Exploration

Kinsevere (DRC)

Overview

Kinsevere is set to become Anvil's biggest investment in the DRC. The project will include a major open cut mining operation, a heavy media separation plant, two (2)  electric-arc furnaces and a 60,000 tonnes per year Solvent Extraction and Electrowinning ("SX-EW") copper facility.

In February 2009, the Company announced an updated Measured and Indicated Mineral Resource estimate for its Kinsevere project of 29.8 million tonnes of ore at an average grade of 3.8% for 1.12 million tonnes of contained copper.

Exploration Update

Conclusion of Phase 4 drilling has advanced the reserve modelling for Kinsevere Hill and the Kinsevere Hill extension, with optimization of an enlarged oxide pit currently underway. 

 Kinsevere Mineral Resource Estimate

Comparisons with the year-end 2007 estimate reflect an overall reduction in the oxide Mineral Resource but an increase in the sulphide Mineral Resources.  Tonnage increases associated with extensional drilling were offset by mining depletion, together with changes in modelled density and to a lesser extent, grade.  Material mined and now in stockpile for the Stage II Solvent Extraction-Electrowinning ("SX-EW") development amount to 2.7 million tonnes at 2.72% Cu (excluding stockpiles from the Heavy Media Separation ("HMS") plant.  At this time, preliminary pit optimizations and economic analysis have shown the potential for an extension of the open pit to provide for access to the sulphide resource a significant portion of the sulphide resource to be mined by open pit methods.

Based on the current drill spacing, the Tshifufia and Tshifufiamashi deposits remain open for incremental addition to the sulphide Mineral Resource between 320 to 400 metres and 170 to 260 metres from surface, respectively.  The updated Mineral Resource estimate is presented in the table below:

Kinsevere Copper Project Mineral Resource Estimate¹:
Tshifufia, Tshifufiamashi and Kinsevere Hill Deposits as at year-end 2008.

Kinsevere Oxide Measured and Indicated Mineral Resource Estimate

Total Kinsevere Measured and Indicated Mineral Resource Estimate

Kinsevere Sulphide Inferred Mineral Resource Estimate

Total Kinsevere Inferred Mineral Resource Estimate

<sup>1. A cut-off grade of 0.7% Cu has been used in all categories of the Mineral Resource estimate.
2. Mineral Resource estimates have been classified and reported using the guidelines of the Australasian Code for Reporting of Exploration results, Mineral Resources and Ore Reserves (the JORC Code, 2004).  These guidelines are consistent with those of the Canadian Institute of Mining, Metallurgy and Petroleum, 2000.</sup>

The year-end 2008 Mineral Resource estimate has been defined from oxide orebodies (to 110 metres depth) and sulphide orebodies (up to 430 metres depth).  The revised estimate reflects interpretation of grade control data and pit mapping and associated refinements to interpreted ore to waste contacts.  Although more than 25,500 assays have been included to date from the 2008 drilling program, the assay results from the remaining 8,000 samples are yet to be received.  There will be a further updated Mineral Resource estimate, as well as a Mineral Reserve estimate in the second half of 2009.  Details of drilling carried out at Kinsevere during 2007 and 2008 are shown in the table below:

Kinsevere Copper Project Drilling Database

Environmental Approvals

The Kinsevere Environmental Impact Assessment ("EIA") was approved in the fourth quarter of 2008 by the DRC Government Directorate for the Protection of the Mining Environment ("DPEM").  This approval included a variance to the design and operation of the Stage II TSF, comprising milling-in-raffinate and the requirement for secure storage of non-neutralised tailings.  These design changes will result in significant reductions in consumption of water, lime and acid, with resulting operating cost improvements.

In addition to the requirements of the DRC Government, a revised Environmental and Social Impact Assessment is in preparation, in order to align the Company's environmental management of Kinsevere Stage II with the Equator Principles and with the environmental, health and safety guidelines of the International Finance Corporation.

Tenements

The Kinsevere Project portfolio is comprised of two mining licenses (Permis d'Exploitations), PE528 and 539, which cover a combined area of 29.6km².  Both of these licenses are owned by Gécamines, but having completed a Feasibility Study on the three known deposits on PE528; AMCK (a JV company formed between Anvil and Mining Company Katanga (MCK), signed an Amendment Lease Agreement with Gécamines and the DRC Government in Q1 2009, which sets out a schedule of royalties, payable to Gécamines, based on royalty payments of 2.5% of gross turnover.  The Company's 95% interest in the Kinsevere Lease Agreement has not been amended..

Geology

There are three know deposits located on PE528 (Kinsevere).

The three deposits at Kinsevere are named, from north to south, Tshifufiamashi, Tshifufia and Kinsevere Hill. They are hosted by what appear to be two separate "mega-fragments" of prospective stratigraphy (Lower Roan Supergroup/Mines Group), which are surrounded by younger sediments of the Kundelungu Supergroup, of the Katangan System. Lithologically, the deposits occur in a mixed sequence of siliciclastic and carbonate rocks, which are typical hosts to Katangan Copperbelt mineralization.

Most of the Kinsevere Mineral Resource defined to date (in all three deposits) is oxide ore, which forms a thick (>100m) supergene blanket that overlies sulphide mineralisation. The dominant copper oxide minerals are malachite (carbonate) and pseudo-malachite (phosphate), which are disseminated throughout the host rock, or as veins and/or veinlets that sometimes coalesce into prominent "clots". Heterogenite (cobalt oxide) is sometimes inter-grown with the copper, but is always a minor component of the ore.

The dominant copper sulphide mineral of the primary ore is chalcopyrite, but minor bornite, chalcocite, and cuprite also occur, along with native copper and pyrite. Most of this mineralisation occurs in veins and veinlets that often cross-cut bedding.

All three of the deposits are interpreted to be examples of structurally modified stratiform copper mineralization, which has weathered to form a supergene blanket of oxide ore.

Exploration History

Since the exploration program began in late 2004, Anvil has completed the following:

• Surface trenching program - confirmed historical results of Gécamines
• Phase 1 drilling program in 2005 to define a preliminary resource for all three Kinsevere deposits, comparable to the original declaration of Gécamines
• Phase 2 drilling program in 2006 to increase the defined resource at the Tshifufia deposit
• Phase 3 drilling program (40,400m) in 2007 to increase level of confidence in the mineral reserves and resources on the tshifufia, tshifufiamashi, Kinsevere Hill deposits and the Kinsevere extension.
• Phase 4 exploration program (26,700m) at Kinsevere completed to evaluate at depth the sulphide zone at the three main deposits. A new universal reserve estimate should be completed in the second half of 2009.