Satimola Independent Geological Report - KPCkazakhpotash.com/.../Satimola-Independent-Geological-Report-October... · Satimola Independent Geological Report Kazakhstan Potash Corporation

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15 October 2014

Satimola Independent Geological Report

Kazakhstan Potash Corporation Limited (ASX:KPC) is pleased to announce the results of anIndependent Geological Report (“IGR”) and Mineral Resource Estimate ("MRE"), for the Satimola Potash-Borate project in Kazakhstan.

IGR Highlights

Mineral Resource Estimate of 6 billion tonnes at 10% K2O cut-off grade containing:

o 3.1 billion tonnes Indicated Resources grading 16.2% K2O

o 2.9 billion tonnes Inferred Resources grading 14.7% K2O

The IGR was produced by Tetra Tech who worked with the Company's technical team:

Tetra Tech independently produced a Mineral Resource Estimate reported in accordance withthe JORC code, 2012 edition and also reviewed local and regional Geology and details relating tothe production of a MRE.

A detailed breakdown and discussion of the MRE results can be found in the IGR report produced byTetra Tech in October 2014, with a summary of Information presented in Appendix A.

Competent Person

This disclosure has been reviewed by Mr. Joseph Hirst, CGeol, FGS, EurGeol, of Tetra Tech, who acted asCompetent Person for the IGR and MRE.

Mr. Hirst is a member of the Geological Society of London, United Kingdom, which is a RecognisedOverseas Professional Organisation (‘ROPO’) for the JORC code.

Mr. Hirst has sufficient experience which is relevant to the style of mineralisation and type of depositunder consideration and to the activity which he is undertaking to qualify as a Competent Person asdefined in the 2012 Edition of the JORC code. Mr. Hirst consents to the inclusion in the release of thematters based on his information in the form and context in which it appears. The information in thereport to which this statement is attached that relates to Mineral Resources is based on informationcompiled by Mr. Hirst in accordance with the JORC Code, 2012 edition.

Kazakhstan Potash Corporation LimitedABN 57 143 441 285Level 5, 406 Collins Street Melbourne VIC 3000tel: +61 3 9258 2107 |fax: +61 3 9670 3222email: [email protected]

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About Kazakhstan Potash Corporation Ltd.

Kazakhstan Potash Corporation Limited (KPC) is a publicly listed mineral exploration company based inMelbourne, Australia, with a sole focus on potash deposits in Western Kazakhstan. KPC owns the rightsto two potash deposits in Kazakhstan, namely the Zhilyanskoye Project and the Chelkar Project. KPC isalso in the process of acquiring the Satimola Project and intends to develop these projects in Kazakhstanto full scale production.

Satimola Geology - The Satimola Dome is a medium size salt dome, with an elongated dimension of 35km along a northwest-southeast strike direction and varying in width from 4 to 8 km. It is suggestedthat this structure is a piercement salt dome formed by diapiric intrusion. The cap rock zone of thedome in cross-sections appears only gently curved and the dome’s core represents halogenous saltdeposition to depth during the Kungurian stage of the Permian period. Overlying sediments includechalk, marls, clays and siltstones ranging from the Cretaceous to Quaternary periods.

Sampling Techniques and Analysis Method - Samples were taken from half core every 1m and analysedwith a PAN analytical Minipal 4 XDXRF. Sample preparation included 0.5 m standard sample withminimum 0.1m sample to avoid samples across geological boundaries.

No samples crossed logged boundaries to ensure representivity of type.

Core was sawn, crushed, sub-sampled, tagged, bagged and sealed for shipment to the labs. Sampleswere typically 100 g aggregated and reduced to 27 – 42 mm diameter by < 40 mm high compressed discsuitable for the XDXRF. Care was taken to ensure that the samples are representative of the whole withregards to grain size and composition

Drilling Techniques - Drilling was done by Longyear LF-230 and Lf-90 rigs, as well as a Schramm rig.Conventional tubing was used as ground conditions were generally excellent.

Core diameter ranged from PQ (85 mm) to NQ (47.6 mm). Top hole was cased to varying depths,depending on water inflow and hole conditions.

Core was logged geotechnically and geologically..

Core recovery was in excess of 95%, typically 100% recovered. Typically the only losses were in carnalliteor at the top ofhole.

Estimation Methodology - An inverse distance (ID) weighted estimate to the 2nd power was used toestimate the grade. This estimate was supported by variography. A kriged estimate was also run, andthe results were similar to the ID estimate. The ID estimate was used for reporting as the deposit isstrongly isotropic and block sample performance was better with ID.

Two domains were created based on current and historic GKZ sectional interpretations used to helpdefine the confidence of the estimate. A separate borate domain was estimated as well as the mainpotash zone. No further domains of specific salts were created. The estimation was based on K2O valuesfor the potash zone and B2O3 for the borate zone.

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Interpolation parameters were derived from variographic analysis of the data set. Search distances weredetermined from the range of the variogram. Maximum extrapolation for inferred resource wasunconstrained as a distance buffer of this range. The seismic data, and therefore geological confidence,exceeded the distance supported by the range of the variogram.

All modelling and estimation was done in CAE Datamine Studio 3.

A previous estimate was completed by CRS consulting. Various historical estimates were also completedfor submission to the SRC ( Kazakh State Reserves Committee). The current estimate accounted forprevious estimates.

There has been no production at Satimola with which to test or deplete the estimate.

No assumptions have been made for the treatment or recovery of by-products. Where possible,information about by-products has been described in the relevant processing section, and is notmaterial to the Mineral Resource Estimate

No estimation has been made for deleterious materials. Carnallite is present in the logs, which hasrecovery implications as it is a hydrous mineral. Tetra Tech recommends further studies on theconstituent salts present at Satimola.

Blocks sizes were defined at 200 m in the X and Y dimensions. Sample spacing ranged between 400-1,000 m, with drill centres nominally at 500 or 1,000 m.

Sub-cells were used, but the grade interpolation was performed into the parent cell.

No assumptions have been made with regards to a Selective Mining Unit (SMU)

No assumptions have been made upon correlation of variables. The interpolation is based on univariatestatistics and block estimation.

The estimate was constrained geologically within units identified in the seismic data, as well asgeological units logged in core. Domains were constrained at the sample point upon lithological breaks,and the seismic data was used as a guide for the domain interpolation. Extrapolation beyond data limitswas constrained by the last known sample point Extrapolation used the seismic interpretation as a guideand was extended to the maximum range of the variogram.

Grade capping was not deemed necessary as there were no statistically biassed samples present. Parrishanalysis and decile analysis was used to determine the proportions of grade in the top decile, and therelative amount of metal was demonstrated to be within acceptable limits..

Block grade estimates were validated by visual inspection and comparison of block and sample grades.The estimation performed as expected with no unacceptable bias introduced during the gradeinterpolation process.

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Classification Criteria - The basis for the classification was geological continuity and confidence in gradecontinuity. Mineralised domains were produced by Satbor for the SRC into C1 and C2 category. Afterreviewing the geostatistics and with the level of geological understanding, these shapes were classifiedas Indicated Resources. Inferred Resources were unconstrained by salt horizons, but well within thegeological continuity understood from the seismic interpretation. The maximum extrapolation distancewas defined by variographic maximum ranges. Drilling was at 1000 m centres with 500 m infill. Drill holespacing was not used to classify resources. Geological continuity is well understood from seismic data.

Resources - The resources at Satimola are classified in accordance with the JORC code, 2012 edition.The grades in the final resource block model were derived from diamond drillhole composites. Acomplete block model was built up, reflecting all in-situ mineralisation. An evaluation of the unmined,in-situ block model is shown in Table 5.4 and Table 5.5 at a range of Cut-off grades in the Potash zonesand in the Borate Zones. The effective date of the estimate is 28th February 2011.

Cut-off Grades - Tonnages and grades are reported at a range of cut off grades, which reflect thedeposits reasonable prospects for eventual economic extraction by conventional underground methodsin light of any market fluctuations since this report was produced. This is due to the fluctuating PotashMarket price over time. Prices have varied considerably over recent years, from a low of US $150 pertonne (/t) in 2007 to a peak of US $1000 /t in 2008. Prices dropped in 2009 to US $350 /t and increasedto US $526 /t in 2010. The spot price for October 2014 is $287 /t.

The following Resource tables demonstrate reasonable prospects for eventual economic extraction at arange of prices based upon inclusive mining, process and general and administration costs of US $100 /t,assuming a processing recovery of 95% and potash prices as previously described.

Table 5.4 Tetra Tech Mineral Resource Estimate for Satimola Mine Potash Zones as of28th February 2011 (COG of 5% K2O)

JORC

Classification

Tonnes (t)(Billions)

Density

(t/m3)

K2O

(%)

Indicated 3.9 2.0 14.6

Inferred 19.2 2.0 7.8

Total 23.1 8.9

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JORC

Classification


Density

(t/m3)

K2O

(%)


Inferred 2.9 2.0 14.7

Total 6.0 15.5


JORC

Classification


Density

(t/m3)

K2O

(%)


Inferred 1.0 2.0 19.6

Total 2.5 20.1

Table 5.7 Tetra Tech Mineral Resource Estimate for Satimola Mine Borate Zones as of28th February 2011 (COG of 2% B2O3)

JORC

Classification


Density

(t/m3)

B2O3

(%)

Indicated 0.37 2.0 6.58

Inferred 1.39 2.0 3.53

Total 1.76 4.17

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JORC

Classification


Density

(t/m3)

B2O3

(%)

Indicated 0.21 2.0 9.49

Inferred 0.40 2.0 5.62

Total 0.61 6.95


JORC

Classification


Density

(t/m3)

B2O3

(%)

Indicated 0.14 2.0 11.76

Inferred 0.14 2.0 7.25

Total 0.28 9.51

The Tetra Tech estimate produced in 2010 is still considered current and relevant as there have been nomaterial changes to the project since this time. No further exploration or drilling has been conducted.

1. Numbers may not add exactly due to rounding

2. Mineral resources that are not mineral reserves do not have demonstrated economic viability.The estimate of mineral resources may be materially affected by environmental, permitting,legal, title, taxation, socio-political, marketing, or other relevant issues.

3. For additional information on key assumptions, parameters and methods used to estimate themineral resources and mineral reserves, including quality assurance measures and othertechnical information in respect of Satimola, reference should be made to the report.

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Appendix A

JORC TABLE 1Section 1 Sampling Techniques and Data

(Criteria in this section apply to all succeeding sections)

Criteria ExplanationSampling Techniques Samples were taken from half core every 1m and analysed with a PAN

analytical Minipal 4 XDXRF calibrated by an external service engineerannually.

Drilling Techniques Drilling was done by Longyear LF-230 and Lf-90 rigs, as well as aSchramm rig. Conventional tubing was used as ground conditions weregenerally excellent.Core diameter ranged from PQ (85 mm) to NQ (47.6 mm). Top holewas cased to varying depths, depending on water inflow and holeconditions.Drilling was at 1000 m centres with 500 m infill.2D seismic survey transepts across the entire site were completed toaid geological interpretation to a depth in excess of 1,500 m. Seismicshots are fired and the two-way travel times are recorded bygeophones. Actual equipment specification used was not recorded.

Drill SampleRecovery

Core was logged geotechnically and geologically and recorded inpassports.Core recovery was in excess of 95%, typically 100% recovered.Typically the only losses were in carnallite or top-hole.No bias was identified between grade and sample length, or due topreferential loss of material.

Logging Core was logged geotechnically and geologically into passports.Passports were transferred to digital logs by the logging geologist.Logging is to a standard suitable for the support of a Mineral ResourceEstimate. All intersections were logged, although only areas ofmineralogical interest were assayed.

Sub-samplingtechniques andsample preparation

Core was logged, photographed, sawn in half, and processed for assay.Sample preparation included 0.5 m standard sample with minimum0.1m sample to avoid samples across geological boundaries.No samples crossed logged boundaries to ensure representivity oftype.Core was sawn, crushed, sub-sampled, tagged, bagged and sealed forshipment to the labs. Samples were typically 100 g aggregated andreduced to 27 – 42 mm diameter by < 40 mm high compressed discsuitable for the XDXRF. Care was taken to ensure that the samples arerepresentative of the whole with regards to grain size and composition.Reject is suitably stored on site in the core storage facilityThe nature and quality of the prepared samples was excellent

Quality of AssayData and Laboratory

QA/QC samples of standards, duplicates and blanks were inserted intothe sample stream at suitable intervals. 10% of the samples were

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Tests QA/QC inserted randomly into each batch. This equates toapproximately 3500 QA/QC samples evenly split between the sampletypes.Measures were taken for representivity including field duplicates, andthat the full geology was sampled.The lab was tested by QA/QC and also by using a second lab for check.assay on a 500 g sample, using SGS Ontario.Acceptable levels of precision and accuracy have been established.

Verification ofSampling andAssaying

A variety of randomly selected drill core intercepts were inspectedduring the site visit, photographed, and compared to original logs.No independent check samples were taken by Tetra Tech as the QA/QCprogramme was considered robust.Some of the modern holes twinned historical holes for verification.Documentation protocols are excellent with well-established chain ofcustody, recording, and storage of data.Redundancies were in place to protect against loss.No adjustment was made to the database as no error was found.

Location of Datapoints

A number of historical and modern collars were inspected in the field.A number of collar locations were independently verified by handheldGPS.Although a local mine grid has been in use, all data is presented inUTM, zone 39U.Topographic survey is adequate as the deposit is on the Kazakh Steppe,at sea level, with no observable changes in elevation.

Data Spacing andDistribution

Data spacing for the reporting of Resource is nominally 1 km, withareas of 500 m infillThe data spacing and distribution is suitable to for a level of confidencein geological and grade continuity to support an Indicated and InferredResource.

