26 April 2018 ASX: EXU QUARTERLY ACTIVITIES REPORT FOR THE PERIOD ENDED 31 MARCH 2018

Transcription

1 26 April 2018 ASX: EXU QUARTERLY ACTIVITIES REPORT FOR THE PERIOD ENDED 31 MARCH 2018 Highlights Exploration RC drilling has commenced over high priority Gravity Target 8 to the north of Tampia, where the gold soil anomaly continues to grow and is now 4,600m long and 2,800m wide, with welldefined north west and north east anomaly trends and numerous soil samples up to 0.8 g/t Au. Shallow supergene gold mineralisation has also been intersected in new RC exploration drilling and recognised in historic RAB drilling over 500m between the Tampia resource area and the Mace prospect from a depth of 5-14m. This new discovery is expected to provide additional gold resources to the project with early production potential. Results include: 5m at 7.62 g/t Au from 13m in THRC m at 1.24 g/t Au from 11m in GR193. 3m at 4.71 g/t Au from 14m in THRC481. 5m at 1.68 g/t Au from 10m in GR280. 4m at 1.83 g/t Au from 14m in THRC097. 6m at 1.01 g/t Au from 5m in THRC281. 2m at 1.91 g/t Au from 12m in THRC478. 4m at 0.71 g/t Au from 11m in THRC479. Soil sampling to the west of Tampia confirms that gold is present along 13 kilometres of the creek system that drains the Tampia resource area. There is potential for additional supergene mineralisation along the creek system. The width of this zone will be established by drilling, but potentially in the range of m. The gold soil anomalies to the south of Tampia have been extended by 2,200m to the south, with the total length of the gold soil anomaly over the eastern greenstone sequence increasing from 10.0km to 12.2km. Encouraging new zones of bed rock gold mineralisation were intersected in the holes drilled immediately around the feasibility study pit. These are all new zones of gold mineralisation that confirm additional zones of gold mineralisation are present outside the Tampia Resource Area. o 5m at 1.51 g/t Au from 67m in THRC403 o 8m at 0.90 g/t Au from 41m in THRC427 o 3m at 1.38 g/t Au from 25m in THRC429 Initial RC drilling of Gravity Target 18, approximately 2.5km south-east of the Tampia Resource area has been completed, with 7 holes completed for a total of 1,142m. Drilling of the deep diamond holes continues with the first two holes completed to the planned depths of 750m (THDD023) and 654m (THDD024). The holes have been drilled to test the source of the large gravity target under the Tampia resource area. Registered Office: Level 16, Waterfront Place, 1 Eagle Street, Brisbane QLD 4000 Postal Address: GPO Box 3249, Brisbane QLD 4001 Contact Details: Telephone info@explaurum.com

2 Significant arsenopyrite mineralisation (a key indicator of gold mineralisation at Tampia) has been intersected in the two completed deep diamond drill holes (THDD023 and THDD024). The arsenic mineralisation in THDD023 was intersected between 197m and 207m and 225m and 242m. This mineralisation is 350m outside the feasibility study pit area and down plunge to the south east from one of the high-grade shoots in the Tampia Resource area. Arsenic mineralisation was also intersected in THDD024 between 91m and 92m, 183m and 184m and 311m and 312m. The arsenic mineralisation intersected at 312m is potentially the deepest intersection of gold mineralisation at the Tampia Gold Project to date. Assay results are expected in early May. Exploration targeting of the Lake Grace region around Tampia resulted in a new tenement application 35km east of the Tampia Gold Project, covering an area of 400km 2 that comprises 500 blocks (Holleton West: E70/5141). Feasibility Study The Tampia Gold Project feasibility study is nearing completion with results expected to be announced in early May. The Company expects to shortly be able to announce the appointment of an adviser to assist in organising project debt financing as well as an independent technical expert to audit the feasibility and assist prospective financing groups. Corporate Institutional and sophisticated placement completed to fund exploration and resource drilling at Tampia. $6.0 million cash position at 31 March June Quarter plans The Feasibility Study is being prepared for publication in early May. The soil sampling program will be completed over the remaining available high priority regional gravity targets up to 15km from the Tampia Gold Project area, with the immediate focus on the gravity targets in the eastern greenstone sequence. Results from the exploration RC drilling program over Gravity target 8 and 18 are expected to start being received in early May. Exploration RC drilling of gold soil targets will continue with a priority being given to the large soil anomaly around Gravity Target 8. Infill resource drilling of the Mace supergene gold mineralisation and grade control drilling over the southern part of the proposed pit, will commence towards the end of April when a second RC drill rig becomes available. Assay results from the first hole of the deep diamond drilling program are expected by the early May. John Lawton, Managing Director commented: Work in the June quarter is expected to add to another major leap forward in advancing the development of the Tampia Gold project, with the results of our feasibility study due to be available in early May. We look forward to the results from the exploration work to date, due shortly, with anticipation as they should set the scene for the potential growth of the Tampia project and give us a view to the scope of the project and optimal development paths. Preliminary results are already giving us confidence for the future of the project and we see the excitement from our regional exploration continuing as we finalise the development options of the Tampia gold mine. 2

