The Natougou deposit can be described as a West African shear zone hosted greenstone gold deposit. Gold mineralization is associated with biotite and silica-sericite alteration, along with disseminated sulphides such as pyrrhotite, pyrite and minor arsenopyrite and chalcopyrite with occasional free gold. The mineralization is structurally controlled and is hosted primarily within a large shear zone and its associated alteration.

The main mineralized lode is interpreted as a flat-lying anticlinal shear that outcrops in the southeast and plunges gently to the northwest.

The mineralization has a strike length of approximately 2 km, striking towards a bearing of 315° and an across-strike length of approximately 1 km (towards 045°). The mineralization is gently folded with the fold axis oriented along strike and the limbs dipping gently at approximately 15°.

Mineralization is open across strike to the southwest as well as towards 315°, although the shear zone is relatively deep in these directions. The average true thickness of the mineralization is approximately 4 m. Drilling to the west of the resource area up to the felsic intrusive suggests that the shear zone does not continue within the intrusive. The interpretation of the shear zone was therefore stopped at the intrusive/volcanic contact.

Other minor footwall zones have been identified below the main shear zone. Although the footwall zones appear much less continuous and thinner than the main shear zone, some do contain significant gold mineralization. At the end of the 2015 delineation drilling program a short hole-extension program was completed to test the continuity of the footwall zone that was originally encountered in the central portions of the deposit by hole TPA0556, in which a secondary sheared and altered zone returned 10.23 g/t Au over 2.69 m downhole. Nineteen holes were extended to reach the footwall zone, for a combined total of 371 m. Based on interpretation of the results, 13 additional holes (including the original discovery hole) intersected the footwall zone. The combined results suggests that the footwall zone is on average 1.5 m thick with local high grade results returned of up to 31.98 g/t Au over 2.5 m downhole. The footwall zone is interpreted to be sub-parallel to and approximately 20 m below the main Boungou Shear. To date, the footwall zone has been traced over an area of approximately 300 m along strike by 90 m across strike, and remains open in all directions. The interpretation of this footwall zone was included in the current resource model. Other zones of gold mineralization are believed to exist below the main shear and will be explored by SEMAFO further in 2016.

Two types of alteration are significant with respect to the mineralised shear at Natougou. The two alteration types are locally termed the Boungou pink (BPK) and the Boungou bleached zone (BBZ).

The BPK type is a pink-brown alteration consisting of fine-grained biotite-plagioclase and is generally present over the entire width of the mineralised shear zone. It is the schistosity developed by the alignment of the biotite that gives the mineralised zone the sheared texture.

The BBZ type is a silica-sericite alteration generally developed as a discrete zone over widths of about 1 m within the BPK alteration. Variable amounts of quartz veining, often highly deformed (boudinaged or folded), can be observed within some of the BBZ. Small bands of silica-sericite are also interspersed within the wider zones of BPK alteration.

Natougou will be mined using a conventional open pit approach of drilling and blasting ore and waste rock, with material mined by hydraulic excavators loading into off-highway rear dump haul trucks. Near surface rock is highly weathered and may be free-dig. Ore will be hauled to a run-of-mine (ROM) ore pad located adjacent to the ore processing plant or dumped directly into the primary crusher. Waste will be hauled to ex-pit waste rock dumps. Waste rock will be backfilled into the mined-out pit void once mining has progressed to enable sufficient pit void to be available.

The deposit will be mined from three distinct pits, approximately 580 m to 1,800 m long, 300 m to 500 m wide, 50 m to 80 m deep and approximately 50 m to 100 m apart. Haulage ramps will be 20 m wide at a 10% gradient, with ore and waste rock trucks using the same haul ramps.

The Natougou mineralization is predominantly hosted in quartz veins and a significant quantity of the gold occurs as visible, free gold. Sulphide minerals comprise pyrrhotite, arsenopyrite pyrite, and minor chalcopyrite. The Natougou quartz vein deposit is considered free milling. A significant component of the gold is amenable to gravity recovery and consequently the proposed process facility will consist of the following process areas:
• Primary crushing and coarse ore storage.
• Grinding, utilizing a SAG Mill, Tower Mill and Pebble Crusher (SATMC) circuit.
• Leach and CIP Carousel circuit.
• Gold recovery and carbon handling circuit (consisting of a cold acid wash followed by a split, Anglo American (AARL) elution circuit and horizontal carbon regeneration kiln).
• High density tailings handling and disposal.

The Natougou project process plant will be designed to process 4,000 tpd (1.34 Mtpa) with an average gold head grade of 4.15 g/t.

Run-of-mine (ROM) ore from the open pit will be transported to the plant by 65 t capacity rear dump trucks. The trucks will tip directly into the ROM bin however allowance will be made for a ROM stockpile. The ROM stockpile will be primarily utilized for emergency storage and ore blending. ROM ore will be reclaimed, from the stockpile, to the ROM bin by a front-end loader.

The mill feed bin will have a live capacity of approximately 55 t (equivalent to 20 minutes plant feed at 167 t/h). The mill feed bin includes an overflow facility, with excess crushed ore conveyed to the crushed ore stockpile. The crushed ore stockpile will have a capacity of 8,000 tonnes (equivalent to 48 hour plant feed at 167 t/h). Crushed ore will be reclaimed from the stockpile, to the mill feed bin, via a front end loader.

