogical Codes 48
Table 13.1: Pre Oriel Drilling Campaigns 61
Table 13.2: 2005 Drilling Summary 64
Table 15.1: Samples analysed during the 2005 drilling programme 74
Table 15.2: SRK Sample Number Allocation Sheet 75
Table 15.3: Comparison of “blank” and standard analyses for Cr2O3 77
Table 15.4: Analytical Precisions – Pre Oriel Data 77
Table 15.5: Internal Assay Control 77
Table 15.6Table 15.6: Internal Repeat Analyses (by laboratory) 78
Table 15.7: Sampling and Analytical Precisions – Pre Oriel Data 78
Table 15.8: Sampling and Analytical Precisions – Oriel Data 78
Table 15.9: Intra-laboratory analytical precision for Fe2O3 and Al2O3 80
Table 16.1: Default grades assigned to “barren” intervals 82
Table 16.2: Indicator Variogram Parameters 91
Table 16.3: Variography for High Grade Zone – Cr2O3 92
Table 16.4: Variography for High Grade Zone – SiO2 93
Table 16.5: Variography for High Grade Zone – Fe2O3 93
Table 16.6: Variography for Low Grade Zone – Cr2O3 94
Table 16.7: Variography for Low Grade Zone – SiO2 94
Table 16.8: Variography for Low Grade Zone – Fe2O3 95
Table 16.9A: Grid Nodes covered by IDW 97
Table 16.10 B: IDW Search Parameters 97
Table 16.11: 2D Resource Statement, Voskhod 98
Table 17.1 Karaagash Historical Resources 107
Table 18.1 Forecast Product Split over LoM 110
Table 19.1 Classified Mineral Resource Statement, Voskhod 120
Table 19.2 Probable Mineral Reserves 120
Table 20.1 Monthly Tailings Dam Water Balance 6
Table 20.2 Storage Requirements for the RWD 7
Table 25.1 Lateral Development Requirements 1
Table 25.2 Mine equipment requirements 1
Table 25.3 Summary of Mine Workforce 3
Table 25.4 Capital Costs – Table 1 11
Table 25.5 Capital Costs – Table 2 12
Table 25.6 Total Project Operating costs (excluding Labour) 14
Table 25.7 Life of Mine Labour Costs 15
Table 25.8 Summary of Unit operating Costs 16
Table 25.9 Post processing Costs 16

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3 EXECUTIVE SUMMARY
1 INTRODUCTION
SRK Consulting (UK) Ltd (SRK) has been requested to produce a Feasibility Study for the
Voskhod chrome project for which a 1.3 Mtpa underground mining operation is proposed.
This study, undertaken on behalf of Oriel Resources Plc (Oriel) a listed company based in
London, UK, was based on a drilling programme supervised by SRK and a detailed
technical audit of all available technical and financial information provided by Oriel. This
included a local Prefeasibility study undertaken on behalf of the previous owner, OSC
Geoinvest (Geoinvest). SRK has based this study on product marketing input from Mr
Heinz Pariser of Alloy Metals & Steel Market Research and on process plant design from
DRA International Ltd (DRA-I) in South Africa.
2 PROJECT LOCATION
The Voskhod chrome deposit has never been worked and lies within the Khromtau District
of the Aktobe Region of western Kazakhstan. A recently reconstructed tarmac road links
the town of Khromtau with Aktobe 110 km to the west. The Voskhod deposit is itself 7 km
NNE of Khromtau and is surrounded by a group of operating and closed mines belonging to
another chrome producer, Donskoy GOK (Donskoy). The site experiences a strongly
continental climate characterised by hot summer weather (+20 ºC) and extremely cold
winters (>-30 º). The site does not have permafrost conditions and the field and construction
season is generally May to November.
3 GEOLOGY
The Voskhod chromite deposit lies within a layered ultramafic complex, referred to as the
Kempirsayskiy Massif, together with up to 80 other deposits discovered since 1936. This
massif is 82 km long in a NNE direction and covers an area of 920 km2. The host rocks to
the deposit have been subjected to hydrothermal alteration and now consist of serpentinites
and serpentinized dunites.
The Voskhod deposit consists of one large lens of massive to disseminated chromite with up
to 9 smaller pods or footwall protrusions. It is a totally “blind” deposit, lying as it does at
depths of 98 to 440 m with a north-easterly dip of 28o. Indicated and Inferred Resources
defined by SRK with a 20% Cr2O3 cut off are summarised as follows in Table 3.1. SRK
notes that there is currently insufficient closely spaced data to support the classification of
Measured Resources but expects that this can be obtained with the 2006 infill drilling
campaign and driving of the ramp to intersect the orebody.

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Table 3.1 Mineral Resources

Resource Tonnes Cr2O3 Fe2O3 SiO2 Estimation
category (million) % % % Methodology
Indicated 19.5 48.5 13.1 8.5 3D
Inferred 1.6 41.0 12.3 12.7 2D
4 RESERVES
SRK has estimated Reserves in accordance with the CIM Code by constructing an
appropriately detailed Life of Mine (LoM) plan. The SRK LoM plan forms the basis of the
Feasibility Study and provides the economic basis for the generation of the Reserve
statement. In the detailed 3D model generated by SRK, dilution and recovery have been
applied to the Indicated Resources in order to estimate Probable Reserves. The Voskhod
reserves are summarised below. SRK has not included any inferred material in either the
life of mine plan.
The current Mineral Reserves are sufficient for 14 years of production at 1.3 Mtpa. In this
Summary Technical Report the economic evaluations are based solely upon the Probable
Reserves.
The Mineral Reserves have been classified in accordance with the CIM code and adhering to
the guidelines set out by NI 43-101. The statement has been estimated using drilling
information collected up to November 2005 and is effective 24th May 2006.
Table 3.2 Mineral Reserves

Indicated Mineral Resource Mineable Resource Probable Reserve
Mt %Cr2o3 Mt %Cr2o3 Mt %Cr2O3
19.5 48.5 17.7 46.6 18.3 40.3
5 MINE DEVELOPMENT
SRK has examined several options for mine access and development and concludes that a
box cut and decline approach is the most appropriate for the orebody. This method is
flexible, allows rapid access to ore and is less capital intensive than a shaft access. The
ramp would have dimensions of 5 m by 5 m and be driven at -15%. Primary ventilation will
be provided by sinking a 5.5 m diameter ventilation shaft. The shaft would be equipped

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with a mechanical lift to provide emergency egress. In order to meet Kazakh regulatory
requirements this shaft would be supplemented by an additional shaft early in 2008. The
design for ventilation underground provides for heating the air during winter.
SRK has assumed in this study that all mine ore and waste will be trucked to surface in 45t
diesel trucks. The trucks will be loaded directly by LHD. SRK notes that an extensive
orepass system is not appropriate for Voskhod due to the flat dip of the orebody.
Development of the mine would initially be undertaken by a contractor with the owner
mining crews taking over in 2009. SRK has assumed that the contractor undertakes initial
ore and waste development at the mine for a two year period, after which owner crews are
scheduled to take over development and production for the life of mine.
Preliminary geotechnical logging by SRK suggests that the entire underground workings are
likely to require shotcrete and systematic bolting. The shotcrete is considered necessary to
prevent the rock becoming weaker over time as a result of oxidation.
In accordance with market generated constraints, SRK has assumed that the mine production
rate will be 1.3 Mtpa which provides for 14 years of production with a two year
predevelopment period.
6 MINING METHOD
SRK has studied the various mining method options available for Voskhod and concludes
that with the current level of information on geotechnics, geometry and orebody chemistry
that bulk mining is the most appropriate method particularly given the low processing costs.
This conclusion assumes high grade and subordinate ore will be mined together and all of
the Run of Mine (ROM) material will be processed.
The bulk method applied to Voskhod in this study is Sublevel Caving (SLC) undertaken by
trackless means using 20 m sublevel intervals and 14m drill drive spacing. The use of this
method is likely to cause subsidence at surface which will be fenced off. Production from
SLC will be predominantly mined by the owner crews. SRK notes that there may be a
possibility to mine high grade parts of the orebody by a selective method in the future. For
this to be successful however, parts of the orebody will need to be of the requisite grade,
geometry and rock mass quality to allow mining with minimal processing of the material.
7 PROCESSING
Oriel commissioned DRA-I to undertake basic design and costing for the Voskhod
processing facilities. Mintek were tasked with the metallurgical test work phase which SRK
notes was based on a limited amount of core material. The proposed beneficiation plant
comprises a crushing and screening circuit followed by gravity separation into the three
chromite products. Gravity spirals are used to concentrate run-of-mine into the finer
products while a Dense Media Separator (DMS) drum will be used for the coarser material.

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DRA prepared a process design based on their knowledge and experience of chrome plants
in Southern Africa and earlier work conducted by the previous owners of Voskhod. The
product suite and specifications were based on the Heinz Pariser market study independently
commissioned by Oriel and other information furnished by Oriel.
From the size distributions and washability data product yields were forecast. Three
products are envisaged from the process plant;
Lump -100/150mm + 10mm, 45-48 % Cr2O3, <10 %SiO2 (8% typical)
Chip -10mm + 1mm, 45-48 % Cr2O3, <10 %SiO2 (8 % typical)
Fine concentrate -1mm, >55-59% Cr2O3, <3%SiO2
The forecast product split was achieved by predicting the split of feed ore types to the plant
over the LoM by analysing the drilling data, which log the intersections by observed ore
types. This data enables a split of the feed after crushing to be estimated to each process
section of the plant. The yield is based on the washability data from the metallurgical
testwork results which has been related back to the forecast plant feed grade and a nominal
density cut point applied for the required Cr2O3 grade of product, typically 48 % Cr2O3. Life
of mine average yield is estimated to be 70 %
Forecast product splits for the overall LoM are presented in Table 3.3. Further details of the
products on a quarterly basis are presented in the financial model. The annual product
forecast is shown in Figure 1 which indicates the lower product yield in the initial years of
the mine life while mining the lower grade area to the SW of the orebody, increasing in the
later stages of the LoM.
Table 3.3 Forecast Product Split over LoM

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% Yield
Production Grade %
(% of % Fe2O3 % SiO2
tonnes Cr2O3
RoM)
Plant Feed 18,298,126 40.3 11.1 8.3
Products
Lump 9,567,541 52.3 48.0 11.9 8.8
Chip 1,805,195 9.9 48.0 11.9 8.8
Concentrate 1,398,314 7.6 57.0 14 1-1.5
Total 12,771,050 69.8
Waste
Lump
Rejects 2,914,456 15.9 10.5
Chip Rejects 552,350 3.0 10.5
Fines 594,924 3.3 19.0
Slimes 1,465,523 8.0
Total 5,527,253 30.2
The process plant is designed to treat 1.3 Mtpa of feed material with a top size of 500mm.
Figure 1 Forecast Production

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Forecast Production Graph
1,200,000
1,000,000
Production tpa
800,000
Fines
600,000 Chips
Lumps
400,000
200,000
0
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
Several issues can be expected to affect the forecast product split which cannot be fully
defined from the initial investigations. These include the limited data on the in-situ split of
ore types in the resource and the noted degradation of material during handling which will
be affected by mining and handling of the feed and in the plant. SRK notes that these are
not expected to significantly affect the overall yield into products but could possibly affect
the quantity of lump product and result in increased levels of chips and fines. The Heinz
Pariser report notes no appreciable difference between prices for each product type which
are typically defined by their % chromite content, Fe/Cr ratio and point of sale. SRK has
therefore assumed that the same price will be received for all three chromite products.
The plant is effectively fully enclosed with the necessary heating and ventilation to cater for
the severe climatic conditions. Interconnecting conveyors between the plant selections are
also in fully enclosed galleries. The layout is relatively compact but allows for possible
future expansion and the provision of additional future recrushing and milling circuits
should these be required.
Process and service building will be heated from a small diesel fired boiler facility with hot
water or steam reticulated around the site to the surface buildings. The main heating duty
requirement is for underground air and this will be by electric elements in the inlet to the
ventilation fans.
The plant would be expected to take 12 to13 months to design and construct with the overall
project schedule governed to a major extent by project approval and the climatic window in
the site area. It is anticipated that site construction can commence in May 2007. The
construction and commissioning phase of the project is estimated to take nine months from
site access to completion of commissioning and start of ramp up to full production, which is
schedule for the first quarter 2008.

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8 TAILINGS STORAGE
The 5.5 Mt of tailings produced over the mine life will be stored in a lined facility 500 m to
the north of the project site. The life of facility would be 16 years with tailings deposition
over 14 years at an average rate of 148 000 tpa pumped slimes and 216 000 tpa of trucked
coarse tailings material. The height of the rehabilitated facility at closure will be 25 m.
The geotechnical parameters for the slimes and coarse tailings materials have been based on
parameters previously used for chromite slimes materials of a similar nature. These
parameters will be confirmed during the detailed design stage. A separate, lined return
water dam will accommodate storm water run-off from the plant area as well as some water
from the underground at a rate of approximately 2 500 m3/day.
9 INFRASTRUCTURE
SRK notes that the Voskhod deposit is situated in a mining district generally well served for
infrastructure, particularly rail links. Voskhod is adjacent to the Donskoy GOK mining
complex and the town of Khromtau. For this study, SRK has assumed that there will be no
shared infrastructure.
All chromite products from the mine have been assumed to be trucked by contractor 14 km
to the Sarysai rail head. Capital has been allowed for an upgrade of this facility and to repair
a the link road to the national road network.
Electric power will be supplied by a 110kV line from the HT supply at Kimpersai, 60km
distant from the mine site. On the site, power will be transformed to 10 kV in multiple
parallel 25 MVA transformers for reticulation on surface and underground. Further
investigations are on going into utilising existing power transmission facilities and possibly
the on-site generation of power from gas, which is available close to site.
Process water will be provided by utilising the 2 500 m3/day of excess water pumped from
underground workings and supplemented by boreholes as required. A concrete facility will
be provided on surface next to the box cut to settle coarse solids and skim oil from the mine
water before reticulation to the return water dam.
Potable water will be supplied from the treatment plant and a well field close to the plant
site and this can also be used as process water make up until sufficient water is available
from underground. A forecast potable water demand of 550 m3/day is estimated.
Cost estimates have been prepared for a number of service buildings including offices,
workshops, warehouse and ancillary facilities. All buildings will be fully winterised and
heated appropriately.
10 ENVIRONMENTAL
The Voskhod site is situated in an area heavily degraded by the surrounding Donskoy
operations. SRK is currently in the process of completing a full Environmental and Social

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Impact Assessment in accordance with World Bank Guidelines due to be completed in the
last quarter of 2006. As part of this document, SRK will also produce an Environmental
Management Plan. Public consultation for the project was initiated in February 2006 to
satisfy Kazakh requirements for environmental impact assessment of planned activities (the
Pre-OVOS process).
The commencement of the ongoing public consultation process was attended by SRK and
involved Interested and Affected parties (IAPs) such as the general public, concerned public
groups, local authorities and local non-governmental organizations. Feedback from the
meeting suggests that the attitude of the local citizens to the Voskhod project is positive.
The main areas considered important by the public were considered to be:
• Jobs for local citizens in the construction and operation of the mine;
• Investments in infrastructure development;
• Improvement of the quality of the medical services; and
• Maintenance and construction of roads.
SRK has provided environmental costs in the capital and operating budgets to allow for
assessment, monitoring and reporting, closure and post closure monitoring. This is to
adhere to legislative requirements in the Republic of Kazakhstan as well as World Bank
Guidelines. SRK has provided the following key environmental protection measures
• Lined facilities for mine water settling, tailings and return water dam;
• Berms and ditches to deflect clean water away from mine facilities;
• Treatment of all water discharged to the environment;
• Future diversion of the seasonal Karaagash river away from any possible zone of
mine subsidence; and
• Full closure and rehabilitation programmes for the site
From the work done to date, SRK considers that the Voskhod project is unlikely to pose any
significant environmental impacts to sensitive receptors, which cannot be adequately
managed through the implementation of appropriate mitigation and management control
measures. Arguably the biggest challenge facing the operation in environmental terms is
quantifying the nature and extent of existing contamination and ensuring these liabilities are
not transfer to Oriel’s operations. The life of mine plan generated in the Feasibility Study
allows for closure rehabilitation. Due the pre-existing levels of environmental degradation
SRK considers it unlikely that there will be ongoing liabilities beyond closure. In the
Feasibility Study a sum of US$3.2 M has been allocated for closure rehabilitation with
US$1 M for the tailings facility alone.

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11 MARKETING AND LOGISTICS
Chromite is generally priced by producers in agreement with consumers and, as a

consequence, product quality and specification vary widely depending on its ultimate
industrial application. Until such time that off take agreements have been finalised, SRK
has relied upon the input from the marketing study by H. Pariser.
The marketing work conducted by Oriel staff and independently by Heinz Pariser indicates
that there is sufficient demand in World markets for the average 896 ktpa of chromite
products over the mine life. Ahlers BV conducted a detailed logistics study which indicates
that the chromite products can be viably transported by the rail network into Russia, China
and by sea to other markets.
SRK has assumed over the life of mine a flat US$145/t (at the Sarysai rail head) for all of
the chromite products from Voskhod. Adjustments were applied to account for logistics
management, bagging, rail operator’s commission, product loss and moisture. SRK was
provided with a range of potential markets by Oriel which were used to verify product
transport volumes to the various destinations. The chromite price used in this study assumes
that the weighted average US$46/t cost for transport from Sarysai to the final destination is
paid by the end user.
12 CAPITAL COSTS
Capital costs for the Voskhod project were estimated to require a US$131 M (pre-financing
charges) for the first two years of development prior to receipt of initial revenues from
chromite production. Beyond this, SRK has estimated that the mine would generate
sufficient cashflows to finance all of the mine capital requirements.
13 OPERATING COSTS
Operating costs were calculated from first principles using a range of assumptions and input
data relevant for Kazakhstan. A 10% contingency was added. :All operating costs up to and
including Q1-2008 have been capitalised and included in the US$131 M above. The
following unit costs are post this period. The total operating costs presented in Table 3.4 are
presented as life of mine.
Table 3.4 Operating Costs (mine site)

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Project Total Operating Costs including contingency
General and Administration Costs Total ($)

Labour $ 10,363,451
Expats Travel $ 169,060
All Other $ 45,190,497
Contingency (10%) 5,572,301
Total $ 61,295,309
Total ($/tonne ore) 2.94
Mining
Labour $ 27,180,015
All Other $ 232,801,272
Contingency (10%) 26,063,857
Total $ 286,702,424
Processing
Labour $ 9,805,416
All Other $ 48,381,740
Total $ 64,068,440
Total - Operating 412,066,173

Post Processing costs are those involved with product handling after beneficiation and are
expressed as $/tonne of product or $/tonne of fines concentrate in the case of bagging. The
table below summarises these.
Table 3.5 Post Processing Costs

Product Costs post Processing ($/t of product)
$/unit $
Concentrate (fines only) Bagging Cost 5.1 $/t fines 7,131,402
Mine to railhead Truck Transport 1.83 $/t 23,371,022
Moisture penalty (truck transportation) 0.07 $/t 893,974
Product Handling at Rail Siding 0.33 $/t 4,214,447
Moisture penalty (rail transportation winter only) 2.02 $/t 12,863,529
Rail Operators Commission (1% of freight charges) 0.51 $/t 6,513,236
Rail Logistics Agent (5% of freight charges) 2.53 $/t 32,310,758
Total Product handling Costs 87,298,367
Inflation over the mine life has not been included in the operating cost calculations.
The total operating cost per tonne of ore (including off site costs but excluding freight to end
user) is estimated to be US$27.3/t of ore. The operating cost expressed per tonne of product
is US$ 39.1/t of product.

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The Pariser report provides an example from a South African Chromite producer with on
site costs of US$37.2/t to mine and process ore. SRK has assumed that this does not contain
any post processing costs and the run of mine grade is 45% Cr2O3. This example when
worked through gives a producer cost of US$5.5cents per lb of Chromium metal. Voskhod
has equivalent costs of US$20.2/t to mine and process ore of a lower grade. When
converted to lbs of metal the Voskhod cost equates to US$4.4cents per lb of Chromium
metal. SRK notes that the proposed mine at Voskhod has the potential to produce chromite
at an ex-mine cost 20% less than the established South African producer cited in the Pariser
report.
A total of 384 personnel will be required for the mine and process plant. The following
table provides a breakdown of the expected numbers in each department.
Table 3.6 Summary of Mine Workforce

Department Number Notes
Mining (expats) 31 Reduces to one by 2012
Mining (nationals) 184
Processing (expats) 3 Reduces to zero by 2012
Processing (nationals) 109
G & A (expats) 5 Reduces to zero by 2013
G & A (nationals) 52
Total 384
14 FINANCIAL EVALUATIONS
SRK has developed a financial model termed the Base Case Model, described below. This
model reflects capital and operating expenditures and revenues from the second quarter
2006 onwards. Most of the project capital that has been committed to date has been
excluded.
In addition, the SRK economic model:
• Is expressed in terms of un-inflated United States Dollar (US$) with no allowances

for inflation or escalation and dated at 24th May 2006
• Delays all sales revenues by a quarter to simulate the product sales pipeline
• Is based on a chromite price used by SRK in this study for all chromite products is
U$145/t at the Sarysai rail head
• Is expressed in post-tax and pre-financing terms which assumes 100 % equity;
• The corporation tax rate of 30 % has been used. Any allowable residual tax losses,
that could be carried forward, have not been taken into account.
• Does not include any acquisition costs or previous corporate expenses.

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• Capital investment is depreciated on an annual fixed percentage basis as per the

fiscal regime in Kazakhstan
• Is based on the SRK mining schedule and its production rate of 1.3 Mtpa.
• Reflects owner mining with a premium applied to reflect the planned approach of
utilising a contractor for mine startup until the end of 2008;
• Is based upon process recoveries and a plant design provided by Mintek and DRA-I
respectively
• Takes no account of the potential for the discovery of further Mineral Resources in
the licence areas.
• Operating expenditures during commissioning and initial ramp up of

mining/processing have been capitalised up to the end of the first quarter in 2008
• Provides a 10% contingency for both capital and operating costs
In terms of taxation the SRK Base Case model applies the following:
¾ 15% VAT to all capital items
¾ It is assumed that all VAT on operating expenditure is recovered in the period

expended.
¾ Import duty has been applied as per the schedule from Kazakh authorities. Duty
rates vary from 5 to 15 % depending on the item
¾ Taxable profits (operating profit less depreciation charge) are taxed at a corporate
tax rate of 30%
¾ 1% royalty applied to gross sales revenue
SRK notes that under the terms of the concession agreement between Oriel and the
Kazakhstan government there is provision for an Excess Profit Tax (EPT). SRK has not
applied this tax to the economic evaluations for Voskhod.
The NPV (Net Present Value) derived for the Base Case Model using the assumptions listed
above is $US319.6 M at a discount rate of 10 %. The Internal Rate of Return (IRR) was
calculated to be 41 %. Therefore, the conclusion of the SRK feasibility study is that the
Voskhod Chromite project is technically and economically feasible based on the
investigations and assumptions made in this report.
Displayed below is the sensitivity of the Voskhod project’s NPV to chromite price, discount
rate, capital expenditure and operating expenditure.

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NPV Sensitivity (30% tax)
$600,000,000
$500,000,000
$400,000,000
Chromite price
NPV
Discount Rate
$300,000,000 Initial Capex
Opex
$200,000,000
$100,000,000
$0
-40% -30% -20% -10% 0% 10% 20% 30% 40%
% Variation
SRK notes that substantial variations in the four variables do not result in a negative NPV
for the Voskhod project. SRK notes that without corporation tax applied the NPV is
USS471.6 M and the corresponding IRR is 50 %.
15 RISKS
In undertaking this technical-economic appraisal, SRK has identified a number of risks and
opportunities relating to the development of the Voskhod project, the most material of which
are commented upon below.
• Markets. No individual off-take agreements are yet in place;
• Permits. The permitting process (though with improving confidence) still remains an
area of concern for any new projects in the FSU region;
• Excessive Loss of Product to Slimes. Product split analysis cannot be performed to a

definitive level based upon the metallurgical test-work performed to date. However,
performance at the neighbouring Donskoy operation suggests that this will not be an
issue;
Incorrect Estimation of Product Splits. The plant has been designed, based on a
predicted size distribution, because core data was a) not available at the time the plant

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design concepts were fixed and b) there is no reliable way to extrapolate from core
data to full plant scale;
• Personnel. Attracting and maintaining key staff at acceptable remuneration levels in

the current minerals boom is becoming a difficult task. To mitigate against this
competitive salaries and work roster have been allowed;
• Water ingress. SRK notes that there is potential for water ingress to the underground
workings, particularly during ramp development. This risk needs to be managed by
additional hydrogeological investigations, cover drilling and pressure grouting ahead
of the ramp face;
• Process Plant Technical Approvals. The processing plant as proposed conforms to the
chromite industry best practices available. Whilst care has been taken to review the
relevant SNIP’s, GOST’s (standards) and applicable codes, there is still an element of
risk involved in obtaining approval, since, as with most design codes and guidelines,
there is still room for subjective judgment;
• Sample Representivity. The metallurgical test-work upon which the process plant has
been designed was from four diamond drill cores which were taken to be
representative of the entire orebody. SRK notes that there is a reduced level of
confidence with this volume of material versus a bulk sample. The samples were
generally high grade of predominantly ‘powdery’ and ‘massive’ chromite lithologies.
The effect of this is unlikely to adversely impact the overall yield but could reduce the
quantity of material reporting to the lump fraction; and
• Weather Effects on Project Execution. As in all extreme climate conditions, the

construction programme may be significantly affected by the weather conditions.
Mitigation in the plant programme exists as float (slack) time, since it is based on
being completed earlier than ore is available from the mining operations.
16 OPPORTUNITIES
There are a number of opportunities that exist to enhance the project commercial and
technical performance;
• Increase Mine Production. The orebody has the capacity to produce at a rate
considerably higher than the planned 1.3 Mtpa and could be increased by purchasing
additional mining equipment. The current limitation on chromite production is market
capacity, although logistics would probably become an issue without some
infrastructure improvements at key transfer points.
• Extra Revenues from Discard Slimes at Saleable Grade. The slime fraction is mainly
generated from the PCR fraction which is generally high grade Chromite.
Consequently the waste slime could be in the region of 50% Cr2O3 depending on the
level of dilution caused by fine material generated during crushing from the

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competent ore types and gangue. At present approximately 100 000 tpa of slime is
forecast to be generated. Should the slime prove to be consistently at a saleable Cr2O3
grade with acceptable SiO2 and Fe2O3 specifications and suitable markets can be
found it would be possible to recover this material and increase the sales revenue from
the chromite. At the assumed price of US$145/t of saleable product this could
potentially provide >US$10 million per year in additional revenues.
• Karaagash Deposit. The exploration lease for this multi lense style deposit directly
north of Voskhod across the Karaagash river has been awarded to Oriel Resources.
This deposit contains 4.5Mt @ 40.9% Cr2O3 classified as C2 and P1 resources under
the Soviet system. The deposit is adjacent to the Voskhod underground workings and
provides good potential for additional production capacity.
• Inferred Resources. The Voskhod Deposit contains 1.57Mt @ 41.05% Cr2O3. These
have not been modelled into the existing production profile. In addition, there exists
another 4 to 5 Mt of potential resources in the adjacent Karaagash deposit. These
resources were historically Soviet classified and have only recently been licensed to
Oriel. SRK has not reviewed these resources in detail or their supporting information.
• Reduced Power Capital Cost. Oriel have been approached by an entity owning at least
part of one of the 110kv power lines from Kimpersay into the Chromtau sub-station
(which is Donskoye controlled). If this power line is available along its entire length
to Kimpersay, the purchase of it may prove advantageous over the current $12.6M
new line installation. Another option involves a study underway by an Aktobe
company to provide a total solution to power and heating requirements by gas which
is locally available in low and high pressure pipelines and at a competitive unit rate.
• Governmental Review of Mining Regulations. The 1974 Soviet mining (ventilation)

regulations on airflow per diesel engine kilowatt require a second ventilation shaft and
corresponding parallel intake ventilation raise throughout the mine. A modernisation
of these regulations could help to save up to $3M off the project capital costs.
• Better Usage of Cheaper Products out of the FSU Region. Time constraints on this
feasibility study have meant that the opportunity still exists for ‘value engineering’ on
some goods and services which as a default have been costed as imported items.
• Direct Shipping Ore. Sections of the Orebody are of product grade material and the
ability to crush, screen and direct ship material has been discussed at length. However
given the dilution profile and non-selective nature of the mining method the extra
capital for the bypass infrastructure was deemed a luxury and removed from the plant
design. However the design has been made and sufficient space left in the plant
should operational experience show that adequate volumes of direct shipping material
can be mined.
• Increasing the Product Yield. A number of areas have been proposed that may be
explored to increase the product yield. These include;

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i) Re-crushing the DMS drum plant lump waste (floats) in an attempt to liberate 'locked'
particles and re-treating the crushed material through the DMS cyclone plant. Locked
particles are those that contain discrete sections of valuable Chromite and waste. If
the proportion of Chromite is small, the average density of the lump will cause it to
float in the DMS drum circuit and be rejected. By re-crushing this lump into smaller
pieces, it may be possible that the smaller particles will contain sufficient chromite to
cause them to sink, thereby recovering more chromite to product.
ii) Milling the <25mm >1mm discards chips (floats) from the DMS cyclone circuit. This
will further liberate Chromite grains from the gangue minerals and allow the Chromite
to be recovered in the spiral plant resulting in a further possible increased overall
yield.
iii) Treating the slimes through a WHIMS (Wet High Intensity Magnetic Separation)
circuit. As suggested by the Uralmechanobr report provided by Oriel, for a "similar"
deposit, there may be a recoverable fraction of magnetic Chromite in the slimes
material.
Initial tests on the samples available have shown that these conceptual approaches have only
been marginally successful. Many of the above would incur additional capital and operating
costs. In order to justify this, additional costs against the potential benefits further studies
area required.
13 CONCLUSIONS
The level of data adequacy is considered sufficient for a Feasibility Study but further work
is required in the several areas in order to manage potential risks. Based upon the work
carried out by SRK and other contributors, SRK opines that the Voskhod Chromite project
can be developed into a profitable mining operation. SRK notes that the project
fundamentals are all positive as follows:
¾ Robust Mineral Resources, the deposit is high grade with favourable mining
characteristics allowing bulk mining methods to be employed.
¾ Low costs. The Voskhod operation is planned to adopt low cost bulk mining
methods combined with a simple processing route with proven technology
¾ The work of Heinz Pariser indicates that the market fundamentals are positive for
chromite with demand expected to exceed supply in the short to medium term
¾ Infrastructure. SRK notes that the Voskhod project is situated in a favourable

position for transporting product to both Russia and China. Rail lines from Sarysai
(14km from the mine) can carry product to both China and Russia simultaneously.
SRK concludes that the feasibility study has met its objectives in determining the viability of
the Voskhod project based upon the work undertaken and assumptions made.

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RECOMMENDATIONS
SRK recommends that the Oriel management team continues with its planned program of
fund raising and mine development at Voskhod.
In addition, SRK recommends that Oriel will need to conduct the agreed program of
activities at Voskhod in order to meet the schedule requirements. Key activities are as
follows:
¾ Aggressively pursue permits and other approvals
¾ 2006 resource infill drilling with additional geotechnical logging
¾ Drilling of water wells and further hydrogeological testwork
¾ Completion of the full Environmental and Social Impact Assessment (ESIA)
¾ Technical Report preparation for local permit applications
¾ Negotiation of definitive off take agreements with end users and traders
¾ Commencement of on site construction – in particular the box cut and portal need to
be established before the last quarter of 2006

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4 INTRODUCTION AND TERMS OF REFERENCE
4.1 TERMS OF REFERENCE AND PURPOSE OF REPORT
In October 2005 Oriel Resources Ltd (Oriel) commissioned SRK Consulting (UK) Limited
(SRK) to prepare a Feasibility Study for the Voskhod Chromite Project in Kazakhstan.
The objectives of the Feasibility Study were to critically review the available information,
define design criteria, carry out additional site work, generate a life of mine plan and
evaluate project economics to a Feasibility Study level. The work included a review of all
historical activity on the property, including geology, sampling and assaying practices of
previous owners and an independent estimation of Mineral Resources and Mineral Reserves
relative to the standards outlined in NI 43-101 using the definitions of various categories of
resources and reserves established by the Canadian Institute of Mining (CIM). The
feasibility study was completed by SRK having refined project alternatives in a Preliminary
Assessment Study. SRK notes that the Feasibility Study prepared by SRK follows industry
norms and was undertaken to satisfy the following objectives:
¾ To satisfy internal decision making requirements within Oriel
¾ To generate an independent estimation of Mineral Resources and Mineral Reserves

relative to the standards outlined in NI 43-101 using the definitions of various
categories of resources and reserves established by the Canadian Institute of Mining
(CIM)
¾ To assist local permit applications for a variety of environmental and industrial

permits
¾ To provide a basis for negotiating project` finance from a commercial bank
SRK has based the Life of Mine Plan in the Feasibility Study Report on Indicated Mineral
Resources converting to Probable Mineral Reserves only.
SRK has strictly adopted the NI-43-101 template for this report which prescribes exactly the
content of each section.
4.2 SOURCES OF INFORMATION
The information SRK has used for this report has come from a wide range of sources
including internal company reports and records from the previous owners, original assay
certificates and SRK reports for the previous owners; Geoincentre. Metallurgical testwork
investigations and reports have been provided by Peter Craven and his team at Mintek in
South Africa. Tom Ryan and other specialists DRA have provided extensive design and
cost input for the process plant and infrastructrure. In addition, Constantin Birkin at Ahlers

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BV has provided a detailed logistical study for product transport and Heinz Pariser has
provided in depth marketing input.
Furthermore, SRK has undertaken a program of on site activities:
¾ Supervision of an extensive orebody infil drilling campaign in 2005 including

hydrogeological testwork and installation of piezometers
¾ Geotechnical logging of core from the 2005 drill program
¾ Excavation and logging of test pits for tailings facility and processing plant site
investigations
¾ Water, rock and soil sampling for environmental purposes
4.3 FIELD INVOLVEMENT
4.3.1 Qualifications of Consultant
The SRK Group comprises 600 staff, offering expertise in a wide range of resource
engineering disciplines. The SRK Group’s independence is ensured by the fact that it holds
no equity in any project. This permits the SRK Group to provide its clients with conflict-
free and objective recommendations on crucial judgment issues. The SRK Group has a
demonstrated track record in undertaking independent assessments of resources and
reserves, project evaluations and audits, CPRs and independent feasibility evaluations on
behalf of exploration and mining companies and financial institutions worldwide. The SRK
Group has also worked with a large number of major international mining companies and
their projects, providing mining industry consultancy service inputs.
The SRK work at Voskhod has been prepared based on a technical and economic review by
a team of 17 consultants sourced from the SRK Group’s offices in the United Kingdom over
an 18 month period. These consultants are specialists in the field of geology, resource and
reserve estimation and classification, underground mining, rock engineering, metallurgical
processing, hydrogeology, and hydrology, tailings management, infrastructure,
environmental management and mineral economics.
The individuals from SRK who have provided input to the May 2006 Voskhod Feasibility
Study, who are listed below, have extensive experience in the mining industry and are
members of good standing of appropriate professional institutions.

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Site
Role Person
visit
Project Director Allan McCracken, C.Eng BSc, MICE, MIMMM, N
Kazakhstan Project Manager Rodney Redden, CEng, B.Eng, MAusIMM, MBA Y
Michael Beare, C.Eng, B.Eng (Hons) MIMMM,
Cardiff Project Manager Y
ACSM
Geology and Mineral
Alwyn Annels BSc, PhD, FIMM Y
Resources
Geology and Mineral
Tracey Laight, BSc, MIMMM, FGS, FACE Y
Resources
Geology and Mineral
James Gilbertson BSc, MSc, FGS Y
Resources
Geology and Mineral
Martin Pittuck, C.Eng, MSc, BSc, MIMMM N
Resources
Mining Gilbert Lamarche, P.Eng, B.Eng (Hons), N
Engineering Drawings Gareth Thomas, BSc (Hons), Member AGI N
Neil Marshall, C.Eng, BSc,MSc, MIMMM,
Geotechnical Engineering Y
MBSA,MISRM
Geotechnical Engineering Philip Mohr, BSc, MSc Y
Mineral Processing Paul Riley C.Eng, BSc(Tech) MIChem, FIMMM N
Tailings Storage Facility Johan Boshoff BSc P.Eng N
Ian Brackley, C.Eng, BSc,PhD, MICE,
Tailings Storage Facility Y
MIMMM,FSAIMM
Tailings Storage Facility Tayfun Gurdal, BSc,MSc, CGE (Turkey) N
Richard Connelly, C.Geol, C.Eng, FIMMM, FGS, FIQ,
Hydrogeology N
FACE
Hydrogeology William Harding, BSc, FGS, MSc, MNGWA N
Hydrogeology Ben Green, MSc, FGS Y
Environmental Fiona Cessford, BSc, FGS N
Environmental Craig Watt, BSc,MSc, MIMWA Y
Financial Modelling Renee Abreu B.Eng N
The Qualified Person with overall responsibility for reporting of Mineral Resources is Dr.
Alwyn Annels, Bsc, PhD, FIMMM, who is an employee of SRK. Mr. Annels is a mining
geologist with over 40 years experience in the mining industry and has been responsible for
the reporting of Mineral Resources on various properties internationally during the past forty
years.
The Qualified Person with overall responsibility for preparing this report and for reporting
of Mineral Reserves is Mr Michael Beare, C.Eng, B.Eng (Mining), MIMM, who is an
employee of SRK. Michael Beare is a mining engineer with 14 years experience in the
mining industry and has been involved in the reporting of Mineral Reserves on various
properties in Europe and Africa during the past two years. Mr Beare has visited site on one
occasion for a total of 3 days during the 18 month period of SRK involvement at Voskhod.
The other significant contributor to this study is Mr Rod Redden who spent four months in
Kazakhstan sourcing costs, permit information, and visiting institutes & operating mines.

