Quarterly Activities Report - 1 July to 30 September 2011 - Discovery ...

The Preliminary Environmental Impact Assessment (PEIA) report for Boseto underground mining has been
accepted by the Department of Environmental Affairs (DEA). It has been agreed that an addendum to the
Boseto Environmental and Social Impact Assessment (ESIA) will be sufficient to grant permission to proceed
with the underground operations. This will ensure that all impacts and the Environmental Management Plan
are comprehensive for the entire scope of the Boseto operations. The process to select a consultant for this
role has commenced.
4. Boseto Coal Fired Power Station
Engineering, Procurement & Construction (EPC) proposals with indicative pricing for a 25MW Coal Fired
Power Station have been received from several potential EPC contractors from South Africa, Australia,
Europe, China and India. All proposals have been evaluated and a short list determined. Fully priced Front
End Engineering Design (FEED) proposals have now been received from these short listed bidders. The EPC
selection due diligence process is underway which will incorporate visits to contractor facilities and design
offices together with nominated projects recently completed or under construction. It is intended to award
a FEED contract to a preferred EPC contractor after this process has concluded. This initiative is an integral
part of the Boseto Development Plan and will allow replacement of the diesel power for the project bringing
significant operating cost savings. The funding of capital costs is planned from operating cash flows during
2013 with the commencement of operation of the coal fired power station currently scheduled for mid‐2014.
5. Kalahari Copperbelt Exploration
Discovery Metals holds 14 prospecting licences covering 8,877 square kilometres in the Kalahari copperbelt
of north‐west Botswana.
The entire prospecting licences package extends from 60 kilometres south‐west of Maun through to the
Namibian border, a distance of over 280 kilometres. The prospecting licences contain approximately 1,300
strike kilometres of favourable geology with the potential to host copper‐silver mineralisation.
Approximately 40% of this prospective horizon’s strike has been explored (soil sampled) by Discovery Metals
and approximately 13% has been drill‐tested to date. Exploration in the September quarter has also been
examining the potential for mineralisation at stratigraphic levels other than that hosting mineralisation at
Zeta and Plutus. Soil sampling has also tested about 100 km of strike length of the Ngwako Pan formation
from Kronus in the south‐west to Zeta in the north‐east at spacing of approximately two kilometres along
strike.
The seven north‐eastern prospecting licences, located in Ngamiland, have been renewed until September
2012, and the seven south‐western prospecting licences, located in the Ghanzi District, were renewed in July
for another two years, until 30 June 2013.
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