A JORC24 Review of a Resource Announcement

I mentioned Everest Mining Corporation (ASX:EMC) for their recent Mt Edon Rubidium Mineral Resource Estimate on the statement regarding RC drill recovery. However, I have read the announcement a bit deeper and I was wondering, how would this Public Report have to be modified under the incoimg JORC24 regulations? How would I critically review the work of the CP involved, to assist with meeting JORC24?

I will deal with some of my critical questions in no particular order.

But first, I would like to start off by saying this is a critical review. It's not me speaking to the quality of the resource published by EMC, or whether the company is fibbing in any way or not; I will stay silent on my opinions about rubidium as a commodity or the Mt Edon Project itself.

Secondly, I am not qualified to determine whether the work of the CP is good, bad, or fantastic. Mr Rashidi has signed the MRE, and I have no skills and have not reviewed it beyond what is released publicly. We should consider that Mr Rashidi is best placed to determine the Resource exists, and accept it as a fact that there is approximately 3.6 million tonnes of pegmatite and it contains approximately 0.22% Rb2O. The resource classification is Inferred and this appears reasonable given the work performed to date.

The Resource is reported under the JORC Code 2012 edition. EMC would not, ordinarily, be required to re-report the Resource under the incoming JORC 2024 standards unless a change in Material assumptions occurs.

As such, I will assess what I believe would be required under the incoming JORC 2024 Code. So let's see how I go, and I will be interested to see if I'm being unfairly persnickety, or missed a bunch of factors.

The Resource

Reasonable Prospects of Eventual Economic Extraction

8.2 Mineral Resources must satisfy the requirement that there are reasonable prospects for economic extraction (i.e., more likely than not), regardless of the classification of the Mineral Resource. Reasonable prospects analysis must reference any available material Modifying Factor data.

More likely than not is a big hurdle for Mt Edon given it is such a niche commodity, with a tiny market, and the metallurgy is so novel and unproven. Personally, if one has 20 years experience, one would conclude it is more unlikely than likely that Mt Edon would ever be mined, especially given how little is defined about it. But that's my opinion.

First off the mark is rubidium (Rb) as a commodity underpinning the RPEEE. EMC has been exploring Mt Edon as a source of Rb. Rubidium is about as niche a commodity as one can imagine, with ~4,000kg-6,000kg (depending on what one googles) per annum market, with prices quoted by EMC at US$1,200/kg.

Whilst JORC24 counsells strongly against this, 7,900t of contained Rb at the prices quoted is about US$9.8B, in 3.4Mt of mineralisation. This is $2,600/t of contained metal value, or about an ounce dirt in Au equivalency (which JORC24 counsells against indulging in this sort of maths). Despite not being encouraged to think in these terms, this illegal thinking does support the Beer Coasterological assessment that the lemon has enough juice to squeeze.

RPEEE for Mt Edon relies upon, philosophically, an argument that

• if one can extract Rb from the pegmatite in which it is hosted (a metallurgical problem)
• and one can sell the purified Rb to customers
• and one can attain a price equal to or close to that quoted by EMC (US$1,200/kg)

then it is reasonable to assume that Rb may eventually be extracted economically.

I think this is an extremely nested set of assumptions that EMC has not fully developed in order to demonstrate RPEEE given;

• EMC has not, to date, produced purified Rb chemicals of marketable quality
• EMC has not demonstrated an ability to extract sufficient Rb (or any defined percentage) from the minerals (EMC may not extract enough Rb to make an economic return)
• EMC has no defined customer base (EMC may not be able to sell any Rb it produces)
• EMC has not quoted an independent research report or marketing study that substantiates its claims of price, market size, or customer base, nor the Rb chemical form or nature or purity required to be met to meet the market (therefore, any Rb produced by EMC may not be saleable)

Note section 8.11;

Where untested practices or emerging technologies are applied in the determination of reasonable prospects, the use of the proposed practices for reporting the Mineral Resource must be discussed and justified by the Competent Person in the Public Report.

The emerging technology is the novel hydrometallurgical process under development at the MRRC at Edith Cowan University. This process, which has not demonstrated nett recovery, or cost of recovery (publicly) is clearly immature. JORC24 s8.11, and others, requires that this be explicitly discussed.

RPEEE should be defined by Modifying Factors as discussed in JORC24;

4.7 ‘Modifying Factors’ are considerations used to assess and estimate Exploration Targets, Mineral Resources, and/or Ore Reserves. Modifying Factors include, but are not restricted to mining, processing, metallurgical, infrastructure, economic, marketing, legal, environmental, social and governance (ESG) and regulatory factors.