Orientation of Datain Relation toGeological Structure

The geology is horizontally strataform. Vertical drill holes achieveunbiased samples.2D seismic survey transepts were completed which help with theunderstanding of vertical structures not picked up by drilling.

Sample Security Chain of custody is very well controlled, and sample security isexcellent. All samples are stored in plastic core boxes, stacked onmetal shelving and locked in a purpose built insulated core storagewarehouse. The building can be considered very secure.Only 3 keys are available to access samples. The geologist, minemanager, and security hold one key each. 2 persons are required tounlock the facility so no one person has sole access to the samples.

Audits or Reviews A review of the sampling techniques and data found all data andprocesses to be suitable to support a Mineral Resource Estimate.

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Section 2 - Reporting of Exploration Results(Criteria listed in the preceding section also apply to this section)

Mineral Tenementand Land TenureStatus

Licenses and tenure documents were inspected on the site visit inNovember 2010, Licence number 1391.

Licence 1391 Co-ordinates (2009)Point Latitude Longitude1 49°02’00” 52°17’00”2 48°56’00” 52°27’00”3 48°51’00” 52°29’00”4 48°50’00” 52°23’00”5 48°54’00” 52°15’00”6 49°01’00” 52°13’00”The documents were inspected to be current and valid until 2020.

Exploration done byOther Parties No exploration has been conducted by other parties.Geology The deposit is a strataform evaporite sequence containing high

concentrations of borate and potash salts with potential for eventualeconomic extraction.

Drilling A tabulation of all the drill collars is provided as an Appendix to theResource Estimate.A scaled plan view of all collars is presented.

Data AggregationMethods

No exploration results have been disclosed in the report.All samples were used in their raw state to define zones ofmineralisation.Selected samples were composited to a best fit routine.No top or bottom data cuts were applied as there was no statisticalsupport for doing do.No metal equivalents were used. K2O from total salt was derived bythe assay laboratory.

RelationshipsbetweenMineralisationWidths and InterceptLengths

Vertical drilling into horizontal strataform deposit means there isnegligible difference between apparent and true widths. As such alllengths are treated as true.

Diagrams Diagrams of plan sections and long sections are presented to scale.Balanced Reporting The range of the raw data is fairly presented in the methodology and

by log-histogram plotting.Other SubstantiveExploration Data

2D seismic transverse sections were collected, and referenced duringthe construction of geological models.

Further Work Recommendations were made for further work, including a shaftsinking study, and further analysis of the different salt types present.

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Section 3 - Estimation and Reporting of Mineral Resources(Criteria listed in section 1, and where relevant in section 2, also apply to this section.)

Database Integrity >10% of the electronic database was cross-referenced with primarydata to ensure no transcription errors, or similar, were presentNo errors were found in the database during all reasonable checks

Site Visits A site visit was made by the project geologist in November 2010. Nowork has been done on site relating to the collection of samples ormaterial to the resource, so this site visit can be considered currentwith respect to the Mineral Resource Estimate

GeologicalInterpretation

Confidence in the geological continuity is very high, supported bydrilling and 2D seismic surveyThe data comprises 73,000 m of historical data supported by 45,300mof modern data for a total of 118,300 m of sampling.The historical data was tested against the modern data and no bias wasobserved.No material effect would be expected from alternative interpretationsfor mineralised zone this large, supported by this data.Geology has been used, as far as possible, to constrain and control theestimate of the Mineral Resource.Grade continuity is controlled by variographic study, while geologicalcontinuity is understood from drilling and seismic data.

Dimensions The mineralisation is relatively homogenous within the various salthorizons lending to large search ranges supported by variograms. Thestrike is in excess of 20 km, across strike in excess of 10 km.The mineralisation starts from approximately 300m below surface andcontinues to depths in excess of 1,500 m below surface.

Estimation andModellingTechniques

An inverse distance (ID) weighted estimate to the 2nd power was usedto estimate the grade. This estimate was supported by variography. Akriged estimate was also run, and the results were similar to the IDestimate. The ID estimate was used for reporting as the deposit isstrongly isotropic and block sample performance was better with ID.No statistically biased high grades were identified during exploratorydata analysis so no grade caps were applied.Two domains were created based on current and historic GKZ sectionalinterpretations used to help define the confidence of the estimate. Aseparate borate domain was estimated as well as the main potashzone. No further domains of specific salts were created. Theestimation was based on K2O values for the potash zone and B2O3 forthe borate zone.Interpolation parameters were derived from variographic analysis ofthe data set. Search distances were determined from the range of thevariogram. Maximum extrapolation for inferred resource wasunconstrained as a distance buffer of this range. The seismic data, andtherefore geological confidence, exceeded the distance supported bythe range of the variogram.All modelling and estimation was done in CAE Datamine Studio 3.A previous estimate was completed by CRS consulting and preceded

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this estimate. Various historical estimates were also completed forsubmission to the SRC (State Reserves Committee). The currentestimate accounted for previous estimates.There has been no production at Satimola with which to test theestimate.No assumptions have been made for the treatment or recovery of by-products. Where possible, information about by-products has beendescribed in the relevant processing section, and is not material to theMineral Resource EstimateNo estimation has been made for deleterious materials. Carnallite ispresent in the logs, which has recovery implications as it is a hydrousmineral. Tetra Tech recommends further studies on the constituentsalts present at Satimola.Blocks sizes were defined at 200 m in the X and Y dimensions. Samplespacing ranged between 400-1,000 m, with drill centres nominally at500 or 1,000 m.Sub-cells were used, but the grade interpolation was performed intothe parent cell.No assumptions have been made with regards to a Selective MiningUnit (SMU)No assumptions have been made upon correlation of variables. Theinterpolation is based on univariate statistics and block estimation.The estimate was constrained geologically within units identified in theseismic data, as well as geological units logged in core. Domains wereconstrained at the sample point upon lithological breaks, and theseismic data was used as a guide for the domain interpolation.Extrapolation beyond data limits was constrained by the last knownsample point, plus extrapolation using the seismic as a guide to themaximum range of the variogram.Grade capping was not deemed necessary as there were no statisticallybias samples present. Parrish analysis and decile analysis was used todetermine the proportions of grade in the top decile, and the relativeamount of metal was demonstrated to be within acceptable limits fornot capping.Block grade estimates were validated by visual inspection andcomparison of block and sample grades. The estimation performed asexpected with no unacceptable bias introduced during the gradeinterpolation process.

Moisture The model is based on wet densities. Density determinations wereperformed on raw sample, and then kiln dried and performed dry.Archimedes’ determinations were not produced as salt is extremelyhydrophilic.

Cut-off Parameters Mineral Resources are presented at a range of cut-off grades todemonstrate the potential economic viability over time. Each scenariocould be deemed economic dependant on mining considerations,throughput and therefore CAPEX requirements.Cut-off grades were determined by analogous deposits and potential

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throughputs and basic cost assumptions.Mining Factors orAssumption

Basic mining assumptions were made with regards to expectedmethods (conventional), shaft sinking, and expected mining rates.

Metallurgical Factorsor Assumptions

Basic metallurgical assumptions were made with regards to expectedprocessing methods, recoveries from test work and expectedthroughputs.

EnvironmentalFactors orAssumptions

Socio-environmental studies were reviewed and commented on forthis study. Assumptions were made with regards to EnvironmentalImpact Assessment and the acquisition of necessary licences toprogress the project

Bulk Density The model is based on wet densities. Density determinations wereperformed on raw sample, and then kiln dried and performed dry.Archimedes’ determinations were not produced as salt is extremelyhydrophilic.

Classification The basis for the classification was geological continuity andconfidence in grade continuity. Mineralised domains were producedby Satbor for the SRC into C1 and C2 category. After reviewing thegeostatistics and with the level of geological understanding, theseshapes were classified as Indicated Resources. Inferred Resourceswere unconstrained by salt horizons, but well within the geologicalcontinuity understood from seismics. The maximum extrapolationdistance was defined by variographic maximum ranges.

Audits or Reviews An internal peer review was conducted for each study that this reportsummarises. No external reviews or audits have been completed.

Discussion ofRelativeAccuracy/Confidence

A proportion of the resource is defined as Indicated and there isenough statistical support, confidence in the grade interpolation,geological continuity, grade continuity, and other factors to supportthis.The rest of the resource is in Inferred as there is less geologicalsupport. The grade continuity is relatively well understood althoughthis cannot be applied to discrete mineralised domains.

Report to:

KAZAKHSTAN POTASH CORPORATION LIMITED

Satimola Potash Project

Independent Geologist’s Report

Document No. 1494750100-REP-L0001-03

Third Party Disclaimer The content of this document is not intended for the use of, nor is it intended to be relied upon by any person, firm or

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1494750100-REP-L0001-03

Report to:

KAZAKHSTAN POTASH CORPORATION LIMITED

SATIMOLA PROJECT

INDEPENDENT GEOLOGIST’S REPORT

EFFECTIVE DATE: 28TH FEBRUARY 2011

Original signed by Joe Hirst Date 14th October 2014

Prepared by Joe Hirst, BSc (Hons), MSc, Eur Geol,

CGeol, FGS

Original signed by Simon McCracken Date 14th October 2014

Reviewed by Simon McCracken, BAppSc, MAIG,

FGS

Original signed by Simon McCracken Date 14th October 2014

Authorised by Simon McCracken, BAppSc, MAIG,

FGS

JH/df

1494750100-REP-L0001-03 ii

T A B L E O F C O N T E N T S

1.0 INTRODUCTION AND TERMS OF REFERENCE ........................................................... 1-1

1.1 INTRODUCTION .................................................................................................................. 1-1

1.2 PROJECT DESCRIPTION ..................................................................................................... 1-1

1.3 TERMS OF REFERENCE ...................................................................................................... 1-2 1.3.1 KPC COMPANY PROFILE .................................................................................. 1-2

1.4 SITE VISITS ....................................................................................................................... 1-3

1.5 LOCATION ......................................................................................................................... 1-3

1.6 LICENCE AREA .................................................................................................................. 1-4

1.7 RELIEF AND CLIMATE ......................................................................................................... 1-5

2.0 GEOLOGY AND MINERALISATION ............................................................................... 2-1

2.1 REGIONAL GEOLOGY ......................................................................................................... 2-1

2.2 LOCAL GEOLOGY ............................................................................................................... 2-2

2.3 GEOLOGY OF THE RESOURCE AREA ................................................................................... 2-3 2.3.1 PRIMARY SALT MASS ........................................................................................ 2-4 2.3.2 CAP ROCK ....................................................................................................... 2-5 2.3.3 OVERLYING TERRIGENOUS SEDIMENTS ............................................................. 2-6

2.4 STRUCTURE AND INTERPRETATION OF THE POTASH STRATA ............................................... 2-6

3.0 EXPLORATION ................................................................................................................ 3-1

3.1 INTRODUCTION .................................................................................................................. 3-1

3.2 HISTORICAL DRILLING ........................................................................................................ 3-1 3.2.1 SATIMOLA DRILLING CAMPAIGN 2008-2010 ....................................................... 3-2 3.2.2 2D SEISMIC SURVEYING ................................................................................... 3-2

3.3 CURRENT DRILLING ........................................................................................................... 3-3

4.0 DATA QUALITY ASSURANCE AND QUALITY CONTROL............................................ 4-1

4.1 INTRODUCTION .................................................................................................................. 4-1

4.2 DRILLHOLE LOCATIONS ...................................................................................................... 4-1

4.3 SAMPLING TECHNIQUES ..................................................................................................... 4-3

4.4 SAMPLE PREPARATION, ANALYSES AND SECURITY ............................................................. 4-4

4.5 SAMPLE SECURITY PROCEDURES ...................................................................................... 4-5 4.5.1 QUALITY CONTROL PROCEDURES ..................................................................... 4-6 4.5.2 DENSITY DETERMINATIONS ............................................................................... 4-6

4.6 HISTORICAL DRILLING CAMPAIGNS ..................................................................................... 4-7

4.7 CORE STORAGE ................................................................................................................ 4-7

4.8 CORE PREPARATION FACILITY.......................................................................................... 4-10

4.9 SAMPLE STORAGE ........................................................................................................... 4-10

4.10 DUPLICATE STORAGE ...................................................................................................... 4-11

4.11 SAMPLE LABORATORIES .................................................................................................. 4-11

4.12 RECOMMENDATION .......................................................................................................... 4-13

5.0 RESOURCE ESTIMATES ................................................................................................ 5-1

5.1 INTRODUCTION .................................................................................................................. 5-1

1494750100-REP-L0001-03

iii

5.2 TOPOGRAPHICAL SURFACE ................................................................................................ 5-1

5.3 SAMPLING DATABASE ........................................................................................................ 5-2 5.3.1 DRILLING .......................................................................................................... 5-2

5.4 DIRECTIONAL SURVEY ....................................................................................................... 5-3

5.5 GEOLOGICAL INTERPRETATION........................................................................................... 5-4

5.6 BLOCK MODELLING ............................................................................................................ 5-9

5.7 DENSITY .......................................................................................................................... 5-13

5.8 GRADE ESTIMATION ......................................................................................................... 5-13

5.9 RESOURCE CLASSIFICATION ............................................................................................ 5-13

5.10 RESOURCE ESTIMATE ...................................................................................................... 5-13 5.10.1 TETRA TECH ESTIMATE, FEBRUARY 2011 ........................................................ 5-13

6.0 CONCLUSIONS AND RECOMMENDATIONS ................................................................ 6-1

6.1 RESOURCE AND GEOLOGY ................................................................................................. 6-1