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5 DISCLAIMER
SRK has taken the technical input to this study provided by Oriel, DRA-I, Heinz Pariser,
Mintek and Ahlers BV in good faith and has checked this for adequacy and appropriateness.
SRK has verified the treatment and interpretation of this data but has not evaluated all of the
source data itself in detail. No warranties regarding the source data provided by others can
therefore be given.
In preparing this report, SRK supervised extensive drilling programmes, reviewed mining
plans, geological reports and maps, miscellaneous technical papers, company letters and
memoranda, and other public and private information as listed in the “Sources of
Information” section. SRK has assumed that all of the information and technical documents
reviewed and listed in the “Sources of Information” and “References” section are accurate
and complete in all material aspects. While SRK carefully reviewed all of this information,
SRK has not conducted an independent investigation to verify its accuracy and
completeness. SRK has only reviewed the land tenure in a preliminary fashion, and has not
independently verified the legal status or ownership of the Voskhod Project or the
underlying agreements.
Mr. Rodney Redden and the other SRK and Oriel personnel made numerous site visits to
Kazakhstan and the Voskhod site during the April 2005 to May 2006 period. SRK carried
out discussions with Oriel management and technical personnel and was provided full and
open access to all available information relating to the project. Oriel has warranted that a full
disclosure of all material information in its possession or control has been made to SRK. In
addition, Oriel provided full disclosure of all reserve, resource, and operational data for the
project. Oriel has agreed that neither it nor its associates will make any claim against SRK
to recover any loss or damage suffered as a result of SRK’s reliance upon Oriel. Oriel has
reviewed draft copies of the report for factual errors. Any changes made as a result of these
reviews did not involve any alteration to the conclusions made. Hence, the statements and
opinions expressed in this document are given in good faith and in the belief that such
statements and opinions are not false or misleading at the date of this report.
5.1 CONSENT AND COPYRIGHT
Neither the whole nor any part of this report nor any reference thereto may be included in
any other document without the prior written consent of SRK as to the form and context in
which it appears.
Copyright of all text and other matter in this document, including the manner of
presentation, is the exclusive property SRK. It is a criminal offence to publish this
document or any part of the document under a different cover, or to reproduce and/or use,
without written consent, any technical procedure and/or technique contained in this
document. The intellectual property reflected in the contents resides with SRK and shall not
be used for any activity that does not involve SRK, without the written consent of SRK.

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6 PROPERTY DESCRIPTION AND LOCATION

The mining concession for Voskhod project covers an area of 43.8 ha and is described in
Figure 6.1 and shown in Figure 6.2. Also shown is the 572 ha of land purchased by Oriel
for the surface facilities required for the operation. The Voskhod project is located in the
northwest of the Republic of Kazakhstan at 50o 18’ N and 58o 30’ S, as indicated in Figure
6.1. The deposit lies 110 km east of the city of Aktobe in the Aktubinskaya Oblast and just
7 km to the north northeast of the town of Khromtau, a mining town servicing the nearby
chrome mines of Donskoy GOK, the wholly owned mining subsidiary of Kazchrome.
SRK has not reviewed the original title certificates during their studies, and that
responsibility should fall to the legal counsel of Oriel. SRK has however, confirmed that the
Voskhod orebody lies within the concession boundary held by Oriel.
The Voskhod site has been the subject of a detailed topographic survey carried out by local
contractors during the 2005 drill campaign. SRK has used this information for all maps and
plans in the May 2006 Feasibility Study. The survey work was correlated to the Kazakhstan
national survey grid.
Oriel has obtained 100% ownership of the project from the previous owners, OSC Geoinvest
(Geoinvest), and has been granted exclusive mining rights for 25 years and a land lease for
49 years by the local authorities. A share agreement was agreed with Energinvest Holding
GmbH on 19 January 2005 by which Oriel acquired 100% of the issued share capital of
Geoinvest and formal acquisition of the project was gained on 8 February 2005.
The neighbouring Donskoy GOK operation was forced to relinquish the licence on the
Voskhod deposit because, due to commitments elsewhere, it had not completed a “Final
Exploration” programme and received final formal approval for the resources. On
18 September 1999, the exploration licence (Licence No AE No 1556) was granted to
Geoinvest by Government Decree 932. This licence, signed by the Deputy Prime Minister
and contained the boundary coordinates for the exploration area
A contract for the “Final Exploration” of the Voskhod chromite deposit (Contract No 425
with amendment N757) was submitted on 16 May 2000. This contract provides exclusive 21
year rights to the minerals and their exploitation on completion of the exploration required
and gives details of various minimum expenditures, taxes, royalties (1% of the value of
production) and fees payable.
The initial two year exploration licence was renewed for a further two years on 10 July 2001
and it eventually expired in July 2003. The area was also increased at this time to 43.8 ha.
Over the period of the above extension to the licence (2001-2003), Geoinvest drilled a total
of 11 holes in order to more precisely define the boundaries between C2 and C1 resources
and to provide additional hydro-geological and geotechnical information on the rock mass
containing the deposit.

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A “Reserves Calculation Report” dated September 2003 was produced by Geoinvest’s

consultants Geological Innovational Centre (Geoincentre). The resources report was
reviewed by SCR and a Protocol (280-03-U) was produced in December 2003 giving
approval for the contained resource estimates.
The Committee Report (Protocol) of 2 April 2004 presents the results of negotiation with the
Government in which Geoinvest will be assigned the right to mine ore from the Voskhod
deposit for a 25 year period. A sign-up fee of US$300,000 was paid within one month of
signature of that contract which took place at the end of September 2004. This document
also stipulates the expenditure on training (1% of mining costs) and of social payments to
the Aktobe regional budget (US$150,000 pa).
The draft mining contract, as prepared by Geoincentre, was submitted in early June 2004
and 44.8 ha of land to a depth of 500 m was assigned to Geoinvest by the Committee for
Geology of the Ministry of Energy and Mineral Resources.
SRK is unaware of any environmental liabilities relating to the property. The mine is in an
area that has been heavily degraded by the historical activities of the neighbouring Donskoy
mines. SRK considers that after mining of the Voskhod deposit it is unlikely that there will
be long term liabilities in relation to the mining operation that cannot be adequately
addressed in the planned program of closure works. SRK notes that a variety of permits are
required for the mining operation from the Kazakh authorities. Oriel is in the process of
obtaining these permits and SRK understands that local institutes will be heavily involved in
this process.

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7 ACCESSIBLITY, CLIMATE, LOCAL RESOURCES

INFRASTRUCTURE AND PHYSIOGRAPHY
7.1 TOPOGRAPHY, ELEVATION AND VEGETATION
The surface above the Voskhod deposit is topographically very flat with elevations varying
between 400 and 412 m, but an 8 m deep gully follows the northern edge of the deposit. The
area is unsuitable for agriculture as soils are poor and stony and the land is covered with
grass, low scrub and aromatic herbs. There are no trees, rivers, streams, houses or historical
sites on the area directly overlying the deposit. The surrounding area has also been
substantially degraded and contaminated by historical mining practices precluding
agriculture in some areas around the mine.
7.2 MEANS OF ACCESS TO THE PROPERTY
The site is easily accessed by motorised vehicles and workers would travel the 7km from the
nearby town of Khromtau by company bus in the future.
The vicinity of the project site also possesses extensive nearby railroad infrastructure. A
Donskoy GOK owned rail line passes just a few kilometres to the west and the newly
completed state owned east-west link is 14 km to the north. The new link allows ore to be
exported to China directly through Kazakhstan. The Molodezhnaya beneficiation plant for
Donskoy’s subordinate ore lies approximately 3 km north of the site.
The main Aktobe – Khromtau road was fully upgraded in 2005 by the Turkish contractor
Alarko. This road passes 7 km to the south and the site is bounded by a public road along the
eastern boundary (unsealed). Agriculture is the major land use in the region, though the soil
is of poor quality. Aktobe is a major regional centre and is well served with regular flights
from Almaty and the capital Astana.
7.3 PROMIXITY OF POPULATION CENTRE
The deposit lies 110 km east of the city of Aktobe in the Aktubinskaya Oblast and just 7 km
to the north northeast of the town of Khromtau, a mining town servicing the nearby chrome
mines of Donskoy GOK, the wholly owned mining subsidiary of Kazchrome. Aktobe is a
city with a population of around 300 000.
7.4 CLIMATE & OPERATING SEASON
Khromtau has an extreme continental climate with hot dry summers (+40oC) and severe
winters (-40oC). The area is semi-arid with mean annual rainfall is about 350 mm mainly in
the autumn and winter. Frost penetration is to 1.5 to 2 m below surface. There is no
permafrost.

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During the summer period masses of dry superheated tropical air are delivered from the
south (Central Asia and Iran deserts), and from the north, Arctic tropical air masses due to
the Ural Mountains. These cold masses of dry air under the influence of increased land
surface area (steppe zones) become warm, dehydrated and transformed into continental
tropical masses, which strengthen the development of droughts and dry winds.
The maximum temperatures of summer is around 39.0ºС and minimum winter temperatures
can range between -31.0ºС to -38.0ºС. The annual period with average daily temperature of
air higher than 0ºС lasts between 209-230 days. Frost conditions do not occur for
approximately 4 - 5 months of the year
The maximum rainfall occurs during summer, a typical attribute of continentality. The lack
of moisture is aggravated by strong winds, which during the summer period causes frequent
dust storms. Winter conditions are cold and long, with snow and blizzards that cause deep
freezing of the ground. Snow cover begins at the start of November and from December a
steady state of cover is evident until April the following year.
The prevailing wind direction recorded at the Novorossiskoye weather station is from the
west with an average velocity of 1.2 m/s. The prevailing wind direction recorded from the
Aktobe station is from the southeast with an average velocity of 3.0 m/s. The maximum
recorded wind speed of the area is approximately 40 m/s.
During the year the region will experience unstable atmospheric conditions as follows:
• dust storms typical occur for 17 to 19 days of the year between April and
November;
• fog conditions typical occur during winter with the average number of days ranging
between 28 and 32;
• thunder storms typical occur in summer with the average number of days ranging
between 17 to 23; and
• blizzard conditions typical occur in winter with the average number of days ranging
between 24 – 34.
Mean and maximum monthly and annual rainfall for the Voskhod area is shown in Table 7.1
below.

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Table 7.1 Rainfall and Evaporation Data

Month Rainfall (mm) Evaporation
(mm) *
Monthly Maximum 24 Monthly Lake

hr Rainfall Evaporation
Maximum Mean
January 58.4 32.4 12.9 0
February 62.8 23.1 36.4 0
March 53.7 22.2 24.6 0
April 55.2 31.7 23.6 20
May 85.4 33.4 29.3 50
June 120.9 29.2 60.5 120
July 83.9 25.9 30.9 120
August 102.3 20.7 55.9 120
September 91.8 18.9 25.9 50
October 72.3 39.5 33.5 10
November 66 29.6 36 0
December 72.8 35.3 20.1 0
Total 528.1 349.4
* These evaporation values are assumptions and need to be investigated further during the final
design phase.
7.5 RIGHTS, POWER, WATER AND PERSONNEL
7.5.1 Surface Ownership
The site plan shown in Figure 6.2 delineates the areas under licence to Oriel. The red
boundary around the deposit indicates the area held as a mining concession. The title is
described more fully in Section 6 and subject of the concession boundaries indicated in
Figure 6.1.
The blue boundary shown in Figure 6.2 defines the boundary of surface rights secured by
Oriel. SRK has not conducted a legal due diligence on this property but has verified that it
is sufficient for the project needs as defined in this feasibility study.

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7.5.2 Surface General
The flat topography at Voskhod lends itself to a mining and processing operation. The site
for a tailings facility was chosen in a shallow gully that was topographically favourable.
The processing facility and office have been located outside the statutory 500m exclusion
zone around the tailings deposit. The waste dump has been positioned at the top of the box
cut and will form the additional height required for trucks to tip into the primary crusher.
7.5.3 Water Supply
The process water supply will principally be derived from mine dewatering operations as
significant inflows are to be expected into the underground workings. In addition, several
boreholes will be developed on the project site that will supplement water from underground
as required.
Analyses undertaken on water samples during the hydrogeological investigation program

indicated that water from the boreholes is likely to be of potable quality. However, SRK has
provided for the cost of a water treatment plant to provide drinking water.
Additional water supplies in the area that could be considered if required would be water
from the Khromtau town system or the water filled open pits in the vicinity that belong to
the Donskoy operation.
7.5.4 Power Supply
Electricity to the mine site will be provided by 60 km of new power line from the HT
substation at Kimpersai. At the mine site it will be transformed to lower voltage for
secondary distribution and usage within the mine and plant. SRK has assumed in this study
that there will be no shared infrastructure with the neighbouring Donskoy mines. Project
capital costs could be significantly reduced if infrastructure could be shared. However, SRK
considers that the option of generation of electricity using gas turbines should also be further
investigated as an alternative option to reduce capital.
7.5.5 Staff
The Donskoy mines have been operating for many years and source mining staff from
Khromtau. The Aktobe region is noted for its high level of unemployment and SRK
considers that Oriel will experience no difficulties in finding sufficient manpower.
However, in order to operate a mine using trackless technology SRK has assumed that a
significant number of expatriates will be required in the early years of mine production to
undertake training programmes for the local staff.

8 HISTORY
8.1 VOSKHOD HISTORY
8.1.1 Ownership History
Between 1994 and 1996, Donskoy GOK undertook a “Detailed Exploration” programme at
Voskhod involving the drilling of a total of 62 holes. Only 23 of these holes have complete
geological and assay information and are thus useable for resources estimation purposes.
Donskoy GOK was forced to relinquish the licence on the Voskhod deposit because, due to
commitments elsewhere, it had not completed a “Final Exploration” programme and
received final formal approval for the resources. On 18 September 1999, the exploration
licence (Licence No AE No 1556) was granted to Geoinvest by Government Decree 932.
This licence was signed by the Deputy Prime Minister and contained the boundary
coordinates for a 19.3 ha exploration area.
with amendment N757) was submitted on 16 May 2000. This contract provides exclusive 21
year rights to the minerals and their exploitation on completion of the exploration required
and gives details of various minimum expenditures, taxes, royalties (1% of the value of
production) and fees payable.
and it eventually expired in July 2003. The area was also increased at this time to 44.8 ha.
of 11 holes in order to more precisely define the boundaries between C2 and C1 resources and
to provide additional hydro-geological and geotechnical information on the rock mass
A “Reserves Calculation Report” dated September 2003 was produced by Geoinvest’s

consultants Geological Innovational Centre (Geoincentre). The resources report was
reviewed by SCR and a Protocol (280-03-U) was produced in December 2003 giving
approval for the resources.
The Committee Report (Protocol) of 2 April 2004 presents the results of negotiation with the
Government in which Geoinvest will be assigned the right to mine ore from the Voskhod
deposit for a 25 year period. A sign-up fee of US$300,000 was paid within one month of
signature of that contract which took place at the end of September 2004. This document
also stipulates the expenditure on training (1% of mining costs) and of social payments to the
Aktobe regional budget (US$150,000 pa).
The draft mining contract, as prepared by Geoincentre, was submitted in early June 2004 and
44.8 ha of land to a depth of 500 m were assigned to Geoinvest by the Committee for
Geology of the Ministry of Energy and Mineral Resources.
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Oriel has obtained 100% ownership of the project from the previous owners, OSC Geoinvest
(Geoinvest), and has been granted exclusive mining rights for 25 years and a land lease for
49 years by the local authorities. A share agreement was agreed with Energinvest Holding
GmbH on 19 January 2005 by which Oriel acquired 100% of the issued share capital of
Geoinvest and formal acquisition of the project was gained on 8 February 2005.
8.1.2 Previous Exploration
A total of 145 drill holes are reported to have been completed within the Voskhod area prior
to 2005 and to depths of between 200 and 500 m. A breakdown of this work is summarized
in Table 8.1.
Table 8.1 Pre Oriel Drilling Campaigns

Phase Period Grid Holes Drilled
Reconnaissance 1965 – 67 Wide 6
“Search and Early
1987 – 89 100 x 100 22
Estimation” Exploration
“Preliminary 83 holes
1990 – 92 50 x 50 55
Exploration”
“Detailed
Exploration” – 1994 – 96 50 x 25 51
Detailed
Donskoy
Exploration
“Detailed
62 Holes
Exploration” – 2001 – 03 50 x 25 11
Geoinvest
Drill holes were laid out on east-west lines 50 m apart and collars are, following the above
drilling campaigns, now on 20 to 50 m centres on each line (see Figure 13.1).
Initially holes were collared vertically and commenced at 120 mm diameter (114 mm ID).
Tricone bits were used to drill through overburden and heavily weathered ground for the first
1-3 m and then the remainder of the hole was cored at 96 mm reducing to 65 mm through the
ore zone using saw-tooth bits with silicon carbide inserts.
Casing was inserted as the holes advanced and internal directional surveys were made after
every 20 m of advance. Many holes showed significant deflections from the original target
positions. As a result, horizontal distances between intersections along drill lines vary from
11 to 64 m while between lines, the spacing is typically 40 to 65 m. On average, 4 to 5
intersections are made across the width of the orebody. Once each hole was completed,
neutron activation surveys were undertaken and the hole was then resurveyed from top to
bottom as a check on the previous information. The location of ore zone contacts and
samples are thus located as accurately as possible in 3D space.
Drill hole “Passports” from the Geoinvest programme were also examined during an
audit by SRK in 2004 which indicated that logging had been very detailed and that a
comprehensive database exists of geological, geotechnical and geophysical data from
bore holes. SRK thus has no concerns about the quality of primary data. Core
recoveries are recorded by drill run.

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Only 23 of the 62 detailed exploration holes have assay information for Cr2O3, Fe2O3 and
SiO2 and were thus useable for the estimation of grade. 25 other holes, however, have down-
hole neutron activation survey data which allows recognition of the mineralized zone and
these were thus used to assist in the definition of the orebody limits and morphology.
Only the 11 Geoinvest holes have complete data records and drill cores are available for
study for the mineralized zones in these holes. The Geoinvest drilling was undertaken for
confirmatory purposes and to provide information on the hydro-geological and geotechnical
conditions in preparation for underground mine design.
In 2005, SRK supervised a drilling program at Voskhod with the following aims and
objectives:
• To confirm existing grade information.
• To upgrade more resources to Indicated status by achieving a local intersection

density of less than 50 m in all directions especially in the northern section of the
orebody where a significant number of old holes lack assay data (neutron activation
surveys only).
• To provide an explanation of sudden changes in thickness of the ore body and

apparent offsets in the orebody fringe.
• To gain a better understanding of the geological context of the orebody.
• To provide samples on which check SG measurements can be made.
• To provide samples on which microscope, XRD and SEM analysis can be made to
determine mineralogical and petrographic characteristics of the ore and host rocks.
• To provide fresh core for geotechnical logging and rock mechanics analysis as well
as resource sampling.
• To provide holes for hydrogeological / hydrological study.
• To provide metallurgical samples.
The drilling programme commenced on 15 April 2005 under the direction of SRK. The first
two rigs were Longyear machines and both were capable of drilling inclined holes; the LF 90
to depths of in excess of 500 m and the LF 30 to depths of in excess of 300 m. The Russian
rig which arrived later was only capable of drilling vertical holes to 500 m, but was best
suited for shallower holes at the larger core size (HQ).
The holes listed in Table 13.2 were all diamond cored from surface and were drilled at either
HQ or NQ size. All holes were internally directionally surveyed at 10m intervals. The
location of all these resource holes is shown in Figure 13.2

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The resource and mine design drilling was completed on 27 September 2005 and totalled
13 955 m, the ramp holes were completed on 23 September 2005 (905.7 m) and the
monitoring holes on 28 September 2005 (185.1 m).
Table 8.2 : 2005 Drilling Summary
Phase Holes Holes Size Proposed Actual Description

Proposed Drilled Metres Metres
1 9 9 NQ 3,970 4,029.05 Confirmatory / Resources / Metallurgical

5 5 HQ 1,575 1,659.60 Geotechnical / Metallurgical
2 13 13 NQ 5,351 5,614.10 Resource
1 1 HQ 425 452.00 Resource
3 10 9 NQ 2,475 2,200.80 Mine design
4 9 10 NQ 846 905.70 Ramp design
5 6 6 HQ 180 185.10 Environmental Monitoring
Totals 14,822 15,046.35
8.1.3 Historical Resources Estimates
Historical Resource estimates at Voskhod are as follows:
Table 8.3 Geoinvest Resources Estimates

The combined C1 plus C2 resources, as approved by the State Committee (SCR) were as
follows:
Category Tonnes Mt Grade % Cr2O3
C1 + C2 18.7 46.2
SRK undertook an audit of the Soviet compiled Voskhod resource estimate in August 2004
and was sufficiently confident of the data set to place them into the AusIMM JORC (1999)
classified Indicated and Inferred categories as described below:
Table 8.4 SRK Preliminary Assessment Study

Indicated Mineral
Resource Estimate Inferred Mineral Resource
Resource
Tonnes (Mt) 18.7 0.6
Grade ( % Cr2O3) 46.2 14.6
8.1.4 Production History
There is no history of production at Voskhod as it is a new project

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9 GEOLOGICAL SETTING
Kazakhstan is situated at the southern tip of the Uralian mountain belt within the Central
Uralian Uplift. The Uralian belt of Russia and Kazakhstan contains numerous ultramafic
ophiolite massifs, aligned parallel to the main Urals structure at the junction between the
Uralides and the East European continental margin. In the southern part of the Urals,
ophiolite massifs outcrop at the eastern tectonic boundary of the Urals. The ophiolite
sequences of Kazakhstan were thrust towards the west during Variscan thrusting onto
Carboniferous to Permian shelf sediments of the West Uralian Zone, and are bounded to the
east by the Main Ural Deep-fault, which is a major north-south trending shear zone
interpreted to be the trace of a subduction zone. East of the fault, units of the Magnitogorsk
island-arc are exposed, which are over-thrust by Precambrian to Early Proterozoic
sedimentary-volcanic complexes.
Figure 9.1 represents a diagrammatic section through a typical ophiolite sequence in which
mantle peridotites are overlain by mafic to ultramafic layered cumulates and then by
gabbroic rocks. Where the succession is complete, these in turn pass up into a zone in which
there is intense dyke and sill intrusion which are feeders to the overlying basaltic lavas.
Peridotites are granular rocks consisting dominantly of olivine and pyroxene, although small
amounts of feldspar and hornblende may also be present. Where olivine exceeds 90%, then
these rocks are referred to as dunites. Where the percentage of olivine lies between 40 and
90%, three rocks types are recognized: harzburgite (orthopyroxene dominant); lherzolite
(orthopyroxene and clinopyroxene); and wehrlite (clinopyroxene dominant).
Orthopyroxenes are Mg and Fe rich pyroxenes with the general formula (Mg,Fe)SiO3 , while
clinopyroxenes are characterized by the presence of Ca in the crystal lattice and have the
general formula Ca(Mg,Fe)Si2O6. Where the content of pyroxene exceeds 60% of the rock
then peridotites pass into pyroxenites.

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The basal mantle units of ophiolite complexes represent the residual material following
partial melting and the generation of basaltic magmas. The high degree of tectonism
displayed by these units is the result of lateral movement away from oceanic ridges beneath
which the basaltic magma is rising as plumes.
The ophiolites were originally formed from a depleted mantle source in an oceanic
environment in the Uralian palaeo-ocean during Palaeozoic times. Early continental rifting in
the Lower Ordovician was followed by a period of spreading, forming oceanic crust in the
Middle Ordovician, which would later be obducted to form the ophiolite sequences exposed
at present. Island arc volcanism, forming the Magnitogorsk island arc commenced in the
Middle Ordovician. Thrust faults within the oceanic crust developed into subduction zones
dipping eastwards beneath the Magnitogorsk island arc as the tectonic regime shifted from
one of extension to one of compression. During the Upper Carboniferous to Permian
continent-continent collision between Kazakhstan and Laurussia, allocthonous blocks of the
oceanic crust and Magnitogorsk island arc were thrust up over the shelf sediments of the east
European continental margin to form the Uraltau anticlinorium. One such allocthonous block
contains the Kempirsai massif of Kazakhstan, one of the largest of the Uralian ophiolite
complexes.
The Kempirsai Massif is located east of the town of Aktyubinsk, in northwest Kazakhstan. It
covers an area of around 2000km2 and extends for 90km from north to south, and 32km from
east to west (Fig. 9.2). It is made up of a complete ophiolite sequence of: (1) mantle
harzburgites, dunites, lherzolites and podiform chromitites; (2) layered olivine gabbros; (3) a
sheeted dyke complex; (4) pillow lavas of mid-ocean ridge affinity; and (5) late stage dykes
and intrusions composed of wherlite, pyroxenite and gabbro (see Figure 9.1). The complex is
cut by a north south trending shear zone (Fig.9.2) which is related to the Main Ural Deep
fault, which is the trace of the subduction zone. On the south eastern side of this major
tectonic lineament, the sequence of mantle rocks exposed is referred to as the Main Ore Field
(MOF) and is chemically distinct from the north-western part.
The MOF, which contains giant deposits of low-Al, high-Cr chromite, extends over a
distance of 22km north northeast from the town of Khromtau. It comprises dunite,
harzburgite, chromitite and rare lherzolite. Gabbro cumulates overlie the ultramafic rocks in
the western and northern parts of the MOF (Fig.9.2) Major lineaments include a NNE-SSW
trending anticline which runs the length of the MOF, and causes repetition of lithologies on
the eastern and western flanks of the block. This is particularly evident in the position of the
chromite deposits which out-crop in two parallel bands on either side of the fold axis.

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Figure 9.2 Geological map of the Kempirsai massif, showing the locality of the
Voskhod deposit within the Main Ore Field of the massif.
The Voskhod deposit lies within the eastern zone of the MOF together with up to 80 other
deposits discovered since 1936. More specifically, it lies within the Sarsai orefield where it
is associated with the “40 years of Kazakh Republic”, Molodezhnoye, Geophysical IX and X
and Karaagash deposits. Figure 9.3 is a geological map of the MOF around Voskhod which
shows the distribution of rock types in the area. Figure 9.4 is a more detailed bedrock
geological plan in the immediate vicinity of the deposit produced by Geoincentre. Voskhod

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is separated from the Karaagash deposit to the north by the east-west Karaagash Fault
(Figure 9.4) whose surface expression is the Karaagash Creek and which is believed to dip to
the north at 80º.
The area is overlain by Palaeogene-Quaternary loams overlying sandy clays with rubble
0.56-0.7 m thick. The underlying bedrock is described as partially serpentinized dunite,
pyroxene dunite and peridotites which are intimately mixed. These rocks are weathered,
heavily fractured and brecciated to depths of 60-80 m.
The serpentinized dunites and serpentinites are the main host rock to the orebody and are
generally fine grained with abundant fractures. The serpentine is described as fibrous
chrysotile with platy antigorite. Sulphides have been described in the dunite but are not
abundant. They include pyrrhotite, pentlandite and rare chalcopyrite. Pyroxene dunites are
interbedded with these rocks. They are characterized by 3-10% orthopyroxenes and possess
oval porphyroblasts of bastite. Serpentinized peridotites contain 10-15% olivine, 60-80%
serpentine, 10-15% orthopyroxene and 5-10% bastite.
For the purposes of drill core logging in the field a series of lithological codes and associated
descriptions have been produced. These codes are listed in Table 9.1 together with colour
codes used on drill logs, spreadsheets and sections. Identification of lithologies on the basis
of drill core examination alone is extremely difficult and subjective and thus thin section
petrographic studies are necessary.

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Table 9.1: Lithological and Mineralogical Codes
VOSKHOD COLOUR SCHEME

NAME (ABB) COLOUR NAME (FULL)
OVB Overburden
AHRZ Altered Harzburgite
ADUN Altered Dunite
APER Altered Peridotite
HRZ Harzburgite
CDUN Cumulate Dunite
PDUN Pyroxene/PoikiliticDunite
Lithologies
TDUN Tectonised Dunite

SDUN Serpentinised Dunite
ADUN/CDUN Altered Dunite and Cumulate Dunite
ADUN/TDUN Altered Dunite and Tectonised Dunite
ADUN/PDUN Altered Dunite and Porhyritic Dunite
PDUN/CDUN Poikilitic/Cumulate Dunite
CDUN/PDUN/ADUN Poikilitic/Cumulate/ Altered Dunite
TDUN/CDUN Tectonised/Cumulate Dunite mixed
TDUN/CDUN/PDUN/ADUN Tectonised/Cumulate/Poikilitic/Altered Dunite mixed
Tectonics
FZ Fault Zone
SZ Shear Zone
BZ Breccia Zone
MCR Massive Chromite

Mineralized
PCR Powdery Chromite

OCR Orbicular Chromite
VCR Vein Chromite
DCR Disseminated Chromite
OVB ZONE Overburden Zone

ALT ZONE Altered Zone
CUMULATE ZONE Cumulate Dunite Zone
ZONES
POIKILITIC ZONE Poikilitic Dunite Zone

TRANSITION ZONE Transition Zone
TECTONIZED DUNITE ZONE Tectonised Dunite Zone
MIN ZONE Mineralized Zone
TECTONIC ZONE Faulted, Sheared or Brecciated Zone
Some of the lithologies listed above are illustrated in Figures 9.5 to 9.10

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Figure 9.5: Typical example of the Cumulate Dunite (CDUN) lithology
Figure 9.6: Typical example of the PDUN lithology

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Figure 9.7: Harzburgite with ovoid poikiloblasts of bastite
Figure 9.8: Alteration selvage around a deformed vein of massive chromite

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Figure 9.9: Altered Hartzburgite (AHRZ)
Figure 9.10: Altered Harzburgite with abundant veins and homogeneous Altered
Dunite (ADUN)
Figure 9.11 shows a contour plot of vertical thickness onto which the interpreted location of
faults has been superimposed. The red boundary represents the fringe of the orebody as
defined by a vertical thickness of 4 m and a weighted ore zone grade of 20% Cr2O3. Rapid
but systematic changes towards the western and southern boundary of the deposit are
strongly exhibited.

Vertical Thickness (m)
120
43100 NEX
110
DZ1
DZ2 100
90
43000
80
DZ3 70
42900 SEX 60
50
40
42800 30
Main Zone (MZ)
20
Eastern Boundary Fault Zone (EBFZ) 10

42700
15400 15500 15600 15700 15800 15900 16000
Contour Map of Vertical Thickness - 2D Ore Zone

FIGURE 9.11
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suggestive of normal fringe conditions, however, there is increasing evidence from

geophysical surveys that the latter boundary might be fault controlled. To the north of the
Main Zone (MZ) and along its eastern limits, rapid truncation and ore zone thinning are
suggestive of a combination of faulting and fringe conditions. This faulting is responsible for
the subdivision of the deposit into the three areas, North Eastern Extension (NEX), South
Eastern Extension (SEX) and the Main Zone.
At least two, if not three, parallel and closely spaced faults possibly exist along the eastern
fringe of the MZ with a north northwest trend and forming the EBFZ (see Figure 9.11),
approximately 40 m wide. These are believed to be early normal faults on which side-slip,
combined with the impact of a north-easterly inclined orebody, has resulted in an apparent
northerly offset of the NEX. The nature and location of these faults is not fully understood
due to the lack of westerly inclined drill holes. This is an issue that needs to be addressed in
future drilling campaigns.
The continuity of the above set of faults has been disrupted by a series of ENE trending so-
called “Dislocation Zones”. There are at least two of these zones (DZ 2 and DZ 3) and an
indication of a third in the north of the deposit (DZ 1). They subdivide the deposit into
narrow corridors 100 to 140 m wide. These zones were initially suspected by unusual offsets
in the western and eastern orebody fringes and then by the offsetting of faults of the EBFZ.
Their presence was further supported by the difficulty of manual contouring across these
zones. Displacements of thick and thin sections of the orebody were apparent either side of
these zones.
The evidence presented by Figure 9.11 suggests that between DZ2 and DZ3 this section of
the orebody has moved westwards by approximately 50 m between what are essentially tear
faults. No significant vertical displacement is suggested, other than that produced by lateral
offsets of topographically higher regions of the orebody (see below).
There is a rapid cut-out of the MZ to the north which is currently interpreted as an east-west
fault. This may be an offset portion of the Karaagash Fault which forms the northern
boundary of the NEX.
Figure 9.12 is a contour map of the assay hangingwall of the orebody which demonstrates a
northerly plunging domal structure in the western half of the MZ with a short westerly flank
towards the western fringe and a longer easterly flank towards the EBFZ. This structure may
be related to and parallel with, the main north northeast striking anticlinal fold reported for

EBF
43100
DZ 1
DZ 2
43000
DZ 3
42900
42800
Dislocation Zones (DZ)
Eastern Boundary Fault

42700
15400 15500 15600 15700 15800 15900 16000
FIGURE 9.12: Hangingwall elevation (RL) contour map showing main faults
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the MOF and illustrated in Figure 9.2. The continuity of this structure has been disrupted by
the “Dislocation Zones” described above.
Figure 9.13 is a diagrammatic representation of the relationship between the orebody

contacts and the host rocks in a section drawn from the south west to the north east of the
orebody. It is based on a plan showing the lithologies found on the hangingwall (HW) and
footwall (FW) of the orebody in each of the new drill holes and also the depth of the TDUN
contact. This section demonstrates that the orebody cross-cuts the lithological boundaries as
one progresses eastwards. In the west and south west in particular, both the HW and FW
lithologies are CDUN/PDUN, but further to the north east TDUN appears at the immediate
FW. Further to the north east again, both the HW and FW contain TDUN. The continuity of
these north-south trending zones is clearly disrupted by DZ2 with a dextral displacement
evident as is the case for the orebody itself. As the EBFZ is approached within Domain 3,
CDUN/PDUN appears once again on the HW with TDUN remaining on the FW.
Between the NEX (Domain 1) and Domain 3 of the Main Zone, (Domain 3) the EBFZ is
duplicated on the section in Figure 9.13 by DZ2 beyond which the ore zone drops deeper
into the TDUN. In this area, the TDUN is overlain by a Transition Zone in which TDUN
lithologies appear to inter-finger with CDUN/PDUN lithologies. This is a common feature
close to the northern fringes of the orebody.

