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The revised National Instrument 43-101 Resource Estimate increases the Song Jiagou resource by 285 percent to 1,174,460 ounces of gold from 413,900 ounces (Majestic news release April 26, 2006). Included in the revised resource estimate are indicated 8,007,999 tonnes at 1.668 grams of gold per tonne (g/t) (429,497 ounces) and inferred 18,142,799 tonnes at 1.277 grams per tonne (744,963 ounces), using a 0.5 gram per tonne cut-off based on an inverse distance squared interpolation. A total of three statistical methods were used to calculate the resource and each produced similar results as shown in Table 1 below:
At a cutoff grade of 0.5 g/t and a capping level of 50 g/t, the deposit is estimated by kriging to contain an Indicated resource of about 8.8 million tonnes at an average grade of 1.46 g/t gold, and an Inferred resource of about 18.2 million tonnes at an average grade of 1.26 g/t gold.
The resource estimated by inverse distance squared interpolation at a cutoff grade of 0.5 g/t gold and a capping level of 50 g/t is: Indicated 8.0 million tonnes at an average grade of 1.67 g/t gold and Inferred 18.1 million tonnes at an average grade of 1.28 g/t gold.
The nearest neighbour estimate at the same cutoff grade and capping level is: Indicated 6.7 million tonnes at an average grade of 1.96 g/t gold, Inferred 17.7 million tonnes at an average grade of 1.38 g/t gold.
Table 1: Song Jiagou Revised Resource Estimate at 0.5 g/t Cut-Off
| Calculation Method |
Category |
Tonnes (t) |
Ounces (oz) |
Grade (g/t) |
| Inverse Distance |
Indicated |
8,007,999 |
429,497 |
1.668 |
| Squared Interpolation |
Inferred |
18,142,799 |
744,963 |
1.277 |
| |
|
|
|
|
| Kriged Method |
Indicated |
8,780,199 |
412,754 |
1.462 |
| |
Inferred |
18,186,999 |
736,252 |
1.259 |
| |
|
|
|
|
| Nearest Neighbour |
Indicated |
6,705,399 |
423,453 |
1.964 |
| |
Inferred |
17,685,199 |
784,745 |
1.380 |
The revised resource estimate was produced in accordance with National Instrument 43-101 and the Canadian Institute of Mining, Metallurgy and Petroleum standards on mineral resources and mineral reserves definitions and guidelines by an independent third party, Wardrop Engineering Inc, Greg Z. Mosher P.Geo. The data used was collected by Majestic in its 2004, 2005 and 2006 exploration programs in addition to data collected by joint venture partner Shandong Yantai Muping Gold Mine ("Muping Mining") and totaled 14,881 gold assays.
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