6.2 EXPLORATION AND DATA QUALITY...................................................................................... 6-1

6.3 CONCLUSIONS ................................................................................................................... 6-1

7.0 REFERENCES ................................................................................................................. 7-1

APPENDIX A JORC TABLE

APPENDIX B COLLAR LOCATIONS AT SATIMOLA

1494750100-REP-L0001-03 iv

L I S T O F T A B L E S

Table 1.1 Outline Budget for Development of the Satimola Project ............................................ 1-3 Table 5.1 Drilling Campaigns at Satimola .......................................................................................... 5-2 Table 5.2 Statistical Summary of Samples ........................................................................................ 5-8 Table 5.3 Summary of Block Model Dimensions ............................................................................... 5-9 Table 5.4 Tetra Tech Mineral Resource Estimate for Satimola Mine Potash Zones as of 28th

February 2011 (COG of 5% K2O) ...................................................................................... 5-14 Table 5.5 Tetra Tech Mineral Resource Estimate for Satimola Mine Potash Zones as of 28th

February 2011 (COG of 10% K2O).................................................................................... 5-14 Table 5.6 Tetra Tech Mineral Resource Estimate for Satimola Mine Potash Zones as of 28th

February 2011 (COG of 15% K2O).................................................................................... 5-14 Table 5.7 Tetra Tech Mineral Resource Estimate for Satimola Mine Borate Zones as of 28th

February 2011 (COG of 2% B2O3) .................................................................................... 5-15 Table 5.8 Tetra Tech Mineral Resource Estimate for Satimola Mine Borate Zones as of 28th

February 2011 (COG of 4% B2O3) .................................................................................... 5-15 Table 5.9 Tetra Tech Mineral Resource Estimate for Satimola Mine Borate Zones as of 28th

February 2011 (COG of 6% B2O3) .................................................................................... 5-15

L I S T O F F I G U R E S

Figure 1.1 Map of Kazakhstan Showing Location of Satimola Deposit ....................................... 1-4 Figure 1.2 Satimola Site, Showing the Regional Relief .................................................................. 1-5 Figure 2.1 Map of Western Kazakhstan and Location of Satimola Deposit ...................................... 2-2 Figure 2.2 Geological Section Showing Details of Cap Rock Formations Overlying Primary Salts .. 2-3 Figure 3.1 Example Seismic Section and Interpretation .................................................................... 3-3 Figure 4.1 Soviet Era Collar Marker ..................................................................................................... 4-2 Figure 4.2 Satimola Collar Marker – Hole SP-16, Satbor, 2009 ........................................................ 4-3 Figure 4.3 Sampling Method ................................................................................................................ 4-5 Figure 4.4 Core Storage and Sample Preparation Facilities .............................................................. 4-8 Figure 4.5 Core Storage ........................................................................................................................ 4-9 Figure 4.6 Core Packing and Labelling ................................................................................................ 4-9 Figure 4.7 Sample Storage ................................................................................................................. 4-11 Figure 4.8 Sample Laboratory Facilities ............................................................................................ 4-12 Figure 4.9 PANalytical “MiniPal4” XDXRF .......................................................................................... 4-12 Figure 5.1 Satimola Area with Drillhole Collars as of November 2010 ............................................. 5-2 Figure 5.2 Location of Drillholes in the Satimola Deposit .................................................................. 5-3 Figure 5.3 Plan View of Satimola Potash Mineralised Zone Wireframes Based on a Cut-off Grade of

6% K2O ................................................................................................................................. 5-5 Figure 5.4 Plan View of Satimola Borate Mineralised Zone Wireframes Based on a Cut-off Grade of

0.5% B2O3 ............................................................................................................................ 5-6 Figure 5.5 Long Sectional View looking NE of Satimola Potash Mineralised Zone Wireframes Based

on a Cut-off Grade of 6% K2O ............................................................................................. 5-7 Figure 5.6 Long Sectional View looking NE of Satimola Borate Mineralised Zone Wireframes Based

on a Cut-off Grade of 0.5% B2O3 ........................................................................................ 5-7 Figure 5.7 Plan View of Block Model Potash Zones .......................................................................... 5-10 Figure 5.8 Plan View of Block Model Borates Zones ........................................................................ 5-11 Figure 5.9 Example Cross-Section View of Block Model Zones looking SE ..................................... 5-12

1494750100-REP-L0001-03 v

G L O S S A R Y

American dollars ..................................................................................................................................................................... US $

Annum (year) ............................................................................................................................................................................... a

Approximately .............................................................................................................................................................................. ~

Australian dollars ................................................................................................................................................................. AUS $

Bachelor of Applied Science ............................................................................................................................................. BAppSc

Bachelor of Science ................................................................................................................................................................. BSc

Centimetres .............................................................................................................................................................................. cm

Chartered Geologist .............................................................................................................................................................. CGeol

Competent Persons Report ..................................................................................................................................................... CPR

Cut-off grade ........................................................................................................................................................................... COG

Degree .......................................................................................................................................................................................... °

Degrees Celsius ......................................................................................................................................................................... °C

Diameter ..................................................................................................................................................................................... Ø

Digital Exchange Format ......................................................................................................................................................... DXF

Digital terrain model ............................................................................................................................................................... DTM

Differential Global Positioning System ................................................................................................................................ DGPS

East .............................................................................................................................................................................................. E

Energy dispersive X-ray fluorescence ................................................................................................................................ EDXRF

European Geologist .......................................................................................................................................................... EurGeol

Feet ................................................................................................................................................................................................‘

Fellow of the Geological Society ............................................................................................................................................. FGS

Grams ............................................................................................................................................................................................ g

grams per cubic centimetre ................................................................................................................................................ g/cm3

High density polyethylene .................................................................................................................................................... HDPE

IMC Geophysics International Limited .................................................................................................................................... IMC

Incorporated ............................................................................................................................................................................. Inc.

Independent Geologist’s Report .............................................................................................................................................. IGR

Inverse Power of Distance Squared ..................................................................................................................................... IDW2

Joint Ore Resource Committee ............................................................................................................................................. JORC

Kazakhstan Potash Corporation Ltd. ......................................................................................................................................KPC

Kilogram ...................................................................................................................................................................................... kg

Kilometre .................................................................................................................................................................................. km

Limited ..................................................................................................................................................................................... Ltd.

Magnesium ............................................................................................................................................................................... Mg

Master of Science .................................................................................................................................................................... MSc

Member of the Australian Institute of Geoscientists ........................................................................................................... MAIG

Metre ........................................................................................................................................................................................... m

Metres per second .................................................................................................................................................................. m/s

Millimetre ................................................................................................................................................................................. mm

Million years ago ....................................................................................................................................................................... Ma

Minus .............................................................................................................................................................................................-

North ............................................................................................................................................................................................ N

Nearest Neighbour ................................................................................................................................................................... NN

Number ..................................................................................................................................................................................... No.

Ordinary Kriging ......................................................................................................................................................................... OK

Per tonne ...................................................................................................................................................................................../t

Percent ......................................................................................................................................................................................... %

Plus ............................................................................................................................................................................................... +

1494750100-REP-L0001-03 vi

Potassium .................................................................................................................................................................................... K

Potassium Chloride ................................................................................................................................................................. KCL

Quality assurance / quality control .................................................................................................................................... QA/QC

Recognised Overseas Professional Organisation ............................................................................................................... ROPO

South ............................................................................................................................................................................................ S

Square kilometre ..................................................................................................................................................................... km2

Tetra Tech WEI Inc. ....................................................................................................................................................... Tetra Tech

The Australian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves ................... the JORC Code

Three Dimensional .................................................................................................................................................................... 3D

Tonne (1,000 kg) .......................................................................................................................................................................... t

Tonnes per cubic metres ........................................................................................................................................................ t/m3

Top of Salt ................................................................................................................................................................................ TOS

Two Dimensional ....................................................................................................................................................................... 2D

West ............................................................................................................................................................................................ W

Kazakhstan Potash Corporation 1-1 1494750100-REP-L0001-03 Satimola Potash Project – Independent Geologist’s Report

1 . 0 I N T R O D U C T I O N A N D T E R M S O F R E F E R E N C E

1.1 I N T R O D U C T I O N

This Independent Geologists Report (IGR) has been prepared by Tetra Tech WEI

Inc. (Tetra Tech) on behalf of Kazakhstan Potash Corporation Ltd. (KPC) in

accordance with The Australasian Code for Reporting of Exploration Results,

Mineral Resources and Ore Reserves (the JORC Code), 2012 edition.

This document has been prepared as an update to previously issued documents,

cited in the references section, to report the Resources at Satimola according to

the guidelines of the JORC code, 2012 edition.

This report has been prepared by Mr. Joseph Hirst, CGeol, FGS, EurGeol. Mr.

Hirst is a member of the Geological Society of London, United Kingdom, which is

a Recognised Overseas Professional Organisation (‘ROPO’) for the JORC code.

The report is an independent report prepared by Tetra Tech. Resources were

originally compiled by Mr. Hirst in 2010 as part of a Competent Persons Study of

the project published by Wardrop Engineering Inc. (now Tetra Tech) in 2010.It

is Mr. Hirst’s opinion that no material changes have been made to the project

since 2010, and the Resources can therefore be considered as current and are

now reported according to the JORC code, 2012 edition guidelines.

Mr. Hirst has sufficient experience which is relevant to the style of mineralisation

and type of deposit under consideration and to the activity which he is

undertaking to qualify as a Competent Person as defined in the 2012 Edition of

the JORC code. Mr. Hirst consents to the inclusion in the report of the matters

based on his information in the form and context in which it appears. The

information in the report to which this statement is attached that relates to Mineral

Resources is based on information compiled by Mr. Hirst in accordance with the

2004 JORC Code. Additional comment is provided to comply with the more

stringent guidelines of the JORC 2012 edition standard.

1.2 P R O J E C T D E S C R I P T I O N

The Satimola potash and borate deposit is currently understood to be one of the

largest in Kazakhstan. The deposit is located in the Uralsk district of Western

Kazakhstan, 220 kilometers (km) north of the Ural River port of Atyrau near the

Caspian Sea and 70 km north of the town of Inderborskiy.


The deposit consists broadly of a borate-bearing eluvial horizon overlying

extensive potash-bearing salt horizons. The salt is overlain by a thickness of

quaternary sediments.

The resource area of the Satimola Dome has been extensively explored over the

last five decades and various resource estimates have been produced, the most

recent of which was the Wardrop Engineering Inc. report published in 2010.

The Satimola deposit has a strike length in excess of 23 km, a width in excess of

8 km and has been explored by surface drilling and 2D seismic survey to a depth

in excess of 1 km.

It is understood that during the 1960s there was a requirement to augment and

eventually replace the depleting boron resource at the Inderborskiy deposit

situated 70 km southwest of Satimola and the Indersky Geological Prospecting

Expedition started its exploration quest for borate-rich potassium salts. It was this

impetus which resulted in a systematic exploration of the Satimola salt dome

between 1963 and 1969. This initial exploration programme involved core drilling

of deep holes into the primary layers of the salt dome which ultimately resulted in

a 2 km grid pattern of drilling.

1.3 T E R M S O F R E F E R E N C E

Tetra Tech was initially commissioned by KPC to prepare an independent

geological review on the Satimola deposit, in December 2013. This report was to

comply with disclosure and reporting guidelines of the VALMIN code, a “Code for

the Technical Assessment and Valuation of Mineral and Petroleum Assets and

Securities for Independent Expert Reports”, 2005. Since this report was issued

the JORC code, 2012 edition has come into full effect and KPC engaged Tetra

Tech to bring the report up to compliance.

Tetra Tech has relied on technical data and reports by others, principally supplied

by Satimola, in preparing this report. Additionally, Tetra Tech has relied upon a

report prepared in 2010 for the reporting of mineral resources at Satimola by

Wardrop Engineering Inc. (now Tetra Tech).

1.3.1 KPC COMPAN Y PR OF ILE

KPC is a publicly listed mineral exploration company based in Melbourne,

Australia, with a focus on potash, gold, nickel, and copper deposits. KPC has

acquired the rights to two significant potash salt deposits in Kazakhstan including

Satimola, as well as interests in several mining tenements in Western Australia.

KPC have outlined a budget for the development of the Satimola project, shown

in Table 1.1 below.


Table 1.1 Outline Budget for Development of the Satimola Project

Work to be Completed Budget

(AUS $)

Geology work 500

Kazakhstan geology government approval for design 70

Subsoil rights evaluation 300

Road

Feasibility Study 1,500

Total $2,370

1.4 S I T E V I S I T S

No site visit was conducted for this geological review, however, a site visit was

made by Stanislaw Kotowski, Project Engineer and Joe Hirst, Project Geologist of

Tetra Tech between 7th and 13

th November 2010. Whilst on site full disclosures

of facilities and documents were made. A tour was made of the exploration camp

and its facilities, and meetings were held with all staff held in the main offices.

Satimola staff were extremely forthcoming with all information requested in order

to complete this body of work.

1.5 L O C A T I O N

The area of the Satimola deposit is a part of the Akzhaik region of West

Kazakhstan Oblast as illustrated in Figure 1.1. The region includes 18

administrative-territorial divisions and a regional centre, namely Chapaevo

village. The population of the region is approximately 42,000 as of the last

census.

The Ural River separates the European and the Asian parts of Akzhaik region.


Figure 1.1 Map of Kazakhstan Showing Location of Satimola Deposit

(Figure courtesy of Satimola Ltd.)

1.6 L I C E N C E A R E A

The area of Satimola’s geological allotment is 249.5 square kilometres (km2),

which covers approximately two thirds of the of the Satimola salt dome complex.

