RNS Number : 8179X

Emmerson PLC

15 August 2018

Emmerson Plc / Ticker: EML / Index: LSE / Sector: Mining

15 August 2018

Emmerson Plc ("Emmerson" or the "Company") 

Exploration Target Demonstrates Large-Scale Potash Potential at Khemisset Project

Emmerson Plc, the Moroccan focused potash development company, is pleased to announce it has defined a significant JORC-compliant Exploration Target* at its 100% owned Khemisset Potash Project in Northern Morocco ("Khemisset" or "the Project").  The Exploration Target, covering an area of approximately 87km² that sits within the recently granted Research Permit area, ranges from 264-616 million tonnes and at the upper end of the scale is more than double the current JORC (2012) Inferred Mineral Resource of 311.4 million tonnes 10.2% K₂O and indicates the significant upside within the Project area. To view the press release with the illustrative maps and diagrams please use the following links:
http://www.rns-pdf.londonstockexchange.com/rns/8179X_1-2018-8-14.pdf
http://www.rns-pdf.londonstockexchange.com/rns/8179X_2-2018-8-14.pdf

Highlights

·     Exploration Target* of 264-616 million tonnes at an average grade of 5.0-14.0% K₂O has been established immediately to the north east of the existing 311.4 Mt @ 10.2% K₂O JORC (2012) Mineral Resource at Khemisset

·     Initial indications of a large-scale project with strong potential to increase the current targeted +20 year mine life

·     Exploration Target covers an area of approximately 87km² within the recently granted Research Permits which total 239km² (see RNS 8 August)

·     Exploration Target* is supported by historical drilling and assays, geophysical surveys and geological modelling of the Khemisset Potash Basin

·     Drilling targeting confirmation of potash thickness and grade is scheduled to start in H2 2019

The Exploration Target* is summarised as follows:

Prospect	Seam Thickness Range (m)	Area (Ha)	Tonnage Range (Mt)	Grade Range (K2O %)
Exploration Target	1.5 - 3.5	8,675	264 - 616	5.0 - 14.0

* Disclaimer: A formal Mineral Resource Estimate in the area of the Exploration Target has not been prepared at this time. The potential quantity and grade of the Exploration Target expressed in this release is conceptual in nature, there has been insufficient exploration to estimate a JORC (2012) Mineral Resource and it is uncertain if further exploration will result in the estimation of Mineral Resource.

Hayden Locke, CEO of Emmerson, commented:

"The Khemisset Potash Project already has a large inferred JORC Mineral Resource of 311.4 million tonnes @ 10.2% K₂O, which covers only a small portion of the broader Khemisset Potash Basin.

"We believe our existing JORC-compliant Mineral Resource Estimate is sufficiently large to support a mine life of over 20 years.  Successful exploration in the area of the Exploration Target will only strengthen the overall fundamentals of the Project and its multi-decade, multi-generational potential.

"We will seek to test this Exploration Target with drilling beginning in the second half of 2019. In the meantime, the Scoping Study for Khemisset is well underway and we're confident of delivering it by Q1 2019.  We continue to be excited by Khemisset's potential to be a low capital cost, high margin, potash project delivering outstanding returns, regardless of the potash price."

Exploration Target

The Exploration Target is summarised as follows:

Prospect	Seam Thickness Range (m)	Area (Ha)	Tonnage Range (Mt)	Grade Range (K2O %)
Exploration Target	1.5 - 3.5	8,675	264 - 616	5.0 - 14.0

Table 1: Exploration Target at Khemisset Potash Project

The Exploration Target is located immediately to the North East of the existing JORC Mineral Resource Estimate. Based on available information, including historical oil drilling and seismic lines, it is believed that potash mineralisation continues in this area. The Exploration Target has been limited to areas where it is believed the potash mineralisation is likely to exist at depths amenable to conventional underground mining. Although the available existing information supports this Exploration Target, it is not considered sufficient to support a JORC (2012) Mineral Resource Estimate at this stage. The Exploration Target will be tested with future exploration as detailed further in this document.

