TECHNICAL REPORT
ON THE
HAVADAN EXPLORATION PROJECT
TURKEY
For
ASLANAY MINING
By
Robert M. Allender, Jr., CPG, RG
Phoenix, Arizona, USA
TECHNICAL REPORT
R.M.Allender, Jr.,CPG, RG
Report No. 12-27
Effective Date: September 27, 2012
Signing Date: September 27, 2012
NI43-101 Havadan Technical Report
Page 1
NOTICE
This report was prepared as a Canadian National Instrument 43-101 Technical Report, in
accordance with Form 43-101F1, for Aslanay Mining (“Aslanay”) by Robert M. Allender, Jr.
(“Author”). The quality of information, conclusions and estimates contained herein is consistent
with the level of effort described in the agreement between Aslanay and Author and based on: i)
information available at the time of preparation, ii) data supplied by Aslanay and other outside
sources, and iii) the assumptions, conditions, and qualifications set forth in this report. This
report is intended to be used by Aslanay, subject to the terms and conditions of its contract with
Author. This contract permits Aslanay to file this report as a Technical Report with Canadian
Securities Regulatory Authorities pursuant to National Instrument 43-101, Standards of
Disclosure for Mineral Projects and with the United States Securities Exchange Commission
pursuant to Guide 7. Any other use of this report by any third party is at that party’s sole risk.
NI43-101 Havadan Technical Report
Page 2
Technical Report
on the
Havadan Exploration Project,
Turkey
Table of Contents
CONTENTS
PAGE
Title Page
1
Notice
2
Date and Signature Page
5
Table of Contents
3
Item 1:
Summary
6
Item 2:
Introduction
8
Item 3:
Reliance on Other Experts
8
Item 4:
Property Description and Location
8
Item 5:
Accessibility, Climate, Local Resources, Infrastructure and Physiography
13
Item 6:
History
14
Item 7:
Geological Setting and Mineralization
15
Item 8:
Deposit Types
20
Item 9:
Exploration
20
Item 10: Drilling
21
Item 11: Sample Preparation, Analyses and Security
21
Item 12: Data Verification
22
Item 13: Mineral Processing and Metallurgical Testing
22
Item 14: Mineral Resource Estimates
22
Item 15: Mineral Reserve Estimates
22
Item 16: Mining Methods
22
Item 17: Recovery Methods
22
Item 18: Project Infrastructure
22
Item 19: Market Studies and Contracts
22
Item 20: Environmental Studies, Permitting and Social or Community Impact
22
Item 21: Capital and Operating Costs
22
Item 22: Economic Analysis
23
Item 23: Adjacent Properties
23
Item 24: Other Relevant Data and Information
23
Item 25: Interpretation and Conclusions
23
Item 26: Recommendations
24
Item 27: References
24
Appendix: Havadan License Documents
25
NI43-101 Havadan Technical Report
Page 3
FIGURES
PAGE
1
Turkey Reference Map
8
2
Havadan Project Location Map
10
3
Havadan License Map
11
4
General tectonics of Turkey
15
5
Plate Tectonic Features of Turkey
15
6
Geology and mineral deposits of the Aladaglar-Zamanti Region
16
7
Geologic Map and Sections, Havadan License
19
TABLES
PAGE
1
Aslanay Mining Havadan Licenses
12
2
Havadan Project Sample Analysis Selected Results
21
NI43-101 Havadan Technical Report
Page 4
CERTIFICATE OF QUALIFIED PERSON
Robert M. Allender, Jr. Certified Professional Geologist (07475)
I, Robert M. Allender, CPG, residing at 5730 East Windrose Drive, Scottsdale, Arizona, USA do
hereby certify that:
1. I am an independent geological consultant contracted by Aslanay Mining;
2. I am a graduate of Colorado State University with a Bachelor of Science degree in Geology
(1978);
3. I am a geological consultant and currently a Certified Professional Geologist (CPG #07475)
by the American Institute of Professional Geologists (AIPG);
4. I have worked as a geologist for a total of 34 years since obtaining my B.Sc. degree;
5. I am responsible for all sections of this technical report entitled “Technical Report on the
Havadan Exploration Project, Turkey for Aslanay Mining” and dated August 27, 2012;
6. I visited the Havadan property on May 27, 2012 and again from September 13 to September
20, 2012;
7. I have had no prior involvement with the Havadan Property that is the subject of this
Technical Report;
8. As of the date of this certificate, to the best of my knowledge, information and belief, the
technical report contains all scientific and technical information that is required to be disclosed to
make the technical report not misleading;
9. I have read the definition of “qualified person” set out in National Instrument 43-101 (NI 43-
101) and certify that by reason of my education and past relevant work experience, I fulfill the
requirements to be a “qualified person” for the purposes of NI 43-101. This report is based on
my personal review of information provided by the Issuer and on discussions with the Issuer’s
representatives;
10. I am independent of the issuer applying the test in Section 1.4 of NI 43-101;
11. I have read NI 43-101 and Form 43-101F1 and the Report has been prepared in compliance
therewith;
Effective Date: September 25, 2012, 2012
Signing Date: September 27, 2012
_______________________________
Robert M. Allender, Jr.
NI43-101 Havadan Technical Report
Page 5
Item 1.