10 DEPOSIT TYPE
Economic concentrations of chromite occur in two principal geological environments; large
ultramafic/mafic layered (stratiform) intrusions such as the Bushveld in South Africa, or as
podiform deposits associated with ophiolite complexes where peridotites are the dominant
host rock. Although stratiform deposits account for 90% of the world’s resources of chrome,
the ophiolite hosted deposits are responsible for more than half of the world’s production and
are the sole source of high grade metallurgical chrome. Chromite ores suitable for
metallurgical purposes (ferrochromium for special steels) will typically grade 40-55% Cr2O3
and possess a Cr/Fe ratio of 1.8 to 4.0. Chemical grade ore (pigments and dyes) will grade
>42% Cr2O3 and possess a Cr/Fe ratio of ≥2.0. Refractory ores suitable for foundry sands
and briquettes are those with a Cr2O3 + Al2O3 > 60%.
The Voskhod deposit occurs with the Kempirsai complex which is a major ophiolite
complex and thus is assigned to the podiform group of chrome bearing deposits.
Podiform chromite deposits occur in those tectonic settings where basaltic melts, rising
through the mantle, have high water contents and are subject to decompression. They thus
tend to occur in supra-subduction zones and are associated with dunite melts within
harzburgites and lherzolites. Within the ophiolite sequence, they are usually deep in the
tectonized harzburgite zone, close to the transition with the underlying depleted lherzolite, or
close to the petrographic Moho at the top of the harzburgites or in the overlying dunites.
A magmatic origin for the chromite is indicated. During this early period of crystallization,
chromite and olivine are strongly fractionated with chromite microliths forming within the
exsolved aqueous fluid and olivine in the silicate melt. Chromite concentrates in fluid
bubbles and migrates upward. Experimental work has shown that bubbles with <50%
chromite will rise through the dunitic magma. These bubbles eventually coalesce to form
larger fluid pools and the chromite crystals settle to the bottom where they accumulate. This
continues until the weight can no longer be supported by the underlying silicate melt and the
chromite body begins to subside forming a downward penetrating plume. Within this plume,
chromite grains aggregate into rounded nodules giving the typical nodular texture of
chromitites. The downward subsidence also results in the formation of highly irregular
deposits and also provides an explanation for keel-like structures at the base of these deposits
including Voskhod.
11 MINERALIZATION
The Voskhod deposit is a lens-shaped body with a variable dip to the northeast averaging
close to 28º, a length of 600 m in this direction, a width of 170-360 m and a thickness of
between 2 and 123 m (average 39 m). However, within this body there are intervals of low
grade or barren rock. It is 98 m deep in the south west and 450 m in the north east. The
orebody can be divided on structural grounds into three areas; the Main Zone (MZ), the
Northeast Extension (NEX) and the South East Extension (SEX). The footprint area of all
three areas totals 139,600 m2. MZ is 350 m long in a north northwest direction, but has a
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width which is variable from 210 m (in the north) to 500 m (in the south). NEX is elongated
200 m in an east northeast direction and has a width of up to 80 m. SEX is elongated 170 m
in an east northeast direction and has a width of up to 45 m. These sub-areas can be seen in
Figure 9.11.
The chromite orebodies commonly have gradational boundaries with the host dunites over a
few metres, although they occasionally display sharp contacts. Four main ore types are
recognized at Voskhod.
Massive ores contain over 90% chromite and are generally coarse grained, with chromite
grain sizes ranging from 2-20 mm. Matrix minerals are serpentine, chlorite, brucite,
olivine and accessory sulphides. Where this ore type (MCR) has disaggregated, then the
mineralization is referred to as Powdery Chromite (PCR)
Orbicular ores consist of matrix-supported, rounded, oval or sub-angular aggregates of
chromite (OCR) in a serpentinized matrix. The nodules vary in size between 0.5 and
10 cm in diameter. Within the nodules, chromite is massive and consists of interlocking
grains <1 mm in size.
Disseminated ores consist of fine-grained (<1 mm) disseminated chromite (DCR) within
serpentinized dunite. They occur along the margins and in the footwall of the massive
orebodies.
Vein type ores (VCR) contain a variety of mineralization types which include thin veins or
veinlets of chromite following fractures, lenses or pods of massive chromite 10-30cm
thick with well developed selvages of serpentine and serpentinized dunite and thicker
units of massive chromite up to 2 m thick which appear to have a sill or dyke like form.
Chromite is a chrome spinel and has the formula (Mg, Fe+2)(Cr,Al,Fe+3)2O4. Deposits
typically have Cr/Fe ratios of between 1.3 and 3.0 to 1 and grades in the range 22.5 to 51.4%
Cr2O3. The chromite at Voskhod has Cr/Fe ratios up to 4:1 and ore grades range between 20
and 64% Cr2O3 and thus are at the high grade end of the spectrum. In general, chromitites of
ophiolitic affinity are enriched in Os, Ir and Ru (the IPGE) relative to Rh, Pt, Pd (the PPGE)
and Au, compared with stratiform chromitites such as those of the Bushveld Complex, South
Africa, that show enrichment in the PPGE. This IPGE enrichment is a characteristic of
Voskhod.
The PGM minerals located include:-
• CuIr2 S4 cuproiridsite in chromite.
• Euhedral Ru(Os,Ir)S2 laurites in chromite
• (Os,Ir,Ru)S2 erlichmanite in chromite
• An euhedral OsIrRu alloy in chromite
• A composite PGM with an RuOsIr-sulphide and a Ni-sulphide with approximately

1% Rh in solid solution enclosed in chromite.

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• IrOsRu alloy with minor Rh in a silicate interstitial to chromite grains.
The ultramafic silicate rocks have a mixture of primary base metal sulphides and secondary
alteration minerals. Base metal sulphides such as pentlandite and chalcopyrite are likely to
be primary whereas heazlewoodite (Ni3S2 ), arsenides and pyromorphite (Pb5[PO4] 3Cl) are
secondary.
12 EXPLORATION
Chrome ore was first discovered in the Kempirsai ultramafic complex in 1936 and
development of resource projects quickly followed in 1938. The Voskhod deposit is,
however, not exposed at surface and was thus not discovered until 1963 when a gravity
survey revealed a 1000 x 600-800 m anomaly at the site. A hole was drilled in the centre of
this anomaly and intersected high grade chromite mineralization at depths of between 246
and 316 m. A range of geophysical methods were employed at this time including
aeromagnetics, ground electrical methods and down-the-hole logging techniques. A report
was thus submitted in 1964 to the geological organization of Western Kazakhstan outlining
the case for further investigations. Between 1965 and 1967 six holes were drilled which
indicated the size and attitude of the chromite bearing body. Between 1987 and 1989 the
results of this exploration work were evaluated and it was concluded that an underground
mining operation was economically and technically viable and that a formal “Preliminary
Exploration” programme should be initiated.
“Preliminary Exploration” was completed between 1990 and 1992 and technical conditions
for the estimation of resources were approved in May 1993. The resulting resource estimates
were approved and added to the State Balance and included 14.894 Mt in the C1 category
and 3.902 Mt in C2. It should be noted that this classification was based on the decision at
the time to place the deposit into Group 2 of geological complexity as defined by the SCR
(stockworks and large massive deposits). However, the formal report on this work was not
completed.
Between 1994 and 1996, Donskoy GOK undertook a “Detailed Exploration” programme at
Voskhod involving the drilling of a total of 62 holes, however, Donskoy were forced to
relinquish its licence on the Voskhod deposit because, due to commitments elsewhere, it had
not completed a “Final Exploration” programme and received final formal approval for the
resources. On 18 September 1999, the exploration licence (Licence No AE No 1556) was
granted to a local Kazakh open stock company called Geoinvest by Government Decree 932.
This 19.3 ha licence excludes the northern part of the orebody (Karaagash) which is
separated from the main deposit by a fault.
with amendment N757) was submitted on 16 May 2000. This contract provided exclusive 21
year rights to the minerals and their exploitation on completion of the exploration required.
and it eventually expired in July 2003. The area was also increased at this time to 24 ha.

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of 11 holes in order to more precisely define the boundaries between C1 and C2 resources
and to provide additional hydro-geological and geotechnical information on the rock mass
The “Technical and Economic Foundations of Industrial Conditions” for the Voskhod
deposit were specified in a report produced by “Zaprudgeologia”, a geological sub-
contractor based in Aktobe, who supervised the drilling programme for Geoinvest. This
document provides the basic data and economic parameters for the later report on the
calculation of resources. This report, containing all geological plans and sections, was
submitted to, and reviewed by, the State Committee for Reserves (SCR) and the parameters
for calculation of resources was approved in a “Conditions for the Calculation of Reserves
Protocol” No 251-03-K dated 3 September 2003.
A “Reserves Calculation Report”, dated September 2003, was produced by Geoinvest’s

consultants Geoincentre based on the conditions set in the earlier Foundations document.
This report contains much of the information in this earlier report together with a
recalculation and reclassification of the Mineral Resources
The resources report was reviewed by the SCR and a Protocol (280-03-U) was produced in
December 2003 giving approval for the contained resource estimates. In January 2004, these
resources were placed on the State Balance in a document entitled “Expert Opinion”
In a Committee Report (Protocol) of 2 April 2004, Geoinvest was given three months from
the date of this protocol to draft a mining contract which was to include a programme of
work for the development of the mining project and also to obtain the land necessary for the
mine. The draft mining contract, as prepared by Geoincentre, was submitted in early June
2004 and 0.44 ha of land to a depth of 500 m were assigned to Geoinvest by the Committee
for Geology of the Ministry of Energy and Mineral Resources.
Following amendments, the contract was signed by the Director of Geoincentre and the First
Vice Minister in September 2004.
Following a period of negotiations, the project was sold to Oriel effective as of February
2005. At that time, Oriel commissioned SRK to undertake a “Pre-Assessment Study” of the
project which included a proposed programme of work. This programme included a drilling
campaign which is discussed in more detail in Section 13 below but which consisted of 38
resource and geotechnical holes plus an additional 9 holes which were drilled for
geotechnical purposes alone to determine the optimum location for a proposed ramp. This
work was directly supervised by SRK on behalf of Oriel. In addition, a surface resistivity
survey was completed in the area of this ramp but also extended to cover the footprint of the
orebody. Though largely for geotechnical purposes, it also gave indications as to the location
of faults at depth.

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13 DRILLING
13.1 PRE ORIEL DRILLING (1965-2003)
A total of 145 drill holes are reported to have been completed within the Voskhod area prior
to 2005 and to depths of between 200 and 500 m. A breakdown of this work is summarized
in Table 13.1.
Table 13.1: Pre Oriel Drilling Campaigns

Phase Period Grid Holes Drilled
Reconnaissance 1965 – 67 Wide 6
“Search and Early
1987 – 89 100 x 100 22
Estimation” Exploration
“Preliminary 83 holes
1990 – 92 50 x 50 55
Exploration”
“Detailed
Exploration” – 1994 – 96 50 x 25 51
Detailed
Donskoy
Exploration
“Detailed
62 Holes
Exploration” – 2001 – 03 50 x 25 11
Geoinvest
Drill holes were laid out on east-west lines 50 m apart and collars are, following the above
drilling campaigns, now on 20 to 50 m centres on each line (see Figure 13.1).
Initially holes were collared vertically and commenced at 120 mm diameter (114 mm ID).
Tricone bits were used to drill through overburden and heavily weathered ground for the first
1-3 m and then the remainder of the hole was cored at 96 mm reducing to 65 mm through the
ore zone using saw-tooth bits with silicon carbide inserts.
Casing was inserted as the holes advanced and internal directional surveys were made after
every 20 m of advance. Many holes showed significant deflections from the original target
positions. As a result, horizontal distances between intersections along drill lines vary from
11 to 64 m while between lines, the spacing is typically 40 to 65 m. On average, 4 to 5
intersections are made across the width of the orebody. Once each hole was completed,
neutron activation surveys were undertaken and the hole was then resurveyed from top to
bottom as a check on the previous information. The location of ore zone contacts and
samples are thus located as accurately as possible in 3D space.
Drill hole “Passports” from the Geoinvest programme were also examined during an
audit by SRK in 2004 which indicated that logging had been very detailed and that a
comprehensive database exists of geological, geotechnical and geophysical data from
bore holes. SRK thus has no concerns about the quality of primary data. Core
recoveries are recorded by drill run.
Only 23 of the 62 detailed exploration holes have assay information for Cr2O3, Fe2O3 and
SiO2 and were thus useable for the estimation of grade. 25 other holes, however, have down-

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hole neutron activation survey data which allows recognition of the mineralized zone and
these were thus used to assist in the definition of the orebody limits and morphology.
Only the 11 Geoinvest holes have complete data records and drill cores are available for
study for the mineralized zones in these holes. The Geoinvest drilling was undertaken for
confirmatory purposes and to provide information on the hydro-geological and geotechnical
conditions in preparation for underground mine design.
Figure 13.1 represents a summary of the pre-Oriel drilling showing holes with and without
assays, barren holes and the more recent Geoinvest drilling

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13.2 ORIEL DRILLING PROGRAMME
The aims and objectives of the Voskhod drilling campaign undertaken in 2005 were as
follows.
• To confirm existing grade information.
• To upgrade more resources to Indicated status by achieving a local intersection

density of less than 50 m in all directions especially in the northern section of the
orebody where a significant number of old holes lack assay data (neutron activation
surveys only).
• To provide an explanation of sudden changes in thickness of the ore body and

apparent offsets in the orebody fringe.
• To gain a better understanding of the geological context of the orebody.
• To provide samples on which check SG measurements can be made.
• To provide samples on which microscope, XRD and SEM analysis can be made to
determine mineralogical and petrographic characteristics of the ore and host rocks.
• To provide fresh core for geotechnical logging and rock mechanics analysis as well
as resource sampling.
• To provide holes for hydrogeological / hydrological study.
• To provide metallurgical samples.
The drilling programme commenced on 15 April 2005 under the direction of SRK. The first
two rigs were Longyear machines and both were capable of drilling inclined holes; the LF 90
to depths of in excess of 500 m and the LF 30 to depths of in excess of 300 m. The Russian
rig which arrived later was only capable of drilling vertical holes to 500 m, but was best
suited for shallower holes at the larger core size (HQ).
The holes listed in Table 13.2 were all diamond cored from surface and were drilled at either
HQ or NQ size. All holes were internally directionally surveyed at 10m intervals. The
location of all these resource holes is shown in Figure 13.2
The resource and mine design drilling was completed on 27 September 2005 and totalled
13,955.55 m, the ramp holes were completed on 23 September 2005 (905.7 m) and the
monitoring holes on 28 September 2005 (185.1 m).
Table 13.2: 2005 Drilling Summary

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Phase Holes Holes Size Proposed Actual Description

Proposed Drilled Metres Metres
1 9 9 NQ 3,970 4,029.05 Confirmatory / Resources / Metallurgical

5 5 HQ 1,575 1,659.60 Geotechnical / Metallurgical
2 13 13 NQ 5,351 5,614.10 Resource
1 1 HQ 425 452.00 Resource
3 10 9 NQ 2,475 2,200.80 Mine design
4 9 10 NQ 846 905.70 Ramp design
5 6 6 HQ 180 185.10 Environmental Monitoring
Totals 14,822 15,046.35

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13.3 RESULTS OF ORIEL DRILLING PROGRAMME
The following general conclusions can be drawn following the 2005 programme.
• Many of the previous data deficiencies have been rectified and this has allowed not
only a better global resource estimate but, for the first time, good local block grade
estimates suitable for mine planning purposes.
• Core recovery is more than adequate to provide good quality assay data.
• Significant differences have been detected between some previous holes and new
holes in relation to ore thickness and to the depth of both the assay hangingwalls and
footwalls.
• There is evidence that previous geological interpretations were simplistic and did
not, with the exception of the Karaagash Fault, recognise the existence of internal
and marginal faults. Drilling has clearly suggested that these exist but further study
is needed to confirm their true nature.
• Much of the mineralization can now be placed in the Indicated Resource category
with confidence.
• Economic fringes of the orebody are now better defined though there are areas that
would benefit from further drilling in 2006 especially where faulting is suspected.
• Drilling has confirmed that the deposit has the grade and physical continuity to allow
its economic exploitation once the problem of access has been resolved.
• The average ore zone thickness is 63.8 m with a range of 11.8 to 134.55 m. Not all
of this is, however, of potentially economic grade and no correction has been applied
for intersection angle.
• A better understanding has been achieved of the geology of the orebody and its host
rocks. The lack of geological logs from old Soviet drilling was originally a serious
problem.
• A better appreciation of the mineral chemistry has been achieved.
• The new drilling and sampling has confirmed the levels of PGM minerals/elements
within the deposit.
• Geotechnical drilling and studies suggest good ground conditions for footwall
development but that some problems are likely in the driveage of the decline from
surface due to poor ground conditions over the upper 70-100 m.

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14 SAMPLING METHOD AND APPROACH
14.1 DRILL CORE SAMPLING
14.1.1 Pre Oriel Sampling
Core sampling during Soviet times was controlled by the results of down-the-hole neutron
activation analysis and sample length is variable within this geophysically defined zone
reflecting changes in chromite concentration and interbeds of low grade serpentinized dunite.
Samples vary from 0.2 to 5.4 (most 0.6 – 3.2 m) and average 2.24 m. Core was split
longitudinally by manual methods using hammer and chisel at the rig site despite a diamond
core saw being available in the sub-contractor’s offices.
Although the total amount of drilling completed totals 58,548.9 m, the total length of
mineralized intersections used for resource estimation is 3,685.9 m. Although 2053 samples
were chemically assayed, only 1678 were utilized for the estimation of resources by
sectional methods. Amongst rejected samples were 228 samples whose recoveries were
deemed to be too low at less than 70%.
14.1.2 Oriel Sampling
Following completion of core recovery measurements and checking of core blocking and
orientation, the core in each drill run was fitted together and a reference line drawn
longitudinally down the core using a chinagraph pencil. The mineralized interval in each
hole was then subdivided on the basis of material type and then further subdivided into
sample lengths taking into account changes between material types. Attempts were made to
keep samples between 1.0 and 1.5m in length, but the range achieved was 0.3 to 2.0 m,
averaging 1.47 m. Two intervals at least were marked into the hangingwall and two into the
footwall waste. Where internal intervals of low grade or waste existed they were also marked
up for sampling either in the field or later in the core sheds. The decision was taken to
analyse all such material so that, in the case of non-selective bulk mining, the true grade of
internal as well as external dilution could be estimated.
Marked core was then cut longitudinally along the reference line using a diamond saw. Each
sample was logged for material type and the core recovery determined. A Sample Number
Allocation sheet was then used to assign both laboratory assay numbers and SRK down-hole
sample numbers to each sample.
Half core samples for each sample interval were then placed into heavy duty plastic bags on
which laboratory sample numbers were written and numbered tickets which were stapled
into each bag.

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14.2 DRILL RECOVERY FACTORS
Pre-Oriel sample recoveries varied between 5 and 100% (most were >45%) and averaged
81.03% though it is reported that all samples with less than 70% recovery were rejected for
resource estimation purposes.
Core recoveries achieved during the 2005 programme were generally excellent given the bad
ground conditions over the upper 100 m of all holes. Ore Zone core recoveries in the early
holes were well above 90%, but towards the end of the programme, recoveries declined to as
low as 74%, but averaged close to 80%. This is no reflection on the drillers, but on the poor
ground conditions in the shallow southern end of the deposit drilled later in the programme.
14.3 SAMPLE QUALITY / BIAS
The manual method used for the splitting of core in Pre-Oriel times resulted in highly
irregular breaks and bias is thus possible. Fortunately the high grade, combined with the
uniformity (low nugget effect) of the mineralization, means that the impact will not be great.
Much of the mineralized core from the Geoinvest is in bad condition with local poor
recovery and intervals consisting of loose friable chromite sand. This will have some impact
on the representativeness of analyses. SRK note that several intervals of low grade vein type
and disseminated material had not been assayed. If a non-selective mining method is used
then some of this material might be taken as internal or peripheral dilution and thus SRK
have used default grade values for this material rather than assign zero grades.
The preparation facilities at Zaprudgeologia required considerable effort to bring them to a

reasonable standard of cleanliness as the equipment was old and little used since Soviet
times. There is thus the possibility that some contamination might have taken place but the
impact is not considered to be high since the grades of the samples are already very high.
Some mislabelling of samples was also detected and corrected when possible.
14.4 DESCRIPTION OF ROCK TYPES / GEOLOGICAL CONTROLS / WIDTHS

USED TO DETERMINE SAMPLING INTERVAL
Sampling intervals were controlled by changes in mineralization type and grade alone and
the sample length is partly based on previous experience and on the need to define internal
grade boundaries. Though sample lengths were flexible, they were constrained within set
limits.
14.5 LIST OF INDIVIDUAL SAMPLES
Presentation of the details of individual samples is not possible due to the large number of
samples taken; 2053 routine samples in Pre Oriel times and 1708 in 2005 by Oriel. This
latter figure excludes those taken for QA/QC purposes (see Section 15.2.1)

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15 SAMPLE PREPARATION, ANALYSES AND SECURITY
15.1 SAMPLE PREPARATION
Pre-Oriel samples were jaw-crushed to -1 mm and then disk-milled to -0.071 mm. Samples
were then cone and quartered and two opposite quarters combined and submitted for analysis
at the laboratory.
In the case of Oriel samples, they were dried, crushed, split and weighed as specified in flow
sheets designed by SRK. This was initially undertaken at “Zaprudgeologia”, the geological
institute in Aktobe but later, due to slow productivity, this work was undertaken at two other
laboratories, one at Karaganda and the other at Kostanai. Figure 15.1 shows that following a
second 50:50 split of the primary crushed material one 25% fraction was pulverized to -200#
and this pulp (approximately 1kg) submitted for routine analysis at the Aktubinsk Geological
Laboratory (Aktobe). This procedure was undertaken under the direct control and
supervision of an SRK field geologist.

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Figure 15.1 Flow Sheet for Sample Preparation at Aktobe

The slow throughput of samples and assays in Aktobe eventually led to the decision to use
another laboratory in Karaganda for both preparation and analysis so bags of half core were
sent by lorry direct from the core sheds at Aktobe. This meant some loss of control on
sample preparation but the quality of their work was monitored by the QA/QC procedures
established by SRK. The flow sheet used at this second laboratory is presented in Figure
15.2. Following primary jaw crushing and scondary roll crushing (with screening), a three

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stage split was applied resulting in the pupling of approximately 500g of -1mm material.
This was pulverized to -200# and split again prior to assay.
In order to complete all the sample preparation and analysis before Christmas 2005, it was
reluctantly decided to introduce a third laboratory at Kostanai. Again half core samples were
shipped direct to this laboratory for preparation and analysis under the supervision of an
Oriel Resources geologist. The flow sheet for this laboratory is presented in Figure 15.3.
Following primary jaw crushing and screening a two stage split reduced the sample to 1-2kg
before secondary jaw crushing and screening. A further two stage split further reduced the
sample to 250-500g. This was then pulverized to -200# before spliting in preparation for
assay. The flow sheet also shows the various samples that were retained for duplicate and
referee analysis
Figure 15.2 Flow Sheet for Sample Preparation at Karaganda

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Figure 15.3 Flow Sheet for Sample Preparation at Kostanai
15.2 SAMPLE ANALYSIS
Each of the three laboratories was required to provide analyses of the following eight
elements on a routine basis.
SiO2 Cr2O3 Al2O3 FeO (or Fe2O3) MgO CaO P S
Analytical and quality control methods applied by these laboratories are governed by GOST
standards introduced during Soviet times. These are specific to chrome ores and are all wet
chemical methods. Translations of these standard methods are provided in the main
Feasibility Study Report.

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In the case of chrome, the pulp is mixed with Na2O2 and then H2 SO4 added. After half an
hour H3PO4 is added and the solution brought to the boil until caustic soda is destroyed.
MnSO4 is added as a catalyst and then more H2SO4. After cooling, an organic indicator
(phenylanthranyl acid) is added and then the amount of chrome is determined using titration
(Mohr salt is added until the end point is reached). The end point occurs when the solution
turns from cherry red to green and this is determined potentiometrically.
FeO, Al2O3, CaO and MgO are determined by titrimetric methods whilst SiO2 is determined
by photometric methods.
A limited amount of additional analyses were requested on selected pulps to determine

concentrations of the following elements:
Ni As Ti
In addition, analyses for Pt, Pd, Au, Os, Ru and Ir were also undertaken but only on referee
samples submitted to OMAC Laboratories in Ireland and to UltraTrace Laboratories in
Australia. 25g samples at this latter laboratory were mixed with a nickel carbonate/sulphur
based flux and fused at 1120o C for 1.25 hours. The resultant nickel sulphide button was then
pulverized and a portion digested to remove the nickel sulphide base. The platinoids were
recovered in a reducing environment which is coupled with tellurium co-precipitation. The
insoluble platinoid sulphides are then separated by filtration, digested and the resulting
solution analysed by inductively coupled plasma mass spectrometry (ICPMS).
Table 15.1 represents a breakdown of the number of samples analysed at each laboratory and
broken down by type. This list includes 15 repeat analyses of routine analyses considered
suspect. In addition, Kostanai undertook the analysis of 47 samples for Ni and As.
Table 15.1: Samples analysed during the 2005 drilling programme
Laboratory Routine Duplicates Standards Blanks Referee Check

Aktobe 574 35 19 + (10) 16 + (10) 10
Karaganda 762 42 22 20 5
Kostanai 372 20 10 10
Ultratrace 150
OMAC (10) (10)
Totals 1708 97 71 66 150 15
Sample numbers in brackets represent multiple analyses of bulk blank or standard samples
produced prior to routine analytical work
Details of the non routine sample are provided in the following section.

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15.2.1 Quality Assurance / Quality Control (QA/QC)
Prior to the commencement of drilling, a field geologist’s manual was produced which
covered all aspects of core logging and sampling and associated QA/QC procedures. Some
of these procedures are best illustrated by study of Table 15.2 which shows the sample
numbering system for drill hole V05-07. This sheet requires the insertion of a duplicate of
the last sample in each batch of 18 samples followed by either a “Blank” or a High Grade
“Standard”. In addition, the laboratories are required to undertake their own internal control
procedures.
A referee laboratory was chosen to undertake check analyses on samples selected and
submitted by SRK/Oriel.
The amount of information available on previous (Pre Oriel) procedures is limited but tables
of repeat and duplicate sample analyses are available for study. The results are summarized
in the following sections.
Table 15.2: SRK Sample Number Allocation Sheet

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VOSKHOD CHROME PROJECT

BH No: V05-07 08
Sample number allocation sheet, Diamond Drilling Batch No: 07-11
Sample Sample Sample Comment Sample ID Sample Sample Comment Sample ID Sample Sample Comment
ID Number Type Number Type Number Type
V 7001 V05-07-01 PULP V 7041 V05-08-06 PULP V 7081 V05-08-42 PULP
V 7006 V05-07-06 PULP V 7046 V05-08-11 PULP V 7086 V05-08-46D DUPLICATE
V 7007 V05-07-07 PULP V 7047 V05-08-12 PULP V 7087 STANDARD
V 7008 V05-07-08 PULP V 7048 V05-08-13 PULP
V 7009 V05-07-09 PULP V 7049 V05-08-14 PULP
W 7010 V05-07-10 PULP W' USED V 7050 V05-08-15 PULP
V 7011 V05-07-11 PULP V 7051 V05-08-16 PULP
V 7012 V05-07-12 PULP V 7052 V05-08-17 PULP
V 7013 V05-07-13 PULP V 7053 V05-08-18 PULP
V 7014 V05-07-14 PULP V 7054 V05-08-19 PULP
V 7015 V05-07-15 PULP V 7055 V05-08-20 PULP
V 7016 V05-07-16 PULP V 7056 V05-08-21 PULP
V 7017 V05-07-17 PULP V 7057 V05-08-22 PULP
V 7018 V05-07-18 PULP V 7058 V05-08-23 PULP
V 7019 V05-07-18D DUPLICATE V 7059 V05-08-23D DUPLICATE
V 7020 STANDARD V 7060 STANDARD
BATCH 07 BATCH 09 BATCH 11
V 7021 V05-07-19 PULP V 7061 V05-08-24 PULP
V 7022 V05-07-20 PULP V 7062 V05-08-25 PULP
V 7023 V05-07-21 PULP V 7063 V05-08-26 PULP
V 7024 V05-07-22 PULP V 7064 V05-08-27 PULP
V 7025 V05-07-23 PULP V 7065 V05-08-28 PULP
V 7026 V05-07-24 PULP V 7066 V05-08-29 PULP
V 7027 V05-07-25 PULP V 7067 V05-08-30 PULP
V 7028 V05-07-26 PULP V 7068 V05-08-31 PULP
V 7029 V05-07-27 PULP V 7069 V05-08-32 PULP
V 7030 V05-07-28 PULP V 7070 V05-08-33 PULP
V 7031 V05-07-29 PULP V 7071 V05-08-34 PULP
V 7032 V05-07-30 PULP V 7072 V05-08-35 PULP
V 7033 V05-07-31 PULP V 7073 V05-08-36 PULP
V 7034 V05-08-01 PULP V 7074 V05-08-37 PULP
V 7035 V05-08-02 PULP V 7075 V05-08-38 PULP
V 7036 V05-08-03 PULP V 7076 V05-08-39 PULP
V 7037 V05-08-04 PULP V 7077 V05-08-40 PULP
V 7038 V05-08-05 PULP V 7078 V05-08-41 PULP
V 7039 V05-08-05D DUPLICATE V 7079 V05-08-41D DUPLICATE
V 7040 BLANK V 7080 BLANK
BATCH 08 BATCH 10
Supervisor JAG Date 25/07/2005
Duplicate from coarse rejects

Alternate blanks and standards
Standards and Blanks
In order to monitor the performance of the routine laboratories, SRK produced two bulk
samples from existing Geoinvest core for submission on a 1 in 18 basis with routine samples
(see Table 15.2).
The “Blank” sample was collected from dunites high in the hangingwall which showed no
visible chromite but all dunites contain some traces of chrome spinel which effectively
means that they are not barren in the true sense of the word but contain background levels
expected to lie between 0.1 and 0.3 % Cr2O3. Similarly a bulk high grade standard was
collected from intervals of massive chromite from an old Geoinvest hole.
Both samples were crushed, homogenized and pulverized at the Zaprudgeologia facility
under the supervision of the SRK field geologist and then 500g batches of each sent to
OMAC Laboratories in Ireland and similar batches to the Aktobe Laboratory with the
request that the full suite of routine elements be determined on 10 sub-samples of each.
OMAC was also requested to determine levels of Au, Pt and Pd in these samples.

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With the exception of one sample analysed at Aktobe, the variance of the standard analyses
is excellent and the individual laboratory means are very similar and close to the original
accepted standard value of 42.34% Cr2O3 (see Table 15.3). The analyses of the blanks show
more variability with Aktobe and Kostanai reporting higher values and variances than
Karaganda. The average value from OMAC was 0.36% Cr2O3 which lies between the values
for the routine laboratories. There is, however, evidence of batch problems at Karaganda
where the blank grade changes from close to 0.35% for a period to 0.14 then back to 0.33
before dropping again to close to 0.18%.
Table 15.3: Comparison of “blank” and standard analyses for Cr2O3
Laboratory Standards Blanks

Mean Std Deviation Mean Std Deviation
Aktobe 41.29* 0.543 0.491* 0.261*
Karaganda 42 87 0.881 0.258 0.096
Kostanai 41.67 0.396 0.469 0.308
* Excludes one sample incorrectly labelled
Internal Laboratory Repeats
Information concerning the results of old internal and external quality control repeat analyses
of pulps has been provided in tabular form by Geoincentre from which the following
analytical precisions have been calculated by SRK.
Table 15.4: Analytical Precisions – Pre Oriel Data
Date Control Lab Samples Avg. Cr2O3 Precision*

1987-88 Routine VUGRE 28 37.22 % 1.26 %
2003 Extn. Donskoy GOK 36 29.17 % 1.99 %
* Analytical variance = Σdiffs2/(n-1) and Precision = 2*√Analytical variance * 100/Mean
These results imply good reproducibility in the laboratory.
Internal repeat analyses from assay pulps have been undertaken by all three laboratories for
the 2005 drilling programme. Details are listed in Table 15.5 below.
Table 15.5: Internal Assay Control

Frequency of
Laboratory Number of Repeats
Repeat Assays
Aktobe Every 10 samples 60

Karaganda Every 5 – 8 samples 159
Kostanai Every 10 samples 36
Total 255

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This gives an excellent database for the determination of analytical precision. Table 15.6
shows the breakdown of results for the three laboratories for the three main elements under
study in this project. It can be seen that the averages for the routine and repeat analyses are
very close and that, with one exception, the precisions are better than the 5% considered
ideal.
Table 15.6Table 15.6: Internal Repeat Analyses (by laboratory)
Lab Analysis Routine Repeat Precision

Aktobe Cr2O3 34.46 34.46 0.66%
SiO2 16.16 16.16 1.96%
Fe2O3 11.09 11.08 2.47%
Karaganda Cr2O3 32.21 31.16 2.38%
SiO2 17.02 17.03 3.89%
Fe2O3 9.61 9.52 7.52%
Kostanai Cr2O3 24.55 24.53 2.21%
SiO2 21.77 21.75 2.41%
Fe2O3 10.20 10.24 3.20%
Duplicates
The results of internal duplicate sampling and then analysis are available for the earlier
Soviet drilling from Geoincentre reports. The combined sampling and analytical variance
determined from this data by SRK are shown in Table 15.7 and again provide confidence in
the process from crushing, splitting, pulping to analysis. The results are remarkably good as
precisions, based on the combined sampling and analytical variance of 10% or less, are
considered acceptable. SRK are unable to confirm that the data provided are actually based
on re-sampling and analysis of coarse rejects.
Table 15.7: Sampling and Analytical Precisions – Pre Oriel Data

Date Control Lab Samples Avg. Cr2O3 Precision*
Routine
1987-88 44 37.25 % 1.83 %
VUGRE
Routine
1990 80 30.43 % 3.82 %
VUGRE
* Combined variance = Σdiffs2/(2n) and Precision = 2*√Combined variance * 100/Mean
SRK submitted duplicate samples collected from coarse rejects after primary jaw crushing
after every 18th sample (see Table 15.2). Details of samples submitted on a laboratory basis
were presented earlier in Table 15.1 and totalled 97.
Table 15.8: Sampling and Analytical Precisions – Oriel Data

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Duplicate
Lab Samples Routine Cr2O3 Precision
Cr2O3
Aktobe 33 34.43 35.35 5.71%
Karaganda 41 27.99 29.54 3.01%
Kostanai 20 21.29 20.979 7.11%
Table 15.8 shows that all precisions are now within acceptable limits, i.e., less than 10%.
Referee Sampling and Analysis
150 samples, consisting of both coarse rejects and pulps from all three laboratories, were
submitted to the referee laboratory, UltraTrace in Australia. They were also selected to give
a uniform coverage of the anticipated grade range of each element. Pulps were submitted to
test the accuracy of analysis of each of the routine laboratories while comparisons between
coarse rejects and pulps will reflect the quality of sample preparation (homogenization,
splitting, pulping and the control of contamination during these processes).
On receipt of the samples, UltraTrace sorted, dried and split them and then pulverized them
as necessary using a vibrating disc pulverizer. The samples were then cast into a glass bead
using a 12:22 lithium borate flux and the eight routine elements were determined by X-Ray
fluorescence spectrometry. Three different international standards were used for the routine
elements (SARM-8C, SARM 9, and JSS 870-2).
The following observations can be made for the most important oxide Cr2O3.
• The correlation between the results for the pulps and coarse rejects for the
Karaganda and Kostanai laboratories are excellent confirming good sample
preparation procedures. However, for the latter laboratory there is one point which is
anomalous and this is due to an error in the original routine analysis which needs to
be resolved.
• The equivalent correlation for the Aktobe samples is less good especially below 40%
Cr2O3 suggesting that the preparation procedures are at fault. This conclusion was
anticipated given the initial poor state of the preparation facility at Zaprudgeologia.
• There is a very close correlation between pulp analyses suggesting that analytical
procedures at all three laboratories are very satisfactory and that the results of
analyses can be considered to be reliable.
• The Aktobe coarse rejects show consistently higher grades at concentrations of

chrome below 40% Cr2O3 suggesting that some contamination may have taken place
whose impact is less significant for the higher grade samples. Inadequate cleaning of
the crushers and disc mills is thus suspected.
Careful analysis of the results of the full spectrum of elements indicates that reliance can be
placed on the analyses of Cr2O3, SiO2 and MgO though there is evidence that poor sample
preparation at Zaprugeologia may have detracted from the relatively good analyses in the
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Aktobe laboratory. Sample preparation at Karaganda and Kostanai seems to have been good
at all times
Concerns are present concerning the analyses of Fe2O3 and Al2O3 at Karaganda and Aktobe
where a wider scatter of points about or below in the case of the latter element, the 45o line.
The intra-laboratory (Routine versus Referee) analytical precision of these analyses is as
follows:
Table 15.9: Intra-laboratory analytical precision for Fe2O3 and Al2O3

Laboratory Precision for Fe2O3 Precision for Al2O3
Aktobe 14.82 % 24.65 %
Karaganda 34.65 % 46.33%
Values of more than 10% would normally be considered excessive.
15.2.2 Sample Security
Core for the upper sections of all the old holes was logged and then disposed of in the field
(often buried) so that only a few metres of barren hangingwall was originally retained for
storage with the mineralized intersections. Core from the Geoinvest campaign is stored in
poorly constructed wooden boxes in lock-up sheds but, during an audit visit by SRK to the
core yard in Aktobe, it was observed that some holes were stacked outside and had clearly
been there for some time and the boxes and depth blocks were in poor condition.
Only 11 partial sets of cores from old holes are stored at the offices of the sub-contractor,
Zaprudgeologia. The core from all the other 134 old holes is now missing or disposed of and
unavailable for inspection, re-logging or re-sampling.
All Oriel mineralized intersections are stored at Zaprugeologia under cover and lock and
key. The remaining core from these holes is stored in a warehouse in Aktobe also under lock
and key.
Unlike gold, security is not a significant issue but good core storage is very important to
prevent deterioration in core quality by exposure to the weather.
15.2.3 Adequacy of Procedures
All aspects of sampling, sample preparation and analysis were carefully monitored by SRK
during the 2005 programme but this was not possible for previous campaigns. Only a limited
amount of information exists on duplicate sampling during Soviet times. Rigorous QA/QC
procedures were followed for all three laboratories which ensured that quality was
maintained but which also highlighted problems in relation to analytical errors and also to
mislabelling of samples. Not all of these anomalies have yet been resolved but resubmission
of suspect samples will be undertaken during the 2006 drilling programme. None are
considered to have material impact on ore zone grades. Analytical precision is generally
considered to be good though problems in relation to intra-lab comparisons have been
highlighted with respect to the Karaganda and Aktobe Fe2O3 and Al2O3 analyses. Initial
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problems with the sample preparation facility at Zaprudgeologia were largely resolved. The
decision has been made not to use this facility again.
As a result of the studies undertaken by SRK and summarized above, SRK is confident that
errors induced by sample preparation and analysis are minimal. More information on the
results can be found in the main Feasibility Study report.
16 DATA VERIFICATION
Each worksheet set up in EXCEL was subjected to validation using conditional formulas and
graphical representation. The Oriel drill hole data, such as collar information and depth of
hole, was cross checked against the original data recorded in the drill hole passports provided
by the drillers. No similar passports were available to check the Pre-Oriel data against.
The assay data for the Oriel holes was received by SRK via Oriel from the various
laboratories used. The assays were compiled into an EXCEL spread sheet recording the hole
identifier, assay interval, assay number and an SRK assay number along with the assay
grades and mineral codes based on the type of mineralization observed during logging (for
example PCR). Comments were also recorded.
The spreadsheet used to house the assay data as it was received was already set up with the
known data, for example the hole identifier, the assay interval, assay identification numbers,
comments and mineral codes. On receipt of the raw data it was subjected to a visual check
for missing data and when SRK were satisfied, it was entered into the EXCEL worksheet and
the sample identification numbers cross checked.
There are intervals within the Pre-Oriel holes which have not been assayed and thus, as there
are no coarse rejects, pulps, photographs of core or indeed any core left , SRK have assumed
that these intervals have not been assayed / sampled as they were considered to be barren.
Barren intervals can be seen in Oriel core between the ore horizons. SRK have taken length
weighted averages from assays from these “barren” intervals in the Oriel holes and
calculated a default low grade value and assigned it to the un-assayed intervals between ore
zones in the Pre-Oriel holes. These grades are presented in Table 16.1. If SRK were to have
assigned a Cr2O3 value of 0.01 to these un-sampled intervals, the grade would have been
underestimated as there appears, from the Oriel holes, to be a background Cr2O3 value which
is typical of the dunites in the Cumulate, Poikilitic, Transition and Tectonized Dunite zones.
If it was assumed that these intervals were not assayed and left as blanks, the computer
software (GEMCOM) would smooth the grades in the last assayed interval through the non-
sampled interval possibly resulting in an inaccurate higher grade. Visually barren intervals
are commonly not assayed as a cost saving exercise but for modelling of internal dilution it
is necessary to assign grade to these un-sampled intervals.