3 Tampia Gold Project Exploration and Development The flagship project of the Company is the Tampia Gold Project located in the wheat belt of Western Australia, approximately 250km east of Perth. The Company owns a 90% interest in two mining leases and a surrounding exploration licence through a joint venture, and 100% interest in an additional eight exploration licences which complement the original tenure. Exploration targeting of the Lake Grace region around Tampia, based on local Narembeen geology mapping was used to check for new target areas for tenement application. This resulted in a new tenement application 35km east of the Tampia Gold Project, covering an area of 400km 2 that comprises 500 blocks. The tenement was acquired to cover anomalous gold results in both soil sample data and air core drill intersections and is called Holleton West (E70/5141). During the Quarter, exploration activity focused on the Tampia Gold Project. No field work was undertaken on other projects. Regional Exploration Regional exploration around the Tampia Gold Project continued during the Quarter. This has been planned as an intensive phase of exploration that is to be completed during the period between the end of harvesting last year to the start of seeding in May The exploration aims to add new resources, both from around the immediate Tampia Gold Project resource area and regionally and includes auger soil sampling and follow up RC scout drilling to collect geological data over soils anomalous in gold (Figure 1). The main aims of the current exploration program are: To expand the resource base at the Tampia Gold project to add potential mine life to the project. To test and infill extensions to the current resource down plunge to the south east. Map the geology and test for additional stacked shoots of gold mineralisation directly underneath the current resource area. To map the geology and geochemistry of all the gravity targets in the regional area (Figure 2). To drill test the regional gravity targets that have gold soil anomalies for bed rock gold mineralisation. Prioritise targets that warrant follow up resource drilling programs. Continue to explore and add potential new resource areas while the feasibility study and development of the Tampia Gold project are completed. Figure 1. Tampia Project location map with exploration survey area in relation to Explaurum tenements. 3

4 Figure 2. Regional airborne gravity survey highlighting Gravity Targets with similar signature to the Tampia gold deposit. Auger soil sampling is being used because historic soil data programs have not been systematically collected, do not include a complete suite of elements known to be associated with gold at Tampia, have not used modern assay techniques that allow lower levels of detection and are poorly located. Soil samples were initially collected over the known resource area as an orientation survey to understand the magnitude of the different elements associated with the gold mineralisation at Tampia in the near surface compared to where the mineralisation is deeper and covered by barren gneiss (Figure 3). There is a total of 294 samples in this area that were analysed for low level Au and multi-element analysis. These soil samples were statistically analysed to determine the elements that correlate with gold and define anomaly thresholds for these elements, including gold, to compare with the regional samples and map those areas with similar geochemical signatures to the Tampia Gold Project. Regional Soil Sampling Manual and auger soil sampling continued during the quarter, with 11,080 soil samples collected since the start of the program from the farm areas to the north and south of Tampia Hill. A total of 10,975 samples have been dispatched to date for analyses and a total of 10,438 samples have been returned since the soil sampling commenced. Data processing, statistical analyses and data interpretation of the regional gold data set continued mapping new gold and arsenic soil targets that require follow up exploration drilling (Figure 3). All these targets have similar element associations and geochemical threshold values as the soils over the Tampia Gold Project resource area, but most have never been drilled. 4