Historical Exploration

The Exploration Target is in the south western section of the Saiss Plain, in northern Morocco. Approximately 30 oil wells were drilled between 1939 and 1954 by Société Chérifienne des Pétroles ("SCP") and large amount of seismic reflection profiles were also completed covering the Saiss Plain south of the Prerifaine. Four of these historical wells; HH-4, OF-2, AY3 and NS1, two of which are known to have intersected potash, provide insight to the potential endowment of the basin.

A gravimetric study completed by the SCP in the 1950s shows a well-defined NE-SW negative Bouger residual gravity anomaly which defines the extension of the Khemisset Basin for at least 30km to the north east of the current MRE all the way to the Prerifaine Front where oil well hole NS1 intersected potash.

Potash mineralisation as defined in the current 2018 Mineral Resource Estimate as open to the northeast along strike.   Historic drill holes PZ116 and PKB-1 located in the far northeast of the Oued Beht sub-basin all intersected significant grade and thickness of potash mineralisation which are summarised in Table 2.

Drill Hole	From (m)	To (m)	Thickness (m)	Grade (K2O %)	Mineralogy
PZ116	1,022.96	1,024.80	1.84	10.20	Sylvinite
PKB-1	1,066.80	1,069.39	2.59	11.39	Sylvinite/Carnallite

Table 2: Historic Drill holes in the region of the Exploration Target

Area of Exploration Target

The 8,675 Ha (86.8 km²) Exploration Target (refer Figure 1) which extends for about 7 km to the north east from the existing Mineral Resource Estimate is restricted to areas where the potash seam is modelled at less than 1,500m below the surface. Emmerson believes 1,500m is the upper depth limit for conventional, underground, room and pillar potash mining. Potash mining at this depth currently occurs at the Boulby Potash Mine in the United Kingdom and has historically occurred at the Sierra del Perdón mine in Spain. The Woodsmith Mine, owned by Sirius Resources, is proposing to mine polyhalite at a depth of 1,500m below surface.

The depth to potash estimate is derived from base of basalt contour model using information from drill holes PKB-1, PZ116 and HH4. It is constrained by the NW and SE basin boundaries determined from historical drilling and seismic surveys.

Seam Thickness Range

The lower seam thickness of 1.5m is defined by the assumed minimum mining width of conventional underground mining. Although some seams have been narrower, with higher grades, the tonnage for Mineral Resource Estimate purposes (which requires a reasonable prospect of economic extraction) would be bulked out to this minimum thickness.

The upper seam thickness is set at 3.5m, which is slightly lower than the widest seam thickness observed in the Oued Beht sub-basin as reported in the Competent Persons Report completed by SRK in June 2018. The mid-point seam thickness of 2.5m corresponds with the average seam thickness for the north eastern Khemisset deposit as documented in the JORC (2012) compliant Mineral Resource Estimate.

Density

The Exploration target is based on the previous data with the expected mineral composition of 75% Sylvinite and 25% Carnallite in the potash seam. Although PZ116, which is the closest drill holes to inform the exploration target, is majority sylvinite, Emmerson believes there is the potential for some carnallite mineralisation.

A bulk density of 2.03t/m³, which factors this mineralogical composition, was used in evaluating the potential tonnage range.

Tonnage Range

The tonnage range is based on a model of 30,450 tonnes/Ha for a 1.5m thick potash seam and 71,050 tonnes/Ha for a 3.5m thick potash seam.

Grade Range

Grade ranges observed in the north eastern extent of the mineral resource estimate range from a low of 5% K₂O up to highs of around 20% K₂O. Historical drill hole PZ88, which is located on the southern edge of the Oued Beht basin intersected 70cm @ 23.1% K₂O. Once bulked out, this would give a 1.5m intercept of over 14% K₂O. PZ81, which is located in the centre of the Oued Beht region included intercepts which, when taken in average, show approximately 1.5m @ 17% K₂O over three distinct intercepts.

As a result, the Company believes it is reasonable to assume that grades encountered in the mineralised zones, once internal dilution is taken into account, would range from a low side of 5% up to a high side of 14%.

Programme to Test Exploration Target

The proposed exploration programme to test the Exploration Targets will:

·     Acquire the historical SCP and ONAREP drilling and seismic surveys data within the EML permit areas;

·     Integrate the historical data into a 3-D geological model incorporating the results of the recent seismic survey completed in the Oued Beht sub-basin;

·     Drill initial 1 to 3 diamond drill hole programme to test the most prospective parts of the Exploration Target as determined by the review of the historical data. This is expected to occur as part of the second drilling programme at Khemisset, which would commence in the second half of 2019.