Summary
The Havadan Project of Aslanay Mining is located in Central Anatolia, Turkey in an area
geologically characterized by tectonic structures and rock units that have favored the formation
of metallic mineral deposits. The project is located in the Kayseri Province, Develi District
approximately 45 kilometers south of the District capital of Develi. Aslanay holds a Group 4
exploration license on 1046.83 hectares in the Havadan Mining District one kilometer east of the
village of Havadan. The license allows Aslanay to explore for and develop metallic minerals on
the license area.
The Havadan Mining District is an active district with three mining operations currently
extracting lead-zinc ore.
Havadan Region Mining Company has produced several hundred
thousand tons of lead and zinc, and several hundred thousand ounces of silver over the past
several years from an underground mine located approximately 2 kilometers west of the Aslanay
license. Aksu Mining Company licenses border the Aslanay license on the west. Aksu produces
lead, zinc, and silver from two mines on structures that trend onto the Aslanay license. No
production numbers were available for Aksu operations.
The Project is in the exploration stage and Aslanay is in the first phase of exploratory work.
Mining and metal production has evidently occurred on the license since Roman times. Recent
production by the former license holder, Dedemen Mining, has been limited to several thousand
tons of ore, as reported in Turkish government documents. The tenor of that ore is not
completely understood, although several stockpiles were sampled and laboratory analysis has
shown that these samples contain significant concentrations of metallic minerals. One such hand-
selected stockpile sample analysed contained 14.47% lead, 34.38% zinc, and 254 grams silver
per tonne.
The mineral deposits in the Havadan District are categorized as Mississippi Valley Type (MVT)
deposits. These deposits are hosted in Jurassic-age platform carbonate rocks that have been
repositioned by tectonic forces in the region. These rocks are part of a large area of overlapping
nappe structures whose development has resulted in significant faulting and fracturing of the
carbonate sequence. This fracturing resulted in the development of open space into which
metallic-bearing hydrothermal fluids migrated and deposited the metallic bodies in the veins
present today.
The mineral deposits in the District and on the Aslanay license are classic MVT deposits that
exhibit pinch and swell characteristics. For example, in the Havadan Company mine, workings
encounter veins that pinch out but then swell again to widths of several meters. The veins are
persistent both horizontally and laterally for several hundred meters in the Havadan Mine and
mineralization continues at depth and along strike for an unknown distance.
Aslanay is preparing to conduct detailed exploratory work on the license. Currently no
development work or production is either being conducted or contemplated. No resource or
reserve estimates are possible or warranted for the license. The Author concludes that there is
potential for economic mineral deposits within the Aslanay license. Significant exploratory
work will be required to evaluate the potential for the discovery of a mineral deposit. Significant
NI43-101 Havadan Technical Report
Page 6
additional efforts will be required to identify and develop an economic mineral deposit on site.
Resource and ultimately reserve calculations may follow a focused exploration mapping and
drilling program.
The author recommends detailed geologic mapping and analysis, magnetic and induced
polarization geophysical surveys, and a series of drilling programs focused on targets identified
by mapping and geophysics. Also recommended is the development and implementation of a
quality control and quality assurance program that will allow Aslanay to manage exploration
data and insure high quality data for possible later resource estimation.
NI43-101 Havadan Technical Report
Page 7
Item 2: Introduction
This technical report has been commissioned by and prepared for Aslanay Mining, Industry, and
Trade Company, Ltd. with an address at Emirhan Caddesi, Naki Cendere Apt. No, 88/4 Besiktas
/ Istanbul, Turkey. It has been prepared for the purpose of summarizing all available information
regarding the property and providing a baseline of technical and exploration information from
which further examinations and exploration may be commenced. It is preliminary in nature and
will be updated as new exploration information is generated.
The property is a recent acquisition for Aslanay and as such has minimal examination or
exploration work results. Past exploration has been limited and not well documented. The focus
of previous activities within the past 10 years has been the production of lead and zinc from the
production licensed areas on site. This work is likewise poorly documented. Mining activities
dating to Roman times are evident at numerous locations within both the license area and the
overall Havadan Mining District.
The license area is prospective for lead, zinc, and silver and represents an excellent exploration
target given its geologic setting, mineralized structures on the property, the past mining activity
on the site, and the current activity within the district. Nevertheless, this is essentially a raw,
early-stage prospect and the company will be starting at the beginning when it commences
exploration activities in the near future.
The Havadan property comprises a continuous
block of land near the village of Havadan in the
Cappadocia region of Central Anatolia, Turkey.
The land holding consists of an exploration and
production license issued by the Turkish
government and acquired by direct purchase
from the previous private mining company
owner. The license allows Aslanay to explore
for and produce metallic products from the
license area which encompasses over 1,000 hectares in the arid Central Anatolia highlands.
Figure 1. Turkey reference Map
Information regarding the Havadan property has been provided by Aslanay Mining, mining
company owners of adjacent properties, and publically-available published reports. No new
investigations have been conducted by the author with the exception of surface sampling during
the site visit. General regional geology is well understood and descriptions are abundant in the
literature. Havadan mining district-specific geology and mining information is available to a
degree with one neighboring company providing significant information on geology, ore
deposits, and production. No information was made available to the author by the other
neighboring mining company.