The licence has been granted for exploration and exploitation.

KPC and Satbor have valid licences granted and in full force subsurface use

rights.

The current Subsurface Law provides for an exploration period for up to six

years, with the possibility of extension for reserve appraisal. A production period

is not stated as it is defined in each contract individually.

The Contact of Satbor (Contract No 1391 from 19th April 2004 with the Ministry of

Energy and Mineral Resources of the Republic of Kazakhstan) was initially

concluded for 23 years, including 3 years of exploration and 20 years of

production. However, the exploration period was extended to seven years of

exploration by Addendum No. 4 (registration № 3468) as of 9th December 2009.

In this case, the exploration period expired on 19th April 2011. However, Tetra

Tech understands that an extension could be granted for further exploration if

required.


1.7 R E L I E F A N D C L I M A T E

Satimola is located in the zone of dry steppes and semi-deserts and the surface

overlying the deposit is in a very shallow flat valley with elevations ranging from

only 0 to 0.75 metres (m). This area is located between two river networks, the

Ural 40 km west and small Wadi-like Rivers to the east, such as the Uil, Ashisay

and Kaldygaty. There are no open lakes in the locality and the nearest is Lake

Dongeleksor 9 km southeast with dimensions of 3 by 4 km. It is a playa or dry

lake with a flat silty bottom in which, during the summer season, thin crusts of

halite are formed.

Climatically the area is extreme continental, with very cold winters and hot

summers. Annual mean temperature ranges from -20 degrees Celsius (°C) to

+22°C with approximately 152 frost free days and relative humidity ranging from

40 to 80 percent (%). Winds are frequent and of variable direction with an

average speed at 4.3 metres per second (m/s). Annual precipitation mean 10

year average is 182 millimetres (mm) with April to October being the wetter

months. Seasonal snow falls and is permanent from the end of December to late

March. The snow depth ranges between 3 and 16 centimetres (cm), with

maximum frost penetration of 1.4 m.

Figure 1.2 Satimola Site, Showing the Regional Relief


2 . 0 G E O L O G Y A N D M I N E R A L I S A T I O N

2 . 1 R E G I O N A L G E O L O G Y

This deposit is located geologically within the potassium-boron-bearing region of

the North Caspian Basin’s central plain, at N48°55’ and E52°21’. This is shown

in Figure 2.1. This basin, stretching 600 km latitudinally, lies north of the present-

day Caspian Sea and is underlain by Kungurian age (late Early Permian) primary

evaporite salts.

Intensive salt tectonics has resulted in the development of about 1,800

recognised salt structures of various styles and shapes. These diverse structural

forms are considered to reflect the differences in salt thickness, driven by

differential loading histories of the overburden in a closed marine basin. Gravity

is the most dominant influence in developing these structures in the salt

sequences and characteristically, salt deformation with differential tectonic

adjustment dominated the history of the Permian salts. The basin limits more or

less remained static from Early Permian (275 Ma) to Palaeogene (60 Ma). The

two main phases of deformation, Permian-Triassic and Jurassic to Neogene are

separated by a 35 Ma quiescent period from Late Triassic to Middle Jurassic.

The basin infill can be divided into three major sedimentary sequences:

Subsalt strata having a complex depositional history dominated by

carbonate reefs and clastic fans.

Kungurian salt (260 Ma) overlain by Kazanian salt (255 Ma) of Late

Permian.

Overburden predominantly terrigenous - Late Permian to Neogene.

It is considered that the environment conducive to the development of the salt

deposits began during the Early Permian when the North Caspian Basin was

sealed off from marine influences, forming a deep water enclosed basin. After

worldwide sea level falls, hyper-saline conditions predominated and evaporites

were deposited throughout the basin, reaching a thickness of over 4,000 m in the

centre. Continental conditions controlled deposition of sands and shales up to

Late Jurassic times and in the southeast border of the basin shallow marine

conditions were established again. During the Mid-Late Triassic, a second phase

of salt dome development took place. The salt structures of the North Caspian

Basin relate directly to the thickness of the Kungurian salt and the

palaeotopography present.

Finally, the North Caspian Basin’s drainage system changed drastically when its

drainage level dropped by 1 km in response to the rapid Neogene opening of the

Caspian Basin to the south, resulting in fast fluvial erosion forming deep canyons


and ravines into the upper sediments and exposing some salt diapirs. These

incised features were infilled by clastics during the Pliocene.

Figure 2.1 Map of Western Kazakhstan and Location of Satimola

Deposit


2 . 2 L O C A L G E O L O G Y

The Satimola Dome is a medium size salt dome, with an elongated dimension of

35 km along a northwest-southeast strike direction and varying in width from 4 to

8 km. It is suggested that this structure is a piercement salt dome formed by

diapiric intrusion. The cap rock zone of the dome in cross-sections appears only

gently curved and the dome’s core represents halogenous salt deposition to

depth during the Kungurian stage of the Permian period. Overlying sediments

include chalk, marls, clays and siltstones ranging from the Cretaceous to

Quaternary periods.

Structurally the salt dome can be complicated, with some uneven uplift during

domal development causing localised differential movement of faulted blocks.

Such fault displacements have been indicated from interpretations of the 2007

and 2008 2D seismic survey results covering the Satimola licence area of the

dome. However, these results and recent resource modelling show that the

overall salt layering is relatively flat, vis-à-vis historical interpretation based on

dominant fold structures. These dominant anticlinal fold structures were defined


by K.K. Kamashev, senior Geologist (Soviet era exploration campaign, 1974),

who studied the primary salt structures during an exploration phase of the salt

dome and projected these structures as “outcrops” at the salt plane.

It was stated in the 1986 eluvial boron feasibility report that “we only have a

general idea on the structure of the primary salts” which suggests some

equivocation on the voracity of the anticlinal fold-model approach, as detailed in

the 1970s. However, this statement was made before the 2D seismic exploration

phase which gave a much more thorough understanding of the structure, at least

in section. 3D seismic cross lines to the existing lines would give a full

understanding of the structure of the deposit and Tetra Tech recommend a 3D

seismic survey which would aid in fully understanding and interpreting the

Satimola deposit, however it may be cost prohibitive to the benefit gained.

2 . 3 G E O L O G Y O F T H E R E S O U R C E A R E A

For convenience, the geology is split into the primary salt layers where the potash

resource has been delineated at depth and the overlying eluvial cap rock, which

has been subjected to hydro-chemical weathering and contains a boron deposit

within the central area of the dome.

Figure 2.2 Geological Section Showing Details of Cap Rock

Formations Overlying Primary Salts



2.3.1 PRIMARY SALT MASS

Beneath the salt plane to depth, three mineralogical units have been defined by

K.K. Kamashev: The Lower Halite Layer, the Central Productive Zone and the

Upper Halite Layer, with thickness of over 400 m, 500 to 650 m and 400 to 600

m, respectively.

LOWER HAL ITE LAYER

The Lower Halite Layer contains rhythmic stratified anhydrite rock salt with thin

sheets of potassium salts containing weak boron mineralisation.

PRODU CTIVE ZON E

This has been identified by the level of high potassium mineralisation and borates

and is characterised by rhythmic deposition with specific geochemical signatures.

Potassium-magnesium salts form thick seams and bands and the main rock-

forming minerals are halite, sylvite, polyhalite, carnallite, kieserite, kainite and

langbeynite. There are two well developed paragenetic associations of

potassium-magnesium (K-Mg) salts and borates:

Carnallite and kieserite with boracite, prebrazhenskite and sulfoborite.

Sylvite, polyhalite, kainite and langbeinite with kaliborite, asherite, sulfoborite

and rare holurginite.

In the Productive Zone, two major boron-bearing bands of K-Mg salts, separated

by rock salt, have been defined – lower and upper.

The lower band (200 to 250 m thick) exhibits geochemical inconsistency

across and along strike with variable boron intensity and both the composition

and quantity of the eluvium boric ores above, reflect the changes found in

these primary boron-bearing zones. Mean B2O3 in this band is 5% and over

a large area it outcrops to the salt plane (bottom of eluvium). It is this band

that provided the initial source of boron during the development of the boron

bodies within the eluvial cap rock.

The upper band includes a number of lens-like boron bearing sylvinites and

sylvite-polyhalite-halite rocks commonly ranging in thickness from 0.5 to 5 m

to a maximum of 10 to 14 m. These are separated by bands of rock salt (20

to 80 m thick).

Tetra Tech understands that the Productive Zone is dominated by sylvanite

(sylvite and halite) with only minor carnallite.

THE UPPER HAL ITE LAYER

This layer includes a number of lens-like boron bearing sylvinites and sylvite-

polyhalite-halite rocks commonly ranging in thickness from 0.5 to 5 m to a

maximum of 10 to 14 m: These are separated by bands of rock salt (20 to 80 m

thick). Both in thickness and composition this layer is variable.


Although these zones have been defined by mineralogical signatures, their

spatial distributions are uncertain in relation to the potash model and an in-depth

synthesis from the historical mineralogical drill log descriptions may help to better

understand this relationship.

2.3.2 CAP ROCK

It is non-uniform from genesis, age and lithology and represents ancient eluvial

formations where the primary salt mass has been subjected to prolonged

chemical leaching during asynchronous uplift of the dome’s core into the zone of

hydrochemical weathering. In the central area of the dome, commercial

quantities of boron mineralisation were concentrated into sub-horizontal layers

within the cap rock and boron rich zones, with intermediate potash grades, in the

underlying primary salt horizons, see Figure 2.2.

This zone is split into an upper chemogenous-sedimentary succession and a

lower eluvial formation containing the high concentrations of boron

accumulations, the dominant commercial resource mineral within the cap rock

formations.

THE UPPER ZON E

The Upper Zone overlies the boron containing body as a continuous cap with a

thickness ranging from 5 to 50 m and uncommonly may underlie it.

The formation is distinctly composed of variable mid to coarse grey crystalline

gypsum rock with massive to banded texture.

This upper zone belongs to the Kungurian of the Permian period, which

concluded the accumulation of halogenous sediments. During domal uplift they

cleaved into individual blocks, vis-à-vis more ductile underlying salt mass. The

zone typically contains gypsum, anhydrite, gypsum-anhydrite, gypsum-carbonate

and carbonate rocks and infrequent clayey lenses. Domal movements have

resulted in intensive folding, fissuring and boudinage development, though

maintaining the sedimentary fabric. Notably, no boron is found within these

sediments.

THE LOWER BOR ON ZON E

The lower boron zone is distinct from the Upper Zone in containing an uneven

distribution of main rock components, from gypsum to clayey carbonates with

massive to brecciated textures. Thickness varies from a few metres to 80 to 90

m that is directly related to the volume of boron-bearing salty rocks, which is

controlled by the degree of uplift of the domal core into the zone of weathering.

Generally, the boron-bearing eluvium spatially coincides with the underlying

boron layers in the salt mass units that outcrop at the interfacing salt plane.

The interface between the primary salt layers and the overlying eluvium is

represented by a horizontal to sub-horizontal salt plane that marks the water

table or top of the phreatic zone and is found at about 300 m from surface.


The lower eluvial formation contains the commercial borate zones and is

commonly brecciated, nodular and fissured with an uneven distribution of rock

components, and containing no seams of anhydrite, gypsum or gypsum-dolomitic

rocks. Fragments of the upper chemogenous-sedimentary formation, are

occasionally present due to caving formed during the development of the boron

bearing zones.

The borate mineralisation is hydroboracite, ulexite, and to a lesser degree,

ascharite. Analysis shows that there are three types of mineral association,

ascharite, polyborate and ulexite-hydroboracite. The ulexite-hydroboracite type

dominates, representing more than 80% of the borate mineralisation.

2.3.3 OVERLYIN G TERRIGEN OU S SEDIMENT S

These sediments lie contiguously over the gypsum cap rock and composed of

continental and marine sediments ranging from Permian-Triassic to Quaternary.

In the area of the deposit there are no Permo-Trias and Jurassic rocks, but these

are widespread in the northwest half of the dome and restricted in the southeast.

The Lower Cretaceous rocks range from a few metres in thickness to 50 m where

they are present in washouts in the top layers of the gypsum cap. The upper

Cretaceous (Kampansky and Maastricht series) have a thickness range from 10

to 40 m and occupy graben-like depressions which were generated in pre-

Pliocene times within the salt mass. About half of the deposit’s area contains

Pliocene (Neogene period) lying directly over the gypsum cap.

2 . 4 S T R U C T U R E A N D I N T E R P R E T A T I O N O F T H E P O T A S H S T R A T A

Historically, the structure of the primary potassium and boron salt layers has been

interpreted as a conformable series of beds which have been folded by horizontal

compression. The result has been presented as a set of dominant open folds

with vertical axial planes to depths of over 1 km and which intersect the top of the

primary salt layers at the salt plane. However, interpretation of the 2D seismic

survey completed in 2007 and 2008, covering the central dome area and the

remaining licence area respectively, showed that structurally the primary salts

form relatively flat horizontal layers, with no evidence for the type of folding as

defined in 1974. Satbor subsequently divided the salt mass into five sub-

horizontal zones and then interpreted individual lenses of higher-grade material

within these zones. The Tetra Tech resource estimate is based on the

interpretation of the primary salts forming relatively horizontal layers. From

examination of the seismic data and modelling work, Tetra Tech concluded that

there is reasonable continuity of structure and value within the primary salts even

where drill holes are spaced at 2 km.

