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The WWW valuation noted that the High value scenario does not represent maximum values, and that, for modelling purposes, the same average price was applied to all stones of six carats or higher. Due to the conservative nature of the WWW price models, where the upside potential of the coarse size frequency distribution was not fully reflected, P&E used the WWW High scenario for the reporting of economic resources. This procedure was also utilized by AMEC in the June, 2008 Resource Estimate.

16.12 VARIOGRAPHY

Standardized isotropic semi-variograms were generated for the EJF Inner, EJF Outer and total EJF units from unadjusted LDD sample data (Table 16.6). Insufficient sample pairs were available to develop meaningful variography for the other kimberlite units. The nugget effect was modelled from the downhole semi-variogram and a single structure spherical model was then fit to the semi-variogram for each model (Figure 16.e).

Experimental semi-variograms derived from the LDD sample data displayed a degree of continuity for the EJF Inner unit out to 220 m. When the EJF Inner sample data are combined with the EJF Outer unit this range is reduced to 170 m, and 170 m was therefore used by P&E in defining search and classification limits for estimation.

Table 16.6: Experimental semi-variograms for the Star EJF kimberlite units

UNIT EJF EJF-Inner EJF-Outer

Semi-variogram

    • 0.3

      + SPH(0.7, 170)

    • 0.3

      + SPH(0.7, 220)

    • 0.3

      + SPH(0.7, 100)

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P&E Mining Consultants Inc. NI 43-101 Technical Report No 159 Shore Gold Inc. - Star Diamond Project Resource Estimate Update

Page 87 of 109

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