Detailed technical information specific to the Havadan property is generally scarce. Preliminary
geologic maps of the area were obtained from the General Directorate of Mineral Research and
Exploration (commonly called the MTA). Some published papers on the geology and ore
deposits in the Aladaglar-Zamanti region of the Eastern Tauride Mountains, in which the
NI43-101 Havadan Technical Report
Page 8
property is situated, were available and reviewed as a part of this preliminary examination and
report. All published material utilized in the preparation of this report are listed in the Reference
section at the end of this report.
A personal inspection of the property was conducted by the Author/Qualified Person, on Sunday,
May 27, 2012 and again from Thursday, September 13, through Thursday, September 20, 2012.
The Author observed the topography, physiography, vegetation, infrastructure, climate, geology,
and mining operations at both the Havadan property and the surrounding mining district during
these visits. The Author also collected geologic samples for laboratory analysis to test for the
presence of metallic minerals in the geological units present on the site.
Item 3:
Reliance on Other Experts
The Author has relied, and believes that he has a reasonable basis to rely, upon Dr. Salih
Bayraktutan, Ph.D. geologist, Exploration Manager of Aslanay who has contributed much of the
geological and mineralization information regarding the Havadan property. For the later site
examinations, the Author was accompanied by Professor Dr. Hüseyin Öztürk and Dr. Nurullah
Hanilçi of the Department of Geological Engineering, Istanbul University. Both of these
geologists have published work on the deposits of this region in international scientific journals
and have extensive knowledge of the geology and the nature and genesis of the lead-zinc
deposits in the area. The Author has relied on their professional analysis and interpretation as
well as their published work in the preparation of this report.
Author has also relied upon the legal, environmental, permitting, and business information
provided by Aslanay Mining that has been reviewed by the author and included in this report.
Geologic and mining experts employed by Havadan Region Mining Company, a neighboring
mine operator, and Dedemen Mining, the former owner of the Havadan property, contributed
information about the mining district and the Aslanay-owned Havadan property specifically.
Although copies of the exploration license and the preliminary survey report prepared by
Aslanay were reviewed, an independent verification of land title and tenure was not performed.
The author has not verified the legality of any underlying agreement(s) that may exist concerning
the license or other agreement(s) between third parties.
A draft copy of the report has been reviewed for factual errors by Aslanay. Any edits or revisions
made as a result of this review did not involve any alteration to the conclusions made. Hence, the
statements and opinions expressed in this document are given in good faith and in the belief that
such statements and opinions are not false and misleading at the date of this report.
Item 4: Property Description and Location
The Havadan property lies in the Kayseri Province, Develi District approximately 45 kilometers
south of the town of Develi in central Turkey (Figure 2). The property block is situated in an area
NI43-101 Havadan Technical Report
Page 9
-0729600
N ^
FIGURE 2
HAVADAN PROJECT
UTM Zone 36S
LOCATION MAPS
Datum European 1950
NI43-101 Havadan Technical Report
Page 10
characterized by low, rolling limestone hills at the northern edge of the Eastern Tauride
Mountains. The existing buildings on site are approximately one kilometer east of the village of
Havadan, Turkey. The location and topography of the property block and surrounding area is
shown on Figure 3.
The Havadan license area is located in an area of rolling limestone hills east of the Zamanti
River gorge (Figure 3). Topographic relief on the license block is relatively low, ranging from
1,575 meters at the southwest corner of the license near the village to 1,800 meters atop Sarikaya
Mountain in the northern half of the license area. The main topographic feature of the licence is a
long, rounded ridge that runs from Tekke Hill (elevation 1,715 meters) in the south to Sarikaya
Mountain in the north. In general, the southwestern portion of the site slopes to the south while
the northeastern portion slopes to the east and north. The major drainage feature in this arid area
is Demirci Creek which occupies a fault-controlled valley along the southwestern flank of the
Sarikaya-Tekke ridge (Figure 3).
N ^
Figure 3. Havadan License Location Map
NI43-101 Havadan Technical Report
Page 11
Exploration and Production License. �� The issuer holds a Group 4 Exploration License from
the Turkish Energy and Natural Resources Ministry, General Directorate of Mining. The total
exploration license area is 1046.83 hectares. As a part of this exploration license, the holder has a
license to extract zinc and lead from four limited areas within the license area. These four areas
total 41.57 hectares. License details are shown in the following table.
Table 1. Aslanay Mining Havadan Licenses
Property
License
Access
Total area
Effective Date
Expiration
Number
Number
(hectares)
Date
Havadan
Exploration
69102
1039223
1046.83
13 December
13 December
2006
2016
Havadan
Production -
69102
1039223
41.57
13 December
13 December
Zinc
2006
2016
Havadan
Production -
69102
1039223
41.57
13 December
13 December
Lead
2006
2016
A Group 4 license entitles the holder to conduct exploration and development activities on the
site and produce minerals from on-site deposits. Group 4 licenses are effective for a period of
seven years. Upon expiration of the license or completion of exploration and resource
development a production license may be obtained by application to the Ministry. Production
licenses have a term of 10 years which may be extended for an additional 10 year period. Under
normal license conditions, the exploration license for this property would have expired in 2013
after a 7-year exploration period. However, since the transaction transferring ownership of the
license from Dedemen Mining to Aslanay Mining was completed in 2012, the license would
have only been effective for another year, Aslanay has ask for and received a 4-year extension of
the exploration license. It now will expire in 2016 and can be extended for another 4-year period
if necessary.
Further conditions under this license type require a Pre-Exploration period of one year, a General
Exploration period with a term of two years and a Detailed Exploration period of four years
duration.