Competent Persons' Statement

The information in this report that relates to Exploration Targets, Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Mr. Christiano Santos Goncalves, a Competent Person who is a Member and Chartered Professional (CP_Geo 306 079) of The Australasian Institute of Mining and Metallurgy. Mr. Christiano Santos Goncalves is employed by Golder Associates, and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are undertaking to qualify as a CP as defined in the 2012 Edition of the JORC Australasian Code for Reporting of Exploration Results and Mineral Resources and Ore Reserves. Mr Christiano Santos Goncalves consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

**ENDS**

For further information, please visit www.emmersonplc.com, follow us on Twitter (@emmerson_plc), or contact: 

Hayden Locke	Emmerson Plc	Tel: +44 (0) 207 236 1177
Edward McDermott
James Biddle Roland Cornish	Beaumont Cornish Limited Financial Adviser	Tel: +44 (0) 207 628 3396
Jeremy King	Optiva Securities Limited Broker	Tel: +44 (0) 3137 1904
Lottie Wadham Susie Geliher	St Brides Partners Ltd Financial PR/IR	Tel: +44 (0) 20 7236 1177

Notes to Editors

Emmerson's primary focus is on developing the Khemisset Potash Project located in Northern Morocco.  The project has a large JORC Resource Estimate (2012) of 311.4Mt @ 10.2% K₂O and significant exploration potential with an accelerated development pathway targeting a low capex, high margin mine.  Khemisset is perfectly located to capitalise on the expected growth of African fertiliser consumption whilst also being located on the doorstep of European markets. This unique positioning means the project will receive a premium netback price compared to existing potash producers. The need to feed the world's rapidly increasing population is driving demand for potash and Emmerson is well placed to benefit from the opportunities this presents.

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014.

APPENDIX

JORC TABLE

 

