Berkeley Eng Regulatory News (BKY)

BERKELEY RESOURCES LIMITED

AIM RELEASE | 30 APRIL 2014 | ASX/AIM:BKY

MARCH 2014 QUARTERLY REPORT

Berkeley Resources Limited ('Berkeley' or the 'the Company') is pleased to present its quarterly report for the period ended 31 March 2014. The Company's primary focus during the period continued to be the advancement of the Salamanca Project located in Spain. Highlights during and subsequent to the end of the quarter include:

· Exploitation Concession ('Mining Licence') for Retortillo granted by Regional Government:

Ø Valid for an initial period of 30 years, renewable for two further periods of 30 years;

Ø Covers an area of 25.2km2 and includes the entire area containing the Retortillo deposit;

Ø Retortillo deposit forms part of the integrated Salamanca Project and is the first resource from which production is scheduled to commence; and

Ø With the grant of Mining Licence, the approval processes associated with other key permits, including the Initial Authorisation of the process plant as a radioactive facility and the Exceptional Authorisation for Land Use (application for reclassification from rural to industrial use) of the affected surface land area at Retortillo, may now be finalised.

· Finalisation of the Scope of Work for the Salamanca Project Definitive Feasibility Study ('DFS'):

Ø Key areas of focus will include resource infill drilling programs, further metallurgical testwork programs, including additional six metre column leach work, development of a Geo-Met model which will incorporate additional geological and metallurgical parameters into the resource block model to support metallurgical process modelling and mine planning and optimisation, and enhanced design of the project infrastructure and site facilities; and

Ø The Company will commence work programs for key inputs to the DFS, including metallurgical testwork and hydrogeological studies, during the current quarter.

· Planning for the next phase of drilling at Zona 7 finalised:

Ø Previous drilling program at Zona 7 recorded significant high grade intersections at shallow depths and essentially doubled the strike extent of the mineralised zone. Better intercepts included 29 metres @ 3,391 ppm U3O8, 17 metres @ 1,260 ppm U3O8, 15 metres @ 1,392 ppm U3O8, 25 metres @ 683 ppm U3O8, and 13 metres @ 1,161 ppm U3O8;

Ø Current drill program will comprise approximately 600 metres of diamond core and 2,500 metres of reverse circulation drilling. The program has been designed to close the existing drill pattern down to a notional 100 metre by 100 metre pattern to facilitate the estimation of a revised Inferred Mineral Resource for Zona 7; and

Ø Drilling will commence in May.

Enquiries: Robert Behets

Berkeley Resources

+61 8 9322 6322

John Prior/ Huw Jeremy - Nomad & Broker

Numis Securities

+44 (0) 207 260 1000

OPERATIONS

Berkeley Resources Limited ('Berkeley' or 'the Company') is a uranium exploration and development company with a quality resource base in Spain. Berkeley is currently focused on advancing its wholly owned flagship Salamanca Project.

Salamanca Project

Berkeley's flagship Salamanca Project comprises the Retortillo, Alameda and Gambuta deposits, plus a number of other Satellite deposits located in western Spain.

Pre-Feasibility Study

In September 2013, the Company completed a Preliminary Feasibility Study ('PFS') on the integrated development of Retortillo and Alameda, which clearly demonstrated the Salamanca Project's potential to support a significant scale, long life uranium mining operation (refer ASX announcement dated 26 September 2013).

Using only the current Mineral Resource Estimates ('MRE') for Retortillo and Alameda, which total 34.5 million pounds U3O8 (36.9 million tonnes at 424 ppm; 200 ppm U3O8 cut-off grade), as a base case scenario, the Project can support an average annual production of 3.3 million pounds of U3O8 during the seven years of steady state operation and 2.7 million pounds of U3O8 over a minimum eleven year mine life. There is strong potential to increase the production profile and/or mine life through the exploitation of additional resources held by the Company (totalling 27.1 million pounds U3O8) and with ongoing exploration work.

The PFS was based on open pit mining, heap leaching using on-off leach pads, a centralised process plant at Retortillo, and a remote ion exchange operation at Alameda, with loaded resin trucked to the centralised plant for final extraction and purification. The open pits are shallow (maximum depth of 135m) with low strip ratios (average 1:2.1 ore to waste for the Project over the life of mine). During steady state operation the annual ore processing rate is 5.5 million tonnes. Operating costs (C1 cash costs) average US$24.60 per pound U3O8 over the life of mine.