Table 16.1: Default grades assigned to “barren” intervals
Cr2O3 SiO2 Fe2O3 CaO MgO S P Al2O3
2 34 7 0.2 41 0.1 0.002 0.7
Where CaO, S and P assays were missing, the weighted low grades calculated from the Oriel
barren intervals were also assigned
Where Fe2O3 values were missing a regression equation based on Pre-Oriel data was used to
calculate this grade from the Cr2O3 grade as an excellent linear relationship exists between
the two elements. This equation is as follows:
Y = 0.1336X + 6.6554
where Y = Fe2O3 and X = Cr2O3.
Regression plots were also used as a means of identifying erroneous data for not only is there
a direct relationship between Cr2O3 and Fe2O3 as described above, there is also an indirect
relationship between SiO2 and Cr2O3. Elemental plots were thus constructed which
immediately identified any anomalous samples by the fact that they lay well beyond the
normal cluster of data about the regression line.
Where possible, i.e. for the Oriel holes, the samples considered to be anomalous values were
sent for re-assay.
In Pre-Oriel holes, 318 and 323, the SiO2 grades and the FeO grades had been interchanged,
giving a high grade SiO2 with a high grade Cr2O3, which is not possible as there is an inverse
relationship between these two elements, silica being associated with interstitial serpentinite
in the chrome ores. The regression equations identified this problem and the data was
changed accordingly.
Though sample validation in EXCEL and the use of core photographs, it became evident that
for the first batch of assays from Oriel holes sent to the Aktobe laboratory there was a
problem in that some of the assays had been mixed up, either at the sample preparation
laboratory or in the assay laboratory. Several of these assays stood out as being suspicious
as the grade seemed to be too high compared with the geologist’s mineralization code and
what was observed in the interval from the photos of the core. Unfortunately four of these
assays were from hole V05-13, a metallurgy hole from which the remainder of the split core
had been sent for metallurgical test work, leaving no core for re-assay. The pulps for these
four samples were re-submitted to Aktobe, and where the problem was not resolved, coarse
rejects were then sent for re-assay at Karaganda.
Standard sample V0020 had a grade of 59.5% which is clearly consistent with a sample of
high-grade MCR and not a standard. V0020 has only been used for the QA/QC study and
was not used in the resources.
Two assays from hole V05-28 showed that the Cr2O3 result from the laboratory is too high
when compared with the photographs and the SiO2 results. Using the SiO2 regression
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equation SRK calculated the Cr2O3 grades which were more in line with the surrounding
assays and the photographs. Following this exercise, the Karaganda laboratory ran further
internal checks on the assay data they had provided to Oriel and spotted errors in other
assays which they corrected.
By its validation procedures, SRK have been able to minimize the number of errors in the
assay database. However, the old Pre-Oriel data could only be checked using regression plots
and, as little core remains, re-analysis was not possible.
16.1 GRADE MODELLING
The decision was made to produce a 2D resource estimate at an early stage in the project to
gain an insight into the problems that might exist for the 3D exercise and to determine the
likely magnitude of the mineable resource. No attempt was made at this stage to subdivide
the resource into structural domains.
The final choice of method for interpolation of grades into a 3D resource model was based
on the recognition that the orebody is far more complex than originally envisaged. Some of
the problems faced are summarized below.
• The orebody is split into three main structural domains by two ENE trending
dislocation zones (tear faults) and each must be modelled separately.
• The exact locations and dips of these dislocations and also the eastern boundary
faults are not precisely known.
• The dip and dip directions of both the hangingwall and footwall contacts of the
potentially economic orebody are highly variable and may be locally reversed. There
is an overall north-easterly trend of increasing depth but dips may vary from
northwest to almost easterly.
• Within the defined mineralization envelope, high grade or sub-ordinate grade zones
are highly irregular in form and in attitude so that 3D modelling of such zones would
be highly complex and time consuming.
The decision was also taken to estimate every block in the model by both Inverse Distance
Weighting (IDW) and Kriging methods so that a comparison could be made.
Statistical analysis of raw and composite data suggested that separate modelling of high,
subordinate and low grade zones should be undertaken using hard envelopes, however, for
the reason stated above this was not deemed a realistic option given the time constraints. The
application of indicator variography and kriging was thus considered using a 40% Cr2O3
threshold but this was also rejected because of the high degree of smearing that could take
place across ore boundaries. The high grade massive ore has sharply defined boundaries and
thus a third method was considered and finally adopted which involved the following stages.
a) Production of 2m composites from the raw data

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b) Tagging of all composites with an indicator code reflecting whether its mid
point fell within the High Grade Zone (200) or Low Grade Zone (100).
c) IDW (n = 3) and Ordinary Kriging (OK) methods were then to be used to
calculate a value for each block in the 3D resource model based on the
indicator values captured in the search volume whose dimensions were to be
determined by indicator variography. These indicator values would thus lie
between 100 and 200. Those which were ≥ 150 were to be re-assigned the
value 200 and those < 150 were to be given the value 100. Effectively this
places a block either into a high grade or low grade category.
d) Separate variography for Cr2O3, Fe2O3 and SiO2 from high grade and low
grade composite databases after coordinate translation for all composites lying
with Domain 3. This is to remove the impact of post ore fault displacement of
this domain.
e) Kriging and IDW grade interpolation by structural domain and by grade zone
assigned to each block. This would mean that a block would only be evaluated
on the basis of samples and composites which are compatible with the block
indicator value (100 or 200).
16.1.1 Statistical Analysis
The SRK assay database contains 3828 analyses for the three main elements Cr2O3, SiO2 and
Al2O3 of which 2085 are derived from old (Pre-Oriel) databases and 1743 from the 2006
drilling programme (Oriel). The other routine elements in the database include MgO, CaO,
P, Al2O3 and S. There is a full set of analyses from the Oriel sampling but only very limited
numbers from the Pre-Oriel sampling.
Full comparative descriptive statistical analysis was performed on these portions of the SRK
database indicating that there are no major differences with perhaps the exception being
CaO. The drill holes from the two drilling programmes cover the same area and there is no
significant spatial bias.
Figure 16.1 shows the nature of the two populations for the three important elements.
Histogram A for Cr2O3 demonstrates the bimodal nature of the population and hence the
inability of standard descriptive statistics to accurately reflect the nature of the two separate
sub-populations that exist. The first is a strongly positively skewed population with a mode
close to 5%, reflecting the vein and disseminated type mineralization, while the second
reflects the high grade MCR/PCR orebody with a mode at approximately 55%. There is a
close similarity between the old and new data but with a slight offset in the high grades in
that the Oriel assay distribution has higher grades.
Histogram B also shows the same bimodality with the low grade SiO2 sub-population
reflecting the High Grade ore (low host rock matrix) and the high grade sub-population
reflecting the low grade ore (abundant serpentinized dunite). The shift in the old assay data
for the former again reflects the lower grades obtained for the MCR/PCR mineralization.

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Histogram C for Fe2O3 shows very similar populations but again a slight excess of low
grades in the second sub-population for the old data. This directly relates to the lower
chrome grades.

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D istribution of New vs Old Cr2O3 Assays

300
New Cr2O3
Old Cr2O3
250
200
Frequency
150
100
50
0
0
64
42
21
78
92
70
48
1
15
42
70
98
4
.2
.5
.8
.0
.3
.6
.9
.2
.4
.7
.0
.3
.6
.8
.1
.4
0.
3.
6.
9.
13
16
19
23
26
29
32
36
39
42
46
49
52
55
59
62
Assay %
Distribution of N ew vs Old SiO2 Assays

160
New SiO2
Old SiO2
140
120
100
Frequency
80
60
40
20
0
87
85
82
69
67
64
62
1
0
0
60
69
79
89
99
5
.0
.1
.2
.3
.4
.5
.6
.7
.8
.9
.0
.1
.2
.3
.4
0.
2.
4.
6.
8.
11
13
15
17
19
21
23
25
27
29
32
34
36
38
40
Assay %
Distribution of New vs Old Fe2O3 Assays
200
New Fe2O3
180 Old Fe2O3
160
140
120
Frequency
100
80
60
40
20
0
3
32
95
57
20
82
69
56
9
13
99
85
72
58
44
30
17
1
.0
.8
.7
.6
.4
.3
.2
.0
.9
.7
.6
.5
3.
3.
4.
5.
6.
7.
8.
9.
10
10
11
12
13
14
15
16
16
17
18
19
Assay %
C
Figure 16.1: Comparative histograms of assay data (Pre-Oriel and Oriel)

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In order to undertake variography and 3D block modelling it was necessary to composite raw
grades to constant support as this is not only a requirement of geostatistics, but it is necessary
to remove the impact of much longer sample lengths in the old data. Compositing was
undertaken using 2m lengths.
Statistical analysis of the composite grades within the combined database was undertaken
and showed the same distribution as for the raw data. Grades of less than 20% Cr2O3
generally reflect zones of low grade sporadic mineralization while grades between 20 and
38% are usually typical of “subordinate” ore consisting of VCR type mineralization. Grades
above 38% are nearly always associated with the massive and powdery ore types
(MCR/PCR). The exercise was repeated after a split which is not based on grade alone but
on the basis of definition of High Grade and Low Grade zones in individual drill hole
intersections. All composites in each zone, irrespective of grade, were flagged with the zone
code and grouped together in separate histograms. The High Grade population is negatively
skewed; partly the product of a lack of very high grades above 60% and by a chemical
barrier at approximately 64.1%. The Low Grade population demonstrates an extreme
positive skewness due to a second intermediate population.
Composited SiO2 values again show a bimodal population with a broad interval of
intermediate values separating the two. A low grade population with a mode close to 5%
SiO2 reflects the high grade Cr2O3 population (inverse relationship) while the second reflects
the low grade population with a mode close to 35% SiO2.
Composites tagged with the indicator value 200 (High Grade Zone) demonstrate a single but
positively skewed population for SiO2 which, on log-transformation approaches log-
normality (skewness close to zero, kurtosis close to 3 and a COV of <0.5). This implies that
variography would benefit from log-transformation of the data. The population extracted on
the basis of indicator values of 100 (Low Grade Zone) has a long negative tail.
Histograms for composite Fe2O3 values also show a bimodal distribution. An extraction
based on the 100 indicator value shows some evidence that bimodality exists with modes at
approximately 7.5% and 10.75% Fe2O3. An extraction based on the 200 indicator values (the
High Grade chrome zone) shows that the mode and mean are close to 13.5% and the
population is reasonably symmetrical but highly kurtotic with a kurtosis of 6.6. In both cases
there is no need to apply log-transformation to variography.
It should be noted that the drill holes on which the resources are based and on which
variography has been undertaken, are uniformly distributed and no de-clustering is necessary
before variographic analysis.
The above discussion is based on the assumption that the two databases can be combined for
the purposes of resource modelling as some differences have already been identified which
could reflect differences in the relative proportions of samples from the different grade
zones. In order to determine whether there would be a serious problem of incompatibility
between 2m composites from the old and new databases, Quantile – Quantile (Q-Q) plots
were produced in which the average grade above a set of quantiles was compared for each

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population. In this case, deciles (10%iles) were used though 95 and 5 percentile thresholds
were added at the upper and lower tails of the populations.
All default values for un-assayed barren intervals were removed leaving 2010 and 1008
composite values for the Pre-Oriel and Oriel data sets respectively. Only Cr2O3, SiO2 and
Fe2O3 values were compared due to the lack of data for the other elements in the old
database.
Figure 16.2A reveals that the Cr2O3 means above the 40%ile (50.64%) are essentially very
similar (Oriel Grades slightly higher) but below this level the Oriel data has an excess of
lower grades bringing the means down. The trend however follows the perfect regression
line (red). This is interpreted as showing that the SRK sampling included all internal waste
zones which were left un-sampled by earlier workers. It is believed that the underlying data
populations are essentially the same.
Figure 16.2B indicates that the Q-Q plot for SiO2 essentially parallels the perfect regression
line but that the Oriel data has higher silica values. Again this reflects the excess of low
grade mineralization with high silica (>30%) An analysis of the two data sets shows that the
Pre-Oriel data has only 13.5 % of values above 30% (equivalent to a Cr2O3 content of 10%
based on regression analysis) but the equivalent Oriel figure is 24.3%.
Figure 16.2C for Fe2O3 is the opposite of Figure 17.2B in that now the Q-Q plot is below and
parallel to the perfect regression line. Again this is explained by the impact of the sampling
bias – high iron is associated with the presence of relatively more high grade samples.
The conclusion of this study is that the two sets can be combined to produce a reliable
database for resource estimation.

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Q-Q Plot - Cr2O3
70
65
60
Oriel Composites
55
50
45
40
35
30
30 35 40 45 50 55 60 65 70
Pre-Oriel Composites
Q-Q Plot - SiO2
45
40
35
Oriel Composites
30
25
20
15
10
10 15 20 25 30 35 40 45
B
Q-Q Plot - Fe2O3
17
16
15
Oriel Composites
14
13
12
11
10
10 11 12 13 14 15 16 17
C
Figure 16.2: Q-Q plots for 2m Composites (Pre-Oriel versus Oriel)

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16.1.2 Geostatistical Analysis
The recognition of four structural domains (1-4) within the orebody plus another (Domain 0)
within the EBFZ, required that a coordinate transformation was necessary to remove the
impact of lateral displacement of Domain 3 (between Dislocation Zones 2 and 3). This
effectively reconstitutes the orebody to its pre-tear faulting state and thus facilitates
variography. All 2m composites lying within Domain 3 were thus subject to a displacement
of 48.3m to the east and 13.94m to the north. It should be noted that this transformation was
only applied for variography and that untransformed coordinates were used for block kriging
within domain boundaries. Composites outside domains were thus not used to interpolate
grades into blocks within the domain being modelled.
Geostokos Toolkit software was used to produce both directional and omni-directional
variograms for each of the three elements and also for the indicator variables. In all cases, a
1m lower cut-off for the composite length was used and either an upper or lower threshold of
150 to select either low or high grade composites respectively.
Despite the transformation of composite mid point coordinates in Domain 3 as described

above, attempts to produce good directional semi-variograms were generally unsuccessful in
that they were either pure nugget effect or very noisy with only a poorly developed structure
at low lags due to lack of data. With the exception of the indicator variogram, variograms
with a dip of 28o to the north east failed to show much improvement on those in the
horizontal plane. It was thus decided to produce omni-directional variograms to determine
the isotropic ranges in the horizontal plane and their associated spatial and nugget variances
but to use the down-the-hole variograms to determine the vertical ranges.
Indicator Variable Variography
The down-the-hole variogram was used to gain an indication of the nugget variance. The
variogram shows a low nugget variance of 0.03 and was modelled with a composite
spherical model whose parameters are listed in Table 16.2. There is clear evidence of drift at
80m thus limiting vertical search radii to less than this distance.
True omni-directional variograms produced without any constraints relating to search

directions and distances indicated a short range of 30m (or less) and a longer range of 120m.
These were, however, clearly influenced by the down-hole information and thus it was
decided to undertake an isotropic search in the horizontal plane and to constrain information
capture in the vertical direction using a limited angle of tolerance of ±10 vertically. The short
range is now 50m and the longer range still 120m but with drift evident at approximately
180m. A directional variogram in the average dip direction of the orebody and at an average
dip of 28o was produced. As has been explained before, both azimuth and dip are very
variable on a local scale, a problem exacerbated by the impact of the dislocation zones. A
good variogram is obtained above 30m with longer ranges for both the two structures. Below
30m the variogram is erratic due to lack of data in the inclined plane between boreholes. In
all other directions very noisy to pure nugget effect variograms were produced.

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Table 16.2: Indicator Variogram Parameters
Variogram Co a1 a2 C1 C2
Down-the-hole 0.03 25 120 0.06 0.16
Omni-directional 0.03 30 120 0.16 0.06
Constrained Omni-directional 0.03 50 120 0.13 0.09
Directional (45o/-28o) 0.03 60 140 0.13 0.09
Variography - High Grade Zones (200)
Cr2O3 Filtering the low grade tail of the population using a threshold of 38% Cr2O3 reduced
the sill variance significantly as might be expected. The variogram is illustrated in Figure
16.3. The parameters for the down-the-hole variogram, again with the low values filtered, are
summarized in Table 16.3 and in Figure 16.3. Though a composite spherical model could
have been fitted, a simple model was used in this case.
Figure 16.3: Omni-directional Variogram for Cr2O3 (Filtered – High Grade Zone)

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Figure 16.4: Down the hole variogram (High Grade Zone – Cr2O3)
The filtered variograms were used to determine the underlying structure of the model
variogram and to control the selection of search radii. The unfiltered model parameters were,
however, used for the kriging exercise.
Table 16.3: Variography for High Grade Zone – Cr2O3
Variogram Co a C1
Omni-directional 38 100 26
Omni-directional (filtered) 17 110 10.7
Down-the-hole (filtered) 6 16.5 12
SiO2
A good omni-directional variogram can be achieved using raw data (1720 values). As with
Cr2O3, directional variograms were pure nugget effect. The parameters produced were
checked using a log-transformed variogram and back calculating the parameters. The
calculated values of 11.94 and 9.97 for Co and C are close to those estimated from the raw
model, i.e., 12.8 and 9.1. However, there is a difference in the ranges with the log variogram
giving a value of 65m compared to 100m for the raw equivalent. Both the raw and log-
transformed down-the-hole variograms showed short ranges but with strong hole effect. The
raw variogram is interpreted as having a range of approximately 8m if a simple spherical
model is assumed but both the sill (Co + C) and the nugget variance (Co) are lower than for
the omni-directional variogram. Again this is probably the impact of sample support relative
to the short range vertically.
As the decision was made to use OK grade interpolation not LK because of the bias
introduced by this method, the raw variogram parameters in Table 17.3 were used.

Table 16.4: Variography for High Grade Zone – SiO2
Variogram Co a C1
Omni-directional (Log) 0.18 65 0.15
Omni-directional (Raw) 12.8 100 9.1
Down-the-hole (Raw) 6.5 8 9.5
Fe2O3
This dataset (1720 values) has a distribution close to normal and hence only raw variograms
were produced. Though a model can be fitted, there is inadequate data at low lags to be
confident in the range. Also the situation is further complicated by evidence of a slight hole-
effect. However, the model parameters listed in Table 17.4 are accepted until more data is
available. A simple spherical model has been fitted to the down-the-hole variogram through
the experimental sill but at a level lower than the data variance. There is again evidence of
the impact of hole-effect.
Table 16.5: Variography for High Grade Zone – Fe2O3
Variogram Co a C1
Down-the hole (Raw) 0.5 8 0.9
The lower Co value for the down-the-hole variogram could reflect the fact that sample
support (2m) is becoming significant in comparison with the short range (8m).
Variography - Low Grade Zones (100)
Cr2O3
Variography is affected by the strong positive skew of the raw data (1543 values). However
a raw omni-directional variogram was produced to which the parameters in Table 16.6 were
fitted. Given the results of the down-hole variography, a lower Co could have been fitted but
there is inadequate data below 25m to confirm this. A log variogram was also produced to
check these parameters and the back calculated results (Co=109, C=57 and a=50m) are fairly
close to those listed below.
A log variogram was also produced in the down-the-hole direction which has an interesting
structure. If the sill is modelled at a level equivalent to the data variance then this variogram
could be interpreted as a composite spherical population with a short range of 9m and a
longer range of 60m, perhaps with some impact of hole-effect, or as the result of mixing of
two different low grade populations. This is a distinct possibility which could reflect the
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subordinate ore (>20%) lying above weakly disseminated mineralization with a longer range.
However, if the sill is modelled at the first structure and at a level well below the data
variance as in raw data variogram, then a simple spherical model could be fitted with drift at
approximately 35m. Though the ranges are identical at 9m, the implication of the raw
variogram is that the search radii should not exceed 35m.
Table 16.6: Variography for Low Grade Zone – Cr2O3
Down-the-hole (Raw) 50 9 - 56 -
Down-the-hole (Log) 0.25 9 60 0.55 0.52
Omni-directional (Raw) 100 50 - 66 -
SiO2
In this case the histogram based on 1543 values for the Low Grade Zone (high SiO2) is
strongly negatively skewed but it was possible to produce a raw data omni-directional
variogram to which a simple spherical model could be fitted with the parameters shown in
Table 16.7. The down-the-hole variogram and its parameters are also listed in this table. As
with the Cr2O3, a composite model could be fitted but again there is the suspicion that two
populations may exist reflecting different mineralization styles. Alternatively a lower sill
could be fitted at close to 25m. It is thus recommended that the short range be used and that
the search radius should not exceed 25m.
Table 16.7: Variography for Low Grade Zone – SiO2
Down-the-hole (Raw) 15 8 60 20 17
Omni-directional (Raw) 22 40 - 38 -
Fe2O3
This dataset consists of 1543 values ranging from 2.22 to 20.22% Fe2O3 and with a variance
of 5.28 %2. The very flat distribution (platykurtotic) probably hides a bimodal population.
The parameters for the raw omni-directional variogram are listed in Table 16.8. Again there
is evidence of two different sill levels which is usually due to the mixing of incompatible
data sets. The down-the-hole raw variogram clearly has a sill at a level much below the data
variance but this variance is partly the product of the strong drift beyond 35m due to a
breakdown in stationarity. This places a restraint on the distance of search in the vertical
direction.

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Table 16.8: Variography for Low Grade Zone – Fe2O3
Variogram Co a C1
Down-the hole (Raw) 1.1 10 2.0
Again the low Co from the down-the-hole variogram is a product of significant sample
support in the direction of the variogram which has a short range.
Conclusions and Recommendations
This variographic study represents an initial investigation which should be fined tuned once
additional information is available from the 2006 drilling programme. However, the results
are considered robust enough to give a reasonable estimate of the block grades using both
IDW and OK methods.
The complex and perhaps two stage nature of some of the variograms especially within the
Low Grade Zone suggests that some improvement could be gained by subdivision of this
data on the basis of zones which correspond to subordinate ore and low grade mineralization.
Total exclusion of the latter may be warranted given that dense media separation which
effectively result in the non-recovery of disseminated or stringer type mineralization because
it has a density below that at which the ore will sink.
More rigorous attempts should be made to produce directional variograms, again once the
new data is available.
16.1.3 Block Modelling and Grade Interpolation
2D Modelling
2D resource estimation was undertaken for a variety of reasons some of which are listed
below.
• To gain an insight into the spatial variability of thickness for the potential ore zone.
• To define the economic and tectonic limits of the orebody prior to the production of
3D resource envelopes.
• To provide grade, thickness and assay hangingwall and footwall elevations for the
Voskhod orebody for use in preliminary mine design prior to the production of a 3D
resource model.
• To present the likely tonnages and grades expected from the orebody together with a
preliminary classification of these resources.
• To act as a cross-check for resource estimates produced by 3D modelling

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The original database available for resource estimation contained 143 old (pre 2005) holes
together with 37 holes drilled during 2005, however, after removal of holes considered
superfluous or unsatisfactory for some reason, the total number of holes used for 2D
modelling was reduced to 124. Some holes without potentially economic mineralization
(<20% Cr2O3) and / or thicknesses of <2m were retained in the database to constrain
extrapolation and allow feathering out of the ore zone where normal fringe conditions exist.
Definition of 2D Resource Envelopes
In order to produce the resource envelope it was necessary to determine potentially economic
intervals in each borehole. An assay cut-off grade of 40% Cr2O3 was used for this purpose
though some internal lower grades were accepted so long as the overall weighted grade did
not drop below 40%. This weighted grade was determined using both length and SG for each
sample, the latter value being determined from a regression equation relating SG and Cr2O3.
These intervals were determined in preparation for the production of ore envelopes suitable
for separate modelling of portions of the orebody amenable to selective high grade mining
for direct shipment to smelters. Though most holes possessed only one such interval others
had up to three intervals.
Similarly subordinate ore intersections defined by assay cut-off grades of 20% Cr2O3 in each
drill hole were identified and the weighted grade determined in the same way.
For the purpose of global (non-selective) modelling, holes with both high grade and
subordinate ore zones or with multiple intersections of both, were recalculated to produce
new potential ore zones to capture all high grade material by accepting low grade (<20%
Cr2O3) internal waste or even barren intervals where the thickness was not excessive (<10m).
In the case of the old Geoinvest data, waste intervals were not always sampled and assayed
so these were allocated grades of 0% Cr2O3, 33% SiO2 and 6% Fe2O3 based on visual
examination of the assays for low grade material. If the weighted grade dropped below 20%
Cr2O3 then the attempt was abandoned and two separate zones were determined either side of
the internal waste. Though 2D modelling and resource estimation would be based on a
minimum mining thickness (vertical thickness of 4m) and a minimum mining grade of 20%
Cr2O3, thinner zones were accepted for the production of ore envelopes to allow “feathering
out” of thickness and grade at orebody fringes assumed to be normal as opposed to tectonic
(truncated by faults).
The weighted grades for Cr2O3, SiO2 and Fe2O3 for each potential ore zone, together with
the calculated vertical thickness, were combined with the de-surveyed coordinates of the mid
point of the “non selective” ore zone in preparation for block modelling.
2D Block Modelling
The interpolation of grade, thickness and elevation data was undertaken using Inverse
Distance Weighting (IDW) methods using the software Surfer 8 and node spacings (block
centres) of 20 x 20m. Tables 16.9A and 16.10B summarize the dimensions of the block

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matrix and search parameters used respectively. The latter were chosen to minimize data
smearing given the evident variability of the ore zones in adjacent holes.
Table 16.9A: Grid Nodes covered by IDW
Minimum Maximum Spacing Number

X 15370 16010 20 33
Y 42670 43190 20 27
Table 16.10 B: IDW Search Parameters
Inverse weighting power (n) 3

Sectors 4
Maximum data 5
Maximum data for each sector 3
Minimum data in all sectors 1
Blanking if sectors empty 4
A blanking file was used to constrain blocks to the limits of the orebody and models were
then created for the following variables:
• Metal accumulation Cr2O3
• Metal accumulation SiO2
• Metal accumulation Fe2O3
• Vertical thickness (VT)
These models and the X, Y coordinates of each block mid were then imported into an Excel
spreadsheet so that block grades could be determined (Metal Accumulation / VT). Specific
Gravities for each block were determined from the Cr2O3 block grades using the following
regression equation (based on Pre-Oriel SG data) and thence block tonnages.
Density = 2.523 + 0.00683 * (Cr2O3) + 0.00035132 * (Cr2O3)2
Grades were weighted by tonnage for individual blocks and then the results summed in order
to determine the global grades of the defined orebody. The results are also summarized in
Table 16.11 under the heading “Unclassified Global Resources”.
Classification of 2D Resources
Consideration of the density of sampling (25-50m) and the confidence in geological

interpretations and assessment of the physical continuity of the orebody, led to its
subdivision into four main sub-areas.
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The Main Orebody (MOB)
This area contains a uniform distribution of holes but the rapid changes in thickness, the
presence of internal transverse zones of dislocation, the uncertainties over the quality of
previous drilling and sampling and finally, the existence of discrepancies between ore zone
depths, thicknesses and grades between closely spaced old and new holes, led to the
assignment of an Indicated status not Measured.
The North-Eastern Extension (NEX)
This sub-area lies to the east of the EBFZ and immediately south of the Karaagash gulley
and fault. Though not fully defined by drilling, most of the holes were drilled in 2005 under
SRK’s supervision and it is thus considered that this area can be assigned to an Indicated
Resource.
The Eastern Boundary Fault Zone (EBF) and South-Eastern Extension (SEX)
These two sub-areas are investigated by only a limited amount of drilling and some of the
holes contain incomplete intersections of the ore zone due to the impact of the faults.
Mineralization is demonstrated to be present but its continuity is in doubt due to the lack of
drilling and to uncertainties as to the location and hade of faults and the magnitude and
direction of their throws. More inclined drilling is needed to resolve these problems. Their
immediate proximity to areas of well drilled Indicated Resource allows their assignment to
an Inferred Resource category and their combined resources can be determined by
subtraction of the Indicated Resources from the Global Unclassified Resources (see Table
16.11)
Table 16.11: 2D Resource Statement, Voskhod

Resource % % %
Tonnes
(MT)
Category Cr2O3 SiO2 Fe2O3
Unclassified Global 21.331 45.82 9.76 12.67
Indicated – Main Zone 18.639 45.96 9.66 12.70
Indicated – NEX 1.118 50.23 7.33 12.71
Indicated - Total 19.757 46.20 9.53 12.70
Inferred 1.574 41.05 12.65 12.29

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3D Modelling
Following the importation and validation of both the Pre-Oriel and Oriel drill hole data and
the importation and creation of a topographic surface, a series of east-west, north-south and
north-east – south-west cross sections were set up using a 25m spacing.
Prior to modelling the orebody, a preliminary visualisation of the deposit was undertaken
looking at the distribution of lithological zones and mineralization. From this exercise it was
decided that there was not enough information in old holes to model the deposit using
lithology and that mineralization zones would have to be used. Following the creation of
hangingwall, midpoint and footwall contour maps in 2D, it was evident that there were 5
mineralised domains which have tectonic boundaries. Though the existence of these domains
is clearly evident on east-west and north-south vertical sections, there is no information from
the drilling as to the dip of the fault controlled domain boundaries and the sense and
magnitude of movement. Smaller faults may also exist which are synthetic and antithetic to
the domain boundaries, but to avoid over complicating the geology these smaller faults have
not been modelled. It was originally planned to use the domain boundaries to create fault
surfaces within which to model the separate domains. However, the lack of data on these
faults made it very difficult to model the domain boundaries as fault surfaces.
2D modelling of the domains allowed the allocation of each drill hole to a specific domain.
This information was entered into GEMCOM in the “minzone” table and, using cross-table
transfer in GEMCOM, it was also inserted into the “2m composite” table. Domains 1 to 4
were modelled separately but Domain 0, east of the Eastern Boundary Fault, does not have
enough data to model in 3D despite containing 29 drill holes. Many of these are likely to
contain incomplete intersections due to fault cut-outs.
The Voskhod orebody was modelled using sectional interpretations of the mineralization in
2D followed by the generation of wire-frame solids of the individual domains in 3D. The
mineralised shell was digitised using the assay information selected by ore type from the
“ore_zone” table. High grade zones were defined on the basis of a 40% Cr2O3 cut-off grade,
subordinate ore zones contain 20-40% Cr2O3 material while “mineralised zones” generally
had grades <20% Cr2O3. Whilst digitising, efforts were made to ensure that the drill holes
were snapped to a clipping corridor of 12.5m either side of the borehole on the 25m sections.
Once digitised in 2D, the mineralised outline was wobbled to honour the drill holes in 3D.
The mineralised envelope was digitised on the east-west sections and also on the north-south
sections. Where the envelope from the north-south sections crossed the east-west sections a
common point was created which tied the two together. 3D tie-lines were then created tying
together endpoints in order to make a wire-frame. Once created, the wire frame was
validated to ensure there were no overlapping triangles and any that did, were eliminated.
The mineralised shell has taken all assayed material into account; digitising in 2D honouring
all the drill holes where assays had been taken. It was, however, impossible to wire-frame
each of the grade zones due to their complexity and also uncertainties as to correlation in 3D
space. In the modelling described below, the subordinate and mineralized zones were
combined into one low grade zone in an attempt to simplify the process.

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Once in GEMCOM, the valid 2m composite data was assigned low and high grade
indicators; this was done by using the “ore_zone” table. Any group of composites with >40%
Cr2O3 over >4m was assigned a code 200 and any with grades of <40% Cr2O3 over >4m with
a 100 code. Where a group of low grade samples (<40% Cr2O3) occur within a high grade
zone (coded as 200) and have a thickness of <4m, they were assigned a 200 code and
similarly where a group of high grade (>40% Cr2O3) samples fall within the low grade zone
(<40% Cr2O3) and have a thickness of <4m they were assigned a 100 code. This procedure
was undertaken to ensure that internal dilution in high grade zones was used when
determining high grade blocks and similarly that narrow intervals of high grade material
could be made to benefit low grade blocks.
The above coded information was transferred into the 2m Comp data tables in both of the
drill hole workspaces and this data was used create points where grades for the high grade
zone can be separated from the low grade zone using the 100 and 200 codes. These points
are created in preparation for kriging in GEMCOM.
3D Block Modelling
A block model was set up in GEMCOM to house grades for the four main domains. The
bock model was set up using a block size of 10m in the X direction, 10m in the Y direction
and 5m in the Z direction. The block model covers 800m in the X direction, 650m in the Y
and 600m in the Z. The size of the blocks was chosen for two reasons; the main reason being
that this block size supports half the sample spacing and secondly is suited to the stope
dimensions used in the preferred mining method.