Section 1 - Sampling Techniques and Data

Criteria	Commentary
Sampling techniques	·   Samples were obtained by core sampling with all drilling of the potash unit fully cored. ·   The PKB drillholes obtained core samples by double tube core drilling or trepan drilling. Trepan drilling is a technique used for large diameter holes where a ring at the periphery of the hole is destructively drilled, leaving a solid core centre for sampling. The PZ drillholes and MSL drillholes cored the potash by diamond drilling, MSL by HQ double tube through the potash. ·   Geophysical logging was completed for natural gamma on the PKB drillholes and for density. The geophysical logs for these drillholes are unavailable and it is not stated if the PZ drillholes were also geophysically logged. MSL logged the full drillhole for natural gamma, and caliper. A smaller sub-section containing the potash unit was then logged in detail with the acoustic televiewer, and for resistivity and self-potential. The geophysical logging was conducted by International Geophysical Technology, S.L. Resistivity and self-potential was not completed on KMSL-3. The geophysical tools are calibrated off site apart from the caliper which was calibrated on site using the PQ drill rods. The consistencies of the geophysical outputs indicate no material bias and are seen to accurately characterise the individual potash unit and potash seam correlation. ·   Specific documentation of sampling and testing objectives and procedures for the PKB and PZ series (completed between 1955 and 1958 and 1962 and 1969 respectively) are unavailable. However, from analysis of the sample intervals and drillhole logs it can be deduced that the PKB drillholes were sampled to lithological boundaries and/or the natural gamma logs were used to guide the sample selection. The PZ series indicates that samples were taken above and below the main potash units in order to accurately define them. ·   All potash seams were fully sampled where they were intersected. In the PZ drilling, where the potash seam was partially intersected or the drillhole did not reach the appropriate depth, a wedge was used to drill a daughter hole in order to gain a full intersection. ·   The MSL drillholes were sampled to lithological and mineralogical boundaries, with sample lengths varying between 0.05 m and 0.93 m. The PKB sample lengths vary between 0.1 m and 2.83 m, and PZ between 0.06 m and 3.58 m. ·   KMSL-1 was point sampled for semi-quantative XRD analysis. The sample locations were identified to represent all the different lithologies in, above and below the potash horizon.
Drilling techniques	·   The PKB series were cased through the Miocene and alluvial sediments and open hole drilled by tricone with drill bits ranging from 15.88 cm to 21.59 cm in diameter. Salient intervals in this section were selectively cored by double tube diamond drilling or Trepan drilling in order to obtain intact rock samples of the units. Deviations were drilled to obtain full core samples of the potash unit where these were not intersected in the initial hole. The holes were drilled vertically. ·   The PZ series were drilled vertically. There is no available information on the drilling methods of this series, but the potash unit is expected to be cored for the intervals where there is sampling and chemical analysis available. ·   The MSL series was drilled vertically. Mud rotary drilling was used to collar the hole through the Miocene and alluvial sediments which was then cased to between 20 m and 30 m depth. Mud rotary drilling with fresh water was used to drill to the Basalt Formation with selective use of PQ diamond drilling to obtain core from the different geological formations. The holes were then diamond drilled at HQ diameter using a CaCl2 saturated mud (250-280 g of Cl/litre) to prevent dissolution of the salts and enable maximum recovery. Once retrieved from the core barrel the core was cut into 1 m pieces with a diamond saw using a saturated CaCl2 brine for the salt units, photographed, then covered in plastic wrap to prevent exposure to moisture.
Drill sample recovery	·   Core recovery is summarised in the PKB logs, by geological unit and drilling method, and is greater than 90% within the potash salt unit. There is no information in the PZ logs on core recovery.  and it was not recorded for the MSL holes. However, visual inspection of the MSL core by SRK during the completion of the re-admission Competent Persons' Report indicates the core recovery through the potash was between 95% and 100%. ·   Deviations were drilled in the historical holes to ensure the potash horizon was totally recovered where it was not cored in the original drilling.
Logging	·   The PKB drillholes have summary lithological logs of the major lithological units, any significant changes within these units and the boundaries of the potash horizon including description of the main potash minerals where they could be visually identified. General dip measurements are recorded for the lower salt unit. No drillhole logs are available for PKB-7, PKB-8 and PKB-9. ·   The PZ drillholes have summary lithological logs recording the same information as the PKB series. No drillhole logs are available for PZ45 and PZ116, and there is incomplete information for drillholes PZ24, PZ50 and PZ121. ·   The MSL drillholes were photographed, and lithologically logged. The logs were depth corrected using the downhole geophysical information to ensure they were as accurate as possible. ·   Within the total database including the drillholes outside of MSL's licences, approximately 98% of the sampled intersections have been logged. Only PZ116 of the 68 drillholes within the MSL licences does not have a lithological log of the sampled intersection, approximately 0.1% of the MSL sampled intersections (188.43 m). PZ116 lies at the northeastern edge of the deposit. Previous reports and maps by Touhami show that this drillhole was barren, however, a list of drillhole intercepts provided by ONHYM indicates there is a potash horizon of approximately 1.8 m at oer 10% K2O. This conflicting information needs to be verified by future drilling.