The Pre-Exploration period is devoted to the collection and analysis of surface rock and
geochemical samples, geophysical investigations, remote sensing data acquisition and
interpretation, and other preliminary investigations designed to determine if further exploratory
work is warranted. The focus of these investigations is to identify possible mineral deposits on
the subject property.
If the results of the Pre-Exploration investigations identify targets warranting further testing then
the General Exploration period may be commenced. This period involves more detailed and
extensive investigations into the geology and mineral deposits on the property. Activities during
this phase of exploration could include topographic mapping, detailed geologic and mineral
NI43-101 Havadan Technical Report
Page 12
deposit mapping, drilling, resource identification and estimation, reserve identification and
estimation, deposit modeling, preliminary economic evaluations, and preliminary mining
engineering studies designed to evaluate the potential feasibility of mining any discovered
deposits.
The Detailed Exploration period may include the refinement and detailed extension of some or
all of the activities undertaken during the General Exploration phase in addition to technical and
economic studies that might lead to mine development and production.
Royalties. The Government of Turkey retains the right to a royalty on all mineral production.
The Group 4 category comprises all industrial and metallic minerals including base and precious
metals which are the subject of the exploration and production licenses for the Havadan property.
The government royalty amount on Group 4 production is 4%. This amount is reduced by half to
2% if the issuer constructs and operates a processing plant in Turkey for purposes of processing
its own ore.
The Havadan exploration and production license was acquired from a private owner. Dedemen
Mining has no further rights to the property nor to any royalty on production from the license.
Environmental Issues. The author is unaware of any environmental liabilities affecting the
Havadan license area. According to Aslanay, no other permits are required for either exploration
or production on the license. At this early stage, there do not appear to be any other impediments
to exploration and mining of the license..
Item 5:
Accessibility, Climate, Local Resources, Infrastructure and Physiography –
The subject property is located approximately 45 kilometers south-southeast from the town
center at Develi. Develi, with a current population of 37,400, is the district center (equivalent to
the county seat). The town is well stocked with the ordinary support materials and supplies that
might be needed for operations at Havadan.
Materials, equipment, ��and supplies of a more mining-specific nature would probably have to
come from the regional capital in Kayseri. Kayseri is located approximately 70 kilometers north
of Havadan. Turkish Airlines operates multiple daily domestic flights from Istanbul and Ankara.
Access to Havadan is possible year round over a well-traveled and fairly well maintained paved
road from Kayseri to Develi and then Develi to Havadan. The final four kilometers into
Havadan is over a poorly-maintained paved road. Access to the property is by a rough,
unmaintained dirt road north from the main road into Havadan. The existing buildings on site are
approximately one kilometer uphill on this road. The access road is not maintained during the
winter months. Year-round access to the site will likely require significant upgrades to existing
roads or new roads altogether. Snow clearance could be necessary to maintain winter access.
The Havadan area is characterized by a dry, continental steppe climate with semi-arid conditions
year-round. Precipitation is low especially during the hot, dry summer months. Winters are
generally cold and relatively dry. Snow fall can be heavy at times and access to the property
may be adversely affected by snow accumulation and windy conditions.
NI43-101 Havadan Technical Report
Page 13
In general, the Havadan property is rocky and covered only sparsely with a variety of dry-land
vegetation. Low grasses and shrubs are prevalent. Several copses of small, scrub oak trees
occupy depressions on the southern, lower slopes of the property. Two large poplar-like trees
grow immediately adjacent to the buildings on site reflecting the presence of shallow
groundwater in the area.
The property package is sufficiently large to accommodate exploration, development, and
mining activities depending on the extent of any mineral deposits discovered. Power is available
locally in the form of a high-voltage overhead line that traverses the area immediately to the west
of the property boundary. This is a multi-wire overhead line that runs through the village and the
Havadan Valley in a north-south direction. The mines of Aksu Mining and Havadan Company
south of the Aslanay license are both connected to this line. A connection to this source and a
power line to the property can be arranged and constructed.
Water is an issue in the Havadan area, given its semi-arid conditions. No surface water is
available to mining operations. The nearest perennial source of surface water is the Zamanti
River which runs north to south in a gorge approximately 5 kilometers west of the Havadan
property. As noted earlier, groundwater resources are not readily apparent. The underlying
karst-forming limestone units may contain water at depth but only drilling will be able to identify
a feasible source.
There are plentiful and appropriate areas within the license that could accommodate logistical
needs, equipment and supply storage, and maintenance areas as well as mining waste and tailings
disposal. Potential processing plant sites are also available.
Item 6:
History
Information about the history of mining and exploration in the license area was provided by the
previous owner of the license, Dedemen Company and by Havadan Company both of Develi.
Numerous test pits, surface mine areas, and underground openings within the license area, as
well as the entire district, attest to the mining history of the area. Evidence of past production of
lead, dating from Roman times and perhaps before, is present in the area and at several locations
on site. Mining artifacts including tools and skeletal remains have been recovered by local
residents that indicate Roman-era activities. Apparent underground mining techniques and
support methods can be observed in several locations on site.