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3D Block Grade Interpolation
The digital drill hole database used for the Mineral Resource estimate presented in this report
incorporates a total of 102 diamond drill holes (30 Oriel holes and 72 Pre Oriel holes)
For all 4 domains modelled in 3D, Ordinary Kriging (OK) and Inverse Distance Weighting
to the power of 3 (IDW) were used as interpolation methods using horizontal search
ellipsoids with no preferred orientation as the strike and dip of the orebody in the
hangingwall and footwall change rapidly. Kriging weights have been set according to the
semi-variogram parameters, discussed in Section 16.1.2. Semi- variograms are not required
for the IDW but were used to control the search radii.
All four domains use elliptical search radii for each of the oxides modelled (Cr2O3, Fe2O3
and the SiO2), separate search ellipses were used for High Grade Ore (code 200) for the
different oxides modelled and a separate search ellipse for the Low Grade Ore (code 100).
These search radii are based on the semi-variogram ranges for high and low grade Cr2O3,
Fe2O3 and SiO2.The decision was made to use an isotropic search in the horizontal plane and
an anisotropic search in the vertical plane. The initial interpolation run for each oxide used
search radii equivalent to the semi-variogram range but second and third interpolation runs
were used to ensure that grade values had been assigned to all blocks in the mineralised
model. For the second run the radii in all directions were doubled and for the third, they were
set to 250m in the X and Y plane and 50m in the Z; thus ensuring that grades were assigned
to all blocks. There were very few blocks in any of the domains which needed to be treated
using the third larger search ellipse.
The block modelling in GEMCOM uses needling vertically through the orebody to assign
grades during the interpolation; 9 needles per block were used. The minimum number of
samples was set to 5 and a maximum to 50 with which to interpolate using both the OK and
IDW methods. The interpolation was limited to the rock code of each domain, Rock code 1
for Domain 1, Rock code 2 for Domain 2 etc.
GEMCOM uses a percent model, whereby a percentage is given to a particular block

reflecting how much of that block lies within the model/domain. Blocks which cross
domains are assigned a percentage depending on the amount of the block in one domain and
the amount of the block in the other domain (see Figure 16.5). This percentage is then used
to weight the grade within each portion of the block.
The interpolation was constrained by the high and low grade. After the initial set up of the
GEMCOM block model, the first interpolation was to determine how much of the model for
each domain was to be coded high grade (code 200) and how much was low grade (code
100). The interpolation of grade zone indicator values into blocks was undertaken by both
IDW and OK methods, both of which were controlled by the indicator variography described
earlier. A comparison between the results of the two methods indicated that out of the total
of 21,572 blocks, 46 % of the blocks were flagged as being low grade by IDW against 47%
in the case of OK. This is not considered an excessive discrepancy, however, scrutiny of the
data suggested that the IDW method was giving more realistic results and hence this model
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was accepted. Blocks were then displayed with high grade in purple and low grade in light
cyan as in Figure 16.6 (Domain 2).
All further interpolations for each domain were restricted by the high and low grade so that
modelling of grade into the low grade blocks was achieved using the low grade semi-
variogram parameters and composites tagged as lying in the Low Grade Zone. A similar
approach was used for the high grade. All domains were interpolated using OK and IDW
using this method of selection by high/low grade. Generic folders had been set up in the
block model for each domain to separately contain the low grade IDW data for each oxide
and the high grade IDW. The same is true for OK.
OK is a more precise method of data interpolation as it takes in to account the block size as
well as the nature of the mineralization expressed by the variogram parameters; this is not
the case for IDW. The reported resources are thus based on the OK results.
The global (Total) Cr2O3, Fe2O3 and SiO2 grades for each domain were extracted from the
OK generic models by combining the values from the High Grade blocks with the values
from the Low Grade blocks. An example block section for Cr2O3 are presented in Figure
16.7.

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Crossing domains, between domains 3 and 4.

Blocks shared by domains, block percentage shown
Domain 4
(purple outline)
Domain 3
(green outline)
Figure 16.5: Blocks on Domain Boundaries
Figure 16.6: High and Low Grade Blocks in Domain 2

Once the block modelling was complete, basic statistical analysis was undertaken including
the production of histograms and regression plots, in order to compare block grades
produced by OK and IDW. An example of the results can be seen in Figure 17.8 for the low
grade Cr2O3.
The histograms in Figure 16.8 show that there is little difference between the results gained
by using IDW and OK; the OK has a smaller data range and hence lower variance.
Figure 16.9 is a scatter plot showing the relationship of OK and IDW grades for each block.
Though the trend line fitted is close to 45o, IDW has produced some abnormally high values
(above the expected 40% upper threshold) suggesting that OK is the best method for
interpolating grade into blocks.
Good comparisons are obtained for SiO2 and Fe2O3 in the case of the low grade zones and
for Fe2O3 in the high grade. However, for the Cr2O3 and SiO2 values in the high grade zones
there is clearly a problem with the IDW results as some blocks are being under-valued or
over-valued respectively. This again confirms that OK is the preferred method.
Figure 16.8 Comparison of Block Grades (Cr2O3 - Low Grade Blocks)
Cr2O3 Low OK
700 120%
600 100%
500
Frequency
80%
400 Frequency
60%
300 Cumulative %
40%
200
100 20%
0 0%
0.99
3.51
6.03
8.55
11.06
13.58
16.10
18.62
21.14
23.66
26.17
28.69
31.21
33.73
36.25
38.77
More
Bin
Cr2O3 Low IDW
1200 120%
1000 100%
Frequency
800 80%
Frequency
600 60%
Cumulative %
400 40%
200 20%
0 0%
0.79
4.23
7.68
11.12
14.57
18.01
21.45
24.90
28.34
31.79
35.23
38.68
42.12
45.57
49.01
52.46
More
Bin
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Figure 16.9 Regression plot OK versus IDW for Low Grade Blocks
Re gression plot show ing the relationship betwe en low grade CR2O3
block va lues by OK a nd IDW
60
50
40
Cr2O3 block values by IDW
IDW
30
20
10
0
0 10 20 30 40 50
Cr2O3 block va lues by OK.
The density for each block in the model was calculated using the polynomial regression
equation derived by SRK from new SG measurements and analyses of the core samples as
follows:
2.5317+0.019594* Cr2O3_TOTAL+0.0001365*CR2O3_TOTAL* CR2O3_TOTAL
The block model, once completed, was exported into EXCEL where the global tonnage,
densities and grades (by weighting by the block percentage) were calculated.
17 ADJACENT PROPERTIES
17.1 DONSKOY GOK
SRK notes that the Voskhod deposit is surrounded to the west and north by the extensive
Donskoy GOK operations that have been in production for since the 1930’s. Information in
Donskoy pamphlets states that the reserves remaining (no classification was provided) are
60 Mt at 30 to 60% Cr2O3. Historical production at Donskoy is stated in the same pamphlet
at 117 Mt grading 49.2 % Cr2O3.

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Heinz Pariser in his report for the Voskhod Feasibility Study estimates reserves of chromite
in Kazakhstan to be 320 Mt or 4.2% of the worlds reserves. In that report the source is not
stated and the classification is not explained. However, the USGS Minerals Yearbook 2004
states Donskoy as producing 5 Mtpa from both underground and open pits from a reserve of
350 Mt. SRK therefore concludes that the Kazakhstan reserves of chromite stated by Pariser
are those at the Donskoy operation.
17.2 KARAGAASH DEPOSIT
Immediately prior to the completion of the Feasibility Study SRK received a document from
Oriel stating that as of 23.03.2006 Voskhod-Oriel LLP had acquired the right for exploration
within Karaagash area, the property immediately to the north of Voskhod.
SRK has been aware of the existence of the Karaagash deposit but have not reviewed any
data relating to it. SRK has also not verified if the Karagaash deposit lies within the new
concession area granted to Oriel. Therefore SRK cannot comment on the validity and
appropriateness of the existing resource estimates. The mineral resources appear to have
been assigned C2 and P1 status under the Soviet classification system. In SRK’s experience
C2 generally becomes an inferred resource when classified in accordance with the JORC
code. P1 resources sometimes become inferred but often they cannot be classified. Without
further study SRK can not comment on the resource estimation carried out at Karaagash but
can comment on the potential to increase the Voskhod Mineral Resource with further study.
It is noted by SRK that there are several resource statements in the information provided and
it should be noted that these are not consistent with each other.
The documents sent by Oriel state that on the basis of prospecting and evaluation at Voskhod
and Karaagash deposits during 1987-89 (Moskalev) the Kazakh Principle Coordination
Geological Agency “KazGeology” drew up a Technical and Economic Considerations
Report of possible commercial significance of the chrome ore of Karaagash and Voskhod
deposits (1989). That report established the possibility of profitable underground mining of
the deposit and recommended preliminary exploration which was carried out during 1990 –
1992.
The Karaagash deposit is reported to have been drilled at a spacing of 200 x 100m and 100 x
100 m grid. Average core recovery was 62 % in the country rock and 74% in the ore. The
table below summarises the historical resource estimates from the 1989 report.
Table 17.1 Karaagash Historical Resources

Tonnes (Mt) Grade % Cr2O3
C2 2.9 41.5
P1 1.6 39.7
Total C2 + P1 4.5 40.9
Note: These numbers were estimated at chromite cut-off grade of 30%

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SRK considers there to be considerable potential for the inclusion of the Karaagash deposit
in a future mine plan providing that infil drilling confirms the Soviet resource estimate stated
above. Given that the deposit is adjacent to the planned Voskhod mining operation SRK
considers there could be potential to extend the mine life by several years providing positive
results are received from the confirmatory drilling. It should be noted that the deposit
sections viewed by SRK personnel in Kazakhstan show the deposit to be of a lense nature
and therefore not similar to the podiform nature of Voskhod.
18 MINERAL PROCESSING AND METALLURGICAL TESTING
18.1 METALLURGICAL TESTWORK SAMPLES AND ORE MINERALOGY
Metallurgical samples were obtained from the 2005 drilling programme coordinated by
SRK. Four holes were selected for the testwork investigations; 9, 12, 13 and 19. The
majority of the investigations were focused on cores 12 and 13 as these incorporated the
majority of the identified ore types and included lower grade sections. The overall grades
were around 46% Cr2O3 for Core 12 and 52% Cr2O3 for core 13.
Two significantly different material types are identified in the Voskhod ore body; competent
and powdery which are expected to behave differently through the circuit and to produce
different ratios of products. The powdery ore is high grade, around 60% Cr2O3 , and could be
expected to generate a large proportion of product grade material. However as its description
implies the material is very friable and will break up during mining, handling and processing
to generate large quantities of fines and ultrafine material. The ultrafines, although high
grade, cannot be easily recovered in the process being generally < 50 micron and can be
expected to report to tails as slimes.
Competent ore varies from high grade massive chromite (55 - 60% Cr2O3) to low grade
poorly mineralised disseminated chromite ore. In total five different ore types are identified
which will constitute the plant feed in varying proportions. The plant feed will also include
approximately 15% low grade mining dilution.
18.2 METALLURGICAL TESTWORK
The process flowsheet was selected before the testwork was undertaken based on the
information from the PAS investigations, general data available on the Voskhod material and
on the adjacent Donskoy operation and information from the treatment of chromite ores in
South Africa. The flowsheet selected incorporated a relatively simple process consisting of a
once through circuit to produce lumps, chips and fine concentrate. The aim of the testwork
was to confirm the flowsheet initially selected and to determine the necessary design
parameters for the detailed design and costing exercise being undertaken by DRA. Data was
also generated to predict the forecast products from the plant.
The metallurgical testwork was undertaken by Mintek in South Africa and mainly involved
investigation into size distribution, comminution parameters (crushing, milling and
abrasion), washability using heavy liquid separation (HLS) and gravity separation using
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tables on the fine material as insufficient material was available to undertake more
representative spiral concentration testwork. Testwork was undertaken initially on cores 12
and 13. Additional tests were undertaken into the application of magnetic separation,
attritioning / tumbling tests to investigate degradation and the breakdown of the products and
different size fractions. Other investigations included elemental scans of the product and tails
streams, Toxicity Characteristic Leaching Procedure (TCLP) evaluations, filtration and
draining tests.
Samples from holes 12 and 13 were categorised geologically into high grade and subordinate
ores and prior to the testwork were reclassified metallurgically into competent and powdery
ore types, high, medium or low grade. The different metallurgical categories were tested
separately to provide washability data for the different ore types and at two different size
fractions; lumps (+10mm) and chips (-10mm + 1mm). Washability data was used to provide
information to forecast product yields. Tabling tests were undertaken on both the natural
fines and the fines generated during crushing although the results were not particularly
informative particularly on the natural fines as the materials were generally high grade.
Testwork was subsequently undertaken on cores 9 and 19 to confirm the initial testwork
results and to investigate optimising recoveries into products by the retreatment of low grade
discard products from sections of the initial treatment circuit proposed, by recrushing and
milling. The possible recovery of a magnetic fraction from the fines was also tested.
The testwork results confirmed that the selected flowsheet was the most appropriate for
treating the Voskhod material and that no significant benefit could be achieved by retreating
discard products generated from the first stage of beneficiation.
18.3 FORECAST PRODUCT SPLIT
From the size distributions and washability data product yields were forecast. Three products
are envisaged from the process plant;
Lump -100/150mm + 10mm, 45-48% Cr2O3, <10%SiO2 (8% typical)
Chip -10mm + 1mm, 45-48% Cr2O3, <10%SiO2 (8% typical)
In summary the forecast product split was achieved by predicting the split of feed ore types
to the plant over the LoM by analysing the drilling data, which log the intersections by
observed ore types. This data is used to predict the feed size distribution to the plant related
to the split of high grade and low grade ore types and more importantly the quantity of
competent and powdery ore. This data enables a split of the feed after crushing to be
estimated to each process section of the plant. The yield is based on the washability data
from the metallurgical testwork results which has been related back to the forecast plant feed
grade and a nominal density cut point applied for the required Cr2O3 grade of product,
typically 48% Cr2O3.

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Forecast product splits for the overall LoM are presented in table 1.8.1. Further details of the
products on a quarterly basis are presented in the TEM. The annual product forecast is
shown in Figure 1.8.2 which indicates the lower product yield in the initial years of the mine
life while mining the lower grade area to the SW of the orebody, increasing in the later
stages of the LoM.
Table 18.1 Forecast Product Split over LoM

% of
Production Grade %
Feed % Fe2O3 % SiO2
tonnes Cr2O3
(Yield)
Plant Feed 18,298,126 40.3 11.1 8.3
Products
Lump 9,567,541 52.3 48.0 11.9 8.8
Chip 1,805,195 9.9 48.0 11.9 8.8
Concentrate 1,398,314 7.6 57.0 14 1-1.5
Total 12,771,050 69.8
Waste
Lump
Rejects 2,914,456 15.9 10.5
Chip Rejects 552,350 3.0 10.5
Fines 594,924 3.3 19.0
Slimes 1,465,523 8.0
Total 5,527,253 30.2

Figure 18.1 Forecast Production
Forecast Production Graph
1,200,000
1,000,000
Production tpa
800,000
Fines
600,000 Chips
Lumps
400,000
200,000
0
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
Several issues can be expected to affect the forecast product split which cannot be fully
defined from the initial investigations and are exacerbated by the lack of bulk samples on
which to undertake more extensive testwork evaluations. These include the limited data on
the in-situ split of ore types in the resource and the noted degradation of material during
handling which will be affected by mining and handling of the feed and in the plant. This
could possibly affect the quantity of lump product and result in increased levels of chips and
fines although is not expected to significantly affect the overall yield into products.
18.4 PROCESS PLANT
18.4.1 Plant Design Parameters and Process Description
The process plant is designed to treat 1.3 million tpa of feed material with a top size of
500mm. Material from the mine is stockpiled on surface adjacent to the feed receipt bin and
is blended for the circuit to provide a relatively consistent feed grade and ratio of competent
to powdery ore. The feed receipt bin of 45t capacity can received material either directly
tipped by truck or rehandled by a FEL.
The circuit includes closed circuit crushing to nominally <150mm followed by dry screening
of the crushed feed into different size fractions +25mm, -25mm +10mm and -10mm.
Typically the coarser material is treated in the DMS drum circuit while the -10mm +1mm
material is fed to a DMS cyclone circuit. Facility is provided to allow material up to 25mm
to be processed through the cyclone circuit with further provision to screen the product
stream into +10mm and -10mm fractions. This allows flexibility in the split between the two
circuits to cater for varying feed size distributions and different loads on the two DMS
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circuits. The -10mm material is further wet screened before the DMS cyclone circuit to
remove -1mm material and this is deslimed and processed through spiral concentrators.
The nominal feed rate to the washing plant is 190 tph. The individual circuits are rated at the
following nominal maximum capacities and as a percentage of overall plant feed rate;
DMS drum circuit - 152 tph (80%)
DMS cyclone circuit - 76 tph (40%)
Spiral circuit (after desliming) - 42 tph (22%)
Provision is made to handle up to 10% of the feed as slime that will report directly to tails.
Surge capacity equivalent to approximately 5 hours throughput is provided before the DMS
drum and DMS cyclone circuits. In the DMS circuits the ore is mixed with a fine slurry of
ferrosilicon (FeSi) and water and in the process separation equipment the lighter fraction
consisting of low grade minerals and gangue is floated off while the higher grade chromite
sinks and is recovered as product.
Products and discards from the DMS drum and DMS cyclone circuits are drained and
washed to recover the FeSi dense medium and dewatered on vibrating screen before being
routed to storage bins by belt conveyor. A common bin is provided for the two coarse waste
streams with individual bins for the two products; three for the lump product and a single bin
for the chips. The bins feed into road trucks with the waste transported to the walls of the
tailings storage facility, while the products are moved to the rail siding for loading into rail
cars. Facility is provided for emergency product storage on the site in the event of transport
problems to the rail head.
The feed to the cyclone circuit is deslimed to remove material nominally < 50 micron and
this is routed directly to the tails thickeners. The spiral circuit treating the deslimed material
consists of three stage of concentration; rougher, cleaner and scavenger to produce a fine
concentrate product of >57% Cr2O3. Tails from all three stages are collected and pass
through a de-grit cyclone with the cyclone overflow passing to the tails thickener. Thickener
underflow and cyclone underflow are pumped to the tailings storage facility.
Product from the spirals is partially dewatered in dewatering cyclones with the cyclone
spigot product being routed to dewatering screens. From the screens the dewatered fine
concentrate is routed by conveyor to storage bunkers where it is distributed using a shuttle
conveyor and allowed to drain further before being loaded into 1t bulk bags for transfer to
the rail siding and shipment by rail.
The process plant is controlled from a central control room located within the DMS building,
directly above the main plant MCC room. The plant control system has been based on a
Program Logic Controller (PLC) and Supervisory Control and Data Acquisition (Scada)
system for the plant displays and operator control.

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18.4.2 Plant Description
The plant is effectively fully enclosed with the necessary heating and ventilation to cater for
the severe climatic conditions. Interconnecting conveyors between the plant selections are
also in fully enclosed galleries. Provision is made for extraction of dust generated in the
crushing circuit. The layout is relatively compact but allows for possible future expansion
and the provision of additional future recrushing and milling circuits should these be
required.
The necessary plant services including process and gland service water, flocculent make up
for the thickener, compressed and instrument air are included in the plant facilities. Power
supply includes the generation of emergency power for critical process duties such as the
agitation of medium, thickener drive, compressed air and the DMS drum drive.
A fully equipped assay laboratory facility is provided adjacent to the main process building.
18.4.3 Plant Operations
The process plant operation involves a total staff of 110 people including 3 expatriate
management staff, 74 on production including product handling, 24 on maintenance and 9 in
the laboratory.
Power consumption for the process plant excluding heating duties is calculated around 15
kWh/t. Process consumables are limited to ferrosilicon for the DMS operation and flocculent
for the slimes thickener.
18.5 INFRASTRUCTURE AND SITE SERVICES
18.5.1 Electric Power Supply
Electric power will be supplied by a 110kV overhead power line from the HT supply at
Kimpersai, 60km distant from the mine site. Application has been made to KEGOC, the
Kazakh power utility company by AREVA, a local electrical contractor, on behalf of Oriel.
On the site, power will be transformed to 10 kV in multiple parallel 25 MVA transformers
for reticulation on surface and underground.
Further investigations are on going into utilising existing power transmission facilities and
possibly the on-site generation of power from gas, which is reportedly available close to site.
These are discussed further under project opportunities.
On site generation capacity is provided rated at 2 MVA at a voltage of 10kV to supplement

the existing construction power of 1MVA. This additional power will be required for
development of the decline and ventilation shafts. In the long term the additional power
generation capacity will act as emergency power for normal mine operations.

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18.5.2 Heating and Ventilation
Process and service building will be heated from a small diesel fired boiler facility with hot
water or steam reticulated around the site to the surface buildings. The main heating duty
requirement is for underground air and this will be by electric elements in the inlet to the
ventilation fans.
18.5.3 Process Water Circuit and Potable Water Supply
Thickener overflow is returned to process water tanks and is re-circulated to the various
plant sections thus maintaining a relatively closed plant water circuit. Water recovered from
the tailings dam gravitates to the return water dam, which acts as the main process water
storage facility and from there water is pumped back to the plant as required. Process make
up water will be supplied predominantly from underground.
Potable water will be supplied from a well field close to the plant site and this can also be
used as process water make up until sufficient water is available from underground. A
forecast potable water demand of 550 m3/day is estimated.
18.5.4 Service Buildings
In addition to the surface process buildings including the ore receipt, crushing and screening
buildings, DMS building (incorporating the central control room, plant workshop and
laboratory) and product storage and waste load out buildings the following service buildings
and facilities are included
• MCCs
• HT and plant substations
• Central services building incorporating administration, change-house, canteen,

medical facilities, stores, etc.
• Mobile equipment workshop
• Ventilation fan and vent buildings
• Access and Plant Roads, Fencing and Security
Raised roads are included to reduce problems with drifting snow and flooding during the
spring melt. The main access road to the mine site from the existing tarred public road will
be sealed as far as the main gatehouse. On-site roads including the roads to remote facilities
such as tailings dam, return water dam, boreholes will be graded and unsealed.
The property will be fully fenced with access via a single security point with traffic boom
controls. A gatehouse will be provided. All vehicles carrying product leaving the site will
pass over a weighbridge.

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18.5.5 Other Services
A central fire fighting facility has been included designed for fire fighting in low temperature
conditions. This comprises an underground fire water ring main supplied by dual electric and
diesel operated fire protection pumps located in a weather protected building. Water for fire
fighting purposes is supplied by 1,500 m3 of water in the plant return water dam below the
forecast icing level, which is dedicated for this duty. The facilities as designed would
typically satisfy fire insurance company stipulations.
An underground storage facility has been included to cater for three months diesel usage of
both the mine and plant. The diesel supplier will supply and install the required underground
facility, which is a standard 500ton installation, with the capital cost being amortised into the
price charged for the fuel.
The plant will be serviced by telephone land-lines and will have an internal switchboard with
extensions in all offices and workshops. Shortwave walkie-talkies will connect all key
operating and maintenance personnel and offices to a central hub.
18.6 PLANT AND INFRASTRUCTURE EXECUTION PHILOSOPHY
The final project execution philosophy is still to be fully developed. However significant
investigations have been undertaken and the following key issues are identified
• There is a requirement for local technical project approval which will commence in
earnest with the results of this study
• Locally approved design standards and specifications are required for gaining
approval to construct the plant
• Climatic constraints on site restricting outside construction during certain periods of

the year
• Availability of locally supplied equipment and services
18.6.1 General
It is understood that the information included in this feasibility study report is in sufficient
detail to apply for project approval following detailed review by an authorised Design
Institute either in Kazakhstan or the FSU. This can therefore be commenced in mid 2006,
with approval expected to take 6 – 8 months. Technical project approval is required before
site construction can commence although basic and some detailed engineering can be
undertaken concurrently, some of which is required for the approval process. It is expected
that only minimal changes will be requested resulting from the project approval procedure.
Only the basic engineering including the process and basic engineering design and
equipment specifications would be undertaken by an international engineering contracting
company and, in order to facilitate project design approval in Kazakhstan, it has been

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assumed that detailed discipline design will be undertaken by local Kazakhstan

subcontractors including engineering companies and where appropriate design institutes.
Only key process and service equipment would be typically imported from Europe or South
Africa, although it may be possible to procure from a more local source once the detailed
design and specifications are finalised and also subject to commercial acceptability. Other
equipment such as instruments and electrical equipment are available through agents in
Kazakhstan or directly from European or South African suppliers. No items of equipment
have been identified with critically long delivery periods.
Structural steel, plate work, piping and insulation materials are readily available in
Kazakhstan and would be purchased there. Fabrication facilities for steelwork and platework
are available near to site.
Sub-contracts would therefore be awarded in Kazakhstan for:-
¾ Earthworks and roads
¾ Civils and building work
¾ Mechanical erection
¾ Structural steel supply, fabrication and erection including buildings and finishes,
conveyor structures and gantries
¾ Platework supply, fabrication and erection
¾ Instrument and electrical supply and installation
¾ Piping supply, fabrication and erection
¾ Insulation and painting
Construction management would be controlled by a Site Manager appointed by Oriel and

supported by a qualified Construction Team.
The plant would typically take 12 to13 months to design and construct with the overall
project schedule governed to a major extent by project approval and the climatic window in
the site area. It is anticipated that site construction can commence in May 2007. The
construction and commissioning phase of the project is estimated to take nine months from
site access to completion of commissioning and start of ramp up to full production, which is
schedule for the first quarter 2008.
19 MINERAL RESOURCE AND MINERAL RESERVE ESTIMATES
19.1.1 Mineral Resources
The Qualified Person with overall responsibility for reporting of Mineral Resources is Dr.
Alwyn Annels, C.Eng. FIOM3, who is a Principal Engineer employed with SRK. Dr. Annels
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is a mining geologist with over 39 years experience in the geology and estimation of mineral
resources and has been responsible for the reporting of Mineral Resources on various
properties internationally during the past 10 years.
The Qualified Person with overall responsibility for this report and for reporting of Mineral
Reserves is Mr Michael Beare, C.Eng, B.Eng (Mining), MIMM, who is an employee of
SRK. Michael Beare is a mining engineer with 13 years experience in the mining industry
and has been involved in the reporting of Mineral Reserves on various properties in Europe
and Africa during the past two years
19.1.2 Global Resources
The global resource within the 3D resource envelope totals 27.5 M tonnes at a grade of
37.6% Cr2O3, but a significant proportion is below the breakeven threshold of 20%. The
tonnage and grade above this threshold is listed later in Table 19.1
19.1.3 Grade-Tonnage Curves
The grade-tonnage curve is a cumulative grade-tonnage curve and is a useful way of

displaying the results of block modelling in that it shows the tonnage and grade above a
series of grade thresholds. Figure 19.1 is the plot for Voskhod which shows an interesting
grade distribution relating to the three categories of mineralization recognized with breaks at
20 and 40% Cr2O3. These breaks are also reflected in the tonnage with very few blocks and
hence little incremental tonnage in the range 20-40%.
Figure 19.1 Grade –Tonnage Curve for Cr2O3
Grade Tonnage Curve
70 30000000
60 25000000
50
20000000
Tonnes
Grade
40
15000000
30
10000000
20
10 5000000
0 0
0 10 20 30 40 50 60
Grade
Grade Threshold Tonnes
Another way of representing the global results of the modelling exercise is the production of
grade tonnage curves subdivided by mine level and sublevel, in this case the spacing being
20m above and below the 1180m level pierce point of the orebody by the decline. In this
case, the tonnages are accumulated only between levels and also the associated grade. This

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diagram (Figure 20.2) shows a drop in grade upwards to 1120m level and then a further drop
towards the 1260m level. Peak resource availability lies between 1000 and 1120m levels.
Figure 19.2 Grade-tonnage Curves by Sublevel
Grade Tonnage curve according to Levels
60.000 3000000
Cr2O3 Grade (>20%)
50.000 2500000
Tonnes
40.000 2000000
30.000 1500000
20.000 1000000
10.000 500000
0.000 0
900
920
940
960
980
1000
1020
1040
1060
1080
1100
1120
1140
1160
1180
1200
1220
1240
1260
1280
1300
Grade
Level
Tonnes
19.1.4 Mineral Resource Statement
A Mineral Resource statement for the Voskhod project has been produced by SRK for the
May 2006 Feasibility Study, which has been classified following the definitions and
guidelines of the Canadian Institute of Mining, Metallurgy and Petroleum CIM standards on
Mineral Resources and Reserves (CIM Standards) and the guidelines of NI 43-101.
SRK has classified the Mineral Resource following the definitions and guidelines of the CIM
Standards. A combination of the quality of estimation, data density, quality of the data
provided, semi-variogram parameters (sill and ranges), geological and grade continuity and
drill hole spacing/depth has been used to derive contiguous zones in which Mineral
Resources have been defined and classified.
In attempting to classify the resources at Voskhod in accordance with the NI 43-101

guidelines, there are many factors which have been taken into account. These are
summarized below.
• The database is of variable quality containing both Oriel and Pre-Oriel data. This
difference relates to core recovery and quality and also sampling techniques
employed.
• Rapid fluctuations in thickness and in material type exist so that correlation of

individual zones between holes is difficult.
• Uncertainties exist due to the postulated presence of structural dislocations which

include both normal and tear faults of differing ages. The exact locations, hades and
throws/offsets of these faults are not known.

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• Omni-directional variograms possess ranges between 60 and 100m and there are
indications of composite structures with shorter ranges of less than 20m. The current
drill spacing is approximately at 25m centres along lines 50m apart, though locally
some infill lines have been introduced by SRK. Others will be completed during the
2006 programme.
• The application of the “Two-Thirds” rule, which specifies a drill hole spacing which
explains two thirds of the data variability (66% of the sill value or data variance),
requires a spacing of close to 25m in all directions in order to achieve Measured
status. This, however, also requires that there are no uncertainties in relation to
physical continuity of the orebody and quality of the data.
• Resources within the EBFZ and the south east extension (SEX) are demonstrated to
exist but difficult to model due to incomplete intersections (fault cut-outs),
inadequate intersection coverage and lack of knowledge as to the location of
individual faults of which there are believed to be several, and their inclinations and
throws.
• During the interpolation of grades into the block model many blocks were not
informed at the first pass and it was necessary to expand the search radii to achieve a
completely filled model. To some extent this was a product of the recognition of
structural domains and the need to model each separately using only data from
within that domain.
Taking into account the above and also the fact that the orebody is drilled at a fairly uniform
spacing, with the exception of the EBFZ and SEX, it is considered that an Indicated Mineral
Resource status can be assigned with confidence to Domains 1 to 4 and that Domain 0 be
classified as Inferred until more drilling is completed in these areas. This is not likely in the
near future. Conversion to Measured status is not considered justified until underground
access to the orebody is achieved allowing short-hole stope definition drilling and also bulk
sampling. Following the 2006 drilling programme, some areas of the southern portion of the
orebody will be very close to Measured status especially as this area will be dominated by
new holes drilled by Oriel.
It is considered by SRK that, given an appropriate cut-off grade, all the Mineral Resource
could be potentially economic to underground mining methods.
The Voskhod deposit has been drilled and sampled using appropriate methods and at
sufficient spacing to support the estimation of Indicated and Inferred Mineral Resources in
accordance with the CIM Code.
In the course of preparation of the Voskhod Feasibility Study, SRK has conducted a
significant amount of detailed technical work and based upon this opines that it is unlikely
that there are any environmental, permitting, taxation, socio economic, marketing or political
factors that could materially affect the Mineral Resources and Mineral Reserves stated in this
report.

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Table 19.1 presents a statement of the Mineral Resources for Voskhod. The resources were
generated by applying a strict cut-off grade of 20 % Cr2O3 to block grades within a resource
envelope defined by a 1% Cr2O3 assay cut-off grade. They thus do not take into account any
internal dilution represented by blocks assigned grades of less than 20% Cr2O3.
The statement in Table 19.1 has been estimated using drilling information collected up to
October 2005 and is effective as of 24th May 2006. The Mineral Resources in Table 19.1
are inclusive of the Mineral Reserves in Table 19.2 of this report.
Table 19.1 Classified Mineral Resource Statement, Voskhod

Resource Tonnes Cr2O3 % Estimation
Fe2O3 % SiO2 %
category (million) Methodology
Indicated 19.76 46.2 12.7 9.53 2D
Indicated 19.51 48.47 13.12 8.49 3D
*Inferred 1.57 41.05 12.29 12.65 2D
*Inferred Resources were only determined using 2D methods as there is insufficient data to
support a 3D model for these resources.
19.1.5 Mineral Reserves
SRK has estimated Reserves in accordance with the CIM Code by constructing an
appropriately detailed Life of Mine (LoM) plan. The SRK LoM plan forms the basis of the
Feasibility Study and provides the economic basis for the generation of the Reserve
statement. In the detailed 3D model generated by SRK, dilution and recovery have been
applied to the Indicated Resources in order to estimate Probable Reserves. The Voskhod
reserves are summarised below. SRK has not included any inferred material in either the life
of mine plan.
The current Mineral Reserves are sufficient for 14 years of production at 1.3 Mtpa. In this
Summary Technical Report the economic evaluations are based solely upon the Reserves in
Table 19.2.
The Mineral Reserves have been classified in accordance with the CIM code and adhering to
the guidelines set out by NI 43-101. The statement in Table 19.2 has been estimated using
drilling information collected up to November 2005 and is effective 24th May 2006.
Table 19.2 Probable Mineral Reserves

Indicated Mineral Resource Mineable Resource Probable Reserve
Mt %Cr2o3 Mt %Cr2o3 Mt %Cr2o3
19.5 48.5 17.7 46.6 18.3 40.3

20 OTHER RELEVANT DATA AND INFORMATION
20.1 TAILINGS STORAGE
20.1.1 Design Criteria
The design criteria agreed with the project team and upon which the feasibility design is
based are:
¾ The design of the tailings storage facilities should be for the slimes dam sited on Site
4 which was selected as the most preferred site during the SRK Preliminary
Assessment Study conducted in July 2005.
¾ Coarse tailings material (100 mm/+10 mm and -10 mm/+1 mm fractions) will be
trucked to the disposal facility.
¾ Slimes (-1 mm fraction) will be hydraulically deposited on the slimes dam.
¾ The capacity assessment of the slimes dam should be conducted at a production rate
of approximately 148,000 dry tonnes per annum at a slurry density of between 1.22
and 1.55 t/m3.
¾ The capacity assessment of the coarse tailings area should be conducted at a

production rate of approximately 216,000 dry tonnes per annum at a moisture
content of 4%.
¾ The life of the facilities will be for a period of 16 years. Tailings deposition will take
place over a period of 14 years.
¾ Volumetric calculations will be based on a hydraulically placed in situ dry density of

the slimes of 1.3 t/m3
¾ The rate of rise of the slimes dam will be limited to 1.5 m/yr.
¾ The geotechnical parameters for the slimes and coarse tailings materials will be
based on parameters previously used for chromite slimes materials of a similar
nature. These parameters should be confirmed during the detailed design stage.
¾ The slimes dam will be constructed by means of conventional disposal methods

above the starter wall. The disposal method proposed is the spigot method of
deposition.
¾ The dam will be constructed with an average outer slope of 1V:3H. The upstream
method of wall raising will be employed above the starter wall.
¾ The footprint of the slimes dams will be lined with a single geomembrane liner
system.
Steffen, Robertson and Kirsten (UK) Ltd. Registered Address: Offices in:
21 Gold Tops, Australia
Registered in England and Wales Newport, North America
Gwent. Southern Africa
Reg. No. 1575403 NP9 4PG South America
United Kingdom
¾ The slimes delivery system will comprise HDPE delivery pipes and ring main with
deposition points.
¾ The decant system will be a vertical penstock structure and outfall pipe. The system
will comprise single intermediate intakes to facilitate pool control during the early
stages of dam development. The final intake will comprise a double inlet structure.
¾ A twin compartment silt trap structure will be installed upstream of the return water
dam (RWD) to trap suspended solids. The silt trap will be designed with twin
compartments in order to facilitate alternate cleaning and operation of each
compartment. The flow from the penstock outfall pipe via a dissipater structure is
directed to either one or the other compartment by means of sluice gates. When the
silt in the operating compartment reaches the level of the underside of the concrete
foundation slab to the penstock outfall chamber, the sluice gates will be closed and
the gates to the adjacent clean compartment opened. The silt in the silted
compartment will then be allowed to dry out and then removed by front end loader
and trucks via an access ramp provided. Silt removed from the silt trap will be
disposed off on top of the slimes dam.
¾ The RWD will accommodate storm water run-off from the plant area as well as
some water from the underground at a rate of approximately 2 500 m3/day.
¾ The RWD will be lined with a single geomembrane liner system.
¾ The new complex will be fenced off and an access gate will be provided.
20.1.2 Capacity Assessment
The impoundment design is dependent on the determination of an optimum layout which

satisfies the capacity requirements. This is addressed through a capacity assessment which is
optimised to reduce capital cost and provide adequate storage.
The capacity assessment of the new slimes disposal facility was based on the following:
¾ Life of facility = 16 years (tailings deposition over 14 years).
¾ Year 1 to 14 production rate for slimes = 147 000 tpa @ slurry SG of between 1.22
and 1.55 t/m3.
¾ Year 1 to 14 production for coarse tailings material = 216 000 tpa @ 4% moisture
content.
¾ In situ hydraulically deposited dry density = 1.3 t/m3. During the Phase 1 period, it is
anticipated that the dry density of the slimes will be lower than 1.3 t/m3 because of
the proximity of the pool, and the high rate of rise.
¾ Bulk density of the coarse tailings material = 1.4 t/m3.
¾ Maximum allowable rate of rise for slimes material = 1.5 m/yr.