Sub-sampling techniques and sample preparation	·   All drillholes were orientated vertically to perpendicularly intersect the sub-horizontal potash horizon. This ensured that the samples represented close to the true thickness of the potash unit and are appropriate for characterising the grade and mineralogical variability within the horizon. ·   No information on further sample preparation is available for the historical samples. In several instances samples were combined after initial analysis for %K2O. However, it is not stated if full core or split core was sent for analysis. ·   The MSL core was split in half by a diamond core saw using a saturated CaCl2 brine. The sample intervals were then marked up on the core for further cutting, then weighed and vacuum packed in a plastic sample bag. The samples were sent for preparation at ALS in Seville, Spain. The whole sample was dried and crushed to 70% passing -2 mm then a 250 g fraction was pulverised to 85% passing -75 µm. ·   MSL inserted three internal pulp duplicates, five external pulp duplicates, three blank samples and three standard samples into the sample stream to assess the quality control of the analytical laboratory. ·   The sample techniques used in the MSL exploration are considered appropriate for the type of lithologies and mineralisation sampled. In addition, the quality control samples provide a duplicate check on 15% of the sample population with other control samples, over 25% which is considered good. These techniques have ensured samples representative of the potash mineralisation have been taken in the MSL and historical drillholes.
Quality of assay data and laboratory tests	·   The PKB drillholes obtained 19 samples from six holes which were analysed for %K2O at the M.Pellet BRPM laboratory. The analytical technique is not specified in the available historical information. ·   The PZ drillholes analysed 522 samples for %K2O through an unspecified technique. 141 of these samples were also analysed for %Na+, %Ca2+, %Mg2+, %Cl-, and %SO42-. ·   The MSL samples were analysed by XRF (for metals and other major constituents), ICP-OES (soluble elements) and gravimetric analysis (insoluble residue) at ALS in Loughrea, Ireland. SRC Geoanalytical laboratories in Canada were used as a control laboratory and analysed five pulp duplicate samples. The analysis methods were soluble and insoluble digestion and ICP-OES. Both laboratories are internationally accredited. ·   10 MSL point samples were analysed by semi-quantative XRD at the National Museum of Natural History, Madrid, Spain, (CSIC) ·   The results of the quality control samples from the MSL data (blanks, standards and duplicates) show good accuracy and repeatability in the analysis and preparation of the samples with no contamination being introduced in the process.
Verification of sampling and assaying	·   No historical core from the PKB or PZ series was available for sampling and assaying which meant verification of the majority of the data was difficult. ·   Verification of the historical data and database, which constitutes 98% of the data used in the resource estimate, has been completed through MSL's recent twin drilling of three historical holes, resurveying of historical drillhole collars, and a check between the scanned BRPM summary logs and the digitised database for 10% of the data (14 drillholes). ·   The MSL "twin" holes varied in distance from their nearest historical collars but were positioned to check drillholes in three strategic locations. KMSL-1 is 300 m east of PZ88 in the, KMSL-2 is 20 m southwest of PZ111 located in the central Khemisset sub-basin, and KMSL-3 is 90 m north of PZ3 in the north central Khemisset sub-basin. Overall, the general position and thickness of the potash horizon in the three locations confirmed the historical information and the presence of potash. The downhole grade profiles can be easily correlated between the twin drillholes and in all instances the mineralogy and lithological logging is consistent. The only exception is in KMSL-1 where carnallite, in addition to sylvinite, was intercepted. SRK considers the verification drilling and sampling has added significant confidence to the historical database and confirmed the presence of economic potash in the north deposit, central deposit and northeast deposit in the Khemisset basin. ·   In 2016 MSL resurveyed all the drill collars that could still be found over the Khemisset Basin. Details of the results of this survey are described in the following section. The results show that some of the drillholes were found up to 1,670 m from the original BRPM collar positions which gives low confidence to the historical collars that could not be found and resurveyed. However, 65 % of the historical collars were located and 84 % of the discrepancies were less than 300 m which is not considered significant compared to the average drillhole spacing across the MSL licences of approximately 3 km. ·   During completion of the re-admission Competent Persons' Report, SRK randomly selected 14 drillholes to compare the original scanned information with the digital database. The collar co-ordinates, lithology data and analysis results were checked, and in all cases no discrepancies were found. This gives high confidence to the compilation of the historical database used for the resource estimate. ·   The data verification has led to increased confidence in the historical database upon which the Mineral Resource Estimate is based.