More recently, small-scale underground mining has occurred at several different locations within
the license. Lead and zinc have been reported by the previous owner to have recovered from
these areas. Production ore grades are not documented. However, reports filed with the Ministry
of Mines, indicated that small scale production was accomplished by Dedemen between 2007
and 2012. Underground workings within the license area were used to extract 4,773.45 tons of
lead/zinc ore during 2007 and 2008. The amount of metal extracted from that ore is not recorded.
Mineralized material stockpiled by Dedemen amounts to approximately 2000 tons near several
mine openings. These were sampled and analysed as part of this evaluation. The analytical
results for this material returned metal concentrations of 14.47% lead, 34.38% zinc, and 254
grams silver per ton.
NI43-101 Havadan Technical Report
Page 14
Mining activities have been minor in scale with most of the open surface pits and observed
underground workings clearly having been excavated by hand methods. The recent mining
utilized mechanical assistance in removing ore and waste from workings. A diesel-powered
hoist is still in place over a shallow decline shaft on the west edge of the license. Evidence of
battery-powered locomotive used to pull ore cars from a long adit is present at another location.
Item 7:
Geological Setting and Mineralization
Regional Geologic Setting.
The Havadan license area is located in the Eastern Tauride Mountains, of Central Anatolia. This
region is comprised of several major tectono-stratigraphic units that are part of the Anatolian
microplate which is considered to be a remnant of the African Plate or Gondwana (Figure 4.)
After rifting during the Late Triassic and the growth of what
is called the Neo-Tethyan Ocean, the plates in this area began
to regroup. The Anatolian microplate eventually attached
itself to the Eurasian Plate during the closure of the ocean in
which these present tectono-stratigraphic units accumulated
(Hanilçi and Öztürk, 2011).
Figure 4. General Tectonics of Turkey
The Anatolian microplate is bordered by several major
tectonic structures. On the north it is bordered by the still-active North Anatolian Fault or Suture
Zone and on the south by the Bitlis-Zagros Suture and the East Anatolian Fault Zone (Figure 5).
The sedimentary units, consisting mostly of platform carbonates, were deposited in relatively
shallow marine environments indicative of an orogenic foreland basin. Ophiolitic rocks present
in the region were originally deposited in the Neo-Tethyan Ocean and then intensely deformed
during subduction of the oceanic crust. Subsequent obduction during the suturing of the plate
boundaries and then significant overthrusting during later nappe development resulted in
outcrops of ophiolite complexes throughout the region.
Compressional forces during Cretaceous to Eocene times resulting in a period of extensive
overthrust belt genesis in the region with the attendant development of classic nappe structures.
There are six identified nappe units in the
Eastern Taurides as mapped by Hanilçi
and Öztürk (2011), including four
sedimentary sequences of various ages and
two ophiolite formations. The rock
assemblages in each nappe reflect different
depositional environments and basin
conditions during their accumulations
(Özgül, 1976). Most of these units are
allocthonous, meaning that they are no
longer situated in the original location
where they were formed. Several of these Figure 5. Plate tectonic features of Turkey
NI43-101 Havadan Technical Report
Page 15
nappe units have been overthrusted by compressional forces for many hundreds of kilometers.
Carbonate-hosted lead/zinc deposits in the Taurides occur exclusively in the Siyah Aladağ and
Yahyali nappe units. Both of these nappe units consist mainly of carbonates deposited on the
northern slope of the passive margin of the Anatolian microplate. They were deposited on the
flanks of the basin and were redistributed during the foreland thrust belt development that
resulted in the nappe structures evident today. The Yahyali unit has been subjected to low-grade
greenschist facies metamorphism and is considered to be the metamorphic equivalent of the
unaltered Siyah Aladağ unit (Hanilçi and Öztürk, 2011). The tectono-stratigraphic units in the
region, their relationship to each other, and the location and size of some of the mineral deposits
in the region are shown in Figure 6.
Figure 6. Geology and mineral deposits of the Aladaglar-Zamanti Region (from Hanilçi
and Öztürk, 2011 with permission)
NI43-101 Havadan Technical Report
Page 16
Property Geology.
The Havadan license geology is characterized primarily by surface outcrop of carbonate units of
the Siyah Aladag Nappe. A thin section of the Aladag Ophiolitic Nappe overlying the Siyah
Aladag rocks and the overthrusted Beyaz Aladag Nappe unit both crop out along the southern
edge of the license. The stratigraphy is relatively simple. The structural geology of the area is,
however, fairly complex. Siyah Aladag Nappe carbonate rocks crop out over the entire license.
Some of these rocks are host to Mississippi Valley Type (MVT) base metal deposits.
The Siyah Aladag unit is composed of Late Devonian to late Cretaceous carbonates and clastic
rocks that, as stated earlier, are not in their original location (they are allocthonous). Only the
lower section of the Jurassic-age sequence of carbonate rocks and part of the overlying,
nonmineralized, Cretaceous-age limestones within the nappe unit are present on the surface in
the license area. This Jurassic section of the nappe is composed of a thick sequence of limestone
and dolomitic limestone. The important ore deposits in the Aladaglar-Zamanti Region occur
within the lower portion of this Jurassic sequence (Figure 6).
The rocks that form the lower part of the Jurassic sequence which are present over the southern
half of the license area are divided into three distinct formations - thin-bedded limestones
overlying massive and thick-bedded limestones which in turn overlie thin-bedded bituminous
limestones. The thin-bedded limestone in the upper part of this sequence grades into a lighter-
colored thin-bedded Cretaceous sequence that is not mineralized. The bottom of this Jurassic
section is overlain by a thin section of ophiolitic rocks of the Aladag Ophiolitic Nappe along the
southern border of the license area. The ophiolite is, in turn, overthrust by thick sequence of
light-colored, cavity-forming limestones of the Hacilardag Formation that is part of the Beyaz
Aladag Nappe unit.
