Prepared by AMC Mining Consultants (Canada) Ltd.

177 Pages·2010·9.14 MB·English

AMC Mining Consultants (Canada) Ltd
BC0767129
Suite 1330, 200 Granville Street
Vancouver, British Columbia
Canada V6C 1S4
T [phone]
F [phone]
E [email protected]

SABODALA GOLD PROJECT
SENEGAL, WEST AFRICA
TECHNICAL REPORT
for
TERANGA GOLD CORPORATION
Prepared by AMC Mining Consultants (Canada) Ltd
In accordance with the requirements of National
Instrument 43-101, “Standards of Disclosure for
Mineral Project”, of the Canadian Securities
Administrators

Qualified Persons:
P R Stephenson, PGeo, BSc (Hons) FAusIMM (CP), MCIM, FAIG
J M Shannon, P Geo, BA Mod, MA
B O’Connor, PGeo, BSc
A Riles, BMet (Class 1), Grad Dipl Prof Management
A Ebrahimi, PEng, PhD, MASc, BASc

AMC 710022
Amended 7 October 2010 and 1 November 2010
Effective Date 27 September 2010

ADELAIDE BRISBANE MELBOURNE PERTH UNITED KINGDOM VANCOUVER
[phone] [phone] [phone] [phone] [phone] [phone]
www.amcconsultants.ca
TERANGA GOLD CORPORATION
Technical Report, Sabodala Gold Project

DISTRIBUTION LIST
1 copy to Mr J Williams, Mineral Deposits Limited, Melbourne
1 copy to Mr BH Van Brunt, Mineral Deposits Limited, Melbourne
1 copy to AMC Vancouver office
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Technical Report, Sabodala Gold Project