Location of data points	·   There is no information in the PKB summary drill logs on how the drillhole collars were surveyed but these documents do describe the co-ordinates are given in the Merchich North Lambert Maroc system. The PKB drillhole collars have several sources of information collected from historical documents and through recent surveying. The first set of co-ordinates (BRPM-MDPA) are shown typed in the front of the scanned drillhole log where it is available. The second set of co-ordinates (ONHYM) were supplied to MSL from historical drilling reports held by ONHYM. The third set of co-ordinates are from handheld GPS surveys completed by MSL in 2016 of collars that could still be located. PKB-1, PKB-2, PKB-6 and PKB-8 were located and resurveyed by MSL, initially by handheld GPS, and then by differential GPS. These drillholes were located between 3 m and 547 m from their original BRPM-MDPA positions and between 3 m and 85 m from the ONHYM locations. Where drillholes could not be found, the ONHYM locations were used preferentially over the original BRPM-MDPA positions. Of the four PKB holes in the MSL licences, only PKB-2 and PKB-6 were located and resurveyed. ·   Similarly, there is no information in the PZ summary drill logs on how the drillhole collars were surveyed apart from a reference, in some cases, that the collar elevations were estimated from the Khemisset topographic map (1:50,000 scale). The co-ordinates are also given in the Merchich North Lambert Maroc co-ordinate system and the drill collars have various different co-ordinates from different sources. The sources for the co-ordinates are the three described for the PKB series. A total of 83 of the PZ drillhole collars were located and resurveyed. Of these, 41 are within the MSL licences, which leaves 20 PZ collars within MSL's licences that were not located. The discrepancies between the original positions and the resurveyed positions are between 1 m and 1,676 m and between 1 m and 1,363 m discrepancy with the ONHYM locations. The final co-ordinates for the drillholes were determined the same way as for the PKB series; where drillhole collars could not be found, the ONHYM locations were used preferentially over the original BRPM positions. ·   The MSL drillhole collars were surveyed by handheld GPS, then differential GPS in the Merchich North Lambert Maroc co-ordinate system. ·   The MSL drillholes were also surveyed for downhole deviation. There is no information on the downhole survey of the historical drillholes, so they have been assumed vertical. The nature of deep drilling is such that holes over a depth of 300 m are likely to deviate significantly from the vertical. However, relative to the space of the drillholes, between 0.5 km and 4 km, this will insignificantly affect the location of the sample points. ·   No detailed topographic surveys have been undertaken across the Khemisset Basin. Therefore, publically available Advanced Spacebourne Thermal Emission and Refelection Radiometer (ASTER) data, year 2000, has been use as the source of the topography for the work completed to date.
Data spacing and distribution	·   The combination of PKB and PZ drillholes are distributed across the Khemisset basin, and in particular the MSL licences, at an approximate grid spacing of 3 km. A closer grid spacing of 1,500 m covers the main potash body south of Khemisset town and the drilling is as close as 500 m within the north deposit under and around Khemisset town. ·   The drill spacing has accurately defined the extents of the potash mineralisation which into four deposit areas, the central north Khemisset sub-basin, the central Khemisset sub-basin, the Souk Jmaâ (southwest) sub-basin and the Oued Beht (northeast) sub-basin. ·   The drilling has also defined areas of low and high grade within the basin, and several potash layers. These have not been correlated in the geological modelling due to a lack of available historical geophysical logging which could help map these distinct layers between drillholes. However, these layers are seen in all three MSL drillholes which are up to 10 km apart, suggesting the mineralisation is very consistent within and between the separate sub-basins. ·   Historical 2D seismic surveys completed across the central Khemisset sub-basin suggest that the drillhole spacing is not close enough at 3 km to constrain major faults. Therefore, in order to gain further information on the structure of the basin, additional close spaced drilling or seismic surveys are required. ·   The current data spacing across the deposit is considered to support the declaration of Inferred Mineral Resources.
Orientation of data in relation to geological structure	·   The drilling was orientated vertically to intersect as close to the true thickness of the sub-horizontal potash unit. ·   There is one instance of known faulting intersecting KMSL-2 which has displaced the top of the potash horizon and decreased the thickness. It is not clear if this has occurred in the historical drillholes as it has not been logged. However, local variations and faulting can have a big influence over the volume of mineralisation cases such as this where it is thin and extensive with wide spaced drilling. As KMSL-2 is a twin, this will not expect to materially affect the thickness or extent of the potash mineralisation.
Sample security	·   No information is available regarding sample handling, transport and security in the historical holes. As the exploration was conducted by the state organisation, Bureau de Recherches et de Participation Minières (BRPM), there is limited potential for disturbance or tampering of any kind. ·   The MSL samples were stored in plastic drums in a safe container at the MSL field offices. There is 24-hour security on the site. The samples are couriered by DHL to the sample preparation laboratory (ALS) in Seville, Spain. The pulps are then also couriered to the analytical laboratories by DHL.
Audits or reviews	·   SRK reviewed the sampling and logging as part of the audit process for the re-admission Compentent Persons' Report. Adam Wheeler also reviewed the data collection in 2016. The procedures were set up initially by Enrique Sanz, an Exploration Geologist from Geomnia.