The initial capital cost (nominally ± 20% accuracy) for the Project is estimated at US$95.1 million. This cost is inclusive of all mine, processing, infrastructure and indirect costs required to develop and commence production at Retortillo. A further US$74.4 million of capital, incurred in the second year of production, is required to develop Alameda and achieve steady state operation. The Project's capital cost reflects the excellent existing infrastructure, use of heap leaching as the preferred processing route, and the favoured mining contractor scenario (no mining fleet capital expenditure).

Key parameters used in the PFS included:

· Ore Processing Rate 5,500,000 tonnes per annum (steady state)

· Mining Cut-off Grades 105 ppm U3O8 for Retortillo and 90 ppm U3O8 for Alameda

· Metallurgical Recovery 85%

· Uranium Price US$65 per pound U3O8

· Exchange Rate US$/€ 1.28

Definitive Feasibility Study

A number of opportunities to further enhance the Project economics through capital and operating cost reductions were identified in the PFS. The Company has undertaken a comprehensive review of the PFS with a view to assessing these opportunities and defining key work programs to be incorporated into the final scope of the Definitive Feasibility Study ('DFS').

Following completion of this review, the Scope of Work for the DFS has been finalised. The key areas of focus will include:

· Resource infill drilling programs aimed at upgrading the classification of specific portions of the current Retortillo and Alameda MRE's to the Measured category;

· Further metallurgical testwork programs, including additional column leach work (six metre columns), in combination with ion exchange ('IX') at Alameda and solvent extraction ('SX') and ammonium diuranate ('ADU') precipitation at Retortillo to generate more detailed information relating to the pH and acid consumption optimisation, design and sizing of the IX and SX units, and final product specification;

· Development of a Geo-Met model which will incorporate additional geological and metallurgical parameters into the resource block model to support metallurgical process modelling and mine planning and optimisation;

· Open pit optimisation, detailed mine design and production scheduling using the upgraded MRE block models;

· Enhanced design of the project infrastructure and site facilities;

· Undertaking engineering studies to support capital and operating cost estimates for the Project to a level of accuracy of nominally ±10%; and

· Undertaking an evaluation of the various alternatives for funding the development of the Project and the sale of future uranium production (including uranium marketing and off-take arrangements).

During the quarter, detailed work programs have been developed for the metallurgical testwork to be conducted at the Mintek mineral processing facility in Johannesburg and the hydrogeological studies for both Retortillo and Alameda. These work programs will commence during the current quarter.

Development of Geo-Met models for Retortillo and Alameda was advanced during the quarter. The existing geological and metallurgical databases were interrogated to assess the available data and determine the key parameters to be captured and modelled. Preliminary 3D models incorporating lithology, structure, weathering and geochemical data for uranium, calcium, magnesium, iron, sulphur and manganese, have been constructed. Metallurgical data (actual or correlated) including uranium solubility, uranium recovery, acid consumption etc. will now be incorporated. The 3D Geo-Met models will be refined on an ongoing basis, with the addition of new geological and metallurgical data and updated interpretation.

The detailed design of the resource infill drilling programs, which are aimed at upgrading the classification of specific portions of the current Retortillo and Alameda MRE's to the Measured category, has also been finalised.

Permitting

A major permitting milestone was achieved subsequent to the end of the quarter with the grant of the Exploitation Concession ('Mining Licence') for Retortillo by the Regional Government of Castilla and León (refer ASX announcement dated 24 April 2014). The Retortillo deposit forms part of the Salamanca Project and is the first resource from which production is scheduled to commence.

The grant of the Mining Licence for Retortillo is a major milestone for the Company and follows the approval of Exploitation and Reclamation and Closure Plans for the proposed mining operation submitted by Berkeley, and the completion of a number of studies and technical review sessions with relevant government agencies. The granting of the Mining Licence has also taken into account the prerequisite approval of the Company's Environmental and Social Impact Assessment ('ESIA') by the environmental authorities (the Environmental Licence for Retortillo was awarded in October 2013), and the favourable recommendation report issued by the Nuclear Safety Council.

The Mining Licence is valid for an initial period of 30 years and may be renewed for two additional periods of 30 years. It covers an area of 25.2km2 and includes the entire area containing the Retortillo Mineral Resource Estimate.