Rather than constraining the estimation within the five zones, as was done for the

most recent estimate, the Tetra Tech grade estimation has followed the Satbor

interpretation of individual lenses of high grade material, surrounded by a

somewhat unconstrained mass of salt for estimation. The constraints applied are

the seismically derived top of salt (TOS) layer and a similar layer at depth. The

deposit is laterally constrained simply by an arbitrary boundary at one half drill


hole spacing. It was considered suitable to let the estimation and subsequent

cut-off grade analysis to define the internal structure within this outer zone. This

was mainly due to the complexities of defining high-grade zones not discernable

from the seismic data and with no hard lithological or grade boundaries

discernable in the drilling data.


3 . 0 E X P L O R A T I O N

3 . 1 I N T R O D U C T I O N

The Satimola salt structure was first discovered between 1931 and 1941 during a

variometric survey within the North Caspian Basin. In 1947 a geomagnetic

survey found a weak anomaly and described the dome structure as relatively

large. A small size negative gravity anomaly was found in 1951 and in 1954

detailed gravimetric and seismic surveys confirmed the existence of the structure.

During 1960 and 1961, the local expedition drilled a number of holes and two

holes (75 and 85) intersected potash bearing Permian-Triassic formations at 225

and 220 m from the surface. Between 1963 and 1969 a deep exploration drilling

programme, on a 2 by 2 km grid pattern, intersected high-grade potash

mineralisation and boron, down to a depth of 1,200 m from surface. In 1968 it

was recommended to explore the evaporate deposit by underground

development. The primary and eluvial borate reserves from 1974 were checked

and confirmed by the former Soviet SCR who classified the deposit as a major

borate resource. From 1978 to 1986 detailed geological exploration was

undertaken by the Prikaspiysky Prospecting Party of the Indersky Exploration

Expedition. From 1980, the Chief Geologist M. Erkingaliev led the exploration

and subsequent FS of the eluvial borate deposit, situated within the cap-rock of

Satimola Dome.

In 2004 Satimola acquired a mineral lease and started confirmatory core drilling

of the eluvial borates in 2005. In 2006 and 2007, Satimola conducted an

additional drilling programme. In 2007 and 2008 Satimola undertook 2D seismic

surveys to understand the structures of the primary potash salts at depth. In

2008 Satimola started an infill diamond drilling exploration programme and this

project continued in 2009.

3 . 2 H I S T O R I C A L D R I L L I N G

It is understood that during the 1960s there was a requirement to augment and

eventually replace the depleting boron resource at the Inderborskiy deposit

situated 70 km SW of Satimola and the Indersky Geological Prospecting

Expedition started its exploration quest for borate-rich potassium salts. It was this

impetus which resulted in a systematic exploration of the Satimola salt dome

between 1963 and 1969. This initial exploration programme involved core drilling

of deep holes into the primary layers of the salt dome which resulted in an

ultimate 2 km grid pattern, covering an area of 23 km along strike by 8 km across

strike. The results from this drilling programme provided the bulk of the

information for this potash resource modelling. The final potash database

represented a total of 77 deep exploration holes covering about 73,000 m of

historical drilling, of which a total of 60 holes were selected by Computer

Resource Services for defining the potash resource, plus the 13 new holes drilled


by Satimola; these deep, historical drill holes ranged in depth from 627 to 1,316

m, with a mean depth of 916 m.

By 1964, two key drill holes (25 and 28) within the central area of the dome,

intersected thick seams of potassium-boron rich salts and closer exploration infill

drilling around these holes resulted in the fortuitous discovery of eluvial borates in

the cap rock above the primary salts. Evaluation of this eluvial boron deposit

culminated in a FS in 1986 by the Ministry of Geology, Kazakhstan. In 2004 a

computerised version of this boron deposit was produced by Satimola geologists.

In 2008 CRS subsequently updated the model and generated a JORC compliant

resource estimation.

A 1:50,000 scale geological map at the salt plane, dated 1979, showing lithology

and major anticlinal structures, was produced by projecting potassium-boron

intersections from the deep exploration holes. It should also be noted that

numerous “short” (360 m) historical drill holes, within the central dome area, were

used to penetrate only the top 20 m of the primary salts in efforts to define these

inferred fold structures and by mapping these projected structures, as “outcrops”

at the salt plane; the grid pattern for this drilling was very close at only 50 by 250

m. It was this salt plane map which formed the basis for estimating the historical

primary boron-potassium reserves to a depth of 1 km. However, from recent

seismic survey interpretations, it has been shown that the assumption of folding

in the primary salts is erroneous, with the actual primary salt bedding or

stratification forming relatively flat horizontal layers.

3.2.1 SATIMOLA DR ILLIN G CAMPAIGN 2008-2010

In order to confirm and upgrade the confidence in the validity of the historical

drilling results, Satimola received official approval to undertake an exploration

diamond core drilling programme, that was initially targeted within the central part

of the salt dome and spatially located below Satimola’s evaluated eluvial borate

deposit. Modern drill rigs were used for this exploration and included a Boart

Longyear LF-230 and LF-90 plus a Schramm rig. The drilling pattern was based

on a 0.5 km grid and it is thought that this grid was designed to define the

historical, but now erroneous, concept of major anticlinal fold structures for the

primary salt formations.

3.2.2 2D SEISMIC SUR VEYIN G

It has been reported that in the 1950s seismic profiling of the Satimola Dome was

conducted but this data is not currently available. In May/June 2007 Satimola

funded a 2D limited seismic survey by Azimut Energy Services in the central area

of the dome, comprising 8 lines totalling 95 km. In 2008 the rest of the licence

area was covered a by a 2D seismic survey, composed of 18 lines totalling over

200 km: The initial interpretations by IMC Geophysics International Limited (IMC)

showed that structurally the primary salt layers were relatively flat and horizontal,

vis-à-vis the historical interpretation. The survey also showed that the top of the

salt layers were very sharp and this coincided with the so called defined salt

plane, even though at the time, no check shot survey or synthetic seismograms

for the drill holes were available.


Figure 3.1 Example Seismic Section and Interpretation

(Figure courtesy of IMC)

Attempts were also made to correlate two major potash zones, as defined by 40

historical drill holes. The seismic interpretation for the reflecting layer S1 was

revised by IMC in July 2009, using drillhole check shot seismic surveys and

synthetic seismograms. As an aid to this interpretation, both historical and

Satimola drill hole potash intersections and down-the-hole geophysical logs, near

the seismic lines, were used to define the reflecting layer (S1) which has been

linked to the lower extents of the eluvial borate soft boundary. The S1 depth

interpretation has a lower confidence than the top of salt, due to the greater

ambiguity in depth/time interpretation for this lower horizon. It was noted that the

revised contour surface of the S1 reflector correlated quite well with the

geological structural interpretation of the delineated potash zones.

The IMC seismic data was used to correlate with the potash zones. However, the

Satbor wireframes were used for Tetra Tech’s “Indicated” Category classification.

The interpretation broadly follows a mix of grade and seismic correlation.

Seismic data was used to correlate the Tetra Tech “Inferred” category

interpretation.

Numerous small scale faults have also been identified from the IMC

interpretations but typically the throws appear to be limited to less than 20 m and

not deemed by Tetra Tech to be significant enough for inclusion in the resource

model at this level of study.

The top of the primary salt layer is marked by gypsum or anhydrite and this

shows as a very distinct reflector and the resulting interpretation of this horizon

confirms the contact layer (salt plane) between the eluvial cap and primary salt

mass below, as defined from the historical drill hole logging.

3 . 3 C U R R E N T D R I L L I N G

At the time of writing, there have been no drilling campaigns by Satimola since

the publication of the Competent Persons Report (CPR).

Kazakhstan Potash Corporation 4-1 1494750100-REP-L0001-03 Satimola Potash Project - Independent Geologist Report

4 . 0 D A T A Q U A L I T Y A S S U R A N C E A N D Q U A L I T Y C O N T R O L


Tetra Tech audited the quality assurance / quality control (QA/QC) Data and

procedures that have been utilised during the Satimola exploration drilling

campaigns and proposed procedure for future work as part of the JORC

compliant resource update.

Tetra Tech also reviewed the drillhole locations, existing core storage facility, the

core splitting facility, existing drill logs, assay data, QA/QC data and the drillhole

database used for resource modelling.

4 . 2 D R I L L H O L E L O C A T I O N S

Soviet era collars are poorly marked or unmarked, but the known locations have

been cross checked with the existing data and positions confirmed by Differential

Global Positioning System (DGPS) where collar markings have been found.

Enough collars were found and with locations accurate to the logs to assume that

the unmarked holes are accurate too. Satimola plan to refresh or replace the

Soviet era collar markers to Satimola’s current standards. Figure 4.1 and Figure

4.2 below, show examples of both Soviet and Satimola era collars.


Figure 4.1 Soviet Era Collar Marker


Figure 4.2 Satimola Collar Marker – Hole SP-16, Satbor, 2009

4 . 3 S A M P L I N G T E C H N I Q U E S

Assay data used for resource modelling was from drill core. The Satimola

deposit is drilled off at primarily 1,000 m centres using Diamond Drill Core;

however infill drilling has been completed at 500 m or less centres and some of

the farthest extents are drilled on 2 km spacing. Core was not orientated. Care

was taken when collecting samples and recording logs to ensure representivity of

the described samples.

The drilling procedure is briefly described below:

Drilling passports and logs are kept during drilling by a company geologist.

o The logs record sampling intervals, lithologies, drill/handling breaks,

geotechnical detail as appropriate, and sample recovery percentages.

Core is placed in labelled plastic core boxes from left to right with the start

and finish of each drill run labelled with a metreage marker.

Core boxes are transported to core logging facility at the end of each shift by

the drill foreman, a Satimola geologist or drill technician and laid out in order

of increasing hole depth.

Core box labels and metreage are checked for accuracy and photographed

by a company geologist.


Plastic wrapping is used for the core to prevent water absorption and

deterioration of the core.

Exploration drillholes are not geotechnically logged.

Geological logs are written in logging forms, which include information on

location, date drilled, etc.

Copies of the forms are kept in each core box.

Geological data recorded includes the lithology, mineralisation and other

pertinent information.

Assay samples are approximately (~) 0.5 m in length or smaller to honour

gross geological units or major structures.

Density measurements on mineralised intervals are completed using

standard water immersion methods.

Assay samples are sawn in half with half remaining in the box, which is

stored in racks in warehouses on site. The other half is tagged, bagged,

sealed and sent to a sample preparation laboratory on site.

Company geologists insert duplicates, standards and blanks at the sample

preparation stage.

Information from the drill logs was entered into a Microsoft™ Excel database.

Tetra Tech considers that the aforementioned methodology is suitable for the

deposit type and the measures taken by Satbor to ensure sample representivity

are suitable for supporting a Mineral Resource Estimate, in particular core

recovery for the DDH campaigns was close to 100%.

4 . 4 S A M P L E P R E P A R A T I O N , A N A L Y S E S A N D S E C U R I T Y

Sample preparation from Satimola’s drilling was completed on site by company

technicians and is outlined in Figure 4.3 below.


Figure 4.3 Sampling Method

Logs entered into Excel

database

Lithological Logging

(including colour,

mineralisation

and structures)

Quality control samples inserted

and samples delivered to off-site sample

preparation laboratory

Core sawn in halfed, tagged,

bagged and sealed

Density Measurements

on selected drill holes

Mark assay sampling intervals

(samples 0.5 m or geological interval)

Core laid out in order

and photographed

Drill Core Received at

Core Storage Facility

Check sample assays and analyses produced from Satimola’s drilling campaign

were performed by the internationally accredited SGS Laboratories in Ontario,

Canada.

4 . 5 S A M P L E S E C U R I T Y P R O C E D U R E S

Sample security procedures are described below:

Core is delivered from site to secured core logging facility by drill supervisor

or company technician.

Core is photographed, logged and sample locations marked by company

geologist.

Core is sawn in half, tagged, bagged and sealed by a company technician.

Samples submitted to company sample preparation laboratory.

Check samples (500 grams [g]) shipped by courier to SGS Laboratories,

Canada in Ontario for analysis.

The core storage facility is double padlocked. Only the Site Supervisor,

Chief Geologist and Mine Manager have keys, but not for both locks. Two

people must be present and all activity in the core storage shed must be

witnessed.

It is Tetra Tech’s opinion that industry accepted procedures were utilised for

sampling, sample preparation, security and analytical procedures.


4.5.1 QUAL ITY CONT ROL PR OC EDUR ES

Satimola has applied a rigorous data handling and data checking protocol for the

treatment of geological, analytical and QA/QC data.

The procedure followed for drillhole data during the Satimola drill programme

was:

Collars were located using standard surveying equipment (theodolite and

distomat) by a company surveyor.

Geologist checks location, azimuth and dip of drillhole collar.

Company geologists entered survey data, core logging and analytical data

into the Microsoft™ Excel database.

Microsoft™ Excel Data is also entered into Datamine™ Studio 3 Version 18

(Datamine™) for company geological interpretation.

Datamine™ has built in checks for consistency of the database in order to

prevent over-lapping intervals or hole name validation errors.

Drillholes were paper plotted on section and plan and visually checked for

unusual collar location, drill orientation, assay pattern or values.

An extensive QA/QC programme was completed by Satimola to monitor

precision, accuracy and contamination. The programme is briefly described

below.

The QA/QC for the Satimola drilling campaigns was available for inspection

at the exploration site, in spreadsheet form these included the data for

duplicates, standards and blanks presented as tables and graphs. The

spreadsheets record sample and batch numbers and the assay results;

these included assays, sample number and assay certificate numbers.

Certificates were available for inspection.

The extensive quality control programme adopted by Satimola consisted of

sample blanks, standards and duplicates. The control samples account for

approximately 10% of all samples collected and assayed. The control

samples were inserted into the sample sequence at random.

