African Queen Mines Ltd.

Properties & Projects:Ghana Noyem-Nyafoman Gold Project

 

Properties & Projects Dabolava

Ghana

Noyem-Nyafoman Gold Project

AFRICAN QUEEN MINES LTD. (the “Company”) entered into an Earn-in and Joint Venture Agreement with Marshall Islands’ private company AKAN EXPLORATION LTD., covering exploration, development and exploitation of the Noyem Gold Project, which is the subject of the Noyem-Nyanfoman Prospecting License LVB 10244/1995 in Ghana. Simultaneously, the Company has entered into a Purchase & Sale Agreement with Newmont Ghana Gold Limited (“NGGL”), the Ghanaian subsidiary of Newmont Mining Corporation (NYSE: “NEM”), under which NGGL has transferred the License directly to the Company’s Ghanaian subsidiary AQ Ghana Gold Ltd. (“AQGGL”), to be held in trust for the Joint Venture partners in accordance with the Akan Agreement. The Company may earn up to 75% interest.

The Noyem-Nyafoman Gold Project. The License currently covers an area of approximately 30.23 sq. km. located within the Birim North District of Ghana’s Eastern Region, approximately 130 km. NW of Accra. It is at the northeastern end of Ghana’s well-known, gold-producing Ashanti Gold Belt, near Newmont’s Akyem deposit which is presently under development for potential production. It is also within approximately 100 km. of AngloGold Ashanti’s world-class Obuasi Mine and the old Konongo open pit gold mine. In addition to its close proximity to Accra which facilitates access, the Project is bisected in a NE-SW direction by a tarred road. It has long been host to large numbers of artisinal miners and in October, 2008, a shed-off area of 8.98 sq. km. adjacent to the current license area was reserved for small scale mining. This was designed to facilitate exploration and development of potential large scale mining operations on the License. In 2011, 19 small scale mining claims were acquired by the Company and have been re-incorporated into the License.

The License was initially acquired by NGGL together with a number of other Ghana gold mining properties through Newmont’s acquisition in 2002 of Australian-based Normandy Mining Limited (“ Normandy”). Bonsu Gold Holdings, a subsidiary of Gencor International Gold Ltd. (“Gencor” (now Newmont Mining Corp. through acquisition of Normandy)) estimated a historic (pre-NI 43-101) inferred resource of 5.2 million tonnes grading 6.67 g/t Au (approximately 1.1 million oz contained Au) within reefs of the Tarkwaian conglomerates in the Eastern portion of the concession (“Noyem A”). A qualified person has not done sufficient work to classify the historic estimate as a current mineral resource. AQ is not treating the historic estimate as a current mineral resource.

The estimate was based on 31 diamond drill holes with 26 holes spaced at 200m intervals to test primary mineralization between 50m (depth of surface weathering and oxidization) and 100m depths. The regular hole spacing allowed use of arithmetic averages for width and grade. Gencor used a density of 2.83, a paleoplacer model to extrapolate mineralized zones to 550m depth and excluded the upper 50m of oxidized mineralization which could not be easily mined from underground and had been exploited at the surface by informal miners. A 2,000 meter diamond drill program conducted by AQ supports Gencor’s drill results at 50m to 100m depths. Further, successful in-fill and depth drilling is required before a qualified person can prepare a compliant current resources estimate. Rather, the Company views it as an exploration target for further evaluation, study and work in the near future.

Drill Program

The Company intiated a 2000 meter core drill program in February 2012. The objectives of the Company’s 2012 diamond core drill program were to: 1) validate the gold results from the Bonsu drill holes; 2) In-fill drill to reduce the drill spacing to 100–200 m; and 3) extend the drill grid towards the east at 100–200 m intervals. The Company presently has physical control of all drill cores from the historic Bonsu program.

During the Company’s diamond core drilling program a total of 1,981.50 m of core was drilled from 26 drill holes to a maximum depth of 150 m. Of the 26 drill holes, 24 intersected the mineralised NCZ, while the other 2 holes were abandoned before intersecting the NCZ due to drilling difficulties. A total of 889 samples, including 751 core samples, 52 duplicate samples, 50 standards and 36 blanks were submitted to Scientific Services Laboratories in Cape Town, South Africa for 50g Fire-Assay gold analyses. The control samples passed the Company’s internal QA-QC requirements. 6 of the 26 drill holes drilled during the 2012 diamond core drilling program were used to twin 6 (or 22%) of the 27 historic drill holes which were spaced roughly equidistantly across the 5.6 km strike length of the Northern Limb target. Considering the nuggety nature of palaeoplacer gold deposits, the comparison of the average widths and gold grades of the intersected mineralised NCZ between each pair of twinned holes showed reasonable correlations. Furthermore, the statistical comparison between the Bonsu and African Queen drilling datasets showed a relatively good statistical correlation, with the two drilling programs showing broad overlap of the zone of elevated gold grades. Therefore, both drilling datasets were combined for interpretative purposes.

Based on lithological, width and gold-grade variations observed within the mineralized NCZ of each drill hole, the Northern Limb target was sub-divided into three broad zones; namely the Western, Central and Eastern Zones, which extend over approximately 2.5 km, 2.0 km and 1.1 km respectively. High interest gold results recovered from the Company’s drilling program are presented along with the high interest gold results from Bonsu’s diamond core drilling program in Table 1.

Table 1. High Interest gold results recovered from the current African Queen and historic Bonsu drilling programs.  

Noyem Initial Select Drill Results (Table 1 -African Queen)

Noyem - Historic Drill Results (Table 1 - Bonsu)

The results indicate that the Western and, in particular, the Central Zones of the Northern Limb target are the most prospective and further exploration drilling will be undertaken in the next phase to test the along-strike and down-dip potential of the mineralized NCZ which to date has not been tested below a vertical depth of 150 m. Commonly associated with palaeoplacer gold deposits are a series of narrow palaeo-channels hosting high gold values which typically form payshoots. Further sedimentological studies on the drill core are required to assist with defining areas where high-grade payshoots are likely to be present.

The mineralised NCZ extends to the east of the Northern Limb target where the stratigraphy has been folded to form a large synformal structure referred to as the Hinge Zone target. The Hinge Zone target is yet to be drill tested, but is considered to be prospective due to the extensive presence of flooded artisanal workings which were previously mined by small-scale miners.

The drill program was carried out on behalf of the Company’s Ghana operating subsidiary, AQ Ghana Gold Limited, and its JV partner, Akan Exploration Ltd. (“Akan”), by E-Drilling Ghana Limited and E. Global Drilling Corp., affiliates of Energold Drilling Corp. (TSX.V: EGD). The program was supervised on behalf of the Company by Remote Exploration Services (Pty) Ltd. of Cape Town, S.A., under the guidance of Senior Geologist, Mr. Conrad Ocker (B.Sc. Hon, Pr. Nat. Sci), and the Company’s Ghana exploration team. Overall project management was carried out by the Company’s Senior Consulting Geologist, Mr. Peter Siegfried (M.Sc., Member (CP Geology) of the AusIMM) and Vice President of Exploration, Dr. Andy Moore (Pr. Sci. Nat.), both of whom are Qualified Persons under N.I. 43-101 and have reviewed and approved the information and data herein.

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