With the grant of the Mining Licence, the approval processes associated with other key permits including the Initial Authorisation of the process plant as a radioactive facility and the Exceptional Authorisation for Land Use (application for reclassification from rural to industrial use) of the affected surface land area at Retortillo, may now be finalised.

The documents required for the next phase of permitting at Alameda, including the Exploitation Plan, Reclamation and Closure Plans, and the ESIA were completed during the quarter and will be submitted to the relevant authorities during the current quarter. The Environmental Scoping Document ('ESD') will also be re-submitted having been updated to incorporate the latest results from the PFS and inputs from the granting of the Environmental and Mining Licenses for Retortillo.

Exploration

No drilling was completed during the quarter however, the planning for the next phase of drilling at Zona 7 was finalised.

Zona 7 is located approximately 10 kilometres to the northwest of the proposed location of the centralised processing plant at Retortillo and currently hosts an Inferred Mineral Resource Estimate ('MRE') of 3.9 million tonnes averaging 414 ppm U3O8 for a contained 3.6 million pounds of U3O8 at a lower cut-off grade of 200 ppm U3O8 (refer ASX June 2012 Quarterly Report).

Assay results returned from an 18 hole reverse circulation ('RC') drilling program in August 2013 confirmed that the Zona 7 mineralisation extends a further 1,200m to the southwest of the current resource area. The drilling, which was carried out on an approximately 400m by 100m grid, essentially doubled the strike extent of the mineralised zone and it remains open. Significant high grade intersections were recorded at shallow depths (from 9m to a maximum depth of 84m), with thicknesses up to 29m. Better intercepts included 29m @ 3,391 ppm U3O8, 17m @ 1,260 ppm U3O8, 15m @ 1,392 ppm U3O8, 25m @ 683 ppm U3O8 and 13m @ 1,161 ppm U3O8 (refer ASX announcement dated 7 August 2013).

The current Zona 7 program, which will comprise approximately 600m of diamond core and 2,500m of reverse circulation ('RC') drilling, is aimed at infilling the zone of mineralisation defined by the 2013 drilling and extending it further to the south-west. The program has been designed to close the existing drill pattern down to a notional 100m by 100m pattern to facilitate the estimation of a revised Inferred Mineral Resource for the prospect. The drilling will be conducted during May and June.

CORPORATE

At 31 March 2014, the Company had cash reserves of A$21.5 million.

In April 2013, Shareholders approved Berkeley's Performance Rights Plan. The Plan is designed to reward superior performance based on materially improved Company performance in terms of growth in the value of the Company and resulting increases in Shareholder value. The Company granted 490,000 Performance Share Rights to employees and consultants of the Company in March 2014.

Competent Persons Statement

The information in this Report that relates to Exploration Results and Mineral Resources is based on information compiled by Craig Gwatkin, who is a Member of The Australian Institute of Mining and Metallurgy and was an employee of Berkeley Resources Limited at the time of initial disclosure. Mr. Gwatkin 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 2004 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Mr. Gwatkin consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. This information was prepared and first disclosed under the JORC Code 2004. It has not been updated since to comply with the JORC Code 2012 on the basis that the information has not materially changed since it was last reported.

The information in this Report that relates to the Pre-Feasibility Study is based on information compiled by Neil Senior of SENET (Pty) Ltd. Mr. Senior is a Fellow of The South African Institute of Mining and Metallurgy and 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 2004 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Mr. Senior consents to the inclusion in this Report of the matters based on his information in the form and context in which it appears. This information was prepared and first disclosed under the JORC Code 2004. It has not been updated since to comply with the JORC Code 2012 on the basis that the information has not materially changed since it was last reported.

Forward Looking Statement

Statements regarding plans with respect to the Company's mineral properties are forward-looking statements. There can be no assurance that the Company's plans for development of its mineral properties will proceed as currently expected. There can also be no assurance that the Company will be able to confirm the presence of additional mineral deposits, that any mineralisation will prove to be economic or that a mine will successfully be developed on any of the Company's mineral properties.

Appendix 1: Summary of Mining Tenements

As at 31 March 2014, the Company had an interest in the following tenements:

No tenements were acquired or disposed of during the quarter ended 31 March 2014. There were no changes to beneficial interest in any mining tenements due to Farm-in or Farm-out agreements. No beneficial interest in Farm-in or Farm-out agreements were acquired or disposed during the quarter.