SUMMARY
Introduction, Location and Ownership
This Technical Report on the Sabodala Gold Project (“the Project”) in Senegal, West Africa has
been prepared by AMC Mining Consultants (Canada) Ltd (“AMC”) of Vancouver, Canada on behalf
of Teranga Gold Corporation of Toronto, Canada as part of its initial public offering on the TSX. It
has been prepared in accordance with the requirements of National Instrument 43-101 (NI 43-101),
“Standards of Disclosure for Mineral Projects”, of the Canadian Securities Administrators “(CSA”)
for lodgment on CSA’s “System for Electronic Document Analysis and Retrieval” (“SEDAR”). It is
proposed that Mineral Deposits Limited (“MDL”) will transfer its wholly owned Mauritian subsidiaries
SGML (Capital) Limited and Sabodala Gold (Mauritius) Limited which, at the time of the transfer,
owns 100% of Sabodala Mining Company SARL (“SMC”) and 90% of Sabodala Gold Operations
SA (“SGO”), and its approximate 15% holding in Oromin Explorations Ltd., to a Canadian company,
Teranga Gold Corporation (“Teranga Gold”) subject to approval by MDL shareholders. A
Restructure and Demerger Deed relating to shares in Sabodala Gold (Mauritius) Limited and SGML
(Capital) Limited and common shares in Oromin Explorations Ltd. will transfer ownership to
Teranga Gold.
The Project, which poured its first gold in March 2009, is located 650 km east of the capital Dakar
within the West African Birimian geological belt in Senegal, and about 90 km from major gold mines
and discoveries in Mali. The area has only recently been opened for mining and exploration and is
emerging as a significant new gold camp, with more than 10 M ounces of resources already
reported as being discovered. With 2.25 M ounces of gold in Measured and Indicated Resources
including 1.46 M ounces of gold in Mineral Reserves, and an additional 0.77 M ounces of gold in
Inferred Resources, the Project currently has a life of up to ten years. Production in FY2011 is
forecast at 130,000-140,000 ounces of gold, processed at the Sabodala plant which has a current
capacity of 2 Mtpa. The plant is currently being expanded to double its capacity, with scheduled
completion in mid 2011; this will deplete reserves at an accelerated rate. An aggressive exploration
program is continuing with the aim of increasing resources, and increasing mine life.
MDL executed its Mining Convention with the Government of Senegal on March 23, 2005, and by
way of a subsequent Supplementary Deed January 22, 2007, was granted a ten year (renewable)
Mining Concession. Sabodala Mining Company (“SMC”), a company incorporated in Senegal, being
a 100% subsidiary of Sabodala Gold (Mauritius) Limited (“SGML”), acts as operator for the
exploration of the Project on behalf of MDL under the Mining Convention. SGML is a wholly owned
subsidiary of Nimbus Gold Pty. Ltd., which in turn is 100% owned by MDL. SGML established an
operating company, Sabodala Gold Operations S.A. (“SGO”), to mine the Sabodala deposit. The
Senegalese Government has a 10% free carried interest in SGO. Commencing May 2, 2007, MDL
is exempt from all property, company and value added taxes for a period of eight years, which
expires in May 2015.
The total property consists of the Mining Concession of approximately 33 km² which is held by MDL
on a ten year (renewable) basis, and seven exploration leases which are grouped into four different
project areas which surround the mine property. All permits are granted by ministerial decree and
are subject to a Mining Convention signed between SMC and the state of Senegal. The exploration
permits are held in a combination of full SMC ownership and earn-in joint ventures where SMC is
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Technical Report, Sabodala Gold Project
the funding and managing party. The current permits in which MDL have an interest cover a total of
1,364 km2, with three new requests for exploration permits covering a total of 91 km2 lodged.
Geology and Mineralization
The property and the surrounding exploration concessions are located in the 2213 to 2198 Ma age
Kedougou-Kenieba Inlier, which lies within the Paleoproterozoic age Birimian Terrane of the West
African Craton. The inlier is divided into the volcanic dominated Mako Supergroup to the west, and
the sediment-dominated Diale-Dalema Supergroup to the east. The boundary between the belts
may be tectonic, with the original stratigraphic relationship not preserved and the overlying
sediments appear to be overturned. The Mako and Diale-Dalema sequences are intruded by a
series of variably deformed granitoid intrusions that range in age from 2160 to 2000 Ma. Felsic and
intermediate composition dykes are often spatially associated with shear zones hosting gold
mineralization, and locally are host to significant gold mineralization themselves.
A north-northeast lithologic grain is seen associated with major crustal shear zones. These include
a north-northeast trending shear zone which lies east of the Sabodala property area. High strain