5 13 km Supergene target area Figure 3. Tampia Gold Project regional soil Au ppm anomalies (orange, yellow, red and pink) map in relation to gravity anomalies and tenements. The gold anomaly over Gravity Target 8 continues to grow and is now 4,600m long and 2,800m wide, with well defined north west and north east anomaly trends that have numerous samples over 0.1 g/t Au up to 0.8 g/t Au (Figure 3). The target is a well-defined coincident gravity, soil gold and soil arsenic anomaly like Tampia but covering a much larger area over what appears to be two intersecting mineralised trends. There are three new highly anomalous gold target areas between the Gravity Anomaly 8 and Gravity Anomaly 10 that have similar geochemistry to the larger anomaly over Gravity Target 8 and the Tampia Resource area. All the gravity anomalies in this area are associated with soil gold anomalies, but there are also soil gold anomalies over less dense lithologies that require testing. The gold soil anomalies to the south of Tampia have been extended by 2,200m to the south, with the total length of the gold soil anomaly over the eastern greenstone sequence increasing from 10.0 km to 12.2 km. The soil anomalies around Gravity Target 18 are similar in grade and distribution to the gold soil anomaly over the Tampia resource area (Figure 3), which provides additional evidence that the area around Gravity Anomaly 18 may be where the Tampia gold mineralisation may come back to the surface. If this is the case, then the geology in the Gravity Anomaly 18 area should dip to the north west rather than the south east in the Tampia resource area. One of the main aims of the planned drilling in the area will be to test this hypothesis, which could add significantly to the Tampia gold resource if proven correct. Large nickel-cobalt-copper anomalies have been mapped over some of the mafic gneiss sequences and this confirms the mafic gneiss units, particularly the eastern sequence of gneisses, are remnant greenstone belts. This element association is common in the Southern Cross Greenstone Belt to the east of Tampia, where significant nickel-cobalt-copper mineralisation is found in association with 5

6 ultramafic lithologies. The presence of similar elements associations suggests that the precursor lithologies to some of the mafic gneiss units were ultramafic rocks, which enhances the prospectivity of the eastern greenstone belt for nickel-cobalt-copper sulphide mineralisation. Subsequently, a review was completed of all historic RC and soil auger drilling assay data in the project area. Results confirm some of the fresh mafic gneiss units are highly anomalous in cobalt and lower level copper and nickel geochemistry. RC intercepts up to 0.15% Co (THDD012M), and cobalt values up to 600ppm in soils have been recorded. The new soil data have confirmed the potential for bed rock cobalt mineralisation in both the western and eastern greenstone sequences in mafic gneiss lithologies that have had no previous exploration for this style of mineralisation. The largest and most attractive anomaly lies between Gravity Anomaly 7 and Gravity Anomaly 4 and appears to be associated with a mafic gneiss that is also anomalous in nickel and copper. This anomaly is also associated with anomalous gold up to 62 ppb Au. Exploration RC Drilling The scout exploration program started in December 2017 and a total of 105 RC holes have been completed since the start of drilling for a total of 8,798 metres. There are 31 holes that are mineralised from the 105 holes that were drilled, including intercepts of: 5m at 1.51 g/t Au from 67m in THRC403 soil anomaly south of pit 1m at 1.74 g/t Au from 6m in THRC411 southern extension of resource 3m at 0.57 g/t Au from 0m in THRC425 Alpaca Prospect 8m at 0.90 g/t Au from 41m in THRC427 Alpaca Prospect 3m at 1.38 g/t Au from 25m in THRC429 Alpaca Prospect 4m at 0.61 g/t Au from 109m in THRC440 Resource down plunge 1m at g/t Au from 61m in THRC442 Resource down plunge 2m at 1.91 g/t Au from 12m in THRC478 Creek Area (Mace) 4m at 0.71 g/t Au from 11m in THRC479 Creek Area (Mace) 3m at 4.71 g/t Au from 14m in THRC481 Creek Area (Mace) 1m at 3.84 g/t Au from 31m in THRC487 Alpaca Prospect 3m at 1.55 g/t Au from 97m in THRC494 Alpaca Prospect A review of the QC samples returned for both soil sampling and RC sampling has been conducted. All QC checks are performing within control with no apparent bias observed. Down hole surveying and data processing started during the quarter, focussing on surveying priority holes that returned anomalous gold grades. All holes drilled to date have been surveyed, with data collection going well and better quality optical data being collected in the holes drilled to the south of the Tampia resource area. The local and regional scale 2D and 3D geology maps will be updated with the new geological information from the holes drilled to date and the targeting of the soil geochemistry will be further constrained by geological prospectivity. Anomalous gold was intersected in bed rock in extension drilling to the south west of the proposed open pit, which has effectively closed off mineralisation in this direction (Figure 4). Encouraging new zones of bed rock gold mineralisation were intersected in the Alpaca prospect and to the east of the proposed pit area (Figure 4). Bedrock gold mineralisation was intersected in three continuous holes at the Alpaca prospect, defining a similar dip to the Tampia mineralisation that is 30m along strike from an earlier intersection of 10m at 5.46 g/t Au from 48m (THRC080). The intersection of bed rock gold mineralisation in THRC403, the last hole of the line targeting a minor soil anomaly south of the pit, was unexpected (Figure 4). The intersection of 5m at 1.51 g/t Au from 67m highlights that smaller lower priority soil anomalies in interpreted felsic gneiss may be as prospective for bed rock gold mineralisation. Down hole data are being reviewed to determine the geological setting of this mineralisation and potential for continuous zones of gold mineralisation. Any follow up drilling will be determined on a priority basis to assess the resource potential of these new zones of 6

