RECURRING REVENUE

DEVELOPMENT

Monetisation of existing identified resources

Transition plans to generate recurring revenue through planned small-scale mining, including the retrieval of historic mineralised waste piles (identified throughout Transition’s tenements), and upgrading at one of the Transition’s six mining leases for third-party sale or toll treatment.

Transition has identified more than 400 historical prospects from both modern (digital) and historical (analogue) sources, that might potentially host ore-grade “waste” in historic piles. Field reconnaissance continues to add additional mineralised waste piles to inventory, including at many previously unknown workings and mineral occurrences.

Historical Chinaman Copper Mine (ML90088)

MINING LEASES (MLs)

Transition plans to utilise one of its six MLs as a handling facility where it will sort, upgrade and load ore for transport to third parties. Sorting and upgrading options include crushing, screening and mechanical separation of heavy minerals from the lighter waste rock via cyclone or similar dry gravity methods. Field samples have been collected and test-work to determine an optimal process is ongoing.

Ore sale options include local buyers with deliveries via road haulage, or cross-state and international buyers via road or rail transport.

Studies indicate a moderately robust operation through simple and cost-effective sorting and crushing of the ore, with subsequent sales at a discount to payable metal prices. Options to improve payable metal prices include upgrading the ore to a “low-grade” saleable concentrate (+/- 10% Cu). The additional cost of installing upgrading equipment is anticipated to be more than offset by savings in haulage and through receiving higher payable prices.

Upgrading the ore also provides flexibility in sale options, including to offshore buyers.

Transition is not considering wet (chemical) processing at this stage, which at significant cost would possibly result in a much higher quality metal product and much higher payable metal prices (approaching LME). Anticipated administrative delays and costs in seeking the various approvals do not make this an attractive option for Transition at this point in time.

DEVELOPMENT PLANS

Transition is progressing development plans to establish a small-scale mineralised waste upgrading operation at its Chinaman Mine Mining Lease (ML90088) where it anticipates it would generate a saleable copper oxide ore product from existing mineralised waste piles sourced from ML90088 and the surrounding tenements.

Since commencement of Transition’s maiden field programmes late 2018, and despite prospect reconnaissance covering only a relatively small area of its Duck Creek Tenements so far, it has identified more than 400 historical mineralised waste piles at exploration prospects throughout its tenements, many of which do not exist in historical records. To date around 211 of these have been assessed as possibly contaminating their immediate environment but also suitable for retrieval and upgrading to a saleable ore material. This number is anticipated to increase over time and would be an important aspect of Transition’s planned activities going forward.

Under the current mining codes most of these historically disturbed sites do not offer a viable economic path to rehabilitation by the private sector, so they remain in an uncontrolled condition(some for over 120 years), and in many cases continue to contaminate their immediate environment.

Transition would address this issue whilst meeting the needs of all stakeholders including:

  • Directly and indirectly generating jobs locally.
  • Maintaining an operational presence that would inject cash into the local economy.
  • Through ore sales pay royalties to the State of Queensland and Native Title claimants.
  • Self-funding Transition’s ongoing exploration and development objectives.
  • Paying dividends to shareholders and taxes to the Federal Government.
  • Undertaking progressive rehabilitation of historical areas of disturbance.

The above images (Dec 2018) are of the Chinaman Mine (ML90088), located on EPM13336. Drone acquired aerial image (left) and associated digital terrain model (DTM) (right) acquired via photogrammetry processing of drone acquired 3D spatial images.

RESPONSIBLE AND SUSTAINABLE LAND USE

Under Transition’s proposed Cloncurry strategy, it would undertake advanced exploration activity, including the re-establishment of existing (or previously existing) roads and tracks. Advanced activity would include excavation of costeans and clearing of drill pads for shallow reconnaissance-based Rotary Air Blast (RAB) drilling, targeted (prospect-scale) Reverse Circulation (RC) drilling, and diamond drilling (DD) of deep Tier One exploration targets.

At the same time, Transition would identify historic mineralised waste piles (common at prospect-scale exploration targets) that it would concurrently retrieve and rehabilitate during site excavations, thereby making efficient use of exploration road and track networks and any heavy equipment used for this process.