zones and possible second and third order shear zones to the Main Transcurrent Shear Zone may
control the localization of gold mineralization.
Lateritic weathering combined with duricrust formation is still active in the region. Oxidation depth in
the region is highly variable, but is generally several tens of meters.
At Sabodala mafic volcanic rocks are mainly present with a large granitic intrusion occupying the
north-western portions of the property. Lithologies generally trend north-northeast to northeast with
steep dips, although local variations are apparent, which may be locally important trap sites for
mineralization.
Principal structures on the Sabodala property form a steeply west-northwest dipping, north-
northeast trending shear zone network which has previously been referred to as the “Sabodala
Shear Zone”. This includes the Niakafiri, and Masato shear zones, which are high strain zones
developed in altered ultramafic units. There are also shear zones that are linked to them by north to
northwest trending splays. These include the “Ayoub’s Thrust”, which is focused along the
ultramafic sill that lies on the west side (hangingwall) of the Sabodala deposit.
These gold deposits show many characteristics consistent with their classification as orogenic
(mesothermal) gold deposits.
Several styles of mineralization are seen in the area and the deposits which have Mineral
Resources and their styles will be briefly discussed below.
Gold mineralization at the Sabodala deposit occurs in a variety of vein sets; a combination of
continuous grey quartz shear veins along shear zone surfaces in the Main Flat and Northwest shear
zones; in sets of quartz-carbonate-albite-pyrite extension veins, in coalescing extension and shear
vein domains which form zones of quartz-carbonate matrix breccia; and in areas of pervasive tan to
pink coloured carbonate-albite-sericite-pyrite alteration which surrounds and links between veins,
shear zones and breccias. Multiple generations of veins are evident,
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At Niakafiri, and Niakafiri West significant areas of mineralization are hosted by north-northeast
trending, steep west-northwest dipping carbonate altered shear zones along the Niakafiri Shear
Zone, shear zones which splay off this structure to the west, and along the Masato shear zone
which lies 400 to 500 m east of and parallel to the Niakafiri Shear zone.
The Soukhoto and Faloumbo areas contain widely spaced east-northeast trending and steeply
dipping quartz veins which vary from 5 to 50 cm thick, and which have strike lengths of at least
several tens of meters. The veins comprise white quartz with local prismatic fill, and have thin
foliated envelopes suggesting that they are developed in minor shear zones. They are hosted in
foliated mafic volcanic rocks.
The Gora Deposit lies approximately 25 km northeast of the Sabodala processing plant and occurs
within the Sonkounkou exploration permit held by Axmin and in which SMC is earning a majority
interest. Gold mineralization at Gora occurs in quartz shear veins which trend north-northeast with
moderate to steep east-southeast dips, in a northeast trending sequence of turbiditic sandstone,
siltstone and mudstone which is at least locally overturned. Two principal and additional veins are
locally 50 to 100 m apart, defining a veining corridor at least 100 m wide in plan view, and veining
extends for at least 700 m along strike.
Exploration and Data Management
SMC has been using a phased approach to the exploration of concessions. This initially utilizes
airborne geophysics integrated with field geology (regolith and outcrop mapping) to identify major
prospective structures, lithologies and alteration zones. This is followed by surface geochemistry,
and termite mound sampling to delineate gold bearing corridors and targets. In addition Rotary Air
Blast (RAB) drilling of prospective structures where extensive transported materials render surface
sampling of low effectiveness in the target generation phase, is employed.
After a phase of prioritization and ranking, target testing utilizes trenching in areas of shallow soil
cover to map the gold bearing zones and provide a first pass evaluation of their potential, and
Reverse Circulation (RC) and diamond drilling to systematically test the defined targets.
Where significant mineralization is identified, systematic RC and diamond drilling is employed to
ascertain dimension and quality of the target area.
Geological mapping has been conducted largely by SMC staff geologists on selected prospects in
all project areas, with some regional scale mapping being completed by Geoter, as part of 400 x
100m soil geochemical grid covering 90% of the Property.
MDL has drilled a total of 200,600 m of diamond core and RC drill holes in the Sabodala Mining
Concession from 2005 to 2010 inclusive and a proportion has been used in the estimation process.
Management of the drilling programs, including logging, sampling, and data verification, was