7 mineralisation. This drilling will be planned once down hole survey data, including optical data, are collected. The main target at the Mace prospect to the west of the Tampia Resource area (Figure 4) was to follow up shallow gold mineralisation intersected by previous drilling programs in the clay at the base of the creek system that drains the Tampia resource area. These holes intersected additional new gold mineralisation in this area, which appears to be confined to the weathered horizon, with no gold mineralisation intersected in the underlying fresh bed rock (Figure 5). Intersections from the new drilling in this area include 2m at 1.91 g/t Au from 12m (THRC478), 4m at 0.71 g/t Au from 11m (THRC479) and 3m at 4.71 g/t Au from 14m (THRC481). These intersections confirm that gold mineralisation occurs at the base of weathering under the creek that drains the Tampia Resource area from a depth of around 5-14m, and which is 2-11m thick. The potential width of this mineralised zone is estimated to be in the m range. This type of gold mineralisation is interpreted to be supergene in nature and has been intersected by the new RC exploration drilling and historic RAB drilling over a 250m length from the Tampia Resource area to the Mace prospect to the west (Figure 4 and Figure 5), with historic intersections including 5m at 1.68 g/t Au from 10m (GR280), 6m at 1.01 g/t Au from 5m (THRC281), 5m at 7.62 g/t Au from 13m (THRC052), 11m at 1.24 g/t Au from 11m (GR193) and 4m at 1.83 g/t Au from 14m (THRC097) (Figure 5). The area of supergene gold mineralisation has the potential to add additional gold resources to the current project that are shallow, immediately accessible and with excellent metallurgical recoveries. Infill resource drilling is being planned to immediately follow the exploration drilling, and which will consist of 2,000m of grid drilling at a 10m spacing across the creek area and 80m spacing along the creek. This will be followed by infill drilling if results warrant at 40m spacing along the creek area. Soil sampling along the creek area to the west of Tampia confirms that low level gold is present along 13 kilometres of the creek system that drains the Tampia resource area (Figure 3). There is the potential for additional supergene resource along the entire length of the creek system, which will be tested by step out exploration drilling once the infill resource drilling of the Mace target area is completed. Gold mineralisation was also intersected in the area above the down plunge continuation of the Tampia resource area, including 4m at 0.61 g/t Au from 109m in THRC440 and 1m at g/t Au from 61m in THRC442 (Figure 4). The mineralisation in THRC440 is the first high grade gold mineralisation to be intersected in felsic gneiss and has important targeting implications for the regional gravity and soil targets. This mineralisation appears to be part of an anomalous halo of gold around the main resource and provides additional evidence that the Tampia gold resource continues at depth to the south east outside the current footprint of the feasibility study pit. Down hole data are being reviewed to determine the geological setting of this mineralisation and potential for continuous zones of gold mineralisation. Any follow up drilling will be determined on a priority basis to assess the resource potential of any down plunge extensions to the Tampia gold resource. This drilling will be planned once down hole survey data, including optical data, are collected and the results from the deep diamond drilling are returned. Initial exploration RC drilling of gold soil targets, including Gravity Target 18 (Figure 2 and Figure 3), to the south of the Tampia Resource area has been completed, with 8 holes drilled for a total of 1,262m. Drilling started testing the soil anomaly to the north west of Gravity Anomaly 18, with a priority on testing the dip of the gneiss units interpreted in the area that may be a continuation of the mafic gneiss that hosts mineralisation at Tampia. Garnet rich felsic gneiss was intersected at the top of the first hole, which then graduated to a more mafic gneiss of similar character to the mafic gneiss at the southern end of the Tampia Resource area. Drill testing of Gravity Target 8 to the north of Tampia has commenced where the new gold soil anomalies cover an area 4,600m long and 2,800m wide with well-defined north west and north east anomaly trends that have numerous samples over 0.1 g/t Au up to 0.8 g/t Au (Figure 2 and Figure 3). 7