These Modifying Factors are dealt with by the Company in turn.

Mining

The Mt Edon resource has outcrop or occurs close to surface and will be amenable to opencut mining, with the information suggesting a low stripping ratio. The assumed mining method is conventional truck and shovel, open pit mining at an appropriate bench height. Since the resource drilling is open ended, further drilling will extend the mineralisation beyond the current boundaries of the maiden mineral resource. The Company believes there are no mining factors which affect the assumption that the deposit has reasonable prospects for mining.

This is an interesting statement: No mining factors affect the assumption that the deposit has reasonable prospects for mining.

Several concerns arise here;

1. No pit shell is defined by EMC to validate that the operation will be "low strip ratio"
2. What a "low strip ratio" is as compared to a "high strip ratio" is highly subjective, especially considering there are no standalone rubidium mines to compare Mt Edon with
3. The appropriate bench height is undefined; given that the market size if Rb is miniscule, EMC has no idea of volume of ore per annum, and recovery is undefined and unproven, there's a lot of judgement used in "appropriate" bench heights, because equipment selection will define this.
4. There is a strongly definite "further drilling will extend mineralisation" which is a strong forward looking statement that needs supporting evidence; I would personally prefer this is changed to "likely"

I would think that this paragraph could use some improvement to comply with JORC24;

4.8 The effects of Modifying Factor variability on the reasonable prospects for economic extraction of a Mineral Resource, or on the likely economic viability and/or on the estimation and classification of an Ore Reserve, must be disclosed and discussed.

There is no discussion of variability of any Modifying Factor. This is especially pertinent given the wholly (partially? you judge) incomplete metallurgical recovery test work with no nett recovery factors, no chemical purity or chemical form (RbCl, RbOH, Rb2SO4, Rb-formate?) etcetera.

Recovery will have a huge effect on the volume of material required to produce the targeted amount of Rb product, and the target Rb chemical. If EMC cannot demonstrate an ability to produce Rb formate, for example, it could be unable to supply it.

Metallurgy

EMC is proposing a set of strategies to extract Rb from minerals (muscovite and/or feldspars) via MRRC at ECU. The metallurgical announcement 24th July 2024 elucidates this as being beaker-scale tests in a laboratory. A full metallurgical flow sheet has not been proposed yet.

Recovery varies by method. Non-destructive (presumably a leach) recovery 41% and destrutive (presumably a front-end calcination followed by leach) has 75% +/- 10%. No preferred processing strategy is elided. Therefore, no recoervy factor can be attributed to the MRE as the company has not locked down their proposed flow sheet.

Is this sufficient to determine RPEEE? That's a question indeed. I believe that the RPEEE here is in the 'beaker half full' type. If we did not all have a beaker half full mentality we would not progress. I think that Inferred is fair enough given the state of metallurgy here, but JORC24 will require additional clarity and discussion of metallurgical risks.

Geotechnical Risk

Geotechnical risk in pegmatite mining tends to be low, as far as my opinion goes. However, no geotechnical holes have been explicitly cited, as we can therefore presume none have been drilled. For an Inferred Resource prior to even a scoping study, this is acceptable, but geotechnical risks should at least be discussed. Geotechnical drilling is not mentioned in the Next Steps for the project as proposed by EMC.

Risks Opportunities and Threats

4.11 Material risks and potential impacts of a Modifying Factor must be disclosed. Refer to the requirements contained in Clauses 5.4 to 5.7.

5.4 The Competent Person must consider all identified Risks related to the reported Exploration Targets, Mineral Resources, and Ore Reserves, analyse the potential effects, and likelihood of impacts on the technical or economic viability of Exploration Targets, Mineral Resources, and Ore Reserves, and evaluate which Opportunities and/ or Threats are material. The Competent Person must ensure that the discussion is appropriately balanced.

There is likely insufficient discussion of risks, opportunities and threats in the announcement.

5.6 Public Reporting of initial or materially changed Exploration Targets, Mineral Resources, and Ore Reserves must disclose and describe material Opportunities and Threats.

There are, of course, a plethora of risks, but some appear to be glaring omissions and others appear left out due to incomplete work. The "if not/why not" principle should see these risks discussed.