The grinding circuit will be a SATMC circuit, comprised of a single, variable speed, SAG mill and a single fixed speed tower mill. The SAG mill will operate in closed circuit with a pebble crusher, whilst the tower mill will operate in closed circuit with hydrocyclones. The product particle size exiting the grinding circuit (hydrocyclone overflow) will contain 80% passing 63µm material.

Oversize from the SAG mill discharge screen will be conveyed to the pebble crusher feed bin, via two belt conveyors. A self cleaning tramp metal magnet will be mounted above the pebble recycle conveyor, to remove any scrap metal and steel media which could potentially damage the pebble crushers.

The gravity circuit will consist of two gravity screens and two variable speed centrifugal concentrators. Hydrocyclone underflow will discharge onto the vibrating, single deck gravity feed preparation screen. The gravity feed preparation screen will be fitted with a 2mm aperture screen panel, with -2mm undersize material constituting the feed to the gravity concentrators. Gravity screen oversize material (+2mm) will be returned to the Tower mill top feed port.

Gravity screen undersize will constitute the feed to the gravity concentrator. Each gravity concentrator will have a capacity of 150 t/h and operate as a batch process with nominally 24 cycles per day. Concentrate from the gravity concentrators will feed the Intensive Cyanidation Reactor (ICR) circuit. Tails from the gravity concentrators will return to the Tower mill top feed port.

Trash screen undersize will gravitate directly to the pre-leach thickener feed box, where flocculant will be added to aid with particle settling. Overflow from a 14m diameter pre-leach thickener will gravitate to the process water tank. Underflow from the pre-leach thickener, at 50% solids, will be pumped by dedicated thickener underflow pumps, to the leach circuit feed distribution box.

Pre-leach thickener underflow will be pumped to the leach feed distribution box. The slurry from the leach feed distribution box will gravitate to the first leach tank. If the first leach tank is offline, the slurry will be diverted to the second leach tank, via an internal dart plug distribution system.

The leach circuit will consist of five, mechanically agitated, leach tanks (13 m diameter x 13.5m high) operating in series. This equates to a nominal residence time of 36 hrs at a feed rate of 167 tph. Each leach tank will have a live volume of 1,725 m³.

Cyanide, for gold dissolution, will be added to the leach circuit by dedicated cyanide dosing pumps. The primary cyanide dosing point will be the leach feed distribution box, with further addition points located down the leach train.

To aid with gold dissolution, oxygen will be added to the leach circuit. Oxygen will be supplied from the onsite oxygen plant, with oxygen being injected into each leach tank, via dedicated oxygen spargers.

Following dissolution, the solubilized gold will be recovered by carbon adsorption, within the dedicated carbon-in-pulp (CIP) carousel Pumpcell® circuit.

The slurry from the leach circuit will gravitate to the CIP plant feed launder. The feed launder will distribute the slurry to the first tank, within the carousel adsorption sequence.

The CIP circuit will consist of seven, mechanically agitated, tanks operating in series. This equates to a residence time of 1.3 hrs at a feed rate of 167 t/h. Each tank will have a live volume of 50 m³. The tanks will operate with a carbon concentration of 50 g/L.

The desorption circuit will consist of separate acid wash and elution columns. A cold acid wash will be utilized. Following acid wash, gold will be eluted from the carbon, utilizing a split Anglo American (AARL) elution process. The elution circuit will however be sized to complete two strips per 24 hour period. At a total carbon (gold + silver) loading of 7,318 g/t the required daily carbon movement equates to 2.5 tonnes.

The cold acid wash sequence will be required to remove accumulated, calcified scale, from the carbon surface. The acid wash column fill sequence will be initiated by pumping carbon, from the first adsorption tank, into the Acid Wash Column via the Loaded Carbon Recovery Screen. Carbon will gravitate from the Loaded Carbon Recovery Screen directly into the Acid Wash Column. Once the Acid Wash Column is filled to the required level, the carbon fill sequence will be stopped.

The elution sequence will commence with the injection of a set volume of water into the column, via the Lean Eluate Tank, along with the simultaneous injection of cyanide and caustic solution. A set amount of cyanide and sodium hydroxide (caustic) will be added to achieve a 2% w/w NaOH and 2% w/w NaCN solution. Both reagent additions will be automatically stopped once the prescribed volume has been added. The pre–soak period will then commence. During this period, the caustic solution will be circulated through the column and be pre–heated to 95°C via a diesel fired elution heater. Upon completion of the pre–soak period, the elution sequence will commence and gold will be stripped from the carbon. The split AARL process will use the last four bed volumes of low grade (lean) eluate from the previous elution as the first eluant for the current elution. Lean eluate, from the Lean Eluate Tank will be pumped, by the Lean Eluate Pump, through the Recovery Heat Exchanger, picking up residual heat from the eluate exiting the elution column.

Soluble gold and silver recovery, from the pregnant eluate, will be achieved by electrowinning onto stainless steel cathodes.

Upon completion of electrowinning, gold sludge on the plated cathodes will be washed off the cathodes, with a high pressure cathode washer. The gold bearing sludge will be recovered to a sludge hopper, from where it will be filtered, via a pressure filter.

The gold bearing filter cake will be thermally dried in an electric drying oven. Dried filter cake will be mixed with a prescribed flux mixture (silica, nitre and borax), prior to being charged into the diesel fired gold furnace. The fluxes added react with base metal oxides to form