The Satimola drillhole data is stored in electronic form; these comprehensive

summary logs for each hole include collar position, down hole survey data,

sample number and position and assay data.

Tetra Tech considers this quality control system to be adequate for this type

of deposit. The results of the QA/QC programme achieve suitable levels of

accuracy and precision to support a Mineral Resource Estimate.

4.5.2 DEN SIT Y DETER MIN ATIONS

The specific gravity used for the Satimola resource estimation is based on

historical determinations. Protocol 7092 on the Satimola deposit, dated January


1974, for the State Reserve Committee determined the density to be 1.97 grams

per cubic centimetre (g/cm3).

The eluvial borate FS, 1986, determined a density value of 2.0 g/cm3.

Density was determined by Satimola from various mineralisation types during the

2009-2010 drilling campaign. Two hundred and thirty-three samples were used

in the determination and these determinations were inspected at the site. Tetra

Tech has used the average density determination rounded up to 2.0 g/cm3 from

1.97 g/cm3 consistent with previous density determinations and historical

estimates.

4 . 6 H I S T O R I C A L D R I L L I N G C A M P A I G N S

Historical QA/QC procedure for drilling completed during the 1963 to 1969

exploration campaign and the 1978 to 1986 campaign was available for

inspection in hardcopy format. Tetra Tech inspected the logs and the assay

certificates for the holes of this drilling campaign. The logs included collar

position, down the hole survey, lithology description, sample number and position

and assay results. Repeats, blanks, duplicates and standards are recorded on

the core logs.

No historical core exists for check assay. However, all the drilling passports, logs

and assay certificates exist in hard copy (and relevant data has been transferred

to the electronic database) and were made available on site for review. Typically

the historical drilling data was of an excellent level of completeness and finished

to a very high standard of detail.

Some of the modern holes twin the historical holes in order to verify the reliability

of the historical drilling and sampling. Tetra Tech considers that the historical

drilling is adequately supported and can be relied upon for a Mineral Resource

Estimate.

4 . 7 C O R E S T O R A G E

A large single separate core storage facility was inspected on site by Tetra Tech.

The core shed is a modern insulated warehouse constructed by Satimola and

houses the entire inventory of core drilled, with space for additional core from

planned drilling campaigns.

The core storage facility is double padlocked. Only the Site Supervisor, Chief

Geologist and Mine Manager have keys, but not for both locks. Two people must

be present and all activity in the core storage shed must be witnessed.


Figure 4.4 Core Storage and Sample Preparation Facilities

The facility was well built, secure and clean. Core was stored in plastic core

boxes well labelled in indelible ink/paint in at least two locations for identification.

Core was stacked in a heavily engineered rack mount system so that each box

was accessible with the minimum amount of work. This also minimised

considerably the risk of collapse.

Inside the core boxes further indelible ink/paint identification was present on the

box itself. Further to this intervals were marked. The core was stored inside

heavy, high density polyethylene (HDPE) type plastic bagging to protect the core

from moisture absorption and deterioration.

Inside the core plastic bags were further paper identification labels with summary

information, written in ink, each contained in their own Ziploc type plastic bag.


Figure 4.5 Core Storage

Figure 4.6 Core Packing and Labelling


4 . 8 C O R E P R E P A R A T I O N F A C I L I T Y

Drill core for both historical and contemporary drilling campaigns produced

89 mm diameter core. Core was marked out and split along its length with one

half retained and the other half used for analysis, geotechnical assessment and

metallurgical test work.

Historical half-core is no longer available. According to the archives the following

preparation was undertaken:

Sample weight about 6 kilograms (kg), diameter (Ø) = 30 to 25 mm.

Crushing in jaw crusher, Ø = 3 mm.

Sifting, Ø = 3 mm.

Mixing and reduction to 3 kg.

Additional sifting, Ø = 1 mm.

Crushing in rolling crusher, Ø = 1 mm.

Control sifting, Ø = 1 mm.

Mixing; reduction to 1.5 kg.

Splitting to 0.75 kg.

Reduction to 0.375 kg.

Pulping in revolving crusher to 0.07 mm.

Sifting, Ø = 0.07 mm.

Mixing; reduction; two sample duplicates of 187 g.

Sample 187 g, Ø = 0.07 mm.

Core from the most recent drilling campaign has been treated using the same

preparation guidelines.

Tetra Tech considers that the sample preparation facilities, although currently not

in constant use, were in good clean order and well maintained.

4 . 9 S A M P L E S T O R A G E

Samples are stored in a separate room in the core shed facility, with separate

locked access. Samples are stacked on shelves, ordered by drillhole and

subdivided by depth so each sample was readily accessible.

Samples were labelled inside and outside the bag, with clear markings.


Figure 4.7 Sample Storage

4 . 1 0 D U P L I C A T E S T O R A G E

Duplicates are stored in a separate room in the core shed facility to both the core

and the samples. They are differentiated by the use of a different coloured bag,

so that no confusion arises between samples and duplicates.

Duplicates were labelled inside and outside the bag, with clear markings.

4 . 1 1 S A M P L E L A B O R A T O R I E S

The sample laboratories were toured during assaying operations. The facilities

were well equipped, kept very clean and fitted out with modern equipment. The

laboratory is used for other third party assay determinations when no Satbor

sampling is required.

Assay is determined by a PANalytical “MiniPal4” energy dispersive X-ray

fluorescence (EDXRF) bench top spectrometer.

Tetra Tech concludes that the core storage facilities were excellent and great

care was taken over the access of the facility providing excellent security for the

chain of custody process.


Figure 4.8 Sample Laboratory Facilities

Figure 4.9 PANalytical “MiniPal4” XDXRF


4 . 1 2 R E C O M M E N D A T I O N

Tetra Tech recognises that the sampling facilities and processes were of an

excellent standard with very little to recommend for improvement.


5 . 0 R E S O U R C E E S T I M A T E S


The resource estimate for the Satimola Deposit was completed using Datamine™

and classified in accordance with the JORC code 2004 in 2010. No material

change has taken place since 2010 and these resources are still considered

current. This report provides additional information to ensure compliance with the

guidelines of the JORC Code 2012.

5 . 2 T O P O G R A P H I C A L S U R F A C E

A topographic surface was constructed in Datamine™ as a wireframe digital

terrain model (DTM).

The topography was constructed using all available collar co-ordinates. Given

the local flat lying terrain the model can be considered accurate for the purpose

of a resource estimate. The collar locations and general topography are shown

in Figure 5.1.


Figure 5.1 Satimola Area with Drillhole Collars as of November 2010

Note: The West Kazakhstan regional co-ordinate system is based on the Pulkovo 1942

geodetic datum within the Gauss-Krüger Zone 9N.

5 . 3 S A M P L I N G D A T A B A S E

5.3.1 DRILLING

Diamond drilling has been carried out as two major campaigns at Satimola as

summarised in Table 5.1.

Table 5.1 Drilling Campaigns at Satimola

Owner Year No. of Holes Metres Drilled

Soviet Era Exploration 1963 - 1969 - -

Soviet Era Drilling 1974 74 72,945 m

Satimola 2008 - 2010 46 45,303 m

The drillhole data has been provided by Satimola to Tetra Tech in Microsoft™

Excel format. A total of 118,248 m of diamond drilling has been carried out and

has produced 32,369 samples with 28,613 K2O assays, 13,405 B2O3 assays and

16,910 KCl assays. The locations of the drillholes at the Satimola deposit are

shown in Figure 5.2.


Figure 5.2 Location of Drillholes in the Satimola Deposit

Historically, the Soviets considered the location of their drillhole collars to be

secret and therefore restricted the distribution of their locations. However, period

logs for all holes exist and were cross-checked by Satimola when compiling their

modern database.

Satimola drilling comprises ~ 28% of the total metres, commissioned to check

and validate the findings of the Soviet era drilling campaign. As well as being

close to 28% of the total in metres, approximately 25% of the collars were

twinned or in-filled to validate across as representative region of the deposit as

realistically viable. Details can be found in Table 5.1.

5 . 4 D I R E C T I O N A L S U R V E Y

Only 17 of the historical drillholes had down-the-hole directional survey

measurements available from the archives and the other holes were assumed to

be vertical. Directional survey measurements, at 20 or 100 m intervals, showed

angles from the vertical of up to 23° at a depth of 1200 m from surface for one

extreme drillhole declination. However, the measurements for the other drillholes

averaged about 4°, with a maximum angle of declination at 11°. The maximum

horizontal displacement from the vertical was recorded in drillhole No. 388 (with a


mean dip of 11°) and this resulted in a displacement of 200 m at a depth of 1200

m. Given the general drillhole spacing at the deposit and the simple distribution

of potash values, Tetra Tech believes that such displacement is not material to

the estimate.

5 . 5 G E O L O G I C A L I N T E R P R E T A T I O N

Two separate domains were identified for the Satimola deposit based on

mineralisation type. These domains consist of the Upper Borate rich zones and

Lower Potash rich zones. These are broadly equivalent to the Lower Boron Zone

within the Cap Rock and the Productive Zone of the Primary Salt Mass

respectively. Please refer to Section 2, Geology and Mineralisation for more

detail.

Geological interpretation was based primarily on the IMC 2D seismic survey

findings, in conjunction with salt concentrate intervals identified from assay data

of the drilling.

Assay values determined the domains, which were limited by the S1 and S2 layer

models, the S1 and S2 layers were defined from the 2D seismic survey.

Down hole geophysical logging was conducted on 23 of the historic holes. The

logging suite included gamma, neutron-gamma, spontaneous-potential and

calliper logging.

The results correlated well with the assay values and helped to support the

delineation of the mineralisation.

Satimola geologists produced 2D AutoCAD sections in AutoCAD Digital

Exchange Format (DFX) based on the seismic and drilling data. These sectional

interpretations were then transferred into Datamine™ and converted into 3D

wireframe shapes based on a natural cut-off grade (COG) of 6% K2O, 0.5% for

B2O3. These shapes represent discrete concentrations of either potash or borate,

depending on the zone. The wireframes were then transmitted to Tetra Tech.

Tetra Tech concurs with the use of the natural cut-off that is also supported by

preliminary economic concepts.

Tetra Tech validated the wireframes against the provided seismic interpretations

and Satimola cross sections and is in agreement with the interpretation. It should

be noted that the lateral extension of the Satimola wireframes is limited, in

accordance with the Kazakhstan regulations and represent only a portion of the

overall resource. Tetra Tech, therefore, used the Satimola wireframes in the

resource modelling process to represent the Indicated category resources. The

Inferred category resources were produced using a much larger constraint,

bounded by the seismic survey derived top of salt horizon, to maximum drilling

depth, exclusive of the Satbor wireframe volumes.

The individual mineralised zone wireframes have all been tested for open edges,

shared surfaces and crossovers and all have been verified correctly. Plan views

of the ore zone wireframes are shown in Figure 5.3 (Potash Zone) and Figure 5.4


(Borates Zone). Long Sectional views of the ore zone wireframes are shown in

Figure 5.5 (Potash Zone) and Figure 5.6 (Borates Zone).

Figure 5.3 Plan View of Satimola Potash Mineralised Zone Wireframes

Based on a Cut-off Grade of 6% K2O


Figure 5.4 Plan View of Satimola Borate Mineralised Zone Wireframes

Based on a Cut-off Grade of 0.5% B2O3

Kazakhstan Potash Corporation 5-7 1494750100-REP-L0001-03 Satimola Potash Project- Independent Geologist Report

Figure 5.5 Long Sectional View looking NE of Satimola Potash Mineralised Zone Wireframes Based on a Cut-off Grade of 6% K2O

Figure 5.6 Long Sectional View looking NE of Satimola Borate Mineralised Zone Wireframes Based on a Cut-off Grade of 0.5% B2O3


Table 5.2 Statistical Summary of Samples

FIE

LD

RE

CO

RD

S

SA

MP

LE

S

MIS

SIN

G

MIN

IMU

M

MA

XIM

UM

RA

NG

E

TO

TA

L

ME

AN

VA

RIA

NC

E

ST

AN

DA

RD

DE

VIA

TIO

N

ST

AN

DA

RD

ER

RO

R

SK

EW

NE

SS

KU

RT

OS

IS

GE

OM

EA

N

LO

GV

AR

LO

GE

ST

MN

K2O - Raw 38,341 31,610 6,731 0 57.50 57.50 107,305.80 3.39 47.84 6.92 0.04 3.03 9.97 0.96 3.16 4.69

K2O - Mineralisation 2,948 2,946 2 0 57.50 57.50 46,705.54 15.85 88.78 9.42 0.17 0.71 0.35 12.25 0.81 18.34

B2O3 – Raw 38,341 13,944 24,397 0 74.97 74.97 12,497.41 0.90 8.99 3.00 0.03 8.05 98.74 0.20 3.82 1.37

B2O3 - Mineralisation 1,375 1,340 35 0.03 74.97 74.94 8,101.20 6.05 49.31 7.02 0.19 3.49 17.30 4.03 0.76 5.90


5 . 6 B L O C K M O D E L L I N G

A summary of the model dimensions used is shown in Table 5.3. A parent cell size of

200 x 200 x 20 m (along strike x across strike x vertical) was selected. No sub-cell

splitting was used in the X and Y directions so the minimum block size matches the

parent cell of 200 x 200 m. In the Z direction a single split of the parent cell was sub-

celled inside mineralised wireframes to a minimum value, or thickness, of 10 m.

Plan views of the block model coded by ore zone are shown in Figure 5.7 and Figure

5.8 respectively, describing the variable Z attribute discussed above. Cross section

views of the ore zones are shown in Figure 5.9.

