2b347220-11ba-42d6-a29c-c8c3a4ef959f.pdf



West African Resources Limited


ABN 70 121 539 375


MANAGEMENT'S DISCUSSION AND ANALYSIS (MD&A)

for the three months ended 31 December 2015


Registered Office


14 Southbourne Street

Scarborough WA 6019


Australia


Principal place of business


14 Southbourne Street

Scarborough WA 6019 Australia

Ph: +61 (8) 9481 7344

Fax: +61 (8) 9481 7355


Website www.westafricanresources.com Email info@westafricanresources.com



GENERAL


Presented below is a discussion of the activities, results of operations and financial condition of West African Resources Ltd. ("West African" or the "Company") for the three month period ended 31 December 2015 ('Q216'), compared to the same periods in the preceding year. This management discussion and analysis ("MD&A") was prepared using information available as of 10 February 2016 and should be read in conjunction with the Company's unaudited interim financial statements for the three month period ended 31 December 2015 and notes thereto. These unaudited consolidated interim financial statements (the "Interim Financial Statements") are prepared in accordance with International Financial Reporting Standards ("IFRS") for interim reporting. As a result, this MD&A should also be read in conjunction with the audited financial statements for the year ended 30 June 2015 and notes thereto. The Interim Financial Statements include the accounts of the Company and its subsidiaries. All monetary amounts referred to herein are in Australian dollars unless otherwise stated.


Additional information relating to the Company can be found on the SEDAR website at www.sedar.com, on the Company's website at www.westafricanresources.com.


FORWARD LOOKING STATEMENTS


This MD&A contains certain forward-looking information and forward-looking statements as defined in applicable securities laws. These statements relate to future events or future performance. All statements other than statements of historical fact are forward-looking statements. The use of any of the words "anticipate", "plan", "continue", "estimate", "expect", "may", "will", "project", "predict", "potential", "should", "believe" and similar expressions is intended to identify forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. These statements speak only as of the date of management's discussion and analysis. Inherent in forward-looking statements are risks and uncertainties beyond the Company's ability to predict or control, as described herein. Actual results and developments are likely to differ, and may differ materially, from those expressed or implied by the forward-looking statements contained in this management's discussion and analysis. Such statements are based on a number of assumptions which may prove to be incorrect, including, but not limited to, assumptions about general business and economic conditions, interest rates and foreign exchange rates, the timing of the receipt of regulatory and governmental approvals for projects, ability to attract and retain skilled staff, the impact of changes in foreign exchange rates on costs, market competition, the accuracy of resource estimates (including, with respect to size, grade and recoverability) and the geological, operational and price assumptions on which these are based, tax benefits and tax rates, and ongoing relations with employees and with business partners. The reader is cautioned that the foregoing list of important factors and assumptions is not exhaustive. Events or circumstances could cause actual results to differ materially from those estimated or projected and expressed in, or implied by, these forward-looking statements. The Company undertakes no obligation to update publicly or otherwise revise any forward-looking statements or the foregoing list of factors, whether as a result of new information or future events or otherwise.


TSX-V disclaimer


Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.



CORPORATE OVERVIEW


West African is a mineral exploration company focused on building shareholder value through the identification, acquisition, assessment and development of mineral resource projects. The Company's portfolio includes mineral rights in a gold project in Burkina Faso.


The Company trades on the Australian Securities Exchange ('ASX') and the TSX Venture Exchange ('TSX') (with effect from January 2014) under the symbol "WAF" and warrants trading on the TSX under the symbol "WAF.WT". The Company is a reporting issuer in Canada in the provinces of British Columbia, Alberta, Saskatchewan and Ontario.


West African Resources Limited (ASX: WAF) is pleased to report activities on its 100%-owned and 100%- earning gold and copper-cold projects in Burkina Faso, West Africa, for the quarter ending 31 December 2015.


OPERATIONS HIGHLIGHTS


Tanlouka Gold Project


  • 100% ownership of Tanlouka Permit completed

  • Mining licence application lodged

  • Environmental and Social Impact Assessment (ESIA) and Relocation Action Plan (RAP) completed, submitted and under review and consultation

  • Follow-up drilling at M3 prospect results included:

    • 25m at 2.5g/t Au including 17m at 3.35g/t Au ending in mineralisation

    • 20m at 2.8g/t Au including 8m at 4.0g/t Au

    • 16m at 2.3g/t Au from surface, including 8m at 4.0g/t Au ending in mineralisation

  • Two zones of mineralisation at M3 identified, combined strike of 500m

  • Continued impressive results from M1 prospect including:

    • 14m at 4.5g/t Au including 3m at 16.2g/t Au from 36m

    • 6m at 2.52g/t Au from 48m

    • 8.6m at 1.84g/t Au from 9m

    • 3m at 21.54g/t Au from 10m

  • Follow-up RC drilling commenced in late December 2015 with early results including:

    • 16m at 5.3g/t Au including 8m at 9.44g/t Au from 48m

  • Gold mineralisation at M1 and M3 is located less than 2km from the proposed heap leach starter pit at Mankarga 5

  • Resource definition drilling to incorporate M1 and M3 into project resource inventory underway - updated resource estimate expected in Q2 2016

  • Recoveries of 97.5% gold from preliminary test work completed on M1 and M3 samples


    December 2015 Quarter Summary


  • 7,458.41m drilled

  • $1.13m exploration and development expenditure

  • $0.32m administration costs


  • $0.30m R&D benefit received

  • $2.65m cash at bank at 31 December 2015


    Corporate


  • $2.04 million raised via placement to accelerate development of high-grade oxide mineralisation at M1 and M3 prospects

  • Share Purchase Plan commenced mid December 2015 and completed end January 2016 with $0.30m raised


    March 2016 Quarter Plans


  • Resource definition drilling ongoing at M1 and M3

  • Preliminary metallurgical test work on M1 and M3 mineralisation

  • Geological and resource modelling on M1 and M3 gold mineralisation

  • Advance Feasibility Study


Overview


The December 2015 quarter has been particularly pleasing with excellent results returned from the M3 prospect, where a new zone was discovered in the eastern portion of the prospect.

Combined strike of drilled mineralisation is now at 500m and remains open. Follow-up diamond drilling commenced at the M1 prospect during the quarter with RC drilling with Ausdrill commencing late in the December 2015.

A $2.04 million placement completed during the quarter is enabling West African to accelerate development of its prospects.

An updated resource estimate for the wider Mankarga project that incorporates material from M1, M3 and M5 prospects is expected to be complete in Q2 2016. Ausdrill rigs are on site completing resource definition drilling before the end of Q1 CY2016.

Initial metallurgical test work on samples from M1 and M3 returned average recoveries of 97.5% gold and demonstrated that oxides from these two prospects are amenable to conventional cyanide processing. Further metallurgical test work is being completed in Q1 CY2016.

MINERAL PROJECTS


Burkina Faso, West Africa


The majority of West African's exploration activities since listing the Company on ASX in 2010 have been focused on Burkina Faso, located in the Sahel region of West Africa. The Sahel is a transition zone between the Sahara Desert to the north and the savannas to the south, and stretching the full width of the continent, having a semi-arid climate.


The area now known as Burkina Faso was ruled by the Mossi kingdoms from medieval times until France claimed the region in 1896 when it became known as Upper Volta. In 1960 the Republic of Upper Volta was granted autonomy by France and in 1987 the name of the country was changed to Burkina Faso.

West African Resources Limited issued this content on 13 February 2016 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 12 February 2016 23:24:28 UTC

Original Document: http://www.westafricanresources.com/wp-content/uploads/2016/02/15-12-31-WAF-MDA.pdf