NI 43-101 Preliminary Economic Assessment - Verde Potash

Verde Potash Plc 5-1
Cerrado Verde Project
NI 43-101 Preliminary Economic Assessment
5
Geological Setting and Mineralization (Item 7)
5.1 Regional Geology
The region is mainly underlain by Neoproterozoic and Cretaceous rock units, which are partly
covered by Cenozoic sandstones, lateritic sediments and soils. The oldest rocks, occurring in the
southwestern portion of the region, are represented by a nucleus of calcoschists and diamictites
of the Ibiá Formation (Araxá Group) surrounded by an undivided domain of the Canastra Group
(quartzites, phyllites and micaschists). A model age of 1,000m.y. ( 207 Pb/ 206 Pb) has been
determined for the Canastra Group, which was metamorphosed together with the Araxá Group
during the Brasiliano Orogeny (600m.y.). The sequence is followed by the Bambuí Group (600-
550m.y.), which comprises the marine deposits of the Paraopeba Formation, the Serra de Santa
Helena Formation and the Serra da Saudade Formation, including the Verdete unit, all these units
being dominated by variegated slates, and the overlying arkoses of the Três Marias Formation.
Following the deposition of the Bambuí Group, and the Brasiliano Orogeny, the region was
exposed to erosion during the Paleozoic, Triassic and Jurassic periods, giving rise to the
development of a remarkable peneplane. In addition, the flat lying surface, the terrigenous
sediments of the Areado Group was deposited during the Lower Cretaceous. The next
stratigraphic phase is recorded by the extensive and dominantly piroclastic kamafugitic
volcanism of the Mata da Corda Group of Upper Cretaceous age.
5.2 Local and Project Geology
5.2.1 The Verdete Unit
The Verdete unit occurs mainly at the top of the Serra da Saudade Formation and underlies the
Areado Group sandstone. The Serra da Saudade Formation consists of carbonate and siliciclastic
sediments that were deposited in an epicontinental platform in the late Neoproterozoic (700 –
600Ma). The Verdete occurs in extensive outcrops, along both banks of Indaiá River, in a trend
approximately 120km x 20km. It covers the regions of municipalities of Santa Rosa da Serra,
São Gotardo and Guarda dos Ferreiros (SW), Matutina, Quartel São João and Cedro do Abaeté
(centre), Paineiras and Biquinhas (NE), in the State of Minas Gerais.
The thickness of the Verdete unit varies from 15 to 80m in the southernmost domain to over 50m
in the northern half of the Serra da Saudade range. The lower contact with the metasiltstone of
the Serra da Saudade Formation is transitional within 2-3m.
The Serra da Saudade Formation was eroded during the Gondwana Cycle (King, 1956) of
probably Jurassic age, and it was over this extensive peneplain that the cretaceous sandstone
beds of the Areado Group were deposited.
The upper contact is transitional with rhythmic intercalations of Verdete and metasiltstone with
various colors (predominantly pink when weathered), defined informally as the Transition Zone.
These intercalations vary from millimeters to meters in thickness.
The lower contact with the metasiltstone of the Serra da Saudade Formation is transitional within
2 to 3m, and contains intercalations of limestone lenses and calciferous metasiltstone.
5.2.2 Structure
The Verdete unit and the Transition Zone underwent two main phases of folding. The first
resulted in the development of pervasive concentric and chevron folds, in which the axial planes
SRK Consulting (U.S.), Inc. September 16, 2011
Cerrado Verde_NI 43-101 PEA_343500.020_007_KG