A rather crude geologic map is included here (Figure 7). It is preliminary in nature and derived
by Aslanay from several sources including MTA maps and observations by Aslanay geologists.
It is not entirely accurate in several respects but is included here to introduce the general geology
of the Havadan District and the license area. A detailed geologic mapping project for the
property is one of the recommendations made later in this report.
Mineralization.
Observed mineralization in the license area is associated with a series of prominent faults that
trend generally in a North 45⁰ East direction. The producing mines in the Havadan District are
all developed on structures with this orientation. These are not bedding plane faults but rather
they cut across the strike of the bedding planes at an oblique angle. The faults are all nearly
vertical, however local variation in the dip of the fault is evident in underground workings
ranging between 75⁰ and 85⁰. The mineral deposits are structurally controlled veins in the fault
zones. However, they do only occur in favorable carbonate lithologies where open space was
developed during faulting and karstification and where host rock composition is favorable for
deposition. For instance, the lower bituminous section of limestone in the Siyah Aladag unit is
not mineralized.
NI43-101 Havadan Technical Report
Page 17
The mineralization pinches and swells irregularly along both strike and dip of the vein. This
feature can be quite significant. In the Havadan Mine, the author observed the vein pinching in
one drift to about 2 centimeters and then swelling to a vein width of 2 meters within the next 5
meters. This condition should be expected in veins throughout the district and on the Aslanay
license.
The observable mineralization is confined to the oxidized zone where sulfide minerals have been
converted to carbonate minerals. Minor amounts of some sulfide minerals, primarily sphalerite
(ZnS) and galena (PbS), are present but the bulk of the mineralization is composed of carbonates
of lead, zinc, and iron. Metallic sulfides in MVT deposits near the surface are commonly
converted to oxides and carbonates. Cerussite (PbCO3), smithsonite (ZnCO3), siderite (FeCO3),
and minor hydrozincite (Zn5(CO3)2(OH)6) are the primary metallic carbonate minerals reported
NI43-101 Havadan Technical Report
Page 18
Figure 7. Geologic Map and Sections, Havadan License
in the deposits. Predominant oxides minerals are hematite (Fe2O3), limonite (FeO(OH)-nH2O),
and goethite (FeO(OH)) with minor amounts of zincite (ZnO) reported. Sulfate minerals may
also be present locally in the form of anglesite (PbSO4) and gypsum (CaSO4). Calcite (CaCO3)
and aragonite (CaCO3) are the primary gangue minerals
According to information made available by representatives of the Havadan Company, derived
from a study of the deposits in the Havadan Mine (approximately two kilometers to the west of
the Aslanay license area), the deposits are zoned with depth. Deposits of heavy iron oxides
containing 12-14% lead carbonates are prevalent from the surface to a depth of approximately 30
NI43-101 Havadan Technical Report
Page 19
to 35 meters. The deposits transitions to primarily a lead carbonate zone containing 18-22% lead
approximately 60 to 90 meters thick to a depth of up to 125 meters. Below this lead zone is a
transition zone about 10 meters thick characterized by mixed lead carbonate and zinc carbonate
mineralization containing up to 22% lead and 27% zinc. Below this zone the deposits are
dominated by zinc carbonate mineralization containing 28-30% zinc that is 40 to 50 meters thick
to a depth of up to 175 meters. Below this series of carbonate deposits the mineralization
presumably transitions to sulfide mineralization, although no operation in the area has as yet
encountered the sulfide zone of mineralization either in mining or exploration drilling.
Item 8:
Deposit Types
Carbonate-hosted base metal deposits in the Aladaglar-Zamanti region have been generally
categorized as Mississippi Valley Type (MVT) deposits (Hanilçi and Öztürk, 2011). The
producing deposits are located in carbonate (limestone formations) rocks and exhibit all of the
characteristics of MVT deposits (Leach and other, 2010). The most important characteristics of
the Eastern Tauride Mountains MVT deposits (and those which result in their classification as
MVT deposits) are:
(1) they are epigenetic, in other words they were formed at a time much later than their host
rocks;
(2) they are not associated with igneous activity;
(3) they are hosted mainly by dolostone and limestone, rarely in sandstone;
(4) the dominant minerals are sphalerite, galena, pyrite, marcasite, dolomite, and calcite, whereas
barite is typically minor to absent and fluorite is rare;
(5) they occur in platform carbonate sequences commonly at flanks of basins or foreland thrust
belts;
(6) they are commonly stratabound but may be locally stratiform;
(7) they typically occur in large districts;
(8) the ore fluids were basinal brines with significant salt concentrations (approximately 10 to
30 weight percent salts);
(9) they have crustal sources for metals and sulfur;
(10) temperatures of ore deposition are typically 75°C to about 200°C;
(11) the most important ore controls are faults and fractures, dissolution collapse breccias, and
lithological transitions;
(12) sulfides are coarsely crystalline to fine grained, massive to disseminated;
(13) the sulfides occur mainly as replacement of carbonate rocks and to a lesser extent, open-
space fill; and
(14) alteration consists mainly of dolomitization, host-rock dissolution and karstification, and
brecciation (Leach and others, 2010).