Table 5.3 Summary of Block Model Dimensions

Property Direction

Model Origin

X 587,500

Y 412,500

Z -1500

Parent Cell Size

X 200 m

Y 200 m

Z 20 m

No. Of Parent Cells

X 2,330

Y 2,260

Z 1,000


Figure 5.7 Plan View of Block Model Potash Zones

The section line in Figure 5.7 describes the section in Figure 5.9, below.


Figure 5.8 Plan View of Block Model Borates Zones


Figure 5.9 Example Cross-Section View of Block Model Zones looking SE


5 . 7 D E N S I T Y

The rock density values applied in the modelling process was 1.97 g/cm3. This

value is the same as that derived from Protocol 7092 on the Satimola Deposit,

dated January 1974, the State Reserves Committee used for the asset balance

sheet. The eluvial borate FS of 1986 and in the previous studies Competent

Persons Study (CRS – 2006) a value of 2.0 g/cm3 was used. Therefore to

maintain consistency with the most recent works on the deposit a value of 2.0

g/cm3 was used by Tetra Tech in this estimation.

5 . 8 G R A D E E S T I M A T I O N

Grade estimation was carried out using Inverse Power of Distance Squared

(IDW2) as the principle interpolation method. Nearest Neighbour (NN) was also

used for comparative purposes. The Ordinary Kriging (OK) method was also

used for estimation using estimation parameters defined by the variography. As

the variography showed strongly isotropic behaviour, the OK method was

included for comparative purposes only and IDW selected as the estimation

method.

5 . 9 R E S O U R C E C L A S S I F I C A T I O N

The resource classification for Satimola Mine is classified in accordance with

JORC.

Resources were classified into either the ‘Indicated’ or ‘Inferred’ categories.

‘Indicated’ classification was assigned to blocks within the Satimola provided

wireframes for submission to the Kazakh State Reserves Committee. These

areas represent zones of greatest confidence. ‘Inferred’ categorisation was

based primarily on drillhole spacing and composite sample spacing within the

search ellipse. No blocks were categorised as ‘Measured’ given the sample data

density and type of exploration completed to date.

No Ore Reserves have been estimated for the Satimola deposits. More studies

will be required to determine detailed technical, economic, legal, environmental,

socio-economic and governmental factors required for classification of reserves.

These modifying factors are normally included in a prefeasibility or feasibility

study and are a pre-requisite for conversion of resources to and reporting of, Ore

Reserves.

5 . 1 0 R E S O U R C E E S T I M A T E

5.10.1 TETR A TECH ESTIMAT E , FEBRU AR Y 2011

The resource classification for Satimola Mine is classified in accordance with the

JORC code, 2012 edition. The grades in the final resource block model were


derived from diamond drillhole composites. A complete block model was built up,

reflecting all in-situ mineralisation. An evaluation of the unmined, in-situ block

model is shown in Table 5.4 and Table 5.5 at a range of Cut-off grades in the

Potash zones and in the Borate Zones. The effective date of the estimate is 28th

February 2011.

Tonnages and grades are reported at a range of cut off grades, which reflect the

deposits reasonable prospects for eventual economic extraction by conventional

underground methods in light of any market fluctuations since this report was

produced. This is due to the fluctuating Potash Market price over time. Prices

have varied considerably over recent years, from a low of US $150 per tonne (/t)

in 2007 to a peak of US $1000 /t in 2008. Prices dropped in 2009 to US $350 /t

and increased to US $526 /t in 2010. The spot price for October 2014 is $287 /t.

The following Resource tables demonstrate reasonable prospects for eventual

economic extraction at a range of prices based upon inclusive mining, process

and general and administration costs of US $100 /t, assuming a processing

recovery of 95% and potash prices as previously described.

Table 5.4 Tetra Tech Mineral Resource Estimate for Satimola Mine

Potash Zones as of 28th

February 2011 (COG of 5% K2O)

JORC Classification

Tonnes (t) (Billions)

Density (t/m

3)

K2O (%)


Inferred 19.2 2.0 7.8

Total 23.1 8.9




JORC Classification


Density (t/m

3)

K2O (%)


Inferred 2.9 2.0 14.7

Total 6.0 15.5




JORC Classification


Density (t/m

3)

K2O (%)


Inferred 1.0 2.0 19.6

Total 2.5 20.1



Borate Zones as of 28th

February 2011 (COG of 2% B2O3)

JORC Classification


Density (t/m

3)

B2O3 (%)

Indicated 0.37 2.0 6.58

Inferred 1.39 2.0 3.53

Total 1.76 4.17




JORC Classification


Density (t/m

3)

B2O3 (%)

Indicated 0.21 2.0 9.49

Inferred 0.40 2.0 5.62

Total 0.61 6.95




JORC Classification


Density (t/m

3)

B2O3 (%)

Indicated 0.14 2.0 11.76

Inferred 0.14 2.0 7.25

Total 0.28 9.51

The Tetra Tech estimate produced in 2010 is still considered current and relevant

as there have been no material changes to the project since this time. No further

exploration or drilling has been conducted.


6 . 0 C O N C L U S I O N S A N D R E C O M M E N D A T I O N S

6 . 1 R E S O U R C E A N D G E O L O G Y

Satimola potash resources have been estimated and reported according to JORC

2012 guidelines as 8.5 Billion tonnes. This is considered to be sufficient to

sustain a mining operation into the foreseeable future. The resources lie at an

estimated average depth of between 400 and 1250 m, lying mainly horizontally,

at mineable thicknesses. They are overlain by layers of clay and sand

sediments, clay siltstone, marly clay and gypsum and are amenable to access by

shafts. A shaft sinking study is recommended to assess the shaft sinking in

terms of best methodology, water make, etc.

6 . 2 E X P L O R A T I O N A N D D A T A Q U A L I T Y

Following the 2008/10 drilling campaign it is concluded that sufficient exploration

drilling of a satisfactory standard has been carried out for the Resource to be

Classified and Reported in accordance with the JORC code (2012 edition).

As no drilling or exploration has been completed since the Resource was initially

reported, this Resource is considered current and valid based on a review of the

Resource Estimate and it’s supporting data in July 2014 to be compliant with the

JORC code, 2012 edition.

Further exploration drilling is not recommended at this time.

The initial interpretations by IMC 2D seismic survey showed that structurally, the

primary salt layers were sub-horizontal.

It is considered that a further 3D seismic survey, although beneficial, may not be

cost effective.

The Data QA/QC System appears to be excellent and conforms to international

best practice.

6 . 3 C O N C L U S I O N S

In summary, Tetra Tech believes the Satimola Potash and Borate resource

and the Satimola Project in general to be robust and would recommend the

project development be continued to Pre-Feasibility Level.

Kazakhstan Potash Corporation 7-1 1494750100-REP-L0001-03 for the Satimola Potash Project- Independent Geologist Report

7 . 0 R E F E R E N C E S

An Interpretation of 2-d Seismic Data from Satimola, Kazakhstan, for Satimola Limited. IMC Geophysics International Limited, October 2009.

Competent Person’s Report on the Satimola Potash Deposit, Kazakhstan:

Mineral Resource Estimation and Evaluation. R. M. Rhodes, Computer Resource Services (UK) (“CRS”), August 2009.

Potash Project, Competent Person’s Report for Satimola limited. Tetra Tech,

November 2011. Satimola Boron-Potash Project The Development Concept, Prepared by ZUMK

Engineering for Satimola Ltd. (“The ZUMK Report”), September 2010. Satimola Limited gave Tetra Tech WEI Inc. full disclosure of all data and materials requested that contributed to the making of this report.

APPENDIX A

JORC TABLE

JORC TABLE 1

Section 1 Sampling Techniques and Data

(Criteria in this section apply to all succeeding sections)

Criteria Explanation

Sampling Techniques Samples were taken from half core every 1m and analysed with a PAN analytical Minipal 4 XDXRF calibrated by an external service engineer annually.

Drilling Techniques Drilling was done by Longyear LF-230 and Lf-90 rigs, as well as a Schramm rig. Conventional tubing was used as ground conditions were generally excellent.

Core diameter ranged from PQ (85 mm) to NQ (47.6 mm). Top hole was cased to varying depths, depending on water inflow and hole conditions.

Drilling was at 1000 m centres with 500 m infill.

2D seismic survey transepts across the entire site were completed to aid geological interpretation to a depth in excess of 1,500 m. Seismic shots are fired and the two-way travel times are recorded by geophones. Actual equipment specification used was not recorded.

Drill Sample Recovery

Core was logged geotechnically and geologically and recorded in passports.

Core recovery was in excess of 95%, typically 100% recovered. Typically the only losses were in carnallite or top-hole.

No bias was identified between grade and sample length, or due to preferential loss of material.

Logging Core was logged geotechnically and geologically into passports.

Passports were transferred to digital logs by the logging geologist.

Logging is to a standard suitable for the support of a Mineral Resource Estimate. All intersections were logged, although only areas of mineralogical interest were assayed.

Sub-sampling techniques and sample preparation

Core was logged, photographed, sawn in half, and processed for assay.

Sample preparation included 0.5 m standard sample with minimum 0.1m sample to avoid samples across geological boundaries.

No samples crossed logged boundaries to ensure representivity of type.

Core was sawn, crushed, sub-sampled, tagged, bagged and sealed for shipment to the labs. Samples were typically 100 g aggregated and reduced to 27 – 42 mm diameter by < 40 mm high compressed disc suitable for the XDXRF. Care was taken to ensure that the samples are representative of the whole with regards to grain size and composition.

Reject is suitably stored on site in the core storage facility

The nature and quality of the prepared samples was excellent

Quality of Assay Data and Laboratory Tests

QA/QC samples of standards, duplicates and blanks were inserted into the sample stream at suitable intervals. 10% of the samples were QA/QC inserted randomly into each batch. This equates to approximately 3500 QA/QC samples evenly split between the sample types.

Measures were taken for representivity including field duplicates, and that the full geology was sampled.

The lab was tested by QA/QC and also by using a second lab for check.

assay on a 500 g sample, using SGS Ontario.

Acceptable levels of precision and accuracy have been established.

Verification of Sampling and Assaying

A variety of randomly selected drill core intercepts were inspected during the site visit, photographed, and compared to original logs.

No independent check samples were taken by Tetra Tech as the QA/QC programme was considered robust.

Some of the modern holes twinned historical holes for verification.

Documentation protocols are excellent with well-established chain of custody, recording, and storage of data.

Redundancies were in place to protect against loss.

No adjustment was made to the database as no error was found.

Location of Data points

A number of historical and modern collars were inspected in the field.

A number of collar locations were independently verified by handheld GPS.

Although a local mine grid has been in use, all data is presented in UTM, zone 39U.

Topographic survey is adequate as the deposit is on the Kazakh Steppe, at sea level, with no observable changes in elevation.

Data Spacing and Distribution

Data spacing for the reporting of Resource is nominally 1 km, with areas of 500 m infill

The data spacing and distribution is suitable to for a level of confidence in geological and grade continuity to support an Indicated and Inferred Resource.

Orientation of Data in Relation to Geological Structure

The geology is horizontally strataform. Vertical drill holes achieve unbiased samples.

2D seismic survey transepts were completed which help with the understanding of vertical structures not picked up by drilling.

Sample Security Chain of custody is very well controlled, and sample security is excellent. All samples are stored in plastic core boxes, stacked on metal shelving and locked in a purpose built insulated core storage warehouse. The building can be considered very secure.

Only 3 keys are available to access samples. The geologist, mine manager, and security hold one key each. 2 persons are required to unlock the facility so no one person has sole access to the samples.

Audits or Reviews A review of the sampling techniques and data found all data and processes to be suitable to support a Mineral Resource Estimate.

Section 2 - Reporting of Exploration Results

(Criteria listed in the preceding section also apply to this section)

Mineral Tenement and Land Tenure Status

Licenses and tenure documents were inspected on the site visit in November 2010, Licence number 1391.

Licence 1391 Co-ordinates (2009)

Point Latitude Longitude

1 49°02’00” 52°17’00”

2 48°56’00” 52°27’00”

3 48°51’00” 52°29’00”

4 48°50’00” 52°23’00”

5 48°54’00” 52°15’00”

6 49°01’00” 52°13’00”

The documents were inspected to be current and valid until 2020.

Exploration done by Other Parties No exploration has been conducted by other parties.

Geology The deposit is a strataform evaporite sequence containing high concentrations of borate and potash salts with potential for eventual economic extraction.

Drilling A tabulation of all the drill collars is provided as an Appendix to the Resource Estimate.

A scaled plan view of all collars is presented.

Data Aggregation Methods

No exploration results have been disclosed in the report.

All samples were used in their raw state to define zones of mineralisation.

Selected samples were composited to a best fit routine.

No top or bottom data cuts were applied as there was no statistical support for doing do.

No metal equivalents were used. K2O from total salt was derived by the assay laboratory.

Relationships between Mineralisation Widths and Intercept Lengths

Vertical drilling into horizontal strataform deposit means there is negligible difference between apparent and true widths. As such all lengths are treated as true.

Diagrams Diagrams of plan sections and long sections are presented to scale.

Balanced Reporting The range of the raw data is fairly presented in the methodology and by log-histogram plotting.

Other Substantive Exploration Data

2D seismic transverse sections were collected, and referenced during the construction of geological models.

Further Work Recommendations were made for further work, including a shaft sinking study, and further analysis of the different salt types present.

Section 3 - Estimation and Reporting of Mineral Resources

(Criteria listed in section 1, and where relevant in section 2, also apply to this section.)