8 Down plunge mineralised intersections Figure 4. Drill plan of current scout exploration RC drill holes with mineralised holes shown as red collars, unmineralised holes as blue collars and red line the long section of the supergene gold mineralisation at the Mace prospect (Farm buildings to east of resource area are derelict and unoccupied). Figure 5. Long section (red line on Figure 4) along the creek that drains the Tampia resource area from the Mace Prospect to the Tampia Pit area (250m long section) with supergene mineralisation intersected in recent exploration RC drilling and historic RAB drilling. 8

9 Tampia Deep Diamond Drilling The deep diamond drilling program continued, with two holes, THDD023 and THDD024, completed to their planned depths. THDD023 reached a depth of 750m and significant sulphide, cobalt and arsenic mineralisation was intersected between 197m and 207m and 225m and 242m. This mineralisation is outside the feasibility study pit area, 350m down plunge to the south east from one of the high-grade shoots in the Tampia Resource area. The hole has reached the depth of the gravity anomaly and intersected an unusually garnet rich felsic gneiss, which based on garnet density of may explain the gravity anomaly in this area. THDD024, targeted the northern eastern contact of the mafic gneiss where the gold mineralisation appears to be truncated. This hole reached a depth of 654m. Arsenic mineralisation has been intersected in this hole between 91m and 92m, 183m and 184m and 311m and 312m. The arsenic mineralisation intersected at 312m is potentially the deepest intersection of gold mineralisation at the Tampia Gold Project to date. The arsenic mineralisation intersected in both deep holes is down plunge and outside the resource area and provides additional evidence to the intersections from the exploration RC drilling that the gold mineralisation that comprises the Tampia resource area continues to a depth of at least 300m and 300m down plunge to the south east. The grade and continuity of gold mineralisation needs to be defined by grid resource drilling to understand the potential for new gold resources in this area. The depth of the target area means this target is a lower priority when compared to the near surface targets to the south east and north of the Tampia resource area. All core from the first diamond drill hole (THDD023) has been logged and sent away for assay. Drilling the third deep hole THDD025 has started, with a planned depth of 550m. Feasibility Study Work on the feasibility study continued during the quarter, with final Whittle inputs signed off and the final mine design and scheduling completed. A new resource report and maiden reserve report will be finalised as part of the feasibility study documentation. Preliminary grade control planning is being planned to both optimise drill hole spacing and depth and test high grade continuity in the resource model with closer spaced drilling. The final site layout plan, including plant, TSF and pit locations has been completed for the feasibility study. All geotechnical work for the feasibility study has been completed and reported. Feasibility metallurgical test work has been completed and a report delivered for the feasibility study document. Test work of the weathered gold composite gave high recoveries of 98-99% and confirmed low lime and cyanide consumptions. There was a significant amount of gravity gold, which was not expected, that resulted in a higher recalculated feed grade (1.38 g/t Au assayed to 3.44 g/t Au recalculated). The average grade of the composite as calculated from the resource model was 1.96 g/t Au, which provides additional evidence that the resource estimate is most likely conservative in areas where coarse gold is present in the resource. Magnetic separation on a sample of float concentrate has recovered most of the pyrrhotite, which comprises 30-40% of the flotation concentrate. The removal of pyrrhotite from the float concentrate prior to fine grinding will significantly reduce the processing operating costs. Planning for an advanced test work program using the Albion Process is underway, with a workplan and budget being considered. Power supply discussions continued, with positive outcomes suggesting that the cost of power for the operation should be significantly lower than assumed in the Scoping Study. 9