contracted to RSG Global through to 2007, since when drilling supervision has been undertaken by
SGO.
Drillhole collars are surveyed, diamond drillholes are downhole surveyed and core is orientated so
as to collect structural data. Information collected during logging includes lithology, alteration,
mineralization and base of oxidation. structural geology, geotechnical features including core
recovery, rock quality designation (RQD), fracture frequency and infill, and hardness. Diamond drill
core recovery averages 98% while RC recovery averages around 85%.
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All drill core is photographed before it is sampled or disturbed during logging, and is photographed
wet and dry. Drilling is orientated to best intersect the veins close to true width, bearing in mind
several orientations to the structures.
The SMC geological database is centralized, and has built in validation features. A Database
Manager is the custodian of the data. Sample preparation and analysis was executed at the SGS-
Kayes laboratory in Kayes, Mali.
The data has been collected in a diligent fashion and in AMC’s opinion is suitable for Mineral
Resource estimation work.
Mineral Resources and Mineral Reserves
Measured and Indicated Mineral Resources as of 1 July 2010 have been estimated for Sabodala and
Niakifiri and total 52.63 M tonnes at a grade of 1.33 g/t Au for 2.254 M ounces of gold, and this is
tabulated below. Note the Mineral Resources include Mineral Reserves which are shown later in this
section.
Table 1 Measured and Indicated Mineral Resources
Measured Indicated Measured and Indicated
M Grade M oz M Grade M oz M Grade M oz
tonnes g/t Au Au tonnes g/t Au Au tonnes g/t Au Au
Sabodala 28.517 1.41 1.294 13.375 1.34 0.575 41.892 1.39 1.869
Niakifiri 0.278 1.74 0.016 10.463 1.10 0.370 10.741 1.12 0.386
Total 28.795 1.41 1.310 23.838 1.23 0.945 52.633 1.33 2.254
Notes: 1. CIM definitions were used for Mineral Resources
2. The cut offs applied are 0.35 g/t or 0.30 g/t for oxide and 0.50 g/t for fresh material
3. Measured Resources include stockpiles which total 2.613 M tonnes @ 1.26 g/tAu for 106,000 ounces
Due to the stockpiling policy a total of 2.61 M tonnes at 1.26 g/t Au for 106,000 ounces of gold
remain on stockpiles and form part of the Measured Resource above. In addition there are Inferred
Mineral Resources for five deposits including the two main ones above, which total 22.66 M tonnes
at 1.06 g/t Au for 0.77 M ounces of gold. These are shown in the table below.
Table 2 Inferred Mineral Resources
Inferred
M tonnes Grade M Oz Au
g/t Au
Sabodala 7.310 1.22 0.287
Niakifiri 7.248 0.88 0.205
Niakifiri West 7.144 0.82 0.188
Soukhoto 0.566 1.32 0.024
Gora 0.387 5.60 0.070
Total 22.655 1.06 0.774
Note: the cut offs applied are 0.35 g/t or 0.30 g/t for oxide and 0.50 g/t for fresh material
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Scott Wilson Roscoe Postle Associates Inc. (SWRPA) was retained by MDL in 2009 to complete a
Resource Block Model on the Sabodala deposit. This block model was a follow up to an earlier
model which was the subject of the Technical Report by SWRPA in November 2007. While this
model was built to assess the viability of underground mining, at Sabodala it was reblocked and
forms the basis for the resource figures above, and the Mineral Reserve figures for Sabadola.
The Sabodala model incorporates current geological thinking taking cognizance of information
collected during mining. Capping levels were determined for each domain prior to compositing, and
after analysis final capping levels were determined after taking reconciliation data into account. One
meter composites were employed and the block model was constructed for underground work but
was later reblocked to 10m x 10m x 5m. Estimation of gold grades was by ordinary kriging.
The other models have good geological interpretations and are estimated in accordance with the
quantity of data, level of knowledge and classified accordingly.
Mineral Reserves have been estimated for the two block models which have Measured and
Indicated Resources. This work has been carried out by mine personnel aided by information
obtained from the existing operation. However the operating costs used have been calculated for
the higher production rate of the expansion case planned for the Project.
The Proven and Probable Mineral Reserves for the Sabodala and Niakafiri deposits were based on
the Measured and Indicated Resources that fall within the designed pits. The total Proven and
Probable Mineral Reserves for the project at 1 July 2010 are 29.88 M tonnes at 1.52 g/t Au for a
total of 1.46 Moz Au. This includes 2.61 M tonnes at 1.26 g/t Au for 106,000 ounces on stockpiles.
Table 3 Mineral Reserves
Proven Probable Proven and Probable
M Grade Moz M Grade M oz M Grade M oz Au
tonnes g/t Au Au tonnes g/t Au Au tonnes g/t Au
Sabodala 18.657 1.60 0.959 4.014 1.75 0.225 22.671 1.62 1.184
Niakafiri 0.231 1.76 0.013 6.980 1.17 0.262 7.212 1.19 0.275
Total 18.888 1.60 0.972 10.994 1.38 0.488 29.882 1.52 1.460