Section 2 - Reporting of Exploration Results

Criteria	Commentary
Mineral tenement and land tenure status		·   The Khemisset Project is covered by a total of 54 research licences and one mining licence held by subsidiary or related companies of MSL Minerals S.A.R.L and Mine de Centre S.A.R.L. The permits are defined by reference number, the position of the control point and the centre of the 4kmx4km square for each permit. ·   Some of the licences overlap, in which case the earliest existing permit has priority. ·   There are no active mining operations relating to the salt mine located in the south of the mining licence. ·   The renewal of research permits and the mining licence will be required to progress the Project through the stages of study (which is common to all exploration Projects) and the renewal of the mining licence is yet to be better understood, as the Company is engaged in exploration works rather than mining activities.
Exploration done by other parties		·   The Khemisset basin was historically explored for potash from the 1950s by Bureau de Recherches et de Participation Minières (BRPM) in conjunction with Mines domaniales des potasse d'Alsace (MDPA) and then from the 1960s onwards by BRPM with assistance from UNDP. The exploration works included surface geophysical surveys, 2D seismic surveys and surface drilling. ·   Geophysical surveys across the basin were conducted at a regional scale in the 1950s as part of a country wide study done by the Societe Cherifienne des Petroles Prérides. The survey was completed on a coarse grid of >1 km spacing. The results of the survey indicate a slight negative anomaly in the Khemisset region but the resolution of the survey was not high enough to define drilling targets. Further telleric and magnetic studies were also completed at the same regional scale, but the same resolution problem exists in using this data for further exploration. ·   A 2D seismic campaign was performed by Bureau de Recherches et de Participation Minières (BRPM) jointly with Mines domaniales des potasse d'Alsace (MDPA). The seismic survey was approximately 100 km consisting of one longitudinal profile and three transverse profiles in the central area of the Khemisset basin and an additional transverse profile in the Oued Beht Valley. The length of the profiles total approximately 17.3 km and taken from "Mine et Geologie Report, 1965" authored by the Royaume du Maroc Ministere de l'Industrie et des Mines. The key reflectors identified in this study were the base of the Miocene, the top of the upper salt, and the top of the basalt. ·   There were two drilling campaigns completed across the basin before 2016. The first is the Potasses Khemisset Bataille (PKB) series drilled between 1955 and 1958, comprising 9 scout holes, drilled to between 560 m and 1302 m depth and totalling 7,525 m. Four drillholes in this series lie within MSL's licences (PKB-2, PKB-3, PKB-6, PKB-9) of which two (PKB-2, PKB-3) intersected potash. Three other PKB drillholes intersected the prospective potash seam outside the MSL licences, PKB-1, PKB-4 and PKB-5. ·   The second drilling campaign, the Potasses Zemour (PZ) series was completed between 1962 and 1969. This comprised 124 drillholes totalling approximately 75,000 m. 61 of the drillholes lie in the MSL licences comprising approximately 35,000 m. 35 of these drillholes successfully intersected the potash horizon. Another 44 drillholes intersected potash outside the MSL licences. The PZ drilling has an average grid spacing of 3 km over the majority of the basin and MSL's licences. In the central area, the basin has been infill drilled to approximately 1,500 m. ·   The results of the historical drilling have been evaluated in conjunction with the recent drilling for the purposes of this evaluation.
Geology		·   The Khemisset potash basin is a half-graben bounded by Paleozoic uplifts of Moroccan Meseta, a highly deformed quartzite schist. The basin is approximately 60 km long and 20 km wide and bounded by mainly northeast-southwest oriented faults. The Late Triassic deposits only outcrop in the southwestern portion of the Khemisset Basin, dip gently (0-10 degrees) towards the northeast and are overlain by Early Jurassic marine dolostones and dolomitic limestones, or directly by Miocene marls and conglomerates. The entire sequence has a maximum thickness of 1,000 m in the axial part of the basin ·   The Khemisset basin is split into three distinct sub-basins; Souk Jmaâ (southwest), Central Khemisset (central and north), and Oued Beht (northeast). They are separated by sterile areas where potash salts are absent or reduced to thin millimetre or centimetre horizons. ·   The southwest deposit (Souk Jmaâ sub-basin) varies in thickness between 0.5 m and 5.5 m with an average thickness of 2.5 m. The %K2O varies