10 The capital and operating costs have been finalised based on the most up to date data for the Feasibility Study. The construction project schedule has been delivered and is to be integrated with the broader project schedule. Work on the hydrological water bore drilling and testing continued, with a report on the work to date provided for review. This will be used as the basis for the next phase of work planning. Environmental studies continued with the environmental waste rock and ore geochemical samples being analysed. Tailings geochemical characterisation work also continued. Subterranean fauna, noise and dust and visual amenity studies were completed with no issues identified. A final report has been provided for the feasibility study. A heritage survey was completed with no issues identified. Work on developing a detailed mine schedule and financial model of the project is underway with results expected to be reported by early May. Corporate The Company successfully completed a bookbuild to raise up to A$8.3 million through a placement of up to approximately 79 million shares at an issue price of 10.5 cents per share to institutional and sophisticated investors. The funds raised will be used for: Exploration and resource drilling which is to include: RC drilling of gravity/soil targets 12,000m (Feb-Apr 2018) RC drilling of gravity/soil targets 10,000m (Q2 CY2018) Deep diamond drilling program 2,000m (in progress) Further soil sampling of regional gravity targets (circa 20,000 remaining); Finalising Tampia Gold Project Feasibility Study; Progress licencing and approvals; Progress development finance package; and Working capital purposes. Hartleys Limited and CCZ Statton Equities were Joint Lead Managers to the Placement. The Company s cash position at 31 March 2018 was $6.0M. June Quarter Plans The Feasibility Study is being compiled and prepared for publication in early May. The soil sampling program will continue over the remaining high priority regional gravity targets up to 15km from the Tampia Gold Project area, with the immediate focus on completing soil sampling of the gravity targets in the eastern greenstone sequence. This program is planned to be completed by the end of April. Target areas will be prioritised for follow up drilling in the following quarter. Scout exploration RC drilling of gold soil targets will continue with a priority being given to following up results from the Soil Anomaly Areas around Gravity Targets 8 and 18. Results from these RC drilling programs are expected to start being received in the middle of next quarter. Infill resource drilling of the Mace supergene gold mineralisation will start in early May. The first results from the first hole of the deep diamond drilling program are expected by early May. 10

11 For further information, contact: John Lawton Managing Director Explaurum Limited Competent Person s Statement The information in this report that relates to Mineral Resources and exploration results is based on information announced to the market on 5 th July, 7 th August, 22 nd August and 13 th September Explaurum confirms that it is not aware of any new information or data that materially affects the information included in the relevant market announcements, and that all material assumptions and technical parameters underpinning the estimates in the relevant market announcement continue to apply and have not materially changed. 11

12 Schedule of Mining Tenements and Beneficial Interests Held as at the end of the March 2018 Quarter Project / Location Country Tenement Percentage held / earning Tampia Western Australia Australia E70/2132, M70/815, M70/816 E70/4411, E70/4433, E70/4616, E70/4473, E70/4474, E70/4720, E 70/4950, E70/ % 100% Schedule of Mining Tenements and Beneficial Interests Acquired during the March 2018 Quarter Project / Location Country Tenement Date Acquired N/A Schedule of Mining Tenements and Beneficial Interests Disposed of during the March 2018 Quarter Project / Location Country Tenement Withdrawal Date N/A 12