Notes: 1. CIM definitions were used for Mineral Reserves
2. Mineral Reserves are reported at the marginal cut-off grade for each pit.
3. Mineral Reserves are estimated using an average long term price of US$900 per ounce for pit design.

There is a small quantity of Inferred Resources contained within the two pits that is not material.
Geotechnical parameters for Sabodala have been provided by Mining One Consultants. There is no
geotechnical information available for Niakafiri and the Sabodala geotechnical model was used for
Niakafiri design. The Niakafiri deposit is adjacent to the Sabodala village. There is no known
community and social issue with the relocation of the village and costs associated with this
movement have been included in the Project estimates.
The cut off’s for the two pits vary according to the haul distance from the plant.

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Mining
Mining of the Sabodala open pit is carried out by owner operated conventional truck and shovel
open pit mining. The loading fleet planned is made up of two PC3000 shovels, one PC2000 shovel
and two WA900 wheel loaders. The PC3000’s utilize 15m3 buckets, the PC2000 10m3 bucket and
the WA900’s 10.5m3 buckets to load 15 HD785-7 haul trucks. One of the PC3000’s and five of the
HD785’s are part of the 2010 mine expansion to increase mining capacity ahead of the proposed
mill expansion. The new equipment will be in production before the end of 2010. Manpower
consists of 96 operators currently, a further 33 when the extra equipment is operational, and with an
additional 15 for vacation allowance.
The mine plan discussed in Section 22 uses two cut-off grades for production assumptions. The
higher cut-off grade is used to define material that can be treated economically in the plant at the
time of production, whereas the material above the incremental cut-off grade will be mined and
stockpiled and, depending on the economics of production at the time, will be treated at the end of
the mine life.
The mining schedule is driven by balancing the truck hours required to deliver ore to the ROM pad
and waste to the dumps annually vs. the loading capacity. Ore in excess of process plant
requirements is to be selectively stockpiled throughout the life of the operation.
Based on the mining schedule the average cost of mining is US$2.00 per tonne. This mining cost is
based on a diesel cost of $0.84 per liter, a 500 FCFA per USD exchange rate and a US$1.25 per
Euro exchange rate.
Mining phases or Pit stages are sequenced to maximize gold production annually.
Sabodala mine will continue to produce ore up to year 2016. Niakafiri pit starts operation in year
2014 and will finish in year 2017.
Table 4 Mine Production Schedule
Yearly Summary Unit FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 Total
Waste Tonnes Mined t 21,163,112 18,841,232 27,845,531 26,869,464 20,654,821 18,936,785 134,310,944
Hi‐grade (+2 g/t) Ore Mined t 403,822 1,010,879 1,656,885 954,025 1,277,269 1,323,687 6,626,566
Hi‐grade (+2 g/t) Ore Grade g/t 3.47 3.26 2.96 2.82 3.00 2.78 2.99
Med‐grade (1.5‐2g/t) Ore Mined t 222,433 525,925 838,525 635,388 678,640 1,019,948 3,920,858
Med‐grade (1.5‐2g/t) Ore Grade g/t 1.73 1.72 1.75 1.71 1.76 1.73 1.73
Lo‐grade (1‐1.5g/t) Ore Mined t 444,351 1,088,650 1,151,747 929,439 1,111,587 1,562,270 6,288,044
Lo‐grade (1‐1.5g/t) Ore Grade g/t 1.21 1.22 1.23 1.23 1.23 1.23 1.23
Marginal (0.5‐1g/t) Ore Mined t         1,310,239          2,112,642              1,486,025          1,650,604          1,902,159          1,972,106 
Marginal (0.5‐1g/t) Ore Grade g/t 0.70 0.71 0.73 0.70 0.71 0.90
Mined Total t 23,543,956 23,579,327 32,978,712 31,038,920 25,624,475 24,962,950 161,728,341
Mined Waste t 21,163,112 18,841,232 27,845,531 26,869,464 20,654,821 19,084,939 134,459,098
Mined Ore (+0.5g/t) t 2,380,845 4,738,095 5,133,181 4,169,456 4,969,655 5,878,011 27,269,242
Ore Grade g/t 1.36 1.49 1.73 1.46 1.56 1.55 1.54
Strip ratio  t:t 8.89 3.98 5.42 6.44 4.16 3.25 5.38
SG t/m³ 2.74 2.74 2.77 2.73 2.56 2.31 2.65
Ore Oxide Percentage % 56% 14% 5% 24% 21% 39% 25%
Mined Ounces oz          1 04,197           226,345               285,101           195,443           249,269           293,644        1,353,999