Item 9:
Exploration
Despite clear evidence mining has occurred on the license no mineral exploration work has been
documented on the Havadan license. Several site visits of limited duration have been conducted,
random surface outcrop and mine dump samples have been collected by Aslanay and the Author,
and samples have been analyzed in the laboratory. These sample results are not representative of
mineral deposits on the property rather they are indications of the potential for mineral deposits.
NI43-101 Havadan Technical Report
Page 20
Collected samples are of the random, grab sample type and were not expected to be
representative. Sampling was accomplished in order to identify potential mineralized rock and
determine whether further investigations on the property were warranted.
The Author collected ten (10) samples from outcrops, open mine pits, and mine dumps during
the site visit in May 2012. These were random grab samples of rock that exhibited potential for
base and/or precious metal mineralization. These were intended as pre-exploration samples to
determine whether the site warranted further, more detailed exploration. As such, these are not
representative samples and no field QA/QC procedures were implemented during this phase of
pre-exploration. The laboratory did, however, employ standard QA/QC methods. Blanks,
duplicates, and standards were all used in the laboratory procedures. An examination of the
results shows that the laboratory program was effective and sample concentration variations
between field, blank, duplicate, and standard samples was within standard deviation limits
applied to sampling of this type. The results for metals analysis for each sample are shown in the
following table.
Table 2. Havadan Project Sample Analysis Selected Results
Sample
Sample
Location
Analyte
Number
Type
Northing
Easting
Pb
Zn
Ag
Au
Cu
Fe
Co
As
Ba
Hg
(%)
(%)
(ppm) (ppb) (ppm)
(%)
(ppm) (ppm) (ppm)
(ppm)
809401
Grab,
vein
4225533
0729990
0.60
46.18
2
1
19.01
4.59
9.6
72.3
3.5
0.389
809408
Grab,
dump
4225825
0730165
14.47
34.38
254
2.1
109.8
8.51
11.6
115.1
64.2
17.506
809409
Grab,
dump
4255530
0729982
2.59
4.65
7
4.9
54.78
31.50
2.2
32.9
6.5
1.959
809410
Grab,
vein
4225534
0729980
0.31
47.25
2
1.3
16.58
3.80
8.1
37.3
2.4
0.396
809411
Grab,
test pit
4229153
0731868
3.78
0.32
19
5.8
28.84
2.68
1.6
852.4
80.3
0.274
809412
Grab,
dump
4226554
0731148
0.01
0.16
<1
0.5
1.38
0.39
0.5
2.7
19.6
0.011
809413
Grab,
dump
4226577
0731184
80.5
0.01
303
1.5
60.89
0.03
<0.1
1.9
50.7
12.304
809414
Grab,
dump
4226577
0731184
0.26
0.03
2
<0.2
1.67
0.08
0.4
1.9
5.9
0.089
809415
Grab,
dump
4226577
0731184
0.87
0.02
5
<0.2
2.12
0.72
2.3
39.1
20.2
0.300
809416
Grab,
dump
4225834
0730289
27.22
2.14
16
<0.2
70.20
30.43
2.4
164.5
282.4
0.838
Item 10: Drilling
No drilling has as yet been conducted on the license. Limited exploratory drilling is being
recommended at selected license sites by the Author later in this report.
Item 11: Sample Preparation, Analyses and Security
Samples were collected and prepared for shipment by the Author/Qualified Person. The samples
were shipped to Acme Laboratories in Ankara under chain-of-custody procedures. The
laboratory in Ankara prepared the samples and packaged them for shipment to Acme
Laboratories in Vancouver, British Columbia, Canada for chemical analysis and report
preparation. Samples were digested using Aqua Regia solution. The digested or dissolved
NI43-101 Havadan Technical Report
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samples were then analysed for ultra-trace element concentrations by the high resolution
Inductively Coupled Plasma procedure with a Mass Spectrometer finish (ICP-MS). Standard
laboratory QA/QC methods were employed.
As stated earlier, no field QA/QC procedures were implemented during this phase of pre-
exploration. The laboratory did, however, employ standard QA/QC methods. Blanks, duplicates,
and standards were all used in the laboratory procedures. An examination of the results shows
that the laboratory program was effective. Sample concentration variations between field, blank,
duplicate, and standard samples were within standard deviation limits typically applied to
sampling of this type.
Sample collection, preparation, security, analytical procedures and QA/QC procedures are
adequate at this stage of exploration and development. A suitable data management and QA/QC
program needs to be developed for subsequent phases of exploration.
Item 12: Data Verification
This item is not relevant at this time given the stage of property development and exploration
since no data has been generated.
Item 13: Mineral Processing and Metallurgical Testing
No testing of this nature has yet been initiated for the Havadan license.
Item 14: Mineral Resource Estimates
The property is in an early exploration phase. As such, no mineral resource estimates are
possible or warranted at this time.
Items 15 through 22 are not relevant at this stage of property development and are
reserved for additional requirements for advanced property technical reports as the
Havadan property develops.