I would think that statements such as the below would be required under JORC24;

• There is insufficient geotechnical drilling to determine the effect of geotechnical risk upon the ability to safely and economically mine the Mt Edon pegmatite
• Insufficient work has been undertaken to determine the effect of mining dilution upon the grade, tonnage or recovery of ore
• Metallurgy is at an immature stage.
• The proposed metallurgical treatment route is a novel process and has not been validated by benchtop or pilot plant stage work.
• Further metallurgical testing and piloting is required to be completed prior to definition of a Reserve. There is a risk that no commercially saleable rubidium chemicals may be produced.
• EMC is yet to complete sufficient flora, fauna, groundwater or waste rock characterisation test work to satisfy environmental approvals for the Mt Edon Project and there is no certainty that Environmental Approvals will be granted

Under JORC24 these sort of discussions are not optional;

5.6 Public Reporting of initial or materially changed Exploration Targets, Mineral Resources, and Ore Reserves must disclose and describe material Opportunities and Threats.

8.13 Where the Mineral Resource being reported is predominantly an Inferred Mineral Resource, sufficient supporting information must be provided to enable the reader to evaluate and assess the risk associated with the reported Mineral Resource.

Geology

EMC cites a considerable body of work on mineralogy, both in the discussion of the deposit and in the Mining And Metallurgical Factors section, page 12-13. However, these results are only described, not demonstrated.

The geology of the deposit is very poorly demonstrated via "appropriate maps and cross sections". The overview geology map is OK, but the JORC resource shape isn't a box, and the MGA Zone is not quoted (it's zone 50, FYI, because it's near Paynes Find, but that may not be obvious).

There are cross sections of the block model, but no context from geology to see how the block model is constrained by geology. Holes on the block model are not labelled, so the block model cannot be compared to the parent holes. The thickness of this isometric view is also not defined, and is likely quite thick given the orientations of holes and drilling.

A section from an EMC announcement released September 2023 (figure 2, page 5) is shown below;

7.13 Clear diagrams and maps designed to represent the geological context must be included in the Public Report. These must include, but not be limited to, a plan view of drill hole collar locations and appropriate sectional views. All figures, diagrams, maps, and graphs must include clear, legible images, and appropriate legend, north arrow, scale bar(s), coordinate system(s) and grids.

Nowhere does the fact that the drill holes are, mostly, oriented down dip of a (folded?) pegmatite dyke(s) get mentioned. This has implications for the true thickness of the dykes, which is not discussed in the MRE announcement, nor in the precending stock market announcements about drilling. Adding to this confusion is the lack of dip symbols on the overview map. However it is clear from the isosurface wireframe view (Figure 1, MRE announcement page 3) that this is the case.

7.11 If true widths of mineralisation are not reported, an appropriate qualification must be included in the Public Report.

This may seem nitpicky, but there is a lack of a clear geological cross section. It is also interesting to note that the higher grade Rb (>0.35%) shows a horizontal orientation. There is no explanation for this feature, including whether this is due to oxidation or top of fresh rock interfaces, or structural, or mineralogical.

7.5 Reporting of selected information such as geological observations, isolated assays, isolated drill holes, assays of panned concentrates, visual estimates, or results from supergene-enriched soils or surface samples, without placing them in perspective and providing adequate discussion of significance is unacceptable.

Is avoiding discussion of dip and orientation of the pegmatites a deselection of relevant information? I think it is. But again, that's just my opinion, man.

This drives at Section 8.28;

8.28 In a Public Report of a Mineral Resource for a material mining project, when reporting for the first time, or when those estimates have materially changed from when they were last reported (including classification changes), a Mineral Resources Technical Summary must be included in the body of the Public Report.

The detail provided in the EMC announcement is relatively detailed excepting for these aspects of the geology identified above. This may pass JORC24, but I for one would expect that drilling down dip, and the impact on interpretations, be discussed explicitly.

Approvals

As mentioned previously, geotechnical work is required in the future. JORC24 requires future work to be appropriately discussed. This includes approvals.

8.26 Public Reports of Mineral Resources must transparently disclose any subset of the total declaration by category, where necessary approvals have not been granted. The Competent Person shall describe the risks, work program(s) and anticipated timeline to obtain outstanding approvals.

EMC discusses this in their Project Development Schedule section; "Metallurgical test work for Rb extraction is ongoing at ECU’s Mineral Recovery Research Centre (“MRRC”). EMC is planning environmental studies, including Flora and Fauna assessments, and is preparing the necessary documentation for the Mining Proposal. The Company aims to obtain all required approvals by the end of 2025."

This is likely an insufficient level of discussion under JORC24, as it does not discuss Risks, Opportunities, and Threats.