¾ Rate of rise at top of starter wall = 1.4 m/yr.
¾ Rate of rise at closure = 1.27 m/yr.
¾ The outer slope geometry of the slimes dam above the starter wall was designed to
have 9 m wide step-ins at 7 m vertical intervals. The slope between step-ins is 1:2.5
with an overall resulting slope of just over 1:3
¾ Height of facility at closure = 25 m.
¾ Top area at closure = 9.6 ha.
¾ The slimes capacity for Phase 1 will be exhausted in approximately 24 months.

20.1.3 Geochemical Classification of Slimes Material
Evaluation of the geochemical characteristics of the slimes is currently ongoing.

Geochemical tests were run on a number of core samples and results are available, but these
cores are not considered fully representative and were taken from old cores.
It is known from previous work that the ore can contain trace amounts of sulphides, therefore
there could be some potential to generate acid. However, as the net acid generating potential
also depends on the buffering capacity of the environment, currently, it is not certain that the
tailings will be acid generating.
A test program is currently underway to assess the geochemical properties of tailings. The
test program involves static analysis and kinetic testing.
For the purposes of this feasibility study it has been assumed that the tailings will not be
totally benign. Acid or other toxins could be generated at some point in the future and
environmental legislation is unclear. SRK therefore recommends that a liner system be
included in the design and has budgeted for such. However, should the ongoing
geochemical test-work indicate that the tailings will not be acid generating, a liner may not
be necessary and could provide capital cost savings at the detailed design stage.
20.1.4 Liner Design
A single geomembrane liner system will be installed on the slimes dam footprint. The liner
system will comprise a 2 mm thick primary geomembrane and a geofabric bedding layer.
The RWD will also be lined with a 2 mm thick single geomembrane liner system similar to
that of the slimes dam. The coarse tailings storage area will however be lined with a single
geomembrane.
20.1.5 Frost Heave
The silty nature of the slimes makes it susceptible for frost heave during the winter months.
Silts exhibit a structure in which frost heave is likely to take place due to the variation in
pore size from larger voids in which individual crystals may start to grow to voids of such
small dimensions that the associated heaving pressure is very high.
It is therefore important to ensure that the under-drainage system is always in a good

working condition which will facilitate the depression of the phreatic surface. The
supernatant pool on top of the slimes dam must also be kept as small as possible.
20.1.6 Placement of Coarse tailings
The coarse tailings material will be trucked to the facility. The coarse tailings will be placed
on the outside of the slimes dam in phases, depending on the rate of rise of the slimes dam.
During the first phase, the tailings material will be placed along the eastern flank of the
slimes dam up to the top of the starter wall and along the far west of the site. It will take the
tailings less than two years to reach the top of the starter wall. By that time, the slimes would
have raised to above the top of the starter wall.
As part of the second and third phases, the tailings will initially be placed along the far west
and away from the slimes dam as the slimes dam level will be relatively low at that time. As
the slimes dam is raised, the tailings will be placed closer to the slimes dam. The tailings will
therefore “follow” the slimes. The coarse tailings will eventually totally enclose the slimes
dam facility.
The placement of coarse tailings will also be a phased approach (placed in three phases) with
the placement of the coarse tailings always being dependant on the rate of rise of the slimes.
20.1.7 Water Balance
The management of water at the slimes dam complex forms an important aspect of the
design of the facility. The principals of the management of water are to divert clean storm
water run-off away from the slimes dam with a series of ditches & berms and to contain and
reuse the dirty water emanating from the slimes dam complex and plant area. The input
information to the monthly water balance is in Table 20.1.
Table 20.1 Monthly Tailings Dam Water Balance

Dry Slimes Volume 12,833 t/month
Slurry Density 1.22 t/m³
SG (Dry Solids) 2.6 t/m³
Slurry Water pumped to the Slimes Dam 30,961 m³/month
Area of the Slimes Dam 320,000 m²
Approximate Area of Pool 16,000 m²
Approximate Area of Wet Beach 240,000 m²
Approximate Area of Dry Beach 64,000 m²
Evapotranspiration Factor from Wet Beach 0.8
Evapotranspiration Factor from Dry Beach 0.4
Plant Area 502,500 m²
Plant Losses 17,500 m³/month
Number of Penstocks required 1
Penstock outlet pipe diameter (Primary) 450 mm

Velocity in Penstock outlet pipe at Flow = 1.83 m/s
0.26m³/s
Depth of flow in Penstock outlet pipe 65%
Number of days to drain max expected 2 days

storm
20.1.8 Sizing of Return Water Dam
The required capacity of the return water facility for the proposed new slimes dam has been
determined based on the fact that it is required to contain the 1:50 year runoff from the
slimes dam surface area, as well as the 1:50 year rainfall on the return water dam surface
area and the intermediate catchment. The return water dam must also contain run-off water
from the plant area as well as some of the water reporting from underground. The return
water dam embankment will be constructed with selected material excavated from the slimes
dam and return water dam basins.
The minimum required storage for the return water dam has been determined and is
presented in Table 20.2.
Table 20.2 Storage Requirements for the RWD

Component Required Storage (m3)
Storm Runoff from slimes dam 20,000 m³/month
Storm Rainfall on Return Water Dam 1,500 m³/month
Storm Run-off from plant area 32,000 m³/month
Operating Volume 36,500 m³/month
Surge storage for ground water 20,000 m3/month
Total RWD Storage (minimum) 110,000 m³/month
The groundwater was originally going to be stored in the RWD at 2500 m3/day it means that
the groundwater inflow into the RWD would have been 75,000 m3/mth and the water
maximum requirement for processing could reach only 25 000m3/mth. This means the mine
will have an excess of about 50 000 m3/mth. It is impractical to evaporate this (one would
need a dam in excess of 1km by 1km possibly 3.5km by 3.5km). In practical terms some
groundwater will therefore need to be released. While geochemical work is still ongoing it is

uncertain at this point whether or not the water from underground will need more than
skimming of oil and settling of solids to be sufficient for Kazakh legislatory requirements.
SRK has therefore allowed a cost in the capital expenditure schedule to provide a facility for
treatment of the excess water from the mine throughout its life.
20.1.9 Final Points
The conventional spigot method of deposition will be employed on the slimes dam.
The coarse tailings material will be trucked to the facility. The coarse tailings will be placed
on the outside of the slimes dam in phases, depending on the rate of rise of the slimes dam.
The slimes dam and tailings area will be constructed in three phases. The first phase capacity
will be exhausted in two years.
The required capacity of the return water facility for the proposed new slimes dam has been
determined based on the fact that it is required to contain the 1:50 year runoff from the
slimes dam surface area, as well as the 1:50 year rainfall on the RWD surface area and the
intermediate catchment. The RWD must also contain run-off water from the plant area as
well as some of the water reporting from underground. The RWD embankment will be
constructed with selected material excavated from the slimes dam and RWD basins. The
RWD has a capacity of 110,000 m3.
A canal was sized to take runoff from the plant to the RWD. The size of the canal is 1.2 m
bottom width, 1.2 m depth with side slopes of 1:2. Peak design capacity for the canal is
9.2 m³/s.
The general storm water drainage is from west to east across the site. Clean storm water
upstream of the proposed slimes dam complex will be diverted around the complex to ensure
that it is not impacted in any way.
Two diversion canals are planned to ensure that clean storm water is diverted past the
facility.
Reticulation of slimes around the perimeter of the slimes dam will be achieved by means of
HDPE spigot pipes, extending from the two delivery stations. These spigot pipes will be laid
as a complete ring main around the impoundment, thereby allowing deposition to occur from
any point on the crest.
The stability analyses confirm that the overall slope of just over 1:3 results in a relatively
low stability factor of safety with very conservative parameters and adverse drainage
conditions during the long term. The stability assessment also confirms that the stability of
the overall facility is governed by the stability of the coarse tailings material. The factors of
safety are acceptable and conform to industry accepted norms.
Results from the seepage assessment indicate that the rate of leachate flow into the
foundation is 2.4e-08 m3/s when the facility is not lined. When the facility is lined the rate

drops to 1.5e-10 m3/s. In both cases, the presence of the toe drain is a big factor in reducing
downward seepage.
The capital costs to develop the facility is :
Phase 1 - US$3,613,614
Phase 2 - US$1,122,372
Phase 3 - US$1,122,372
The operating cost for the facility is :
Slimes dam - US$0.91/tonne
Trucking and spreading of coarse - US$0.41/tonne
The closure costs for the facility are :
Closure design - US$45,000
Closure and sealing of penstocks - US$105,000
Shaping of the dam top surface - US$110,000
Placement of topsoil - US$800,000
Dismantling and removal of pipelines - US$90,000
20.2 GEOTECHNICAL STUDIES
SRK have undertaken a geotechnical study of the Voskhod deposit to define the mining
geotechnical design parameters for the feasibility study.
Because the deposit is blind, i.e. there is no surface expression ore exposure of the orebody
and surrounding rocks, the study has comprised the analysis of data from a programme of
borehole core drilling undertaken in 2005 together with a review of geotechnical information
presented in a previous Russian feasibility study (Geoincentre – 2004) and anecdotal
information regarding geotechnical conditions at adjacent underground operations.
Consequently all of the recommended geotechnical design criteria presented herein have
been developed using the rock mass classification systems of Laubscher (iMRMR) and
Barton (Q).
Full details of the geotechnical study are presented in the May 2006 SRK Feasibility Study
report from which this summary has been extracted. A summary of the more important
geotechnical issues is presented below.

20.2.1 Geotechnical Characteristic of the Deposit
The characteristics of the deposit have been based on a total of 3,500m of geotechnical
logging. Because it was determined that geotechnical characteristics were independent of the
lithological descriptions the rock mass has been characterised in terms of its relationship to
the orebody. The orebody itself comprises three types of ore - massive chromite, powdery
chromite and subordinate (vein, orbicular and disseminated) ore. Each of these ore types has
different geotechnical characteristics but their distribution within the orebody is variable. A
summary of the geotechnical characteristics of each zone is tabulated below.
Rock Mass Conditions

Zone ID Description Mean
Range Description
iRMR
Top 2-3 m of ground below surface
Overburden OB
weathered to a residual soil.
Zone of completely to highly weathered
Very Poor to
Weathered Zone WZ rock extending to a depth of 70-100 m 29 19 - 39
Poor
below surface.
Zone of moderately weathered to
Far Hangingwall FHW unweathered rock extending to within 34 20 - 48 Poor to Fair
60 m of the ore zone hangingwall.
Intermediate Zone of unweathered rock located 30 –
IHW 41 26 - 56 Poor to Fair
Hangingwall 60 m above the ore zone hangingwall.
Zone of fractured unweathered rock
forming the immediate hangingwall to
Mining Hangingwall MHW 36 21 - 51 Poor to Fair
the upper ore zone and extending 30 m
into the hangingwall.
Massive
MCR Massive weak chromite ore 38 24 - 52 Poor to Fair
Chromite Ore
Ore Zone
Powdery Friable weak ore. iRMR reflects the Very Poor to

PCR 19 14 - 24
Chromite Ore interbedded nature of PCR and MCR Poor
Subordinate
SCR Strong, competent ore 55 45 - 65 Fair to Good
Chromite Ore
Poor to Fair
Footwall FW Competent, unweathered dunite. 41 25 - 57
occ. Good
Because only a small quantity of the boreholes drilled in 2005 was geotechnically logged
rock mass rating s were estimated for all the core drilled using a site specific relationship
between rock mass rating and core recovery. This allowed a deposit wide geotechnical
database to be constructed.
20.2.2 Mining Method
A mining method selection study was undertaken using a modified version of the Nicholas
(1981) method. The selection study confirmed that the best candidate mining method for the
orebody geometry and ground conditions is sub-level caving. From classical draw theory and
experience of sub-level caving operations in similar ground conditions elsewhere in the
world a sub-level interval of 20m vertical and 14m horizontal was chosen for feasibility level
design.

20.2.3 Caveability
A caveability assessment was carried out on a level by level basis from the 1280m level to
the 940m level using Laubscher’s stability graph. Because of the limited orebody strike
length above the 1180m level the maximum undercut dimensions were insufficient to
guarantee the development of the cave. It would only be possible to draw off swell. From the
1180m downwards the strike length of the orebody increases and an undercut of sufficient
dimensions can be created to induce cave. Full development of sub-levels will therefore
begin on the 1180m level. Because of the variability in the angle of dip of the hangingwall
mining of some of the sub-levels will begin under an uncaved back. Initial mining on the
sub-level will require that only the swell will be mined until the undercut has been opened up
to allow full cave to occur. The swell may be drawn from lower sub-levels.
It has been assumed that the cave will propagate to surface. For design purposes and location
of surface infrastructure a cave angle of 55° has been chosen surrounded on surface by a
30m wide tension zone.
20.2.4 Mining Induced Stresses
There is no information currently available on the in-situ state of stress surrounding the
orebody. Given the information on caveability there is the potential for the development of
high mining induced stresses. In particular it is considered that the hangingwall ends of the
sub-level crosscuts and those crosscuts at the strike limits on each sub-level will fall within a
high stress abutment. These areas will need particular attention with regards stability and
support requirements.
20.2.5 Groundwater
The current interpretation of the groundwater model is that the main groundwater storage is
in the weathered zone located within 80m of the ground surface. During mining and with the
development of the cave it is anticipated that the rock mass will open up and that ground
water may begin to migrate downwards along opening joints and the inferred vertical faults
and will enter the caved rock mass. In terms of mining conditions it is possible that
groundwater will infiltrate the orebody and may give rise to wet mining conditions. The
magnitude of potential groundwater inflow still needs to be investigated.
20.2.6 Support Requirements
Support requirements have been estimated for four different categories of development (sub-
level drives and crosscuts in ore, sub-level drives in footwall waste, main haulage and ramp
development in footwall waste, footwall development intersections) using the Q support
design chart. Because of the generally poor ground conditions in the orebody the standard
support system for the orebody development will comprise 2.4m long, 20mm diameter,
cement grouted rebar rock bolts installed on a 1.4m spacing with a 10cm thickness of fibre
reinforced shotcrete. From the deposit wide geotechnical database it has been estimated that
this level of support will be required in about 90% of the sub-level development. An
allowance has been made for the installation of steel sets or fibre reinforced ribs in about 6%
of the sub-level orebody development. A similar standard support will be required in the
footwall development but the total percentage of development requiring this level of support
should be about 60%. At brows the standard sub-level support will be supplemented by the
installation of four 3m long cement grouted threaded rebar bolts with large face plates in a
single line across the drawpoint. In particularly poor ground the bolts will be connected by
straps.
20.2.7 Mine Access
Underground access will be achieved initially by driving an inclined ramp from the base of a
box cut excavated to the south east of the orebody. A specific geotechnical investigation
campaign was conducted to determine ground conditions and support requirements along the
ramp alignment. A geotechnical domain model was constructed to estimate support
requirements along the ramp. A stability assessment of the vent shafts has also been
undertaken.
20.2.8 Conclusions
The geotechnical study has largely achieved its objectives. The main areas of risk associated
with the geotechnical work undertaken so far are related to:
¾ the current lack of structural data, although geophysics undertaken along the ramp
alignment suggested that the apparent structural features were orientated
perpendicular to the ramp.
¾ the variability and distribution of the various ore types and their behaviour during
mining,
¾ limited understanding of the groundwater regime and its behaviour as the cave
propagates through the hangingwall.
A 2006 drilling campaign is underway which will go some way to improve project
geotechnical knowledge and fill gaps in the structural and groundwater model. Once the
additional information has been collected it is recommended that a more detailed analysis of
the mine design parameters be undertaken to confirm and improve confidence in the work
presented herein. Mine design parameters may only be fully optimised during initial trial
mining. However, the support criteria in particular are sufficiently robust and conservative to
account for particularly adverse ground conditions and should provide an upper bound
economic estimate of mine wide support costs.
20.3 WATER MANAGEMENT
20.3.1 Introduction
Water Management studies at Voskhod have included the assessment of the hydrogeology,
assessment of mine water requirements, optimisation the dewatering of the mine and

workings, establishing a groundwater monitoring programmes, calculation of a site water
balance and planning for the mine closure. Costs are proposed for this work.
20.3.2 Summary of work completed
The following studies were reviewed:
¾ Geoinvest Pre-Feasibility Study (2003)
¾ SRK PAS Report, June 2005
¾ AsiaEcolink Background Ecological Investigation (2005)
¾ SRK Voskhod Mine Ramp Hydrogeological Investigation October 2005
20.3.3 Hydrogeological Testwork
Hydrogeological testwork was undertaken during October 2005 as part of the geotechnical
and hydrogeological investigation for the mine ramp. The objectives of the study were to
assess potential groundwater flows into the ramp workings, to input hydrogeological
information to the conceptual hydrogeological model, to investigate the options for water
supply to the mine, and to create a site water balance. The testwork involved the reaming out
of existing geotechnical boreholes and then constructing piezometers down the hole. In the
absence of packer systems, rising and falling head tests were undertaken in all holes, with a
step test and a constant discharge test also completed on borehole V05_R9.
Results suggested that the aquifer has low primary permeability in the rock mass with high
secondary permeability which is highly controlled by the presence of fracture zones in the
rock. The hydrogeological work to date is considered insufficient to make reasonably
confident predictions into water inflows to the ramp and underground operations.
A zone of high permeability was recorded in the north eastern region of the project area,
indicating potential for siting a groundwater supply to the mine. Geophysical sections
reinforced this analysis. Provision for a small well field capable of providing approximately
4l/s was made.
20.3.4 Conceptual Model
Information from geological and geotechnical logging was collected, as well as results and
observations from the hydrogeological testwork. On top of this a GIS study was completed,
overlaying topography, geophysical surveys, and known geological structures along with the
plan of the future mine. The findings of this study were used to create a conceptual model of
the hydrogeological regime. Conclusions of this were used to estimate probable minewater
inflows, and hence rates of mine dewatering and volumes of water to be treated and
discharged to the River Karagaash.

20.3.5 Water Supply & Mine water management
The water requirement for the plant is in the region of 30m3/hour. However allowance has
been made for this volume to increase up to 35m3/hour if fine grained ore is processed.
Although further hydrogeological work will improve confidence in groundwater inflows to
the mine, an exact figure can only be estimated at this stage. Once the mine is developed, it
is considered probable that minewater inflows will be substantially greater than the plant
requirements. The surplus of water is therefore to be treated and discharges to the River
Karagaash. During construction and early development of the mine however, requirements
for water are likely to be greater than those expected from dewatering. It is proposed for a
wellfield to supply water for this period, as well as a contingency supply for the life of mine.
Potable and domestic water demand is likely to be in the region of 30m3 /day.
It is probable that the spring used as the village water supply at Susanovka will be affected
by the mine workings, resulting in the deterioration in water quality, or the lowering of the
water table by dewatering which could result in cessation of spring flow. An allowance has
been made for a potable water supply to be piped from the
Surface water runoff from rainfall and snowmelt will be managed by a series of drainage
ditches around site. These will channel runoff water into the return water dam (RWD) to
prevent contamination with plant material
As the mine develops, a consequence of the mining method of sub level caving is that a
degree of subsidence is likely to occur on surface. The surface expression of this has been
modelled, and is observed to intersect the course of the River Karagaash. SRK propose to
divert part of the river to prevent the Karagaash rerouting south to pond in the subsidence
zone.
20.3.6 Tailings management
Tailings from the plant are to be disposed of at the tailings management facility (TMF). The
tailings will be dispatched to the TMF as coarse and fine grained (slurry) tailings and will
dealt with in different ways. The footprint of the TMF is to be lined with a single membrane
liner to reduce the risk of contaminant seepage into the groundwater regime.
Excess water will be pumped to the RWD where it will be settled and then returned for use
at the plant. The RWD will be lined also.
A risk assessment was carried out on seepage from the TMF to the nearest receptor, which
was determined to be the water supply spring at the Susanovka village 1.5km to the south
east. Hydraulic properties used in the calculation were taken from fieldwork and testwork
results. The results of the calculation concluded that due to the likely high physical and
chemical attenuation properties of the geological and hydrogeological systems a low
contamination risk was present for the project. Geochemical and hydrochemical studies are
ongoing to further characterise the potential for ARD from waste rock dumps.

20.3.7 Water balance
A site water balance was generated in order to understand the overall water inflow to,
consumption of and discharge out of the mine, plant and tailings disposal area. A full
spreadsheet model is included in the Appendix. As mentioned in the dewatering section,
there are uncertainties to the exact volume of groundwater to be expected flowing into the
mine. The volumes required by the plant are fairly precise, depending on the quality and
grain size of the ore. These factors also affect the volume of return water from the dam.
At the time of writing this report (May 2006) it is unclear as to the exact Kazakh legislation
for discharge of water to the environment. SRK have allowed for costs for different degrees
of water treatment depending on the level of minewater contamination, and the discharge
volumes and contamination limits determined by Kazakh legislation.
20.3.8 Mine Closure
The main impact on the hydrogeological regime following mine closure will be the rebound
of the water table as dewatering pumps are turned off. Monitoring of groundwater elevations
and chemistry will be ongoing during the life of the mine and should continue into the
closure phase of the project. There is however a low perceived risk of contamination to
groundwater.
The TMF will be remediated and covered with vegetation to prevent soil erosion.
As mentioned in the water management section, the formation of a subsidence lake will be a
legacy of the mine on surface. Although it is likely this will be hydraulically connected from
surface to the underground mine through series of failure planes, attenuation properties of
the rock suggest that water quality will be of relatively good quality. This assumption
requires confirmation on the receipt of results of the ongoing geochemical characterisation
work of Voskhod rock samples.
20.3.9 Conclusions
Water management issues including mine dewatering, water supply and mine subsidence
have been assessed, and risks have been mitigated and costed;
A site water balance has been created to assess and monitor water movement around site;
A qualitative assessment of flooding risks was carried out for the mine, plant and tailings
area;
Mine water supply is dependant on further hydrogeological work to confirm initial estimates
The risk from contamination seepages from Tailings is deemed to be relatively low
Mining induced subsidence will determine the requirement for a diversion of the River
Karagaash to prevent flow into the mine from surface.

SRK is uncertain about the long term mine water treatment, as well as the effect the mine
will have on the village of Susanovka. SRK has added provisions for water supply and water
treatment.
20.3.10 Recommendations
The following recommendations are proposed by SRK:
¾ Further hydrogeological testwork during water well drilling and ramp development
is required to verify predicted inflows
¾ Pressure grouting and other measures to control water ingress must be available
during ramp construction.
¾ Cover drilling will be required during ramp development to ensure that no aquifers
are intercepted
¾ Provision for drainage and collection of water to be pumped to surface for water
supply.
20.4 LOGISTICAL STUDIES
20.4.1 Introduction
As part of the Voskhod Feasibility Study Ahlers BV were commissioned to provide an

independent survey of the logistics of transporting 800-900 000 tpa of chromite products
from Voskhod to a number of potential destinations worldwide. The scope of the study
covered
¾ current costs for transportation of ore from Voskhod to the specified destinations
¾ background information, commentary and recommendations concerning the

feasibility of the successful transportation of indicated volumes, subject to
information provided by the client,
¾ current market conditions and a view on the ever-changing transportation situation

world-wide.
The principal destinations indicated were Tikhvin, near St Petersburg in Russia and Eastern,
Central and North-Western China, with a mandate to investigate destinations in other regions
of China, China’s eastern seaboard, South Africa, Sweden, Chelyabinsk (Russia) and to
consider spot sales. This required consideration of a number of port regions including the
Black Sea, the Baltic Sea and the western Pacific coast. In the case of China, consideration
extended to overland transportation from Voskhod and to transportation by sea into China
via the eastern seaboard.
SRK has assumed over the life of mine a flat US$145/t (at the Sarysai rail head) for all of the
chromite products from Voskhod. Adjustments were applied to account for logistics
management, bagging, rail operator’s commission, product loss and moisture. SRK was
provided with a range of potential markets by Oriel which were used to verify product
transport volumes to the various destinations. The chromite price used in this study assumes
that the average US$46/t cost for transport from Sarysai to the final destination is paid by the
end user.
20.4.2 Rail transportation
Concerning rail movement within the Commonwealth of Independent States (CIS), the
former Soviet Union, all ore must move during the first part of its journey by rail, and the
most economical option is the use of State rolling stock on a one-way basis. This currently
holds few apparent operational risks if managed carefully and rolling stock bookings are
made well in advance.
The leasing alternative adds direct costs of between $11.92 and $17.31 to transportation,
depending on destination, which is also higher than State rolling stock one-way costs due to
the return leg of the empty wagons to Voskhod. The option to find a return load is shown to
be inadvisable.
The purchase of new rolling stock option shows a high capital outlay of $42,000 per wagon,
plus ongoing maintenance costs as the equipment ages. Rail rates for privately owned stock
is lower than for State transportation for the outbound leg but there is a cost for the return
journey, bringing the cost for the round trip to a slightly higher cost for all destinations than
for State rolling stock. Therefore this is an additional cost (at best over $30 million in capital
cost, plus maintenance plus additional operational costs) and this option would therefore
only be beneficial if the risk of rolling stock shortage were to be untenable. The option to
contract ore transportation with State enterprises is therefore recommended.
20.4.3 CIS
Transportation costs to Tikhvin at $42.93 per ton and Cheliabinsk at $19.75 per tonne have
been the subject of preliminary discussions with relevant Rail Authorities and are the lowest
base tariff costs at present time. Escalation to a higher level at the earliest opportunity by all
involved parties is strongly recommended concerning these routes and routes to other chosen
ports, to ensure that most advantageous terms are secured.
20.4.4 China
Transportation options to West and Middle China were compared via overland and sea
routes. Black Sea ports proved more economical than Baltic ports.
The cost from Voskhod overland to Karamay/Taihang in Western China is $46.23 per ton,
and no other route is competitive.
For reference purposes only, costs per tonne from Voskhod to Shanghai overland and by sea
via Tuapse (Black Sea) are $86.96 and $68.35 respectively.

For comparison purposes, using Jinzhong in Central China as an example, the costs per
tonne from Voskhod are $81.83 overland by rail via Alashankoy and $100.35 via Black Sea
and Shanghai.
In addition to the need for an ecological permit at Tuapse discussed below, the transit time is
known to be considerably longer by sea, but as yet by an undetermined time.
A visit was made to inspect the Dostik/Alashankoy border between Kazakhstan and China,
an important border crossing for rail transportation between the two countries. Careful
attention must be given to this route as there is a capacity constraint that will challenge the
indicated volumes to China. Careful proactive management by the rail/freight operator’s
agent at the Alashankoy border crossing will be essential as the Kazakh/Chinese rail gauge
change currently requires manual reloading of rail wagons and little warehousing cover is
available for this activity.
Should the volumes increase substantially in excess of those currently indicated, as discussed
in the report in detail, this border facility may be unable to handle high volumes using the
present method of trans-loading and a different means of transhipment and/or transportation
or less convenient alternative routes may have to share the volume. As indicated above,
limited infrastructure changes may be necessary, but the long–term economies may be
substantial and should be weighed against any such costs. It must be emphasised that there
is no jeopardy to the routing of substantial volumes of ore into China; it is simply a logistical
assessment yet to be determined of the most appropriate methodology and routing.
The route to Vladivostok is expensive at $85 per tonne.
Product Destinations
SRK has compiled the following summary table using the costs provided by Ahlers and
notes from discussions with Oriel Resources regarding product offtakers. The general
approach has been to ensure that the chromite product is marketed broadly across a number
of markets to reduce risk and to avoid overloading transport infrastructure.
Summary of Product Destinations
Product Tariff
Destination Country Route shipped Notes transport
annually ktpa cost US$/t
Chelyabinsk Russia North via rail 100 #1 19.75

Tikvin Russia North via rail 340 #2 42.93
Tai Hang / Karamai China (West) East via rail 200 #3 46.23
Uddevala Sweden Rail to Baltic port then shipped 70 #4 54.65
Shanghai China (East) Rail to Black Sea port then shipped 186 #5 68.35
Total product sales 896

Rail Operators Commission
SRK has applied 1% to transport costs to allow for the Rail Operators Commission. This
equates to US$0.51/t of product moved.
Logistics Management
SRK considers that logistics company would be appointed to manage the transport of
chromite products from Voskhod at a cost of 5% of the total freight cost (based on above
tariffs) which equates to US$2.53/t of product moved.
Bagging
Experience from Donskoy operations and advice from Ahlers indicates that all fines products
will need to be appropriately bagged. This is necessary in order to void loss of product in
transit that could breach environmental laws, ease transhipment between rail and shipping
and to comply with port rules which stipulate that fine granular products must be bagged
The polyethylene bags would have a 1t capacity and be loaded in the process plant for fine
concentrate only. Lump and chip products would be handled as loose products. The cost of
bagging equates to US$5.10/t per tonne of fine concentrate product. This cost will not be
incurred by the chip and lump products.
Transportation losses
SRK has made a transportation loss allowance of 0.5% (from all sources) for the purposes of
this study. This is a 0.5% loss of revenue. Losses are envisaged due to the following:
• Rail siding spillage
• Cracks in rail cars
• Port losses
Moisture penalty
A moisture penalty has been applied to both road and rail transport equivalent to 4%
moisture content which is required to be transported ‘free’. The 4% is applied to each tonne
of product year round for trucking, but to only the 6 winter months for rail transportation.
SRK estimates that the hot and dry summer months will sufficiently dry the material out
whilst stock-piled at the rail siding. The cost equates to US 2.2/t of product for the 6 winter
months of the year.

Regelation
SRK has not provided for any additional cost to be incurred as a result of measures to
prevent freezing of the chromite products. However, a number of measures are anticipated
that will mitigate any anticipated problems:
¾ Lump and chip products will be essentially free draining and are unlikely to carry
sufficient moisture levels to allow freezing.
¾ The transportation costs allow for the products to be rehandled between carriers. In
these rates are costs for cleaning the rail wagons manually dealing with frozen
cargoes.
¾ Fine concentrate will be placed in 1t bags which are a manageable size. In the event
of the product freezing the bags will still be able to be handled, provided that they
are packed appropriately into the rail wagons.
Road Transport
30 tonne road trucks are envisaged to haul the Voskhod Chromite products 14kms along an
existing road from the mine and plant to the new Sarysai rail load-out terminal.
The existing public road that borders the east of the project requires a substantial upgrade to
provide a reliable year round haulage surface that will be suitable for haulage trucks and
general public transport. SRK has obtained a detailed quotation from a local contractor to
upgrade the existing road to a gravel specification. SRK understands that a tarmac surface
will not be required in the short term.
Road trucks would be loaded at the plant with loose bulk product via bins for lump and chip,
and with 1-2 tonne bags by grab for the concentrate material. Material would be maintained
in heated bins on-site to prevent regelation.
Product is to be trucked all year round, 24 hours per day with stock-piling to occur at the
rail-head and only emergency stock-piling areas provided for on-site.
A weighbridge on the site exit road will record all product leaving the site and will be used
to calculate the contractor payments.
SRK has allowed for a CAT 14H grader (fitted with snow-plough equipment), throughout
the project life to ensure the roads stay usable throughout the year.
Once at the rail load-out the trucks ‘paddock dump’ alongside the load-out tracks and the
front end loaders will maintain these stock-piles in preparation for loading wagons.
Rail Transport
Chromite products will be loaded into wagon trains at the Sarysai station by two CAT 988
loaders. Sarysai station was built in 2005 on a new 400km section of line that links
Khromtau to an existing rail line going east to China. This new line allows chromite
products to travel either east to west from Sarysai to China, Russia or elsewhere in
Kazakhstan.
A cost has been provided by a local contractor to upgrade the Sarysai facilities to include
new sidings and facilities for loading wagons. The facility would pass into the hands of the
local rail authority which would be responsible for maintaining the facility in the long term.
Conclusion
In general, no major operational transportation issues are foreseen at this time concerning the
transportation of ore to the principal specified destinations, although to maximise the
throughput into China through the economic land routes, limited additional infrastructure
may be called for, subject to further study with the relevant parties. Rolling stock shortfall
risks may be mitigated by forward contract planning, which also has the advantage of
stabilising and locking-in discounted tariffs. Port congestion risks within the region may be
mitigated by forward contract planning and, as a last resort because of additional costs, by
alternative routing options.