Item 15: Mineral Resource Estimates
Item 16: Mineral Reserve Estimates
Item 17: Mining Methods
Item 18: Recovery Methods
Item 19: Project Infrastructure
Item 20:
Market Studies and Contracts
Item 21:
Environmental Studies, Permitting and Social or Community Impact
Item 22:
Capital and Operating Costs
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Item 23: Economic Analysis
Item 24: Adjacent Properties
Two other companies are producing lead, zinc, and silver from mines in the Havadan District.
Aksu Mining Company operates two mines immediately to the west of the Aslanay license. No
information could be obtained from Aksu relating to production details or resource specifics for
these mines. On the other hand, Havadan Region Mining Company was helpful in providing
information specific to their mine and the Havadan District. Havadan Mining produces 40 to 50
tonnes lead, 6 to 7 tonnes zinc, and approximately 85,000 troy ounces silver per annum,
according to information provided by Abdullah Malkoçoglu, General Manager. The amount of
ore extracted from which this production is derived is not clear. However, Mr. Malkoçoglu
stated that economic grades typically run 12-15% lead, 24-32% zinc, and 350-450 grams silver
per tonne. Low-grade ore that runs less than about 20% zinc is placed on a stockpile to await
higher metal prices.
The Author was conducted on a tour of the mine and made the following observations. The ore is
extracted from a vein in a fault structure that strikes approximately North 40⁰ East and dips
steeply to the northwest. This is the same orientation as the structures measured on the Aslanay
license. The vein in the mine pinches and swells in classic MVT fashion. At the current limit of
the mine at 120 meters depth and along strike 130 meters, the ore is still within predominantly
oxide zone mineralization. The sulfide zone has yet to be encountered. Further deep
development is planned with a 20-meter extension of the internal shaft to reach addition blocks
of ore beneath current mine workings.
Item 25: Other Relevant Data and Information
No additional information or explanations are necessary at this time. As further investigations
progress and additional information is available, amendments will be made to this report to
clarify and expand on the information given here.
Item 26: Interpretation and Conclusions
The results of the limited pre-exploration phase work on the Havadan property are encouraging.
Additional more detailed and invasive exploration techniques are warranted given the results of
the limited sampling and analysis at Havadan as well as the history of mining and metal
production in the surrounding Havadan District. Geologic mapping, geophysical surveys, and
drilling of identified targets have reasonable potential to identify mineralized zones within
favorable limestone lithologies on the Havadan license. This is the first phase of a series of
exploration periods that should be designed to identify mineral deposits and eventually ore
deposits on site.
This is an early stage exploration target. As such, the risks of pursuing this type of project are
high. Exploration expenditures and implementations could lead to the conclusion that no mineral
resource or reserve exists on the site. As with any project of this type, the potential return on
investment could be great. On the other hand, the risk of losing part or all of the invested funds
is also great.
NI43-101 Havadan Technical Report
Page 23
Item 27: Recommendations
The Author recommends a phased approach to evaluation of the Havadan Property for further
development. The first phase corresponds to the Pre-Exploration and part of the General
Exploration terms as specified by exploration license requirements. Each phase should derive
its scope and specific plan from the results of the previous phase.
1. Geologic mapping; Complete a detailed geologic map of the properties and surrounding
area at 1:1,000 scale. Mapping of geology, structures, and mineral deposits on the
surface and in accessible underground workings should be included. Estimated cost:
US$30,000.
2. Geophysical investigations: Conduct surface magnetic and induced polarization surveys
of the license to identify metallic targets. The focus of initial investigations should be on
those areas identified by surface and underground mapping as likely targets for
exploratory drilling. Estimated cost: US$50,000.
3. Drilling: Conduct an exploratory drilling program targeting those areas identified by
mapping and geophysical anomalies as having potential for metallic mineralization.
Drilling costs in Turkey are currently about 220TL per meter. At current exchange rates
that equates to roughly US$37 per foot of drilling. At that rate, an initial limited,
exploratory drilling program totaling 2,000 meters would cost an estimated US$250,000.
4. Additional drilling phases to delineate any discovered mineral deposits and develop
resources and reserves, if feasible.
5. Develop a Quality Control/Quality Assurance program including policies and procedures
to insure the quality of data for eventual resources and/or reserve estimations.
Item 28: References
Hanilçi, Nurullah, and Öztürk, Hüseyin, 2011. Geochemical/isotopic evolution of Pb-Zn deposits
in the Central and Eastern Taurides, Turkey: International Geology Review, vol.53, No. 13,
November 2011. p. 1478-1507.
Hanilçi, Nurullah, and Öztürk, Hüseyin, 2008. The geology and formation of the Aladaglar-
Zamanti (Kayseri) region Pb-Zn deposits: in Öztürk, H., Hanilçi, N., Kahriman, A., and Özkan,
S., eds.,The geology, mining, and existing problems of Turkish Pb-Zn deposits: Istanbul,
Istanbul University, p. 184-299.
Leach, D.L., Taylor, R.D., Fey, D.L., Diehl, S.F., and Saltus, R.W., 2010. A deposit model for
Mississippi Valley-Type lead-zinc ores: in Mineral Deposit Models for Resource Assessment,
United States Geological Survey Scientific Investigations Report 2010–5070–A, Chapter A. 52
pages.
Özgül, N., 1976. Some geological aspects of the Taurus orogenic belt (Turkey): Bulletin of the
Geological Society of Turkey, v. 19, p. 65-78.
NI43-101 Havadan Technical Report
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APPENDIX
Havadan License Documents
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NI43-101 Havadan Technical Report
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