For example, under JORC24 I would expect that the approvals process needs to be discussed (especially for Inferred Resources, see s8.13) in greater detail, for example;

• Mt Edon is located on M59/714 a granted Mining Lease
• M59/714 is not permitted for extraction of rubidium
• Prior to mining commencing, a Mining Proposal will need to be lodged which includes;
• Groundwater Surveys including surface runoff, flood modelling, and pit dewatering (if required)
• Tailings Dam and Tailings Disposal Facility and all required statutory test work
• Geotechnical assessments (the risk of which must be assessed in the mine closure plan)
• Heritage approvals (where required)
• Flora and Fauna Surveys

EMC has not yet completed flora and fauna surveys, and it is unclear whether heritage and ethnographic surveys in support of and allowing of mining have been completed; this seems unlikely given the mine site layout, waste dumps, tails dams, etc have not been defined. This is fine for an Inferred Resource, but these areas of risk (ie; that no waste rock dump site is available, or it may be available but uneconomic to dump it there, etc) need to be explicitly dealt with.

ESG

JORC24 requires that ESG be dealt with more thoroughly than under JORC 2012;

4.9 ESG factors must be given equal prominence to other Modifying Factors. This requirement acknowledges the nature of evolving knowledge in these areas and requires that the available and material knowledge at any reporting stage is applied in the Public Report.

4.10 All Public Reports of Exploration Targets, Exploration Results, Mineral Resources, Ore Reserves and Technical Studies must include the consideration and reporting of the ESG factors that could have a material effect on the outcome of the exploration assessment, project, or operation.

One ESG factor which is discussed is the lack of interaction with national parks or other reserves. "The tenement is in good standing and no known impediments exist. The Competent Person has not verified any potential social or environmental pediments (sic) to progressing the Project." This is like saying you haven't done your homework, so you don't know if you've passed the class. If no surveys have been done, then this should be stated. If they have been, then this should be stated. If the CP or Company is just assuming no impediments exist, this assumption is a Material assumption, and would be required to be stated.

The announcement does not explicitly state ESG factors. These are dealt with in part via discussion of flora and fauna surveys (to be performed by 2025), but are not in equal prominence to other Modifying Factors.

Crucially, for 2024 post-ACHA, there is no mention of Native Title, not even whether it exists or has been extinguished. This is a clear Risk that is undefined and not discussed. In a modern Western Australian context, we cannot presume that none exists and ignore it (the if not/why not). This would be a clear omission under JORC24.

Equal ESG prominence is a tricky one to evaluate ahead of other examples under JORC24, but given there is somewhat limited to very limited discussion of some modifying factors (eg; metallurgy, marketing risk) the fact ESG is likely under done would probably be treated in equal prominence.

If JORC24 would cause additional disclosures around Risks, Opportunities, Threats, and therefore more thorough discussion of metallurgy as a Modifying Factor, then ESG would have to be discussed in greater detail (a rising tide lifts all boats).

Table 1 & 2 Comments

There are some things I find difficult to follow in the Table 1 and 2.

