Bifox & KI
Independent Geologists Report 16 Feb 2016
Title Report Chile 9 Mar 2016
Bahia Inglesa project
The nearest town to the project area is the coastal town of Caldera, located 8 km north of the BiFox mining area on the Panamerican Highway. Caldera is a port town having first exported silver from the rich Chañarcillo mine during the late 19th century. The port is equipped with a modern conveyor belt facility, loading iron ore and copper concentrates into 40,000t capacity handymax vessels. Caldera’s population is 14,000 people and its economy is supported by the port facilities, fishing, aquaculture industries and tourism.
The project consists of two areas:
- The BIFOX Area (60.9 km2), which includes SCM Bahia Inglesa Mine; and
- A package of 66 exploration licenses covering 160 km2 (KI Exploration Licenses or the KI sub- Project) adjacent to the BIFox Area
Total granted area
The Bahia Inglesa phosphate deposit is in the Atacama Desert with minimal vegetation coverage. The license area is quite large – basically a rectangular plot approximately 20 kilometers by 11 kilometers.
The Company carried out a trenching program in July 2015 which confirmed previous drill results undertaken by the Chilean government but this work does not satisfy the JORC Code for reporting a resource and accordingly. On February 2019 the company commenced their JORC program to target 10 million tn of phosphate rock in an area of 25 sqm.
The Bahia Inglesa phosphate deposits are typical of sedimentary hosted phosphate deposits worldwide. The primary mechanism for the formation of these deposits is the warming of cold phosphate-rich upwelled deep ocean waters within shallow marine environments. The solubility of phosphate in cold seawater is about 0.3 ppm whereas in warm saline water it’s solubility decreases to <0.05 ppm, so phosphate precipitates as the sea water warms. Important factors controlling mineralization are the presence and scale of upwelling, current directions and coastal and sea floor geomorphology.
An important mechanism in producing economic deposits is the mechanical upgrading of the precipitated phosphate by current and wave action. The phosphate precipitates form layers which break into fragments (pellets) which are hard, heavy and possess a low aspect ratio relative to calcareous sand grains. Wave and current action is thought to winnow the finer material and concentrate the phosphate pellets.
Another factor contributing to the formation of economic phosphate deposits is the development of sea floor irregularities due to active structures. For example ,down dropping across a fault or rocky outcrop may focus winnowing ocean currents and also create a trap where phosphate pellets can accumulate.
A close analog to the Bahia Inglesa deposits is the Sechura phosphate deposits in Peru. At Sechura, phosphate mineralization is hosted in Miocene shallow marine sediments in a 100 km by 40 km wide basin adjacent to the coast. Similar to Bahia Inglesa, the phosphate mineralization is largely pelletal and associated with diatomites and other bioclastic sediments. Also, like Bahia Inglesa, the host basin is partially separated from the coast by an outlier of basement rocks.
The Sechura Phosphate deposits are considered to be the largest phosphate resource in the world. The Bayovar phosphate mine was recently developed there by Vale, Mosaic and Mitsubishi and was due to have an annual production capacity of 5.9 million tons of phosphate rock.
Geological Settings and mineralization
The phosphate deposits are hosted in the Miocene to Pliocene Bahia Inglesa formation. The Bahia Inglesa formation is comprised of up to 42 m of siltstones, fine sands, shelly coquinas, pebble beds, and phosphatites, and represents a near shore shallow marine setting. It overlies crystalline basement composed of Paleozoic metamorphic rocks and Cretaceous granitoids. It is partially covered in some localities by a thin cover of Pliestocene clastic and chemical sediments.
Phosphate mineralization occurs in the upper part of the Bahia Inglesa formation in 3 different stratigraphic locations. The Lower Phosphate Manto is an extensive unit 0.1 to 0.4 meters thick and is located above a sandy unit within the lower part of a siltstone unit. One to 2 meters above the Lower Phosphate Manto is the Main Manto which is up to 2 meters thick and consists of phosphate pebble conglomerate. The third type of mineralization is described as fluvial deposits which are up to 7 meters thick and consist of conglomeratic units interbedded with phosphatic sandstones. Clasts in the conglomerates are described as consisting of 70% phospherite and 30% basement lithologies.
CORFO/CCHEN conducted an extensive exploration program in the project area from 1983 to 1985. Work included geologic mapping, 929 meters of reverse circulation drilling in 50 drill holes, 154 vertical meters of pitting in 27 pits and surface sampling, various metallurgical test work and resource studies. The location of the surface sampling, pits and drill holes are shown on the map. The cumulative P2O5% times width is shown as a colour scale for the drill holes.
CORFO/CCHEN calculated total resources in all categories of 80 million tons at greater than 7.5% P2O5. This estimate was completed in the 1980s and is not compliant with JORC or NI43-101 mineral reporting codes.
Since the CORFO/CCHEN work, at and near surface phosphate deposits have been exploited in some areas.
The Company has processing plant on site which was refurbished an upgraded with a capacity to produce up to 20,000 tn/year of phosphate rock for direct application at 20% P2O5. Initially the company will commence producing up to 50,000 tn/year and then after getting all permits will increase their production to 100% capacity.
Below current flowchart production:
The Company commenced in November 2018 their JORC program to estimate their current resources and reserves over an area of 25sqm in the Bifox and KI areas targeting about 10 millions resources of P2O5. The program includes up to 39 drilling holes (525 metres) and approximately 125 trenching holes.
Geophysical survey has commenced in March 2019 for completion of the initial survey before end of March.
The passive seismic survey is being undertaken to map the depth to the phosphate horizon, which is a hard compact unit that forms a prominent high-velocity reflector. The passive seismic method is an extremely cost effective geophysical technique that is significantly lower cost than traditional seismic refraction and reflection surveys. The passive seismic survey relies on natural seismicity as a source from which to measure responses from the subsurface and does not require the use of an external energy source (dropped weight or explosives) or installation of extensive arrays of geophones at surface
Passive seismic measurements are being taken adjacent to historical pits, to allow correlation of the seismic survey response with the geology observed in the pits. Following collection of measurements adjacent to pits that expose the phosphate horizon systematic east-west lines will be undertaken across the area within several kilometres of the plant site, in order to map the depth to the phosphate unit and establish the priority areas for pit sampling or drilling in order to develop a resource for the project to be reported in accordance with the JORC Code.
The area to be covered by the passive seismic survey is presented below, which shows where the project is located in the north of Chile in the Caldera area. The survey will be carried out with east-west oriented survey lines, with measurements taken every 100 m, with more detailed information collected as required.
Bifox Caldera project properties and proposed Tromino seismic locations, showing the location of the project in Northern Chile
Detailed Passive Seismic Survey plan in the Bifox and Kiwanda concessions.