Tonnes (t)	PGM+Au (g/t)	Ni (%)	Cu (%)
Probable (East & West)	11.8 Million	0.87	0.33	0.35
Indicated (East Zone)	3.57 Million	0.91	0.32	0.39
Inferred (East Zone)	1.87 Million	0.91	0.32	0.36

Based on resource estimated at cut-off NSR of C$50/tonne

Metal	Probable (East & West)	Indicated (East)	Inferred (East)
Nickel (Ni)	86 Million lbs.	25 Million lbs.	13 Million lbs.
Copper (Cu)	91 Million lbs.	31 Million lbs.	15 Million lbs.
Platinum (Pt)	0.14 Million oz.	0.04 Million oz.	0.02 Million oz.
Palladium (Pd)	0.15 Million oz.	0.05 Million oz.	0.02 Million oz.
Gold (Au)	0.08 Million oz.	0.03 Million oz.	0.01 Million oz.
PGM+Gold	0.37 Million oz.	0.12 Million oz.	0.05 Million oz.

CIM definitions were followed for Mineral Resources. The Qualified Persons for this Mineral Resource estimate are: Richard Routledge, M.Sc. (Applied), P.Geo., Eugene Puritch, P.Eng, and Antoine Yassa, P. Geo. Mineral Resources are estimated by conventional 3D block modeling based on wireframing at a $50/tonne NSR cut-off and ordinary kriging grade interpolation. Metal prices for the estimate are: US$3.69/lb Cu, US$9.46/lb Ni, US$1,595/oz Pt, US$590/oz Pd, US$1,396/oz Au and US$18.50/lb Co based on a three-year trailing average as of July 31, 2012. A uniform bulk density of 3.01 tonnes/m3 has been applied for volume to tonnes conversion. Underground Mineral Resources are estimated beneath the bottom of the 2006 feasibility study pit at approximately 80 m elevation (258 m depth) to the -294 m elevation (632 m depth). Mineral Resources are classified as Indicated and Inferred based on drill hole spacing and geologic continuity. Overall revenue contribution expected from payable metals in the NSR calculation is 30% Cu, 52% Ni and 18% for combined Co, Au, Pt and Pd. Mineral resources, which 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. There is no certainty that all or any part of the Inferred Mineral Resource will be upgraded to an Indicated or Measured Mineral Resource as a result of continued exploration.
Detailed Resource/Grade Table

Technical Reports:

• Mar. 2008, Shakespeare Feasibility Study Update (File size: 1.8mb)
• Aug. 2006, Shakespeare Preliminary Economic Assessment (File size: 3.4mb)
• Jan. 2006, Shakespeare Feasibility Study (File size: 3.8mb)

Overview: Shakespeare Project

Prophecy Platinum's 100%-owned Shakespeare Nickel Mine is located 70 km west of Sudbury, Ontario. The project was acquired as part of a business combination agreement (the "Transaction") completed in June 2012 under which Prophecy acquired all of the issued and outstanding securities of URSA Major Minerals, and thereby its assets, including Shakespeare.  URSA Major holds a 100% beneficial interest in the Shakespeare project area which contains all of the Shakespeare reserves and resources and is subject to a 1.5% royalty in favour of Xstrata.  

The Shakespeare project area is partially surrounded by an exploration property that was the basis of a joint venture between URSA Major and Xstrata with URSA Major as the project operator. URSA Major holds an approximately 81% beneficial interest in the joint venture area.

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During the twelve months of operation ending January 31, 2012, URSA delivered a total of 151,910 tonnes of ore to the Strathcona Mill at a grade of 0.314% nickel, 0.368% copper, 0.019% cobalt, 0.348 g/t platinum, 0.389 g/t palladium, 0.203 g/t gold and 2.164 g/t silver.  URSA recorded gross revenue of $11,162,363 on the sale of metals from the Shakespeare Nickel Mine from the year ending January 2012.