Database Integrity >10% of the electronic database was cross-referenced with primary data to ensure no transcription errors, or similar, were present

No errors were found in the database during all reasonable checks

Site Visits A site visit was made by the project geologist in November 2010. No work has been done on site relating to the collection of samples or material to the resource, so this site visit can be considered current with respect to the Mineral Resource Estimate

Geological Interpretation

Confidence in the geological continuity is very high, supported by drilling and 2D seismic survey

The data comprises 73,000 m of historical data supported by 45,300m of modern data for a total of 118,300 m of sampling.

The historical data was tested against the modern data and no bias was observed.

No material effect would be expected from alternative interpretations for mineralised zone this large, supported by this data.

Geology has been used, as far as possible, to constrain and control the estimate of the Mineral Resource.

Grade continuity is controlled by variographic study, while geological continuity is understood from drilling and seismic data.

Dimensions The mineralisation is relatively homogenous within the various salt horizons lending to large search ranges supported by variograms. The strike is in excess of 20 km, across strike in excess of 10 km.

The mineralisation starts from approximately 300m below surface and continues to depths in excess of 1,500 m below surface.

Estimation and Modelling Techniques

An inverse distance (ID) weighted estimate to the 2nd power was used to estimate the grade. This estimate was supported by variography. A kriged estimate was also run, and the results were similar to the ID estimate. The ID estimate was used for reporting as the deposit is strongly isotropic and block sample performance was better with ID.

No statistically biased high grades were identified during exploratory data analysis so no grade caps were applied.

Two domains were created based on current and historic GKZ sectional interpretations used to help define the confidence of the estimate. A separate borate domain was estimated as well as the main potash zone. No further domains of specific salts were created. The estimation was based on K2O values for the potash zone and B2O3 for the borate zone.

Interpolation parameters were derived from variographic analysis of the data set. Search distances were determined from the range of the variogram. Maximum extrapolation for inferred resource was unconstrained as a distance buffer of this range. The seismic data, and therefore geological confidence, exceeded the distance supported by the range of the variogram.

All modelling and estimation was done in CAE Datamine Studio 3.

A previous estimate was completed by CRS consulting and preceded this estimate. Various historical estimates were also completed for submission to the SRC (State Reserves Committee). The current estimate accounted for previous estimates.

There has been no production at Satimola with which to test the estimate.

No assumptions have been made for the treatment or recovery of by-products. Where possible, information about by-products has been described in the relevant processing section, and is not material to the Mineral Resource Estimate

No estimation has been made for deleterious materials. Carnallite is present in the logs, which has recovery implications as it is a hydrous mineral. Tetra Tech recommends further studies on the constituent salts present at Satimola.

Blocks sizes were defined at 200 m in the X and Y dimensions. Sample spacing ranged between 400-1,000 m, with drill centres nominally at 500 or 1,000 m.

Sub-cells were used, but the grade interpolation was performed into the parent cell.

No assumptions have been made with regards to a Selective Mining Unit (SMU)

No assumptions have been made upon correlation of variables. The interpolation is based on univariate statistics and block estimation.

The estimate was constrained geologically within units identified in the seismic data, as well as geological units logged in core. Domains were constrained at the sample point upon lithological breaks, and the seismic data was used as a guide for the domain interpolation. Extrapolation beyond data limits was constrained by the last known sample point, plus extrapolation using the seismic as a guide to the maximum range of the variogram.

Grade capping was not deemed necessary as there were no statistically bias samples present. Parrish analysis and decile analysis was used to determine the proportions of grade in the top decile, and the relative amount of metal was demonstrated to be within acceptable limits for not capping.

Block grade estimates were validated by visual inspection and comparison of block and sample grades. The estimation performed as expected with no unacceptable bias introduced during the grade interpolation process.

Moisture The model is based on wet densities. Density determinations were performed on raw sample, and then kiln dried and performed dry. Archimedes’ determinations were not produced as salt is extremely hydrophilic.

Cut-off Parameters Mineral Resources are presented at a range of cut-off grades to demonstrate the potential economic viability over time. Each scenario could be deemed economic dependant on mining considerations, throughput and therefore CAPEX requirements.

Cut-off grades were determined by analogous deposits and potential throughputs and basic cost assumptions.

Mining Factors or Assumption

Basic mining assumptions were made with regards to expected methods (conventional), shaft sinking, and expected mining rates.

Metallurgical Factors or Assumptions

Basic metallurgical assumptions were made with regards to expected processing methods, recoveries from test work and expected throughputs.

Environmental Factors or Assumptions

Socio-environmental studies were reviewed and commented on for this study. Assumptions were made with regards to Environmental Impact Assessment and the acquisition of necessary licences to progress the project

Bulk Density The model is based on wet densities. Density determinations were performed on raw sample, and then kiln dried and performed dry. Archimedes’ determinations were not produced as salt is extremely hydrophilic.

Classification The basis for the classification was geological continuity and confidence in grade continuity. Mineralised domains were produced by Satbor for the SRC into C1 and C2 category. After reviewing the geostatistics and with the level of geological understanding, these shapes were classified as Indicated Resources. Inferred Resources were unconstrained by salt horizons, but well within the geological continuity understood from seismics. The maximum extrapolation distance was defined by variographic maximum ranges.

Audits or Reviews An internal peer review was conducted for each study that this report summarises. No external reviews or audits have been completed.

Discussion of Relative Accuracy/Confidence

A proportion of the resource is defined as Indicated and there is enough statistical support, confidence in the grade interpolation, geological continuity, grade continuity, and other factors to support this.

The rest of the resource is in Inferred as there is less geological support. The grade continuity is relatively well understood although this cannot be applied to discrete mineralised domains.

APPENDIX B

COLLAR LOCATIONS AT SATIMOLA

B-1

Collar locations at Satimola

All holes are vertical so azimuths are not recorded.

Collar X location Y location Elevation

2 591,886.79 430,845.97 -0.60

3 593,149.15 432,183.69 -0.19

4 595,717.31 428,817.50 -0.11

5 594,377.96 422,356.38 -0.10

6 598,172.92 425,610.40 0.70

7 601,222.88 417,923.10 -0.18

8 599,940.73 416,603.23 -0.49

9 604,029.67 420,856.18 0.90

10 602,668.29 419,404.38 0.94

11 604,895.11 415,988.51 0.13

12 590,785.88 432,991.95 0.54

14 589,407.12 431,607.31 0.66

15 592,766.48 426,273.80 0.08

16 602,926.45 422,422.50 1.71

19 594,505.02 430,408.64 0.49

20 594,234.44 427,505.92 0.44

21 597,217.77 430,139.00 0.40

22 596,714.03 427,521.30 0.97

23 596,606.78 424,287.06 0.49

24 597,964.16 420,081.47 0.33

25 599,102.42 421,098.03 0.50

26 600,584.41 422,410.89 1.08

27 596,443.24 418,764.93 0.49

28 597,897.96 422,638.77 0.50

29 595,206.59 426,202.08 0.27

31 596,414.49 421,293.00 -0.03

32 599,108.00 421,104.00 0.50

34 593,012.18 429,242.81 0.70

35 599,382.19 424,019.49 1.01

36 601,589.54 420,926.88 0.91

37 600,334.63 419,531.16 0.16

38 603,732.11 417,697.04 0.83

42 593,735.82 424,899.66 0.33

43 595,485.50 423,325.69 -0.46

45 594,940.46 419,932.08 0.54

46 598,994.39 418,048.49 -0.32

48 602,355.56 416,287.37 -0.25

51 605,183.08 419,188.62 0.07

55 600,956.31 414,862.52 -0.23

57 607,434.07 415,529.69 -0.19

79 603,278.57 414,812.40 -0.16

81 606,512.11 417,166.39 -0.17

B-2

82 591,448.11 428,017.03 0.06

83 596,430.33 418,755.09 0.66

102 599,978.10 416,639.44 -0.20

108 598,400.00 423,088.00 0.67

111 598,896.00 421,930.00 0.80

112 599,826.00 420,734.00 0.30

190 601,243.56 417,939.56 -0.27

191 602,682.94 419,418.40 1.09

204 599,106.00 419,772.00 0.30

205 598,752.00 421,800.00 0.63

231 599,676.00 420,602.00 0.20

232 599,862.00 421,440.00 0.60

233 597,903.60 420,070.38 0.27

264 600,316.00 421,516.00 0.30

280 596,367.04 421,255.19 -0.05

281 595,517.42 423,349.21 -0.21

282 601,044.52 422,821.23 1.11

283 593,482.88 418,573.41 -0.22

284 592,863.42 421,029.05 -0.22

285 596,078.76 431,637.96 -0.07

338 600,855.38 420,632.91 0.87

380 596,621.34 424,306.20 0.63

381 594,401.18 422,368.60 -0.47

382 598,208.40 425,640.10 1.13

383 593,279.77 421,395.31 -0.02

384 595,244.46 426,220.22 0.55

385 596,741.33 427,523.90 1.22

386 594,273.49 427,538.80 0.33

387 595,756.11 428,850.20 -0.12

388 594,545.00 430,442.32 0.52

389 591,922.99 430,883.92 -0.60

390 597,795.23 416,923.93 -0.75

396 597,689.06 419,842.91 0.25

512 599,344.00 422,330.00 0.80

513 600,201.00 421,066.00 0.50

514 600,161.00 421,706.00 0.50

28144 598,170.93 420,847.46 0.53

28147 598,267.94 420,732.84 0.40

PR1 599,261.51 421,590.01 0.60

PR10 598,852.55 422,179.49 0.76

PR12 599,903.99 420,451.89 0.46

PR14 600,519.99 420,975.89 0.90

PR16 601,402.75 421,726.27 0.56

PR18 600,963.11 420,690.11 0.94

PR2 599,570.09 421,172.80 0.51

PR20 601,560.76 421,210.69 0.80

PR23 599,910.04 419,028.39 0.21

B-3

PR24 600,616.06 419,661.80 0.24

PR26 601,336.89 420,308.75 0.88

PR27 601,961.42 420,868.82 0.82

PR4 597,816.43 421,942.89 0.32

PR5 597,552.43 419,713.50 0.23

PR6 598,445.99 422,485.89 0.49

PR8 598,227.99 421,620.88 0.55

PR9 598,530.11 421,891.78 0.60

SP1 596,124.06 425,129.67 0.36

SP12 599,122.88 419,767.54 0.63

SP14 597,127.58 419,362.96 0.21

SP15 598,244.09 420,344.41 0.40

SP16 596,368.34 420,020.92 -0.14

SP18 597,135.36 420,662.86 -0.71

SP19 595,647.98 420,560.21 0.31

SP2 596,492.01 424,067.72 0.39

SP20 596,751.75 421,574.69 -0.44

SP21 597,120.53 421,912.42 -0.34

SP22 595,261.55 421,678.70 0.96

SP23 596,007.92 422,339.54 1.07

SP24 595,153.14 423,006.19 -0.37

SP25 598,048.86 424,143.57 0.55

SP26 593,196.12 430,770.84 -0.40

SP27 593,880.10 431,500.19 -0.42

SP29 593,173.44 431,476.75 -0.23

SP3 597,249.67 423,542.33 0.58

SP30 593,514.97 431,841.95 -0.21

SP31 593,491.43 432,547.87 -0.61

SP33 592,443.08 432,159.85 -0.73

SP34 592,784.80 432,525.03 -1.44

SP36 594,563.14 432,230.63 -1.10

SP4 598,381.76 417,474.06 -0.26

SP5 592,807.78 431,818.10 -0.24

SP6 594,779.31 422,684.12 -0.68

SP7 600,853.76 417,615.93 -1.05

SP8 598,364.11 419,116.30 0.35

SP9 599,232.46 418,402.33 -0.07

Ground Floor, Unit 2, Apple Walk, Kembrey Park, Swindon, SN2 8BL, United Kingdom

Tel: +44 1793 512305 www.tetratech.com

Mr. Joe Hirst. B.Sc., M.Sc., EurGeol, FGS, CGeol

Pursuant to the requirements of ASX Listing Rules 5.6, 5.22 and 5.24 and Clause 9 of the JORC Code

2012 Edition (Written Consent Statement)

Kazakhstan Potash Corporation Limited

15th October 2014

I, Joe Hirst, confirm that I am the Competent Person for the Report and:

I have read and understood the requirements of the 2012 Edition of the Australasian

Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC

Code, 2012 Edition).

I am a Competent Person as defined by the JORC Code 2012 Edition, having five years’

experience that is relevant to the style of mineralisation and type of deposit described

in the Report, and to the activity for which I am accepting responsibility.

I am a Chartered Geologist with The Geological Society of London, a Recognised

Professional Organisation under JORC.

I have reviewed the Report to which this Consent Statement applies.

I am a consultant working for Tetra Tech WEI Incorporated and have been engaged by

Kazakhstan Potash Corporation Limited, to prepare the documentation for The Satimola

Project, on which the Report is based, for the period ended 15th October 2014.

I have disclosed to the reporting company the full nature of the relationship between myself

and the company, including any issue that could be perceived by investors as a conflict of

interest.

I verify that the Report is based on and fairly and accurately reflects in the form and context in

which it appears, the information in my supporting documentation relating to Exploration

Targets, Exploration Results and Mineral Resources.

I consent to the release of the Report and this Consent Statement by the directors of Tetra Tech

WEI Inc. 1494750100-REP-L0001-03 1494750100-REP-L0001-03 1494750100-REP-L0001-03 1494750100-REP-L0001-03

15th October 2014 Signature of Competent Person:

The Geological Society of London

Date:

1007756

Professional Membership:

1494750100-REP-L0001-03

1494750100-REP-L0001-03

1494750100-REP-L0001-03

1494750100-REP-L0001-03

Membership Number:

D S Fairclough

Cheltenham, United Kingdom

Signature of Witness : Name and Residence of Witness:

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