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Processing and Engineering
Metallurgical testwork on the Sabodala ore has determined it to be a medium to hard silicified
breccia with the gold being fine-grained, mainly associated with pyrite but with some liberated gold
also present.
Gold extractions in the 85-90% range at an optimal grind size of 75µ (80% passing size) were
readily achieved in the laboratory with some potential enhancement with gravity concentration. In
anticipation of actual closed circuit grinding resulting in improved liberation, it was decided to defer
installation of a gravity circuit and a simple crush, SABC, CIL circuit was designed to treat a
minimum of 2Mtpa with a predicted recovery of 91.4% .
The major equipment includes:
 Primary crusher: Nordberg C140S single toggle jaw crusher
 SAG mill: Outotec 7.3 m diameter x 4.3 m EGL, 4,000 kW
 Ball mill: Outotec 5.5 m diameter x 7.85 m EGL, 4,000 kW
 Recycle crusher: Metso HP200SX Cone Crusher
 CIL circuit: 9 x 1,240 m3, with compressed air injection
 Elution circuit: 5 t batch capacity, split AARL Elution
 Tailings thickener: Outotec 23 m diameter High Rate Thickener
Preliminary tests on Niakafiri ore showed it to be very similar to Sabodala but, in view of the greater
oxide content there and at other potential satellite orebodies, some initial tests were carried out to
determine amenability to heap leaching. Although additional work is required, the oxide ore appears
to be heap leachable with 90% recoveries obtained on agglomerated ore at an 8mm crush size.
Actual plant performance has exceeded throughput predictions (286 tph for 09/10 vs 240 tph
design) and generally vindicated the expectations regarding recovery with 91% achieved without a
gravity circuit. A recovery model has been developed showing 92.8% for oxide ore and with a head
grade dependent algorithm for fresh ore of the form 86.7% + 1.55 Au(g/t), capped at 94.5%. For a
typical 75/25 fresh/oxide blend and head grades of 2g/t the predicted recovery of 90.6% is in line
with plant performance.
It is planned to expand the Sabodala mill in two phases:-
 Phase 1: A partial secondary crushing facility with new stockpile/reclaim facilities to screen out
and crush critical-size material thus debottlenecking the SAG mill, and a 4.0 mtpa Wet Plant
with a second ball mill and additional CIL capacity to deliver overall capacity of 3.5 Mtpa
Teranga technical and site operating personnel and Aurifex consultants are of the opinion that the
existing primary crusher will be capable of delivering approximately 4.0 mtpa (based on a 75%
fresh:25% oxide feed), on the basis that the crusher gap is opened, the secondary crusher and
associated stockpile reclaim is installed and the feed blend contains sufficient fines (these bypass
the crusher and allow higher throughputs). The crusher gap increase, together with the addition of
the secondary crusher and secondary reclaim, should allow for feed rates approaching 6Mtpa
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based on 100% oxide feed. These assumptions have yet to be verified in practice and will require
further plant surveys and subsequent modelling as per AMC recommendations.
 Phase 2: Primary crushing upgrade with either a larger jaw crusher or a new gyratory crushing
facility to complete the overall expansion to 4Mtpa
The benefits in staging the expansion include:
 Deferrment of capital
 Minimal downtime incurred to tie in new equipment
 Flexibility depending on future ore blends
Table 5 Capital Costs for the Plant Expansion
Upgrade Option Cost Upgrade Option Cost
Phase 1 (US$M) Phase 2 (US$ M)
4.0 mtpa wet plant 40.4 Jaw crusher option 8.2
Secondary crushing facility 7.6 Gyratory crusher option 18.3
Power Station engine 7.9
Totals 55.9 26.5

It is noted that the capital estimates were developed to a level of accuracy of ±30%, and are valid as
of the last quarter 2009
Environmental
An Environmental and Social Impact Statement (ESIS) for the Sabodala Gold Project was
completed in July 2006 by Tropica Environmental Consultants, and an Environmental and Social
Management and Monitoring Plan (ESMMP) was developed by Earth Systems in September
2007.The ESMMP committed SMC to preparation of a stand-alone Rehabilitation and Mine Closure
Plan in the first year of operations.
Estimated closure costs for the Sabodala Project are US$16.22M.
Project Metrics
Table 6 Key Project Metrics
Item Assumption and Metrics
Total Metres Drilled 200,000, 116,214 RC, 84,387 core
Proven – 18.9 Mt at 1.60 g/tAu
Mineral Reserve
Probable -11.0 Mt at 1.38 g/tAu
Mining Rate 24 -32 Mtpa.
Total Material mined 162 Mt
Mining Method Truck and excavator
Owner / Contractor Owner Mining
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