New areas of disturbance by Transition (including RC/DD drill pads, RAB lines, costeans and retrieved mineralised waste piles) would be progressively rehabilitated in accordance with the Code of Environmental Compliance for Exploration Permits and Mineral Development Projects.

Examples of some of the hundreds of historical workings with mineralised waste piles identified throughout Transition’s tenements, earmarked for retrieval and rehabilitation.

REGIONAL INFRASTRUCTURE

ML90088 is approximately 2.3km by unsealed road from the all-weather (sealed) Cloncurry-Dajarra Road, which intersects with the Barkly Highway approximately 35km by road to the north. The regional township of Cloncurry is just 10km east of this intersection along the Barkly Highway which continues around 800km east to Townsville on the east coast of Queensland. From ML90088 to Cloncurry is an estimated total of 47.3km of predominately sealed all-weather road, resulting in an approximate driving time from ML90088 to the centre of the township of around 40 minutes.

Queensland Rail’s narrow gauge (1067mm) Mt Isa Line passes less than 1km to the east of ML90088 and the Marraba Train Station (not in current use) is located just 1.5km by road.

The township of Cloncurry has a permanent population of around 1,719 (2016 Census) and an unknown yet fluctuating number of transient (FIFO) workers. The town is well serviced by modern facilities and services including large regional hospital, separate medical centre, swimming pool, Woolworths & IGA supermarkets, retail shops, cafes, schools, law courts, police station, town hall, council offices, sporting facilities including lawn-bowls, service station, rail loading facilities, major fuel depot and storage area, racetrack, showgrounds, various cattle loading and competition facilities, motels, caravan parks and six pubs.

The Cloncurry airport is regularly serviced by QANTAS and Virgin Airlines using large jet aircraft and include direct flights from Townsville and Brisbane. Taxi, rail and bus services are also available.

DEVELOPMENT ACTIVITIES

Transition plans to utilise ML90088 as a handling and upgrading facility where it would sort, upgrade and load ore for transport to third parties.

Sorting and upgrading options include crushing, screening and mechanical separation of heavy minerals from the lighter waste rock via cyclone, Inline Pressure Jig (IPJ) or similar gravity methods. Field samples have been collected and test-work to determine an optimal process is ongoing.

Ore sale options include local buyers with deliveries via road haulage, or cross-state and international buyers via road and/or rail transport.

Studies indicate a moderately robust operation through simple and cost-effective sorting and crushing of the ore, with subsequent sales at a heavy discount to payable metal prices. Options to improve payable metal prices include upgrading the ore to a “low-grade” saleable concentrate (+/- 10% Cu). Upgrading the ore also provides flexibility in sale options, including to offshore buyers.

Operations Plan –Option 1

Operations Plan –Option 2

Site Infrastructure

Planned site infrastructure includes:

  • Access roads, site roads, haul roads and cattle grids.
  • Duck Creek seasonal water transfer pump, sump and surface pipeline (optional).
  • Water pumping stations, transfer pipes, tanks and standpipes (from Chinaman Mine pit).
  • Stormwater management including diversion culverts, and sediment ponds.
  • Mineralised waste pile sorting, load-in and load-out areas.
  • Dry crushing and sorting area (crushing and screening).
  • Wet classification and sorting area (optional).
  • Offices, gatehouse, potable water storage, ablutions and sewage facilities.
  • Workshops and service areas, stores, equipment parking, fuel storage and filling area.

Transport

Haulage of ore product from ML90088 load-out area would be by road-train to the nearby Cloncurry-Dajarra Road via the existing and previously used ML90088 access road (approximately 2.3km), then north to the Barkly Highway intersection (~35km), then east towards Cloncurry (~10km) and;

  • if local buyers, either turn north onto the Burke Development Road or continue east along the Barkly Highway to either of the buyer’s delivery location; or
  • if interstate or international buyers, continue to the Cloncurry rail load-out facility using the by-pass road, or continue through Cloncurry if continuing to Townsville for sale or export.

No new roads are proposed and upgrading of existing roads and tracks to suitable status for use would be undertaken as required within ML90088 and designated access areas.