• no diamond core drilling, a good example of staying Inferred till that is sorted. Diamond core should be a priority going forward, especially for metallurgical testing
• Handheld GPS only; this would be a priority for me to get DGPS
• Topographical control is not mentioned in the report, eg, LIDAR or RTK surveys for contouring. There appears to be reasonable topography (for Paynes Find anyway) so this is on the to-do list IMHO
• Data spacing was classed as "not relevant". Given the variogram limits were not discussed, I would think this is a little bold to be mentioning. Data spacing will define the tonnage outside of the drilling grid which is included by dint of variography, and it is therefore relevant to strike extensions.
• Orientation of data is discussed, including a mention of obtaining true thickness via drilling 'fans' of holes to minimise land sitrubance. This is another way of admitting a lot of drilling is apparently down dip because EMC didn't want to do more heritage surveys, or was unable to gain additional permitting, or was physically incapable of accessing the drill pads. This explains the drilling pattern. However, the true thickness (as demonstrated above) is not shown or mentioned.
• "True thickness of the intercepts remains unknown." This would be a small issue to determine true tonnage. For a pegmatite presumably drilled through both contacts (mentioned to be easily observable) and modelled in Leapfrog Geo and wireframed, this also goes on the to-do list.
• "Other substantive exploration data" lacks appropriate "if not why not"-age. Why no geotechnical data or discussion of it? IF there are no deleterious elements, discus it. If you don't know, also discuss it. I would put more effort in here myself, but each to their own.
• Database integrity. "Any discrepancies or errors were either corrected or the results rejected." What were these errors? Were there any? "Drill cores with no sample assays were inserted with zero grade." That's easy, as there were no diamond drill holes.
• Geological Interpretation. "Confidence in the interpretation of the Mt Edon pegmatite is considered to be high given domain interpretation was completed with a consideration for outcrop mapping, downhole geological logging, geochemical data and surrounding holes." Yet no True Thickness? Seems to not be that high.
• Mining Factors or Assumptions. "The mineralisation at Mt Edon is shallow and suitable for open pit mining. The Mineral Resource is being reported assuming using conventional open cut (pit) mine with a significant portion expected to be free dig material. • No assumption on mining method and parameters have been made. The Competent Person is not aware of any major geotechnical or hydrogeological constraints that may impact the potential of mining." This is a Schrodingers' Assumption. On the one hand, open pit mining is being assumed. But no assumptions on mining method or parameters is assumed. And yet again, not having some any work, one can be unaware of geotechnical or hydrogeological constraints.
• Classification. "Portions of the deposit that do not have reasonable prospects for eventual extraction are not included in the Mineral Resource." I infer that this means there are portions of the deposit without RPEEE. Should one infer that these are the areas of <0.1% Rb? Or areas below the 140m estimation envelope? It is not areas that fall outside of the non-existent whittle optimisation. This is an interesting conundrum that leaves me unable to assess why some pegmatite is RPEEE and why some is not, and what the difference is beyond simple grade, or distance from assays.
• Audits and Reviews. "GeoPrecision Resource Solution Inc. conducted a review of the Mineral Resource Estimate, and no material issues were identified. Dr. Omid Asghari, a senior resource geologist and geostatistician (MAusIMM) undertook an audit of the Mineral Resource estimate as an independent technical review." I am encouraged by this statement. I do not that under JORC24, Dr Ashgari would likely classify as an independent Specialist, and would have to consent to the inclusion of his name as a Specialist and the form and context in which it appears. Further, this is only mentioned in the Table 2, not in the body of the text.

Conclusions for JORC24

Everest Metals Corporation, with Mr Bahman Rashidi, the Competent Person, have met the standards required to estimate and report a Maiden Inferred rubidium resource at Mt Edon under the JORC Code 2012.

Like all Maiden Mineral Resources, there are a plethora of improvements to be made and data to be generated and collected, before the current Inferred Mineral Resource can increase in quality and continuity to be upgraded to Indicated.

These deficiencies are common and normal for early stage projects and companies and individuals must balance budgets with seeking perfection in estimation, and often many other factors limit the quality of the work one would wish to do.

Everest Metals Corporation is working with, I presume, land access constraints, budgetary constraints, and a boutique commodity requiring a novel metallurgical process, in order to realise value from the rubidium mineralisation. A Maiden MRE is an important first step in the process.

Further resource upgrade reporting will likely occur under the incoming JORC 2024 Code, which has been put out in exposure draft form. This critical review has highlighted a selection of disclosure opportunities to bring a JORC 2012 compliant Mineral Resource up to standard with the JORC 2024 Code. We should not judge this as anything except an example of the work required to draft a Public Report in the incoming JORC 2024.

Chief amongst these is the incoming Risks, Opportunities and Threats disclosure, which will determine increased discussion of risks, and require thorough deliberations and exposition of material matters. As it stands as a JORC 2012 Inferred Resource, re-reporting an extension to Mt Edon or an upgrade to Indicated or Measured, will see a considerable expansion of the length of the disclosure.

Secondly, ESG matters will gain strong prominence under JRC 2024. The current MRE disclosure under JORC 2012 will need significant work, so that investors will be able to full appreciate the work required to gain approvals and permitting, assess the proposed timeline to a Mining Proposal or Approval, and understand the quantum of work (and money) required.

To-Do List

• Core drilling for geotechnical, metallurgical and structural data, and to inform likely True Thickness
• Drone LIDAR topography and DGPS survey of drill hole collars to bring the topographical control up to standard
• Structural mapping of the pegmatites to define dips, strikes and inform True Widths
• Trenching or cut channel sampling of outcrops (to allow projection of grade to surface)
• Depiction of BOCO, TOFR on section and classification of MRE via oxidation state (which may have mineralogical and metallurgical implications)
• Drafting coherent geological cross sections for publication, to demonstrate ore body knowledge
• Core drilling of horizontal Rb-enriched zone to elucidate the reason for this phenomenon
• Flora and Fauna Surveys
• Heritage and Ethnographic Surveys
• Completion of metallurgical testing and product development (eg; produce a Rb chemical)
• Waste Rock, Tailings
• Define logistical access and include access, tailings, waste landforms in Enviro/Heritage surveys
• Drill more holes orthogonal to the pegmatite!