During this 12 month period, URSA successfully extended the nickel-copper mineralization and down plunge of the Shakespeare East Deposit after completing eleven drill holes.  A highlight of the program included drill hole U3-122 that intersected 5.19 metres grading 0.81% nickel, 0.48% copper, 0.03% cobalt and 1.20 g/t precious metals within a wider 23.67 metre interval grading 0.55% nickel, 0.36% copper, 0.02% cobalt and 0.92 g/t precious metals. This is one of the highest grade intersections ever reported at Shakespeare.

Five drill holes, numbered U3-127 to 131, were drilled vertically to depths of up to 127 meters within the central portion of the planned Shakespeare East pit to confirm grade continuity and to provide additional geotechnical information to assist with commencement of mining the Shakespeare East Pit. Highlights include: hole U3-127 that intersected 83.7 metres grading 0.45% nickel, 0.53% copper, 0.024% cobalt and 1.15 g/t precious metals and hole U3-131 that intersected 60.0 meters grading 0.44% nickel, 0.54% copper, 0.025% cobalt and 1.26 g/t precious metals.

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  The primary crushing operation to <5"
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  Blast hole drilling operations, Shakespeare west deposit, May 2010

 

 

 

 

 

 

 

In December 2011, the Company announced that operations at the Shakespeare Mine were being limited to crushing of existing broken ore, ore sampling and trucking operations as a consequence of reduced prices for base metals.  Subsequent to the end of the year ending January 31, 2012, URSA Major announced a temporary suspension of all operations at the Shakespeare Mine. The Company's processing agreement expired in December 2011 and the Company was not able to conclude a new processing agreement for Shakespeare ore.

For the nine production months ended January 31, 2011, the ore averaged 0.357% nickel, 0.407% copper, 0.025% cobalt, and 0.989 gram/tonne precious metals. This is 91% of the average budgeted grade for 2010 that is based on the previous bulk sample and pre-production mined grades 0.39% nickel, 0.44% copper, 0.03% cobalt and 1.1 gram/tonne precious metals. Ursa Major recorded gross revenue of $14,866,306 on the sale of metals from the Shakespeare Mine for this period.

The table below shows total approximate contained metals in the delivered ore, for the nine production months ended January 31, 2011.

Platinum	Palladium	Gold	Silver	Nickel	Copper	Cobalt
1900 oz.	2100 oz.	1100 oz.	12,100 oz.	1,314,000 lbs	1,499,000 lbs	92,204 lbs.

The recovered and contained metals were subjecte to smelter recoveries and to further smelter deductions.

Production History

In 2008, a total of 83,029 tonnes of ore was processed by Xstrata. This ore had average grades of 0.39% nickel, 0.40% copper, 0.03% cobalt and over 1 gram/tonne precious metals. The grade was consistently higher than block model projections. In the first half of 2009, URSA Major shipped 10,000 tonnes of stockpiled ore to Xstrata for processing. For the year ended January 31, 2010, the property was on care and maintenance following a suspension of pre-production mining operations in October 2008 due to low commodity prices. During this period, a number of site improvement efforts were implemented at Shakespeare, including construction of a water pipeline to pump mine water to the sedimentation pond facility. URSA also initiated environmental monitoring and reporting procedures as required under that company's environmental permits. Water treatment and monitoring was also required prior to discharge from the sedimentation pond. Surface and groundwater sampling has been an ongoing part of the site monitoring activities at Shakespeare.

Feasibility Update

An update to the 2006 feasibility study was completed in 2008, by Micon International Limited ("Micon").  The feasibility study update defined a diluted Probable Reserve of 11,828,000 tonnes grading 0.33% nickel, 0.35% copper, 0.02% cobalt, 0.33 g/t platinum, 0.36 g/t palladium and 0.18 g/t gold. The mineral reserve is to a maximum depth of 250 metres below surface and was determined by applying a C$12.84/tonne NSR internal cut-off value which is derived from the sum of the milling and G&A costs. The reserve is based on an Indicated Resource (undiluted) of 12,430,000 tonnes grading 0.35% nickel, 0.37% copper, 0.02% cobalt, 0.35 g/t platinum and 0.39 g/t palladium and 0.20 g/t gold. This Indicated Resource is contained within an optimized pit shell with an NSR cut off above C$24.23. An additional Indicated Resource of 1,830,000 tonnes grading 0.37% nickel, 0.41% copper, 0.03% cobalt, 0.36 g/t platinum, 0.39 g/t palladium and 0.22 g/t gold at an NSR cut off of C$50/tonne is located outside of the pit shell.