Black Sea & Baltic Ports
Favoured Black Sea ports are Tuapse and Novorossiysk due to their size, experience,
economy of location due to Russia’s proximity as a neighbour to Kazakhstan, with Tuapse as
the preferred port at present, due to lower cost and congestion at Novo. Both ports offer
services to China and South Africa, and may be suitable for spot sales. Both ports require an
ecological certificate before handling chromite ore.
Costs from Voskhod via Tuapse to Shanghai (China) and Richards Bay (South Africa) are
$68.35 per ton and $62.85 respectively.
3 Ukrainian ports (Ilichevsk, Yuzhniy and Odessa) are available to handle bulk products, but
because they are further away from source and an additional country is involved in the
transition, costs are higher and these ports should be considered only as an alternative if
Russian ports are ruled out.
Several other ports in Russia on the Azov Sea of the Black Sea (Temryuk, Taganrog, Azov
& Rostov-on-Don) are also able to handle bulks, but with draft limits and the area prone to
winter freezing, this region should be considered only for European markets/spot sales.
For Baltic ports, for north, central and western European destinations, the recommended port
is Liepaja in Latvia, where ferrochrome (and similar ferroalloys) is currently handled. Ore
to Sweden is costed at $54.65 to Uddevala. There are no constraints to shipments through
most Baltic ports, but the costs are higher for shipments to South Africa and China compared
to Black Sea routes.
Other Baltic ports of Ventspils, Latvia and Klaipeda, Lithuania are also capable of handling
Voskhod ore, as is Kaliningrad, Russia, although this port is less favoured due to congestion.
Baltic ports currently appear to offer operational advantages compared to Black Sea ports,
but are more expensive in terms of specified destinations, except for Sweden.
Black Sea ports have suffered recently from poor resources, bad weather conditions and an
excess of bulk traffic. As improvements and expansion continues to occur within the region,
the position may improve. The situation will be carefully monitored.
Investigations will continue into possibilities concerning shipments through Iranian ports.
Ore handling
An issue that arose a number of times during the study concerned the handling of small
fraction and fines, and consideration given to handling at ports and trans-loading locations to
physical losses, ecological/environmental issues, Customs difficulties due to perceived or
real losses and clean-up issues. Consideration of the use of containers for fines and small
fraction such as big bags is recommended.
Conclusion

The report shows that transportation of the tonnages indicated to the specified destinations
may be undertaken successfully when managed efficiently. The indicative costs are relevant
today and it is recommended that these are captured and continuously developed throughout
the intervening project construction period to ensure that they are honed and finalised as
early as possible prior to contract commencement.
20.5 PROJECT IMPLEMENTATION AND PERMITTING
SRK notes that one of the principal constraints to the project schedule is the inability to do
large scale earthworks in winter due to the difficulties with frozen ground and pouring
concrete at -40 degrees. This dictates that the plant construction can only commence as of
May in any year. The local permitting process applies the following restrictions to the
project schedule:
• Boxcut excavation approval: Due 12 May 2006;
• Exploration ramp approval: Due 28 July 2006;
• Ventilation shaft approval: Planned completion 22 December 2006; and
• Full Technical Project Approval: Planned completion 22 December 2006.
The critical institute involvement is that of UralGiproRuda in Russia and Kazmechanober in

Almaty who are carrying out the technical approvals for the mining and process plant
approvals respectively.
The most critical pathway to production is ore-body access and development thereafter. Late
September 2006 has the underground contractors commencing portal works and the start of
the decline. To ensure this timeline is met Oriel have committed to the necessary equipment
purchases for long lead items such as the batch-plant, shotcrete machine, drilling jumbo and
underground loader, along with a selection of electrical equipment.
Project Development Milestone Dates
• Temporary power supply energised and temporary infrastructure establishment

commences: 1st June 2006
• Underground development commences: 20 September 2006
• Primary ventilation raise sink commences: 25 December 2006
• Technical project Approvals in place: 22 December 2006
• Process plant and permanent site infrastructure works commence: 1 May 2007
• Permanent Power connected to site: October 2007
• Decline connected with Ventilation raise: October 2007

• Process plant commissioning commences: 13 November 2007
• Plant handover: 25 February 2008
• Road upgrade and rail-load complete: 7 March 2008
• First Ore Shipment: 14 March 2008
The approvals process for temporary installations is much less arduous than those for
anything ‘permanent’. As such it is the intention to commence works in May 2006 by using
temporary permits and the ‘Turkish Camp’ as a base. Electrical installations (by Areva) have
commenced with 3.5kms of 10kV line and a 1MVA sub-station feed from the Susanovka
facility is under construction. Other facilities to be installed are those to enable the decline
works to commence in August of 2006.
Institute (Kazakhstan) Technical Project Approvals

Institute name Project Cost Start Finish Status
Asia Ecology (OVOS and Base-line) $100,000 28/4/06 27/10/06 Estimate
Energy (Permanent Power) $170,000 20/4/06 6/10/06 Tender
Geo-Incentre (Resource) $77,000 27/1/06 28/4/06 Contract
Geo-Incentre (Exploration Ramp) $116,000 1/2/06 28/7/06 Contract
UralGiproRuda (Mining Technical) $330,000 28/4/06 27/10/06 Contract
Kaz-Mechanober (Process, Infrastructure

and Permit leader) $180,000 30/5/06 22/12/06 Contract
Documentation $50,000 on-going Estimate
Total Institutes $1,023,000
Land Allotment
Land allotment for Voskhod involves three steps:
1. Mineral Lease area. (Granted with lease)
2. Area to the North of the deposit owned by Donskoy GOK. This land has been
purchased for US$70,000.
3. The take-up of public grazing land within the allotment request area. This final step
involves paying ‘compensation’ for land loss of grazing (in the case of the Voskhod
site).
Orebody access including mining of a bulk sample and level development can be carried out
under an Exploration Mining Permit. As such Oriel has opted for this approach to allow

critical path development to commence whilst the full technical approvals carry on in
parallel.
Permitting approval for the exploration ramp along with the relevant designs has been
contracted to the Geoincentre Institute in Almaty Kazakhstan (SRK has verified this contract
is underway). Permits are to be sourced in a two step process in-line with the project time-
line:
• Boxcut excavation: Due 12 May 2006; and
• Exploration Decline: Due: 28 July 2006
Complete Technical Project
The approvals for the overall ‘Technical Project’, which involves the entire mine, plant and
surface infrastructure is to be co-ordinated by Kazmechanober in Almaty. The specialised
mining project has been sub-contracted to UralGiproRuda from Yekaterinburg in Russia.
The scheduled completion dates for the technical projects is the 27 October 2007. Following
this is a two month approvals process before the technical project is complete, targeted for
25 December 2006.
Ust Kamenogorsk based mining contractor Vostokshakhstroy has in conjunction with

UralGiproRuda been contracted to complete the designs and approvals for the primary
ventilation shaft.
Installing 25MVA of permanent power to site is a two step process:
1. Application for power from the utility owner; followed by
2. The Technical Project.
Energia Institute has provided Oriel with a tender to complete the technical project, whilst
the application is in progress. The OVOS is the Soviet Environmental impact assessment. A
Pre-OVOS was completed in March 2006 by Asia Eco-link company in Almaty. SRK
confirms that Oriel has contracted the same company to continue and complete the work
required for the full OVOS in the time-frame to match the approvals process. During the
investigations for the OVOS, Oriel have awarded Asia Ecol-link a supplementary contract to
complete under SRK supervision all requirements for the ESIA required for international
financing.
20.6 RISKS AND OPPORTUNITIES
A Risk Analysis was carried out by SRK which summarises the project risks with the level
of information available during May 2006.
Controls

A number of controls have been applied to mitigate against the identified risks. In general
these controls included:
• Detailed studies in key areas (e.g. Marketing and Product transport logistics);
• Additional capital costs have been included in some areas (e.g. Independent mine and
load-out infrastructure, concrete batching plant, mine water release treatment facility);
• Further orebody and hydrogeological drilling in 2006 to reduce geological and

geotechnical risks
• Additional specifically targeted operating cost contingencies (applied to ground

support and mining contractor rates);
• Early and closely monitored institute involvement. (Project Approvals and

understanding of legislation constraints
Risks
Key areas of project risk are summarised as follows:
• Markets. No individual off-take agreements are yet in place;
• Permits. The permitting process (though with improving confidence) still remains an
area of concern for any new projects in the FSU region. The definitive requirements
and timing are issues SRK believes that Oriel will need to supervise on a daily basis.
The inability of technical institutes to respond to changing project requirements on the
run has caused delays for other recent mining projects in Kazakhstan;
• Excessive Loss of Product to Slimes. Product split analysis cannot be performed to a

definitive level based upon the metallurgical test-work performed to date. However,
performance at the neighbouring Donskoy operation suggests that this will not be an
issue;
• Incorrect Estimation of Product Splits. The plant has been designed, based on a
predicted size distribution, because core data was a) not available at the time the plant
design concepts were fixed and b) there is no reliable way to extrapolate from core
data to full plant scale. In the event that the actual size distribution is drastically
different from that assumed, there could be constraints on the plant throughput. To
mitigate against this risk, the plant as proposed includes a great deal of flexibility in
terms of:
i) the size distribution by including the ‘swing’ fraction capability to swing the feed
to either Drum or Cyclone plant; and
ii) the spiral plant uses twin start spiral separators for treating the fines. These can
easily be replaced in the future with triple start units in the same physical space,
thereby increasing the capacity by 50%.

Obviously, a shift in the size distribution may change the relative proportions of
lumpy, chip and fines products.
• Personnel. Attracting and maintaining key staff at acceptable remuneration levels in

the current minerals boom is becoming a difficult task. To mitigate against this
competitive salaries and work roster have been allowed;
• Water ingress. SRK notes that there is potential for water ingress to the underground
workings, particularly during ramp development. This risk needs to be managed by
additional hydrogeological investigations, cover drilling and pressure grouting ahead
of the ramp face;
• Process Plant Technical Approvals. The processing plant as proposed conforms to the
chromite industry best practices available. Whilst care has been taken to review the
relevant SNIP’s, GOST’s (standards) and applicable codes, there is still an element of
risk involved in obtaining approval, since, as with most design codes and guidelines,
there is still room for subjective judgment.
• Sample Representivity. The metallurgical test-work upon which the process plant has
been designed was from four diamond drill cores which were taken to be
representative of the entire orebody. SRK notes that there is a reduced level of
confidence with this volume of material versus a bulk sample. The samples were
generally high grade of predominantly ‘powdery’ and ‘massive’ chromite lithologies.
The effect of this is unlikely to adversely impact the overall yield but could reduce the
quantity of material reporting to the lump fraction.
• Weather Effects on Project Execution. As in all extreme climate conditions, the

construction programme may be significantly affected by the weather conditions. This
is both in terms of the actual activities (no earthworks can take place in freezing
conditions for instance) and in the sequence of activities. Delays or disruptions to the
programme can, therefore, have a disproportionate effect on the overall programme if
specific “windows” of time are missed. Most importantly of these are the 2006 and
2007 summer earth-works and construction programs. Mitigation in the plant
programme exists as float (slack) time, since it is based on being completed earlier
than ore is available from the mining operations.
Project Opportunities
There are a number of opportunities that exist to enhance the project commercial and
technical performance;
• Increase Mine Production. The orebody has the capacity to produce at a rate
considerably higher than the planned 1.3 Mtpa and could be increased by purchasing
additional mining equipment. The current limitation on chromite production is market
capacity, although logistics would probably become an issue without some
infrastructure improvements at key transfer points.

• Extra Revenues from Discard Slimes at Saleable Grade. The slime fraction is mainly
generated from the PCR fraction which is generally high grade Chromite.
Consequently the waste slime could be in the region of 50% Cr2O3 depending on the
level of dilution caused by fine material generated during crushing from the competent
ore types and gangue. At present approximately 100 000 tpa of slime is forecast to be
generated. Should the slime prove to be consistently at a saleable Cr2O3 grade with
acceptable SiO2 and Fe2O3 specifications and suitable markets can be found it would
be possible to recover this material and increase the sales revenue from the chromite.
• Karaagash Deposit. The exploration lease for this multi lense style deposit directly
north of Voskhod across the Karaagash river has been awarded to Oriel resources
(unverified by SRK). This deposit contains 4.5Mt @ 40.9% Cr2O3 classified as C2 and
P1 resources under the Soviet system. The deposit is adjacent to the Voskhod
underground workings and provides good potential for additional production capacity.
• Inferred Resources. The Voskhod Deposit contains 1.57Mt @ 41.05% Cr2O3. These
have not been modelled into the existing production profile. In addition, there exists
another 4 to 5 Mt of potential resources in the adjacent Karaagash deposit. These
resources were historically Soviet classified and have only recently been licensed to
Oriel. SRK has not reviewed these resources in detail or their supporting information.
• Reduced Power Capital Cost. Oriel have been approached by an entity owning at least
part of one of the 110kv power lines from Kimpersay into the Chromtau sub-station
(which is Donskoye controlled). If this power line is available along its entire length to
Kimpersay, the purchase of it may prove advantageous over the current $12.6M new
line installation. Another option involves a study underway by an Aktobe company to
provide a total solution to power and heating requirements by gas which is locally
available in low and high pressure pipelines and at a competitive unit rate.
• Governmental Review of Mining Regulations. The 1974 Soviet mining (ventilation)

regulations on airflow per diesel engine kilowatt require a second ventilation shaft and
corresponding parallel intake ventilation raise throughout the mine. A modernisation
of these regulations could help to save up to $3M off the project capital costs.
• Better Usage of Cheaper Products out of the FSU Region. Time constraints on this
feasibility study have meant that the opportunity still exists for ‘value engineering’ on
some goods and services which as a default have been costed as imported items.
• Direct Shipping Ore. Sections of the Orebody are of product grade material and the
ability to crush, screen and direct ship material has been discussed at length. However
given the dilution profile and non-selective nature of the mining method the extra
capital for the bypass infrastructure was deemed too costly at this stage and removed
from the plant design. However the design has been made with sufficient space left in
the plant should operational experience show that adequate volumes of direct shipping
material can be mined.
• Increasing the Product Yield. A number of areas have been proposed that may be
explored to increase the product yield. These include;
iv) Re-crushing the DMS drum plant lump waste (floats) in an attempt to liberate 'locked'
particles and re-treating the crushed material through the DMS cyclone plant. Locked
particles are those that contain discrete sections of valuable Chromite and waste. If the
proportion of Chromite is small, the average density of the lump will cause it to float
in the DMS drum circuit and be rejected. By re-crushing this lump into smaller pieces,
it may be possible that the smaller particles will contain sufficient chromite to cause
them to sink, thereby recovering more chromite to product.
v) Milling the <25mm >1mm discards chips (floats) from the DMS cyclone circuit. This
will further liberate Chromite grains from the gangue minerals and allow the Chromite
to be recovered in the spiral plant resulting in a further possible increased overall
yield.
vi) Treating the slimes through a WHIMS (Wet High Intensity Magnetic Separation)
circuit. As suggested by the Uralmechanobr report provided by Oriel, for a "similar"
deposit, there may be a recoverable fraction of magnetic Chromite in the slimes
material.
Initial tests on the samples available have shown that these conceptual approaches have only
been marginally successful. All of the above will incur significant capital and operating
costs. In order to justify this additional costs against the potential benefits further studies area
required.
21 INTERPRETATION AND CONCLUSIONS

The level of data adequacy is considered sufficient for a Feasibility Study but further work is
required in the several areas in order to manage potential risks. Based upon the work carried
out by SRK and other contributors, SRK opines that the Voskhod Chromite project can be
developed into a profitable mining operation. SRK notes that the project fundamentals are
all positive as follows:
¾ Robust Mineral Resources, the deposit is high grade with favourable mining
characteristics allowing bulk mining methods to be employed.
¾ Low costs. The Voskhod operation is planned to adopt low cost bulk mining
methods combined with a simple processing route with proven technology
¾ The work of Heinz Pariser indicates that the market fundamentals are positive for
chromite with demand expected to exceed supply in the short to medium term
¾ Infrastructure. SRK notes that the Voskhod project is situated in a favourable

position for transporting product to both Russia and China. Rail lines from Sarysai
(14km from the mine) can carry product to both China and Russia simultaneously.
SRK concludes that the feasibility study has met its objectives in determining the viability of
the Voskhod project based upon the work undertaken and assumptions made.

22 RECOMMENDATIONS
SRK recommends that the Oriel management team continues with its planned program of
fund raising and mine development at Voskhod.
In addition, SRK recommends that Oriel will need to conduct the agreed program of
activities at Voskhod in order to meet the schedule requirements. Key activities are as
follows:
¾ Aggressively pursue permits and other approvals
¾ 2006 resource infill drilling with additional geotechnical logging
¾ Drilling of water wells and further hydrogeological testwork
¾ Completion of the full Environmental and Social Impact Assessment (ESIA)
¾ Technical Report preparation for local permit applications
¾ Negotiation of definitive off take agreements with end users and traders
¾ Commencement of on site construction – in particular the box cut and portal need to
be established before the last quarter of 2006
23 REFERENCES
The following were referenced for this report:
Voskhod ’Feasibility’ Study, 2002 Geoincentre (Almaty)
Indicative Valuation Report, August 2004, SRK Consulting (UK) Ltd
Preliminary Assessment Study for the Voskhod Chromite Project, July 2005, SRK
Consulting (UK) Ltd
USGS Minerals Industry Yearbook, 2004, John F. Papp
Feasibility Study for the Voskhod Chromite Project, May 2006, SRK Consulting (UK) Ltd
24 DATE
This report is effective 24th May 2006.

25 ADDITONAL REQUIREMENTS FOR TECHNICAL REPORTS
ON DEVELOPMENT PROPERTIES AND PRODUCTION
PROPERTIES
25.1 MINING
25.1.1 Production Rate
The Voskhod production rate has been set at 1.3 Mtpa to match Oriel Resources identified
product markets and as such is market constrained. SRK notes, however, that the podiform
orebody is capable of sustaining a higher production rate with the proposed mining method.
With the current mining reserves and proposed production rate, the life of mine is estimated
at 14 years.
25.1.2 Mining Method
SRK considers that the preferred mining method will be sub-level caving (SLC). The main
reasons for this choice include:
¾ the geotechnical characteristics of the host rock and ore being applicable to a self
caving method and not to open stoping;
¾ the geometry and orientation of the deposit are applicable to bulk mining;
¾ relatively low mining cost;
¾ no backfill required and surface subsidence is acceptable; and
¾ method allows for reasonable ore recovery.
25.1.3 Mining Recovery
Mining recovery for the Voskhod deposit is expected to vary throughout the orebody. This
variation will depend on the ore width and the regularity of the ore boundaries. Even though
some ore is expected to be discarded as it becomes trapped behind caved waste at the
drawpoint, the sub-level caving (SLC) method does allow for acceptable ore recovery. This
can be accredited to the fact that remnants of the ore that cannot be completely recovered
from a particular level can, in most cases be recovered on the level below.
In SLC, the waste dilution factor will be affected by the recovery of the ore, it is therefore
important to keep a reasonable balance between the two, to maximize net profit, not just the
recovery. This is realized by regular geological control of drawpoints (including inspection,
sampling and mucking to tightly supervised controls) and stope geometry design, while
taking into account metal expectations from the production blast rings.

25.1.4 General
The proposed development and stoping layout used to extract the deposit were based on the
expected behaviour of the extraction ellipsoids and the gravity flow of the ore, while
considering the Voskhod rock characteristics. The history and the practical experience from
other similar operations such as the Donskoy, Craigmont, Stobie, Kiirunavaara, Telfer and
Rideway Mines were also considered for this analysis. The proposed stoping and
development layout for the purpose of this study are:
Sublevel spacing 20 m
Height between main levels 80 m
Horizontal spacing of sublevel drifts 14 m
Production ring burdens 2.3 m
SRK notes that these resulting dimensions are based on industry common practice,
theoretical ellipsoid and gravity flow equations, as well as carefully considering the orebody
characteristics. It is anticipated that these dimensions could be adjusted to increase mining
efficiency as the rock behaviour is studied through the progression of the mine life.
25.1.5 Ground Subsidence
The use of a caving method will induce ground subsidence above the mined out area
(dependent on thickness of extraction and depth) and will require approval from the mining
authorities to undertake. Geotechnical studies suggest that this disturbance is estimated to
occur at a 55º angle from the horizontal. A 3D representation of the maximum subsidence
cone that can be expected was created (see Figure 25.1) using the expected subsidence at
55º, plus a 30 m buffer to account for local disturbances. Using these parameters, the
maximum surface area that will be affected by subsidence brought on by the underground
mining operations is expected to be approximately 657,000 m2, with a maximum diameter of
no greater than 1,000 m. SRK notes, however, that in reality the subsidence incurred by
mining can be expected to be much smaller than the designed cone since the extreme case is
modelled. To ensure, however, that all permanent infrastructure be away from the zone of
disturbance, the maximum cone limits were used when the designs were prepared.
Due of the remote location of the operation and the fact that no significant problems are
expected to arise from the permitting authorities, ground subsidence is not expected to cause
much concern with respect to the mine design. The neighbouring underground mines of
Donskoy also practice self caving methods.
Figure 25.1 Expected Zone of Subsidence

Expected
Subsidence
Voshkod
Orebody
25.1.6 Main Ramp and Boxcut
The Voskhod main access ramp, as the surface topography above the deposit is significantly
flat, the portal location will require a boxcut excavation. The boxcut is a temporary
excavation that provides access to the hard rock where a portal can be constructed. This
excavation would be accomplished by using a combination of standard earthmoving
equipment with drill and blast being used as the hard rock is encountered. It is expected to
have a volume of approximately 83,000 m3, with almost 95% consisting of earthworks and
the remaining being hard rock.
• If the boxcut were to remain open to the elements, SRK notes that there are certain
adverse effects that would have an impact on the ongoing mining operations,
including:
• water ingress due to rainfall and snow melt (During a rainfall event the boxcut has
the effect of acting like a large funnel channelling water underground which can
flood the ramp face and disrupt development.);
• sloughing of the walls of the boxcut can occur potentially blocking access to the
mine and causing traction problems for vehicles on the ramp (personal safety could
also be an issue if the slopes became unstable) and these occurrences incur
production loses;
• icing of the ramp during winter causing traction problems for trackless equipment on
the ramp; and
• long term stability issues due to weathering, requiring on-going rehabilitation.
SRK notes that, in the short term, the boxcut can be managed with a sump on the ramp to
catch the rain water and regular grading to keep the ramp clear. However, in order to prevent
the effects of the above disrupting the mining activities, SRK recommends that a long term
solution be implemented for the boxcut. This recommended solution comprises backfilling
the boxcut with waste rock. Prior to backfilling, a steel or concrete liner will be constructed

in the boxcut. The liner will allow vehicular access to the mine after backfilling of the box
cut.
The main access ramp will serve as the mine’s main access for men and material, the path
for transporting the ore from underground workings, as well as acting as a fresh air intake. It
will be driven straight with an initial ‘dog leg’ aimed at channelling water into the sump and
to avoid visibility problems associated with driving towards daylight at the portal.
Internal spiral ramps will follow the orebody along the footwall and offer access to every
main level and sublevel within the mine. Because of the flatter dip of the orebody around the
1100 level and the expected subsidence which will be more pronounced in the upper regions
of the deposit, there were advantages in locating the ramp section between 1180 and 1100
levels closer to the orebody and simply allow it to fail as mining progressed down the
deposit. As a result, a bypass ramp, situated well outside the expected zone of subsidence, is
necessary to ensure a safe and stable access way to surface. The internal ramps below the
1100 level are situated outside of the zone of subsidence and will serve as main access and
haulage way as mining progresses downward. A general schematic of the ramp can be seen
in Figure 25.2
Figure 25.2 General Schematic of the Conceptual Access Ramp
Main Ramp
to Surface
Orebody
Bypass Ramp
Internal Ramps
25.1.7 Contractor Works
All mining activities at Voskhod were assumed to be performed by contractors for the first
2.5 years of the project (until end of 2008 in schedule). Mining productivities and equipment
utilisations were assumed to be the same for both the contractor crews and the owner crews.

However, a cost premium was added for the contractor works in the financial analysis, as
may be seen in Section 18.
25.1.8 Ore Transportation
A simplified flowsheet of the ore transport system at Voskhod may be seen in Figure 25.3.
For the purpose of this study, it was assumed that all material would be processed, and
blended in order to yield the production suite. However, it is a possibility that some of the
ROM may be directly shipped, as a significant portion of the ore would possess the required
product grade directly as ROM material.

Figure 25.3 Production transport flowsheet
Blast Ore
Muck With LHD

50%
Dump in Underground
Stockpile
50%
Muck With LHD
Load in 45T Truck
Haul to Surface ROM

Stockpile
Reclaim Loader to
ROM Crusher
Processing Plant
Lumps Chips Fines
Truck 14 kms to
Sarysai
Railhead
Load into Wagons
Off-Takers
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Figure 25.4 CAT-1700 LHD
25.1.9 Mucking and Trucking
Both development and production mucking is via 5.0m3 diesel LHD equipment, modelled as
a CAT 1700 (Figure 25.4) for the study purposes.
Once the broken ore has been mucked, it will either be temporarily stockpiled in the truck
loading areas or tipped directly in to large capacity haulage trucks. For the purpose of this
analysis, it was estimated that 50% of the material would be stockpiled and 50 % tipped
directly. The modelled trucks comprise of the CAT AD45 (see Figure 25.5) which has a
proven reputation within the mining industry.
Figure 25.5 CAT AD45
25.1.10 Lateral development
Lateral development will consist of conventional drill and blast utilising:
¾ Twin boom electric-hydraulic drill rigs (Tamrock Axera);

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¾ Emulsion explosives;
¾ Modern fibre reinforced shotcrete technology (Normet Spraymech and agitator

trucks); and
¾ Cemented grouted steel bar rock bolts and steel sets.
Table 25.1 Lateral Development Requirements

Type Total Metres Profile
Main Ramp 1,250 5.1x4.7
Internal Ramps 2,585 5.1x4.7
Level Accesses 5,880 5.1x4.7
Truck Loading Areas 851 5.1x4.7
Ventilation Accesses 3,291 4.5x4.5
Sumps 288 4.5x4.5
Safety Bays 66 2x2
Ore Crosscuts 21,927 4.5x4.5
TOTAL 36,138
25.1.11 Vertical Development
Vertical development will utilise the following technologies:
¾ Conventional sinking (will be required for the two ventilation raises to surface);
¾ Drop raising (in 20m legs by standard long-hole drilling equipment); and
¾ Timbered conventional raising for slot development
25.1.12 Production
Production drilling of the Voskhod ore will be entirely comprised of up-holes, laid out in a
diamond shape above each extraction drift. SRK recommends that a compact and flexible
electro-hydraulic longhole drill rig to be used for all the production drilling; for example, the
Tamrock SOLO 7-7V. This machine has been chosen to suit the required drill hole
diameters and has the most favourable boom configuration that will allow flexibility of usage
of this machine for both up and down hole drilling and production and ‘clean-out’ functions
(where the boom needs to reach out over the rill of material at the brow).
25.1.13 Mine Services
The mine will be serviced by compressed air, water, power and a de-watering network. The
power network will comprise of a 10kv high voltage and 1000v low voltage network.
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25.1.14 Ventilation
The fresh air intake into a level would be sourced from the decline and the inter-level fresh
air rises. The mine has two intakes and one exhaust airway system which has been designed
to supply 350 m3/s in order to comply with the local laws and mining requirements. The
proposed primary ventilation system has the capability to support up to two working levels,
inclusive of production and development. Primary fans have been selected such that the air
flow quantities could be easily controlled to an acceptable velocity during emergencies when
the non travel airways would be utilized as an escape way.
Level cross cuts would be secondary ventilated by a single staged fan with motor power
rating of 55kW to supply sufficient air for diesel equipment, along with ducting size of
1200mm diameter. Primary ramp development will be secondary ventilated with dual staged
fans having two 90kW rated motors and complemented by either 1400 mm or 1600 mm
diameter ducting depending on the length of development.
The mine would require heating for up to five months of the year. The maximum average
heat load required has been estimated to be 6.5MW with a peak of 15.5MW. The intake shaft
airway requires greater heating than the portal intake due to potential ice growth in the
airway caused by ground water. In summer months the mine would be unlikely to suffer
from any hot conditions in the work places as it depth is not great and the summer humidity
is low. The heat simulation conducted in this study provided this verification but some
parameters have been assumed as there were no actual data. These must be verified with
further studies.
25.1.15 Underground Equipment Requirements
A list of the main underground mining equipment required for both the owner and the
contractor to develop and sustain a 1.3 Mtpa production rate from the mine is described
below in Table 25.3. The full equipment delivery schedule is displayed in Section 19
(financial evaluation).
Table 25.2 Mine equipment requirements

Name kW V.A.R Number
3
m /sec Utilised
Truck - Cat AD45 439 48.29 5
Bogger - Cat 1700 231 25.41 3
Grader - Cat 120H 101 11.11 1
Jumbo - Tamrock Axera 7-60 110 12.1 2
Integreated Toolcarrier - Cat 930G 67 7.37 2
Shotcrete machine - Normet Spraymech 65 7.15 1
Agitator - Normet Variomech 112 12.32 2
Production Drill - Tamrock SOLO 07-7V 110 12.1 2
Allowing 80% availability and 80% utilisation
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25.1.16 Mine Labour Requirements and Organisation
SRK have built up the manpower schedule using a combination of ex-patriates in key
specialised roles and a national workforce. The first four years of mining show relatively
high ex-patriate numbers in technical services and in key underground supervision and
training roles. SLC is a new mining method to Kazakhstan and SRK believe it is critical in
achieving success and the calculated equipment productivities to utilise well targeted
imported mining specialists. There are no government restriction on the usage of expatriate
labour.
Training and communication need to be of utmost importance. Communication problems are

almost certainly to be encountered. Translators have been budgeted for and it should remain
a top priority to maintain good communications in both languages. In the process of
compiling this study SRK visited two other mechanised operations in Kazakhstan (Suzdal
and Malevsky) and were impressed by the standards of operation in particular the workforce
size, which was in-line with similar western operations.
25.1.17 The Mining workforce in Summary:
¾ A technical services department heavy in ex-pats initially
¾ An ex-pat mining manager for the mines life
¾ Ex-pat foreman, supervisors and crew trainers till 2010
¾ Expat miners from the ramp start till the end of 2008
¾ Ex-pat maintenance personnel, including planners
¾ Expat workforce of 3 shifts
¾ National workforce of 4 shifts
¾ Each piece of equipment has an operator (hence contingency exists through machine
availabilities
¾ Blasting/services crew of 3 per shift
¾ Shotcreting crew of 3 per shift
¾ One nipper (or supply man per shift)
¾ 8 tradesman per shift to maintain the mobile fleet
25.1.18 Summary of Total Project Workforce
The life of mine labour requirements for the Voskhod mine are estimated in the following
table.

Table 25.3 Summary of Mine Workforce
Department Number Notes
Mining (expats) 31 Reduces to one by 2012
Mining (nationals) 184
Processing (expats) 3 Reduces to zero by 2012
Processing (nationals) 109
G & A (expats) 5 Reduces to zero by 2013
G & A (nationals) 52
Total 384

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Voskhod FS Page 4
25.2 RECOVERABLITY
SRK notes that the average product yield is 70 %. Processing of Voskhod ores will
primarily consist of crushing a screening followed by gravity separation. Refer to Sections 8
and 9 for further details.
25.3 MARKETS
As part of the Voskhod Feasibility Study a detailed market survey was commissioned by
Oriel Resources. To this end, Heinz Pariser was commissioned to update his earlier report
that was used for the SRK Preliminary Assessment Study.
SRK has reviewed the Pariser report and considers the level of detail and scope is
appropriate for a Feasibility Study. The report covers all the necessary aspects including
supply & demand, potential and existing markets, competition and future prices. In addition
to the Pariser work, Oriel Resources has been undertaking discussions with end users of
chromite products and potential off-takers. Feedback from these discussions has been
provided to SRK.
The Pariser report supports the conclusion that the international chrome market can sustain a
new player producing chromite product at the rate of 800-900 ktpa. In Section 13 of this
report the logistics study indicates that moving the product to various destinations can be
achieved.
The Voskhod project will produce three types of chromite product. The specification for
each of these products is expected to be:
Lump -150mm + 10mm, 45-48% Cr2O3, <10%SiO2 (8% typical)
Chip -10mm + 1mm, 45-48% Cr2O3, <10%SiO2 (8% typical)
The Pariser work does not differentiate between prices for either of the three chromite
products although the fine concentrate is expected to carry a higher grade. SRK has assumed
that the same prices will be paid for any of the three products.
Although Pariser has suggested higher prices for chrome products going forward, SRK has
adopted a flat US$145/t as the price for all chromite products ex-mine. The SRK assumption
can be backed up by the prices realised at the Russian and Chinese borders for Kazakh ores
from Donskoy GOK in recent times. The current (2005) price for Kazakh ore at the Russian
border was 158/t and 197/t at the Chinese border (H. Pariser report Section 6). If these
prices are corrected to the Sarysai railhead, the price is close to US$145/t SRK has applied in
this study.
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SRK Consulting
Voskhod FS Page 5
SRK notes from the Pariser report that chromite prices are highly dependent on where the
product is actually sold. Transport costs are significant and can confuse the product pricing
issue if not carefully applied.
The Ahlers study has provided costs for transporting the products to the proposed markets,
SRK has not applied them to the various destinations proposed due to the lack of firm price
agreements will product offtakers. SRK currently lacks product price data at all of the
destinations – different end users will have different price structures according to their end
use of the chromite, the quality of the product and the transport costs. Therefore SRK has
taken the following approach:
¾ Use a flat US$145/t price (ex mine) for all of chromite products for the life of mine
supported by recent prices for Kazakh ore
¾ Using the table of destinations and proposed quantities the transport costs could be
calculated. This provided a basis to calculate logistical costs, rail operators
commission and bagging costs. Other adjustments applied were allowances for
moisture and transportation losses. The costs of these items were subtracted from the
product revenue stream. The transport costs themselves were assumed to be covered
by product off takers.
The chromite price used in this study assumes that the average US$46/t cost for transport
from Sarysai to the final destination is paid by the end user.
SRK notes that there is a risk that offtake terms will not match the estimates from the Pariser
study. However, given the strong market fundamentals and the quality of the product
historically mined from Khromtau the probability is considered unlikely.
The Pariser report provides an example from a South African Chromite producer with on site
costs of US$37.2/t to mine and process ore. SRK has assumed that this does not contain any
post processing costs and the run of mine grade is 45% Cr2O3. This example when worked
through gives a producer cost of US$5.5cents per lb of Chromium metal. Voskhod has
equivalent costs of US$20.2/t to mine and process ore of a lower grade. When converted to
lbs of metal the Voskhod cost equates to US$4.4cents per lb of Chromium metal. SRK notes
that the proposed mine at Voskhod has the potential to produce chromite at an ex-mine cost
20% less than the established South African producer cited in the Pariser report.
25.4 CONTRACTS
SRK notes that no off take agreements have been signed between Oriel and potential off
takers at the time of preparation of this report. However, Oriel Resources staff have been
discussing potential product sales arrangements with a number of end users, processors and
traders which has provided guidance to SRK as to the likely product destinations. Further
details of product destinations and prices are given in Sections 20.4 and 25.3 respectively.
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25.5 ENVIRONMENTAL CONSIDERATIONS
25.5.1 Introduction
This Environmental Feasibility report provides an overview of environmental and legislative

requirements, environmental and social issues, evaluation of potential environmental impacts
and mitigation and an estimation of environmental costs.
The preliminary rounds of sampling and a desktop review of documentation are considered
to be sufficient for background investigations and provide an indication of potential
pollutants. However, the results are not considered sufficient to quantify the full magnitude
and significance of identified environmental impacts for the project at present. The impact
assessment, potential mitigation measures and estimated environmental costs contained in
this report will be subject to change based on final design options and the outcome of
baseline studies.
25.5.2 Environmental Legislation
The Voskhod project will be subject to laws, regulations, standards and guidelines from the
Republic of Kazakhstan and international institutions (World Bank/IFC, WHO etc). The
project is classified as Category A under World Bank Group/IFC criterion and therefore is
subject to a full Environmental and Social Impact Assessment (ESIA) prepared in
accordance with the relevant local and international legislative framework.
A review of Kazakhstan laws and the World Bank and IFC guidance documents indicated
that the following is relevant to the Voskhod project:
Operating Policy 4.01, Environmental Assessment;
Pollution Prevention and Abatement Handbook, 1998 [PPAH]:
General Environmental Guidelines (GEG);
Base Metal and Iron Ore Mining Guidelines (BMIM);
Environment, Health and Safety Guidelines on Mining and Milling – Underground;
and
IFC Environmental and Social Review procedure and guidance on ESIA; and IFC
Performance Standards 1, 2, 3, 4, 5, 6, 7 and 8.
25.5.3 Environmental Assessment Requirements
The Voskhod Mine project requires a further Environmental Assessment (EA) to satisfy the
Republic of Kazakhstan and WB/IFC requirements for project approvals and financing. In
particular, completion of the Environmental Baseline Study (EBS), including specialist
studies and an ESIA is required.
Terms of Reference (ToR) for undertaking the ESB and specialist studies will be developed
to reflect the requirements of international guidelines and standards applicable to the
proposed mine.
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At the conclusion of the specialist studies, the information will be used, together with the full
design details of the mining process, processing plant, proposed haulage routes and railway
siding to develop the EsIA and Environmental Monitoring and Management Plan (EMMP).
25.5.4 Environmental and Social Impacts
It is considered likely that environmental impacts will occur due to historical mining
activities of the area and the proposed mine operation itself. At this stage of the assessment
process it is not possible to determine the degree or significance of these potential impacts.
A desktop review of project related information and the preliminary monitoring and
sampling was performed as part of the background ecological investigation, and indicated
the following:
• There are a number of potential soil pollution sources within close vicinity of the
site. However, at this stage soil contamination does not appear to be widespread and
is confined to the southwest portion of the site.
• The site does not contain soils of high fertility or suitability for agricultural
purposes. Due to past disturbances and the proposed mine, post mining land uses
may be restricted.
• The surrounding mining activities and proposed mine have the potential to impact on
the quality of surface water and groundwater resources, natural drainage pathways
and flow pattern regimes.
• The analysis results indicate that sensitive surface and groundwater receptors are of
reasonable water quality, while artificial water sources such as abandoned open pits
may be impacted by organic, inorganic and heavy metal contaminants. It appears
that the low lying areas of the Akzhar tributary in the southwest portion of the site
are most heavily impacted.
• The surrounding Donskoye GOK mining activities pose a number of potential air
pollution sources, in particular these include stockpiles of waste rock, transportation
vehicles and a number of processing plant stacks. The proposed mine also has the
potential to impact on the air quality of the region.
• The monitoring and analysis results did not indicate significant levels of air
pollution. However, the analysis did not determine the concentration of heavy
metals or the fraction of fine particulate matter (for example, PM10). Further
monitoring and analysis is required to determine the background air quality of the
project area.
• Potential impacts on the ecology of the site are considered to be minor due to the
existing low biodiversity of plant and animals. The mine site has undergone
significant disturbance from surrounding mining activities and agricultural uses.
This has resulted in impacts to native flora communities and habitat disturbance,
particularly
Steffen, Robertson and Kirsten (UK) Ltd. in low lying Registered
areas (flood
Address: plains) and riparian zones.
Offices in:
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• No assessment of background noise levels or predicted noise levels as a result of the
proposed mining operation was made during the preliminary site investigation.
However, the heavy industrial nature of the area indicates that background noise
levels are likely to be high, although impacts to noise sensitive receptors are likely to
be low due to distance.
• No assessment of background noise levels or predicted noise levels as a result of the

proposed mining operation was made during the preliminary site investigation. Due
to the distance between the mine and nearby settlements (that is, noise sensitive
receptors) potential impacts are considered low.
• The proposed mine development will result in an increase in traffic volumes of large
vehicles along the proposed haulage route.
• The potential risk of impacts to cultural heritage items or archaeological sites of