between 7 % and 12 % with an average grade of 9%. It covers an area of approximately 25 km2. The potash horizon is generally flat-lying and occurs at between 500 m and 550 m below surface with no interpreted faulting. The potash minerals in this deposit are a central carnallite zone surrounded by sylvinite. ·   The central deposit (Central Khemisset sub-basin) varies in thickness between 0.7 m and 9 m with an average thickness of 4.6 m. The %K2O varies between 4% and 14% with an average grade of 10%. It covers an area of approximately 28 km2. Several faults orientated northeast-southwest have been interpreted through the central deposit with vertical displacements of between 5 m and 25 m with one major fault showing displacement up to 80 m. The potash horizon dips gently to the northeast up to 10 degrees and occur at between 680 m and 980 m below surface. The deposit contains a central carnallite zone that gradually changes towards the southwest and northwest to sylvinite. A mixture of sylvinite and carnallite is present in the intermediate zone. ·   The north deposit (Central Khemisset sub-basin) varies in thickness between 0.7 m and 3.5 m with an average thickness of 2.2 m. The %K2O varies between 8% and 12% with an average grade of 11%. It covers an area of approximately 3 km2. There are two faults orientated northeast-southwest are interpreted with vertical displacement of up to 25 m. The potash horizon dips gently to the northeast up to 5 degrees and occur at between 470 m and 560 m below surface mainly under Khemisset city. The main potash mineral in this deposit is sylvinite but at the southern edge it changes to a mixture of carnallite and sylvinite. ·   The northeast deposit (Oued Beht sub-basin) varies in thickness between 0.5 m and 5.5 m with an average thickness of 2.5 m. The %K2O varies between 4% and 18% with an average grade of 11%. It covers an area of approximately 53 km2. There are no faults interpreted in this area, although it is likely there is some faulting parallel to other structures (oriented northeast southwest) in this deposit. The potash horizon dips gently to the northeast up to 10 degrees and it occurs between 520 m and 1,070 m below surface. The distribution of potash minerals in this sub-basin is more complex than the others with a mixture of carnallite, rinneite and sylvite present. The central area of the deposit contains a mixture of carnallite and rinneite mineralization towards the west and sylvinite and rinneite towards the east. The northern area is characterized by a mixture of carnallite and rinneite and the south and southwest edges by zones of sylvinite and rinneite respectively. ·   The main potash minerals in the Khemisset deposits are carnallite, sylvinite and rinneite. The relative concentrations of these within the potash horizon vary. The mineralisation is also characterised by a very low insoluble fraction, rarely above 5%.
Drill hole Information		·   This information is not applicable or included here as this report concerns the reporting of Exploration Targets and Mineral Resources and not only Exploration Results.
Data aggregation methods		·   This information is not applicable or included here as this report concerns the reporting of Exploration Targets and Mineral Resources and not only Exploration Results.
Relationship between mineralisation widths and intercept lengths		·   This information is not applicable or included here as this report concerns the reporting of Exploration Targets and Mineral Resources and not only Exploration Results.
Diagrams		·   This information is not applicable or included here as this report concerns the reporting of Exploration Targets and Mineral Resources and not only Exploration Results.
Balanced reporting		·   This information is not applicable or included here as this report concerns the reporting of Exploration Targets and Mineral Resources and not only Exploration Results.
Other substantive exploration data		·   This information is not applicable or included here as this report concerns the reporting of Exploration Targets and Mineral Resources and not only Exploration Results.
Further work		The proposed exploration programme to test the Exploration Targets will: ·     Acquire the historical SCP and ONAREP drilling and seismic surveys data within the EML permit areas ·     Integrate the historical data into a 3-D geological model incorporating the results of the recent seismic survey completed in the Oued Beht sub-basin ·     Drill initial 1 to 3 diamond drill hole programme to test the most prospective parts of the Exploration Target as determined by the review of the historical data. This is expected to occur as part of the second drilling programme at Khemisset, which would commence in the second half of 2019.

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