The updated feasibility study also evaluated the base case of an open pit mine and a 4,500 tonne/day on-site concentrator. In Micon's opinion, "Shakespeare project contains an economic mineral reserve and is worthy of continued development through detailed engineering and construction to produce 4,500 t/d of ore and subsequent concentrate for sale". At projected metal prices including nickel at an average of US$9.37/lb., the project is projected to yield an after tax internal rate of return ("IRR") of 22.6% (29.1% pre-tax IRR) on an initial total capital cost of C$148,193,000. Net smelter revenue ("NSR") is $58.89/tonne and totals C$696,331,000 for the project. Total operating cost is C$26.64/tonne milled. The undiscounted total annual cash flow ("NPV") is C$169,581,000 and the NPV discounted at 8% is C$73,297,000. The project has a 7.2 year mine production life. The economic analysis makes the assumption of a reversion of metal prices from current levels to their 10-year historical median Canadian dollar prices, expressed in 2007 terms. Current price levels are assumed to regress exponentially toward the median, with a 'decay' half-life of three years. The resulting average prices over the life of the project, expressed in 2007 dollars, are nickel US$9.37/lb, copper US$2.11/lb, cobalt US$27.57/lb, platinum US$995.52/ounce, palladium US$342.49/ounce, gold US$563.27/ounce. The base exchange rate for the economic analysis is taken from the average of over 9 months of 2007, for a rate of C$1 = US$0.9052.  The majority of the Indicated Resource is down plunge to the east of the pit shell.

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  Micon Feasibility Study Model
  The mineral resource (red and green) has been defined by drilling (orange traces). The mineral reserve is contained within the open pit shells. The mill building and infrastructure are shown in purple.
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  Geology
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  Layout and Topography

 

 

 

 

 

Review of Exploration and Development Activities

The Shakespeare project area is partially surrounded by an exploration property that was the basis of a joint venture between URSA Major and Xstrata with URSA Major as the project operator. URSA Major holds an approximately 81% beneficial interest in the joint venture area.  Under the terms of the Transactions, Prophecy Platinum has assumed URSA's interest in this regard.

In December 2010, URSA Major initiated a drill program to test the down plunge extension of the Shakespeare East Deposit. An immediate goal of the program is to expand the size of the Shakespeare East Deposit and assess the potential of underground production from this section of the Deposit.

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  3D View Looking North West
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  Geological map around deposit
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  Shakespeare Pit Design

 

Permits and Agreements

The Shakespeare Mine has all permits including a Permit to Take Water, Certificate of Approval for noise and air emissions, and a Certificate of Approval for the Shakespeare Mine and Mill co-disposal facility and sedimentation pond for water treatment. URSA Major received acceptance of a certified Closure Plan for the Shakespeare Mine and Mill Project from the Ontario Ministry of Northern Development and Mines ("MNDM") in 2007. URSA also received a permit from the Ontario Ministry of Natural Resources ("MNR") for the operation of a gravel pit located approximately 3 km north of the Shakespeare nickel-copper project, in the Sudbury area of Ontario. 

In August 2009, URSA Major signed an Impacts and Benefits Agreement ("IBA") with Sagamok Anishnawbek First Nations ("Sagamok"). The IBA is the first such agreement to be entered into by either Sagamok or URSA Major, and one of only a few in the Sudbury mining camp. For the year ended January 31, 2011, the Company made its first payment to Sagamok under the IBA. 

In addition to custom milling of Shakespeare ore at the Strathcona Mill, URSA Major has an agreement with Xstrata that provides terms for the smelting of URSA Major's concentrates for a period of seven years.

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