State significance is considered low as no known sites are found with 20 km of the
site.
• No assessment of the existing visual impacts or potential visual impact posed by the
proposed mine has been undertaken. Whilst there will be some landform changes as
a result of the Voskhod Mine operations, these are considered minor in comparison
to existing impacts from surrounding mining operations.
• The socio-economic benefits from the Voskhod Mine project are considered to be
positive for the local, regional and national economy and should contribute to the
existing upward trend in monthly wages and decreasing trend in unemployment
currently being experience in the region.
25.5.5 Public Consultation
Public consultation for the project was initiated in February 2006 to satisfy Kazakh
requirements for environmental impact assessment of planned activity during preparation of
preliminary and planning materials (the Pre-OVOS process).
The ongoing public consultation process was attended by SRK and involved Interested and
Affected parties (IAPs) such as the general public, concerned public groups, local authorities
and local non-governmental organizations.
Generally, the attitude of the local citizens to the Voskhod project is considered positive.
The main areas considered important by IAPs for improvement of living conditions in the
region were considered to be:
• maximum involvement of local citizens in the construction and operation of the

proposed mine development;
• investments in local budgets for infrastructure development;
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• improvement of the quality of the medical services; and
• maintenance and construction of roads.
At completion of the Pre-OVOS review a Public Consultation and Disclosure Plan (PCDP)
will be developed for the Voskhod Mine project outlining consultation requirements during
the assessment phase of the project.
25.5.6 Closure and Costs
In the Republic of Kazakhstan a closure plan for mining operations is a legislative

requirement, generally submitted 1 or 2 years prior to closure. There is also a requirement to
set aside sufficient money into a government held closure fund for the mine. The issue of
performance bonds or insurance for closure also needs to be addressed from the start of the
project to ensure sufficient funding is available.
Significant long-term environmental and economic benefits will arise (and negative impacts
be minimised) from the close coordination of the development and implementation of the
environmental monitoring and closure plans for the site. In the Feasibility Study a sum of
US$3.2 M has been allocated for closure rehabilitation with US$1 M for the tailings facility
alone.
Environmental costs for the project are associated with assessment, monitoring and
reporting, closure and post closure monitoring. The total costs are estimated to be in the
order of US$5.5M over the mine’s lifespan.
25.5.7 Conclusion
In general, the Voskhod project is unlikely to pose any significant environmental impacts to
sensitive receptors, which cannot be adequately managed through the implementation of
suitable mitigation and management control measures. The biggest challenge facing the
operation is quantifying the nature and extent of existing contamination and ensuring these
liabilities are not transfer to Oriel’s operations.
25.6 TAXES
In the feasibility study life of mine plan and financial model SRK has applied the following
taxes and royalties:
¾ 15% VAT to all imported equipment and capital items

expended.
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tax rate of 30%
25.7 CAPITAL AND OPERATING COSTS
25.7.1 Capital Costs
Capital costs for Voskhod were estimated from a number of sources including quotes
obtained locally, input from consultants (mainly SRK and DRA-I) and estimates from
international equipment suppliers.
From the detailed economic model developed for the Voskhod feasibility study SRK has
estimated the total capital requirement (excluding any project financing costs) is US$131 M.
Capital expenditure for the Voskhod project has been broken down into it constituent parts in
the following tables:
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Voskhod FS Page 11
Table 25.4 Capital Costs – Table 1

Cost Area Pre-Production Capex Working Capital Total Sustaining LOM
General and Administration
Owner cost General
Institute Fees 1,023,000 1,023,000 0 1,023,000
2006 Drilling campaign 427,000 427,000 0 427,000
Kaaragash River re-aligment 0 0 450,000 450,000
On-going consultants fees (including ESIA) 281,200 281,200 0 281,200
Closure Costs (excluding tailings dam) 0 0 2,026,000 2,026,000
Land Allotment 300,000 300,000 0 300,000
Geobyte water sampling for the Baseline 75,000 75,000 0 75,000
Infrastructure and Process Plant Pre-project costs 106,928 106,928 0 106,928
Bore-field establishment Cost 180,000 180,000 0 180,000
Power Infrastructure
Temporary Power 369,231 369,231 0 369,231
Permanent Power 12,620,185 12,620,185 0 12,620,185
Site Power re-ticulation 2,139,980 2,139,980 0 2,139,980
Purchase of second hand 2006-2007 winter generators 337,500 337,500 0 337,500
Technical Services Office Equipment
Survey Equipment 26,477 26,477 0 26,477
Computers & software 133,350 133,350 0 133,350
Ventilation monitoring equipment 50,000 50,000 0 50,000
Safety
Initial personal Safety supplies 17,423 5,808 23,230 11,615 34,845
General site safety supplies 25,000 25,000 0 25,000
Cap lamps and personal self rescuers 40,282 40,282 161,127 201,409
Mines Rescue Equipment (including Dragear units) 266,476 266,476 0 266,476
Site & Local Infrastructure
Short Term Infrastructure 250,000 250,000 0 250,000
Turkish Camp 1,190,400 1,190,400 0 1,190,400
Site Buildings 6,548,350 6,548,350 0 6,548,350
Site Access Road 120,000 120,000 0 120,000
Social ammentities for Camp 150,000 150,000 0 150,000
Road Upgrade Donskoye - Site 359,431 359,431 0 359,431
Road Upgrade Site Rail Out 6,064,508 1,516,127 7,580,636 0 7,580,636
Rail Load - Out 5,154,164 572,685 5,726,849 0 5,726,849
Site roads 1,348,458 1,348,458 0 1,348,458
Site services reticulation 1,400,416 1,400,416 0 1,400,416
Bore holes and pumps 8,960 8,960 0 8,960
Potable water line from treatment plant to Susanovka 0 0 50,000 50,000
Water treatment plant (potable water) 56,915 56,915 0 56,915
Water treatment plant (environment realease) 0 0 287,500 287,500
Sewage Treatment Plant 519,779 519,779 0 519,779
Laboratory Fit-out 575,000 575,000 0 575,000
Pre-liminary and General Infrastructure construction costs 348,178 87,044 435,222 0 435,222
Mining workshop 750,347 750,347 0 750,347
Perimeter Fencing 390,111 390,111 0 390,111
Fire Pumps & Reticulation 97,701 97,701 0 97,701
7.5 tonne Hiab truck 18,784 18,784 37,568 56,352
Forklift 25,185 25,185 50,370 75,555
Mobile Crane 14,861 14,861 29,723 44,584
Fire Truck 65,138 65,138 65,138 130,277
Ambulance 21,991 21,991 21,991 43,983
Stores Truck 64,805 64,805 86,406 151,211
Personnel Bus 76,519 76,519 153,037 229,556
General light vehicles 100,050 100,050 333,500 433,550
Manager vehicle (GM) 38,497 38,497 76,995 115,492
Manager vehicle (Admin) 0 0 76,995 76,995
Fuel Tanker 0 20,364 20,364 20,364 40,728
Subtotal General & Administration Capital ($) 44,177,579 2,202,028 46,379,607 3,938,330 50,317,938
United Kingdom
Table 25.5 Capital Costs – Table 2
Cost Area Pre-Production Capex Working Capital Total Sustaining LOM
Mining
Batch Plant 167,366 167,366 0 167,366
Batch Plant Civils 50,000 0 50,000 0 50,000
Box Cut 678,500 678,500 0 678,500
Boxcut liner + vent raise construction 520,972 520,972 0 520,972
Mine water setler plus oil skimmer facility 75,000 75,000 0 75,000
UG Electrical Infrastructure 586,450 146,613 733,063 0 733,063

Surface LV's 33,350 33,350 66,700 100,050
UG LV's 195,500 195,500 391,000 977,500 1,368,500
Primary ventilation fans 2,634,398 2,634,398 0 2,634,398
Primary Boosters fans 511,700 511,700 0 511,700
Decline Fans (2x90 kkw) 112,709 112,709 0 112,709
UG Dual stage fans (2 x 55 kw) 134,871 134,871 269,741 404,612
UG Single Stage fans ( 1 x 55 kw) 492,375 492,375 1,477,125 1,969,500
UG heating infrastructure 192,774 192,774 0 192,774
8kw Flyght Pumps 64,050 8,006 72,056 104,081 176,138
20kw Flyght Pumps 54,320 54,320 95,060 149,380
55kw mono pumps 119,600 119,600 119,600 239,200
135kw mono pumps 200,635 200,635 200,635 401,270
Stench gas system 10,000 10,000 0 10,000
Surface explosives magazine 50,000 50,000 0 50,000
Egress system 286,490 286,490 0 286,490
Hand held rock drills 23,608 23,608 0 23,608
Initial Mobile workshop fit-out 200,000 200,000 0 200,000
Mobile Refuges 92,100 92,100 184,200 184,200 368,400
Manager Vehicle (Mining) 38,497 38,497 0 38,497
VAT on Mobile equipment 441,300 508,350 949,650 3,675,600 4,625,250
0
Subtotal Mining Capital ($) 7,966,565 950,569 8,917,133 7,170,243 16,087,376
Processing
Ural 8x4 Rejects Truck 0 75,430 75,430 150,859 226,289
Tailings Dam starter 2,858,034 2,858,034 0 2,858,034
Tailings Dam Phase 2 and 3 0 0 2,444,744 2,444,744
Tailings Dam Closure 0 0 0 1,150,000 1,150,000
Return Water Dam 755,580 755,580 0 755,580
Plant Capital 28,071,777 141,064 28,212,842 0 28,212,842
Plant Workshop fit-out 100,000 100,000 0 100,000
Surface LV's 66,700 33,350 100,050 200,100 300,150
Manager vehicle (Plant)) 38,497 38,497 76,995 115,492
Capital spares for first two years 162,312 162,312 162,312 324,623
First fill consumables 292,829 292,829 0 292,829
Subtotal Processing Capital ($) 32,345,730 249,844 32,595,573 4,185,010 36,780,583
Project sub-Total 84,489,873 3,402,441 87,892,314 15,293,583 103,185,897
Contingency on capital items 8,448,987 340,244 8,789,231 1,529,358 10,318,590
Capital - Grand Total items 92,938,861 3,742,685 96,681,546 16,822,941 113,504,487
Capitalised Operating
General and Administration 6,433,601 1,124,345 7,557,946
Mining 16,347,803 7,618,511 23,966,314
Processing 456,830 694,300 1,151,130
Q2 - 2008 Revenue - Cost Balance 1,632,120 1,632,120
Capitalised Operating sub-total 23,238,234 11,069,276 34,307,510
Project - Grand Total 116,177,095 14,811,961 130,989,056 16,822,941 147,811,997
VAT (Break-out up to end of Q1 2008) Pre-Production Capex Working Capital Total Sustaining LOM
VAT on capital works and goods 10,019,791 364,592 10,384,382

VAT (Mobile Equipment) 441,300 508,350 949,650
VAT (total ) 10,461,091 872,942 11,334,032
25.7.2 Operating Costs
Operating costs have been built up on the following basis:
• Engineered designs for the Voskhod project;
• Competitive tenders for the supply of services such as product trucking, security,
providing of camp services, etc;
• Locally obtained quotes (FSU) for consumables in the first instance, followed by
quotations from suppliers external to the FSU;
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• Where required specific material contingencies have been applied (such as ground
support) these have been stated;
• Costs have been grouped into the three classifications of General and Administration,
Mining and Processing; and
• Rates are quoted using the most applicable, for example per tonne of material, per
period or specifically as for power $/Kwhr.
All operating costs up to and including Q1-2008 have been capitalised. The following
numbers are post this period. Operating Costs are:
• Administration and General $2.9/ore tonne
• Mining $14.4/ore tonne
• Processing $3.4/ore tonne
• Total $20.8/ore tonne
Table 25.6 below shows the total project operating costs by major area excluding labour.
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Table 25.6 Total Project Operating costs (excluding Labour)

Cost units $/unit Item Total Project Cost
Admin and general
$/quarter 41,100.00 Aktobe + Chromtau Office running cost 2,599,575
$/quarter 7,500.00 Aktobe office Rental + maintanenace 558,000
$/quarter 221,750.00 London/Almaty Corporate Office Costs 14,192,000
$/quarter 243,975.00 Camp running cost 13,432,943
$/year 150,000.00 Social responsibility 2,400,000
$/quarter 83,790.00 Site security 5,119,569
$/quarter 3,000.00 Miscellaneous fuel 192,000
$/quarter/unit 3,201.00 Light vehicles 2,296,397
$/kwhr 0.0461 Grid Power cost (temporary) 366,440
$/year 34,615.00 Rail load-out maintenance 484,610
$/quarter 35,469.00 988 Rail Load-out Ownership 1,986,264
$/quarter 25,907.00 Environment 1,476,699
$/year 7,000.00 Land Rent 86,000
Total General Cost ($) 45,190,497
Mining
variable Mine Directs 85,540,361
variable Equipment Ownership 40,272,972
variable Equipment operating 63,737,854
$/kwhr 0.0322 Permanent Grid Power 27,916,388

$/quarter 9,600.00 Explosives Magazine 614,400
$/quarter 7,500.00 Fan and pump maintenance 453,000
$/quarter 15,000.00 Other mining consumables 906,000
$/quarter 15,000.00 UG maintanence dept- small tools, etc 906,000
$/quarter/unit 4,938.00 Underground Light vehicles 2,928,234
$/quarter 35,700.00 PPE consumables 2,088,450
Contractor Premium 7,437,614
Total Mining Cost ($) 232,801,272
Processing
$/tonne 1.23 Process consumables and maintenance 22,470,098

$/quarter 35,469.00 988 FEL - ROM ownership 2,021,733
$/tonne 0.33 988 FEL - ROM operating 5,699,694
$/quarter 44,192.00 14H Grader (Ownership + operating) 2,518,944
$/quarter 150,462.00 Permanent Grid Power 8,501,103
$/quarter/unit 3,201.00 Light vehicles 547,371
$/tonne 0.41 Reject trucking cost 1,421,391
$/tonne 0.91 Tailings dam (and RW D) mainteance 1,875,007
$/quarter 59,400.00 Assay Laboratory 3,326,400
Total Processing Cost ($) 48,381,740
Total (Excluding Labour) 326,373,509
The total project labour costs are described in the following table:
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Table 25.7 Life of Mine Labour Costs

Total Life of Project Employee salary (incl burden) Costs
Mining $
Total National Employee Costs 12,267,855
Total Mining Employee Costs 27,180,015
Processing
Total Processing Employee Costs 9,805,416
General and Administration

Total Gen and Admin Employee Costs 10,363,451
Project Total
Total Labour Cost 47,348,883
Total Ex-pat Travel 883,220
The table below provides a summary of mine operating costs. It should be noted that these costs
include those that are treated as capitalised operating costs during project start-up.
United Kingdom
The unit costs below in Table 25.8 represent operating costs after production has commenced.
The cash totals in Table 25.8 are life of mine numbers that include capitalised operating costs.
Table 25.8 Summary of Unit operating Costs

Project Total Operating Costs including contingency
General and Administration Costs Total ($)

Labour $ 10,363,451
All Other $ 45,190,497
Total $ 61,295,309
Mining
Labour $ 27,180,015
All Other $ 232,801,272
Contingency (10%) 26,063,857
Total $ 286,702,424
Processing
Labour $ 9,805,416
All Other $ 48,381,740
Total $ 64,068,440
Total - Operating 412,066,173

Post Processing costs are those involved with product handling after beneficiation and are
expressed as $/tonne of product or $/tonne of fines concentrate in the case of bagging. The
table below summarises these. The total operating cost per tonne of ore (including off site
costs but excluding freight to end user) is estimated to be US$27.3/t of ore. The operating
cost expressed per tonne of product is US$ 39.1/t of product
Table 25.9 Post processing Costs

Product Costs post Processing ($/t of product)
$/unit $
Concentrate (fines only) Bagging Cost 5.1 $/t fines 7,131,402
Mine to railhead Truck Transport 1.83 $/t 23,371,022
Moisture penalty (truck transportation) 0.07 $/t 893,974
Product Handling at Rail Siding 0.33 $/t 4,214,447
Moisture penalty (rail transportation winter only) 2.02 $/t 12,863,529
Rail Operators Commission (1% of freight charges) 0.51 $/t 6,513,236
Rail Logistics Agent (5% of freight charges) 2.53 $/t 32,310,758
Total Product handling Costs

Steffen, Robertson and Kirsten (UK) Ltd. Registered Address: Offices in: 87,298,367
United Kingdom
25.8 ECONOMIC ANALYSIS
For the economic evaluation SRK has combined the capital and operating cost inputs with
the mining schedule in order to generate a detailed economic model in MS Excel for the life
of mine. . SRK has reviewed the data available and carried out additional investigations and
research on the Voskhod project. Based on this work SRK has derived an independent
technical economic model termed the Base Case Model, described below. This model
reflects capital and operating expenditures and revenues from the second quarter 2006
onwards. Most of the project capital that has been committed to date has been excluded.
In addition, the SRK economic model:
• Is expressed in terms of un-inflated United States Dollar (US$) with no allowances

for inflation or escalation as at 24th May 2006
• Delays all sales revenues by a quarter to simulate the product sales pipeline
• Is based on a chromite price used by SRK in this study for all chromite products is
U$145/t at the Sarysai rail head
• Is expressed in post-tax and pre-financing terms which assumes 100 % equity;
• The corporation tax rate of 30% has been used. Any allowable residual tax losses,
that are able to be carried forward, have not been taken into account.
• Does not include any acquisition costs or previous corporate expenses.
• Capital investment is depreciated on an annual fixed percentage basis as per the

fiscal regime of Kazakhstan
• Is based on the SRK mining schedule and its production rate of 1.3 Mtpa.
• Reflects owner mining with a premium applied to reflect the planned approach of
utilising a contractor for mine startup until the end of 2008;
• Is based upon process recoveries and a plant design provided by Mintek and DRA-I
respectively
• Takes no account of the potential for the discovery of further Mineral Resources in
the licence areas.
• Operating expenditures during commissioning and initial ramp up of

mining/processing have been capitalised up to the end of the first quarter in 2008
• Provides a 10% contingency for both capital and operating costs
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In terms of taxation the SRK Base Case model applies the following:
¾ 15% VAT to all capital items

expended.
tax rate of 30%
The NPV (Net Present Value) derived for the Base Case Model using the assumptions listed
above is $US319.6 M at a discount rate of 10 %. The Internal Rate of Return (IRR) was
calculated to be 41 %. Therefore, the conclusion of the SRK feasibility study is that the
Voskhod Chromite project is technically and economically feasible based on the
investigations and assumptions made in this report.
Displayed in Figure 25.6 is the sensitivity of the Voskhod project’s NPV to chromite price,
discount rate, capital expenditure and operating expenditure.
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Figure 25.6 NPV Sensitivity Graph
NPV Sensitivity (30% tax)
$600,000,000
$500,000,000
$400,000,000
Chromite price
NPV
Discount Rate
$300,000,000 Initial Capex
Opex
$200,000,000
$100,000,000
$0
-40% -30% -20% -10% 0% 10% 20% 30% 40%
% Variation
SRK notes that substantial variations in the four variables do not result in a negative NPV for
the Voskhod project. SRK notes that without corporation tax applied the NPV is
USS471.6 M and the corresponding IRR is 50 %.
25.9 PAYBACK
The SRK financial model indicates that based upon the assumptions used in this Feasibility
Study the project payback period is three years.
25.10 MINE LIFE
Based upon Indicated Resources converted into Probable Reserves the mine life is currently
14 years (57 quarters) preceded by a two year construction period.
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Figure 25.7 Summary of Project Cashflows

Unit LOM Total 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
CAPITAL EXPENDITURE
Subtotal General & Administration Capital ($) $50,317,938 $8,421,598 $35,755,981 $2,591,425 $20,141 $100,050 $207,039 $58,830 $470,141 $87,130 $117,024 $220,248 $86,841 $58,830 $20,141 $684,319 $1,418,200
Subtotal Mining Capital ($) $16,087,376 $2,567,669 $5,398,895 $1,877,344 $21,586 $579,338 $443,286 $884,588 $763,786 $551,373 $95,686 $846,688 $361,586 $928,088 $21,586 $528,788 $217,086
Subtotal Processing Capital ($) $36,780,583 $1,918,473 $30,427,256 $412,155 $1,222,372 $383,022 $75,430 $244,474 $244,474 $138,547 $319,904 $244,474 $1,150,000
Subtotal - Upfront capital $87,892,314 $12,907,741 $71,582,133 $3,402,441
Sustaining capital $15,293,583 $0 $0 $1,478,483 $21,586 $1,821,851 $543,336 $1,474,649 $898,046 $1,265,988 $182,816 $1,208,186 $720,382 $1,334,833 $80,417 $793,403 $901,405 $2,568,200
Contingency on capital items $10,318,590 $1,290,774 $7,158,213 $488,092 $2,159 $182,185 $54,334 $147,465 $89,805 $126,599 $18,282 $120,819 $72,038 $133,483 $8,042 $79,340 $90,140 $256,820
Capital Grand Total $113,504,487 $14,198,515 $78,740,346 $5,369,017 $23,745 $2,004,036 $597,670 $1,622,114 $987,851 $1,392,587 $201,098 $1,329,005 $792,420 $1,468,316 $88,458 $872,744 $991,545 $2,825,020
Production
Total waste produced t 1,680,482 18,519 138,617 199,152 128,951 220,089 121,961 92,111 120,257 67,131 80,782 72,364 48,439 67,440 73,097 147,422 84,151 0
Ore
Ore produced from sublevel drifting t 1,026,327 - - 82,161 90,940 60,297 108,965 125,927 147,221 110,402 8,767 43,354 52,533 25,531 67,710 56,755 45,764 0
Ore produced from sublevel caving t 17,271,799 - - 998,352 1,207,724 1,240,979 1,190,597 1,176,362 1,156,190 1,193,750 1,292,454 1,256,932 1,249,318 1,276,276 1,233,481 1,242,733 1,255,031 301,620
Total ROM ore production t 18,298,126 - - 1,080,514 1,298,664 1,301,277 1,299,561 1,302,289 1,303,411 1,304,152 1,301,221 1,300,286 1,301,852 1,301,807 1,301,191 1,299,488 1,300,795 301,620
Grade % 607 38.70 36.32 37.43 35.91 39.00 39.88 41.54 39.62 45.07 38.52 42.40 41.30 44.91 42.83 43.14
Saleable Products
Lump t 9,567,541 510,808 592,794 621,304 577,381 654,170 675,546 707,444 653,898 781,665 640,096 718,704 698,503 790,300 762,811 182,118
Chip t 1,805,195 102,827 110,937 115,526 109,033 122,923 126,649 134,160 126,371 148,805 120,908 138,011 132,911 147,146 137,183 31,805
Concentrate t 1,398,314 87,143 79,257 83,129 78,895 92,707 96,230 106,577 101,585 124,081 91,371 113,625 105,856 117,186 99,161 21,513
Total Saleable Products t 12,771,050 700,778 782,988 819,959 765,309 869,799 898,425 948,181 881,855 1,054,550 852,374 970,339 937,270 1,054,632 999,155 235,435
Yield % 69.79 65.41 60.62 64.29 60.75 67.05 69.26 73.10 67.89 81.28 65.90 74.66 72.63 81.41 76.92 78.06
Revenues
Lump $ $1,387,293,509 $50,142,737 $91,080,726 $82,114,854 $90,038,927 $91,508,332 $109,854,576 $114,479,749 $94,815,239 $113,341,398 $92,813,919 $104,212,021 $101,282,910 $114,593,513 $110,607,571 $26,407,038
Chip $ $261,753,242 $10,373,229 $17,045,510 $15,334,549 $16,859,193 $17,257,590 $20,619,337 $21,708,523 $18,323,860 $21,576,691 $17,531,614 $20,011,545 $19,272,160 $21,336,170 $19,891,594 $4,611,678
Concentrate $ $202,755,559 $9,134,755 $12,505,464 $10,645,932 $12,396,099 $12,907,130 $15,690,582 $17,190,917 $14,729,817 $17,991,722 $13,248,743 $16,475,636 $15,349,052 $16,992,028 $14,378,327 $3,119,355
(Transport losses correction) -$9,259,012 -$348,254 -$603,159 -$540,477 -$596,471 -$608,365 -$730,822 -$766,896 -$639,345 -$764,549 -$617,971 -$703,496 -$679,521 -$764,609 -$724,387 -$170,690
Total Revenue $ $1,842,543,299 - - $69,302,467 $120,028,542 $107,554,859 $118,697,748 $121,064,686 $145,433,672 $152,612,293 $127,229,571 $152,145,262 $122,976,305 $139,995,706 $135,224,602 $152,157,101 $144,153,104 $33,967,380
Operating Costs
General and Administration Costs $ $61,295,309 $2,057,378 $4,376,223 $4,521,548 $4,246,635 $4,159,410 $4,159,410 $4,092,574 $4,019,650 $3,600,803 $3,594,714 $3,594,714 $3,594,714 $3,594,714 $3,594,714 $3,594,714 $3,594,714 $898,679
Mining $ $286,702,424 $2,747,924 $13,599,879 $30,414,011 $20,619,650 $21,763,438 $19,169,195 $18,629,041 $19,896,039 $17,853,131 $16,525,033 $16,422,936 $15,924,470 $16,106,012 $17,088,045 $19,136,154 $17,233,229 $3,574,238
Processing $ $64,068,440 $15,036 $441,794 $4,344,787 $4,870,455 $4,726,029 $4,572,031 $4,431,785 $4,411,267 $4,402,338 $4,469,883 $4,360,769 $4,467,728 $4,417,389 $4,417,648 $4,350,739 $4,381,803 $986,960
Subtotal $ $412,066,173 $4,820,338 $18,417,896 $39,280,346 $29,736,740 $30,648,877 $27,900,636 $27,153,399 $28,326,956 $25,856,272 $24,589,629 $24,378,420 $23,986,912 $24,118,115 $25,100,407 $27,081,607 $25,209,746 $5,459,876
Royalty Payment (1% on operating costs) $ $18,425,433 $0 $0 $693,025 $1,200,285 $1,075,549 $1,186,977 $1,210,647 $1,454,337 $1,526,123 $1,272,296 $1,521,453 $1,229,763 $1,399,957 $1,352,246 $1,521,571 $1,441,531 $339,674
Total Operating Costs $ $430,491,606 $4,820,338 $18,417,896 $39,973,371 $30,937,025 $31,724,426 $29,087,613 $28,364,046 $29,781,293 $27,382,394 $25,861,925 $25,899,872 $25,216,675 $25,518,072 $26,452,653 $28,603,178 $26,651,277 $5,799,550
Product Costs Post Processing
Concentrate Bagging Cost $ $7,131,402 $444,430 $404,208 $423,958 $402,366 $472,804 $490,771 $543,541 $518,083 $632,812 $465,990 $579,488 $539,863 $597,651 $505,720 $109,715
Mine to railhead Truck Transport $ $23,371,022 $1,282,423 $1,432,868 $1,500,525 $1,400,516 $1,591,733 $1,644,117 $1,735,172 $1,613,794 $1,929,827 $1,559,845 $1,775,721 $1,715,204 $1,929,977 $1,828,454 $430,846
Moisture penalty (truck transportation) $ $893,974 $49,054 $54,809 $57,397 $53,572 $60,886 $62,890 $66,373 $61,730 $73,819 $59,666 $67,924 $65,609 $73,824 $69,941 $16,480
Product Handling at Rail Siding $ $4,214,447 $231,257 $258,386 $270,587 $252,552 $287,034 $296,480 $312,900 $291,012 $348,002 $281,284 $320,212 $309,299 $348,029 $329,721 $77,694
Moisture penalty (transportation) $ $12,863,529 $445,264 $768,526 $935,103 $872,784 $921,313 $907,409 $957,663 $890,673 $1,065,096 $860,898 $980,043 $946,643 $1,065,179 $1,009,147 $237,789
Rail Operators Commission (1% of freight charges) $ $6,513,236 $357,397 $399,324 $418,179 $390,308 $443,598 $458,197 $483,572 $449,746 $537,821 $434,711 $494,873 $478,008 $537,863 $509,569 $120,072
Rail Logistics Agent (5% of freight charges) $ $32,310,758 $1,772,967 $1,980,959 $2,074,497 $1,936,232 $2,200,592 $2,273,015 $2,398,899 $2,231,092 $2,668,013 $2,156,507 $2,454,958 $2,371,293 $2,668,220 $2,527,862 $595,650
Total Product Handling Costs $ $87,298,367 0 0 $4,582,792 $5,299,080 $5,680,246 $5,308,330 $5,977,960 $6,132,879 $6,498,120 $6,056,130 $7,255,389 $5,818,901 $6,673,219 $6,425,918 $7,220,743 $6,780,415 $1,588,247
CASHFLOW $ $1,282,853,281 -19,018,853 -97,158,242 19,377,288 83,768,692 68,146,151 83,704,135 85,100,566 108,531,649 117,339,191 95,110,419 117,660,996 91,148,309 106,336,099 102,257,573 115,460,437 109,729,867 23,754,563
Cumulative Cashflow (pre tax) -19,018,853 -116,309,095 -97,063,806 -13,427,115 54,680,800 138,384,935 223,485,502 332,017,151 449,356,342 544,466,760 662,127,756 753,276,065 859,612,164 961,869,737 1,077,330,173 1,187,060,040 1,210,814,603
Depreciation 146,179,877 3,489,375 18,946,865 20,939,682 20,945,618 18,364,586 12,150,691 6,161,741 6,366,844 6,469,926 6,370,783 6,199,941 4,927,470 4,725,691 3,246,015 1,676,835 1,391,929 3,805,883
Taxable 1,087,505,203 -19,018,853 -97,158,242 -1,562,394 62,823,073 49,781,565 71,553,445 78,938,825 102,164,805 110,869,264 88,739,635 111,461,055 86,220,838 101,610,408 99,011,558 113,783,601 108,337,938 19,948,680
Tax Payable (30%) 361,573,407 0 0 0 18,846,922 14,934,469 21,466,033 23,681,648 30,649,442 33,260,779 26,621,891 33,438,316 25,866,251 30,483,122 29,703,467 34,135,080 32,501,381 5,984,604
post tax cash 849,675,432 -19,018,853 -97,158,242 19,377,288 64,921,770 53,211,681 62,238,102 61,418,919 77,882,208 84,078,411 68,488,528 84,222,679 65,282,057 75,852,976 72,554,106 81,325,356 77,228,485 17,769,959
Cumulative Cashflow (post tax) -19,018,853 -116,177,095 -96,799,806 -31,878,037 21,333,645 83,571,747 144,990,665 222,872,873 306,951,284 375,439,813 459,662,492 524,944,549 600,797,525 673,351,631 754,676,987 831,905,473 849,675,432
SRK Consulting
Voskhod FS Page 21
26 CERTIFICATES
CERTIFICATE of AUTHOR
1. Alwyn E. Annels, FIOM3, C. Eng., do hereby certify that:
2. I am a Principal Mining Geologist of SRK Consulting (UK) Ltd, Windsor Court, 1-3
Windsor Place, Cardiff CF10 3BX, UK
3. I graduated with an Upper Second Class Honours degree (B.Sc) in Geology from Kings
College, University of London, in 1964 and with a PhD in volcanic geology from Imperial
College, University of London in 1967.
4. I am a Fellow of the Institution of Mining, Metallurgy and Materials (IOM3) and a
Chartered Engineer.
5. I have worked as a mining geologist for a total of 39 years since my graduation from
university.
6. I have read the definition of “qualified person” set out in National Instrument 43-101 (“NI
43-101”) and certify that by reason of my education, affiliation with a professional
association (as defined in NI 43-101) and past relevant work experience, I fulfil the
requirements to be a “qualified person” for the purposes of NI 43-101.
7. I am responsible for the preparation of the geology and resources sections of the technical
report titled “Voskhod Feasibility Study Summary Technical Report” and dated May 2006
(the “Technical Report”) relating to the Voskhod property. I have visited the Voskhod
property on six occasions during the period September 2004 November 2005 for a total of
39 days.
8. I have had no prior involvement with the property that is the subject of the Technical
Report.
9. I am not aware of any material fact or material change with respect to the subject matter of
the Technical Report that is not reflected in the Technical Report, the omission to disclose
which makes the Technical Report misleading.
10. I am independent of the issuer applying all of the tests in section 1.5 of National
Instrument 43-101.
11. I have read National Instrument 43-101 and Form 43-101F1, and the Technical Report has
been prepared in compliance with that instrument and form.
United Kingdom
12. I consent to the filing of the Technical Report with any stock exchange and other
regulatory authority and any publication by them for regulatory purposes, including
electronic publication in the public company files on their websites accessible by the
public, of the Technical Report.
Dated this 24th day of May, 2006.
Dr Alwyn E. Annels
United Kingdom
SRK Consulting
Voskhod FS
CONSENT of AUTHOR
TO: Ontario Securities Commission
I, Alwyn. E. Annels, do hereby consent to the filing of the written disclosure of the
Executive Summary of technical report titled “Voskhod Feasibility Study Summary
Technical Report” and dated May 2006 (the “Technical Report”) and to the filing of the
Executive Summary of the Technical Report with the securities regulatory authorities
referred to above.
Dated this 24th Day of May, 2006.
Dr Alwyn. E. Annels
United Kingdom
File Ref: Page No:
24th May 2006
CERTIFICATE of AUTHOR
I, Michael J. Beare, MIOM3, C. Eng., do hereby certify that:
1. I am a Senior Mining Engineer of SRK Consulting Ltd, Windsor Court, 1-3 Windsor Place,
Cardiff CF10 3BX, UK
2. I graduated with a First Class Honours degree (B.Eng) in Mining Engineering from
Camborne School of Mines, Cornwall, UK in 1992.
3. I am a Member of the Institution of Mining, Metallurgy and Materials (IOM3 ) and a

Chartered Engineer.
4. I have worked as a mining engineer for a total of 14 years since my graduation from
university.
5. I have read the definition of “qualified person” set out in National Instrument 43-101 (“NI
43-101”) and certify that by reason of my education, affiliation with a professional
association (as defined in NI 43-101) and past relevant work experience, I fulfil the
requirements to be a “qualified person” for the purposes of NI 43-101.
6. I am responsible for the preparation of the technical report titled “Voskhod Feasibility
Study Summary Technical Report” and dated May 2006 (the “Technical Report”) relating to
the Aguas Teñidas property. I visited the Voskhod property on one occasion during the April
2006 for a total of 3 days.
7. I have had no prior involvement with the property that is the subject of the Technical
Report.
8. I am not aware of any material fact or material change with respect to the subject matter of
the Technical Report that is not reflected in the Technical Report, the omission to disclose
which makes the Technical Report misleading.
9. I am independent of the issuer applying all of the tests in section 1.5 of National Instrument
43-101.
10. I have read National Instrument 43-101 and Form 43-101F1, and the Technical Report has
been prepared in compliance with that instrument and form. 11. I consent to the filing of the
Technical Report with any stock exchange and other regulatory authority and any publication
by them for regulatory purposes, including electronic publication in the public company files
on their websites accessible by the public, of the Technical Report.
Dated this 24th day of May, 2006.
Mr Michael Beare
United Kingdom
CONSENT of AUTHOR
TO: Ontario Securities Commission
I, Michael J. Beare, do hereby consent to the filing of the written disclosure of the Executive
Summary of technical report titled “Voskhod Feasibility Study Summary Technical Report” and dated
May 2006 (the “Technical Report”) and to the filing of the Executive Summary of the Technical
Report with the securities regulatory authorities referred to above.
Dated this 24th Day of May, 2006.
Mr Michael Beare
United Kingdom

017 Summary Tech Report NI43101 R

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Voskhod Feasibility Study

43-101 Summary Technical Report

VOSKHOD CHROME DEPOSIT, KAZAKHSTAN

Report Prepared for:

011_Summary Tech Report_NI43-101 MAY 2006

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Voskhod Feasibility Study

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4 Introduction and Terms of Reference 25

6 Property Description and Location 29

7 Accessiblity, climate, local resources infrastructure and physiography 33

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14 Sampling Method and Approach 68

15 Sample preparation, Analyses and Security 70

17 Adjacent Properties 106

18 Mineral Processing and Metallurgical Testing 108

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18.5.5 Other Services 115

19 Mineral Resource and Mineral Reserve estimates 116

20 Other Relevant Data and Information 1

21 Interpretation and Conclusions 29

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25 Additonal Requirements for Technical Reports on Development Properties

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Figure 9.1: Idealized Ophiolite Stratigraphy 42

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Table 8.2 2005 Drilling Summary 40

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Table 3.1 Mineral Resources

Indicated 19.5 48.5 13.1 8.5 3D

Inferred 1.6 41.0 12.3 12.7 2D

Table 3.2 Mineral Reserves

Mt %Cr2o3 Mt %Cr2o3 Mt %Cr2O3

19.5 48.5 17.7 46.6 18.3 40.3

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Lump -100/150mm + 10mm, 45-48 % Cr2O3, <10 %SiO2 (8% typical)

Chip -10mm + 1mm, 45-48 % Cr2O3, <10 %SiO2 (8 % typical)

Fine concentrate -1mm, >55-59% Cr2O3, <3%SiO2

Table 3.3 Forecast Product Split over LoM

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Plant Feed 18,298,126 40.3 11.1 8.3

Lump 9,567,541 52.3 48.0 11.9 8.8

Chip 1,805,195 9.9 48.0 11.9 8.8

Concentrate 1,398,314 7.6 57.0 14 1-1.5

Total 12,771,050 69.8

Chip Rejects 552,350 3.0 10.5

Fines 594,924 3.3 19.0

Slimes 1,465,523 8.0

Total 5,527,253 30.2

Figure 1 Forecast Production

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Forecast Production Graph

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• Investments in infrastructure development;

• Improvement of the quality of the medical services; and

• Maintenance and construction of roads.

• Treatment of all water discharged to the environment;

• Full closure and rehabilitation programmes for the site

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11 MARKETING AND LOGISTICS