Quarterly Report For the Period Ending 30 June 2012 Activity Report for the Quarter Ended 30 June 2012 Base Metal Exploration Northern Territory Outcropping copper-gold mineralisation continues to be found at the priority Illogwa Iron Oxide (IOCG) Target Area with 4 new prospects identified Mini Me, El Gordo, Nigel and Dixie. Rock chip sampling of Mini Me copper mineralisation returns values up to 7.8% copper and 1.4g/t gold. Surface channel sampling at El Gordo returns 7m @ 0.94% copper, 2.8g/t silver and 0.05g/t gold. Soil sampling underway through eastern portion of Illogwa to identify additional targets in soil covered areas ahead of maiden drilling program planned for September 2012 Quarter. Desktop review of the Yambah Project identifies two prospects Red Rock Bore and Harry Creek for immediate follow up. Historic wide spaced reconnaissance drilling at Red Rock Bore has returned a best intersection of 12.35m @ 0.1% copper, 0.5% lead, 3.3% zinc, 5.1g/t silver from 131.25 metres in drill hole RRK31 including 2.00m @ 10.9% zinc from 132.3m metres. Ground EM underway at the Red Rock Bore and Harry Creek prospects. MMG have completed an initial field reconnaissance of nickel targets throughout the Huckitta Project under the terms of the MMG Nickel Joint Venture. Base Metal Exploration Western Australia 4 Reverse Circulation drill holes (922 metres) completed to test VTEM anomalies at the Talga East and Gorge North prospects (East Pilbara Project). Drilling intersects target horizon with assays due by mid- September 2012. Discussions with third parties regarding possible divestment of the Sandstone Nickel Project continuing. Cash Cash at hand as of 30 June 2012 is $5.55 million and the Company is well resourced to drill test the priority targets on the Illogwa IOCG Target Area during the September Quarter. 58 King William Road T: (61 8) 8378 8200 ASX Code: MTH Goodwood, South Australia, 5034 F: (61 8) 8378 8299 Issued Shares: 219,615,500 Page 1 of 9 www.mithrilresources.com.au E: admin@mithrilresources.com.au Market Capital: A$6.80M
Overview Mithril Resources has an extensive portfolio of high - quality mineral exploration projects located within the Northern Territory and Western Australia. The Company is focussed on exploring for high grade copper gold mineralisation at the Illogwa IOCG Target Area on the Huckitta Project, and high grade copper lead zinc mineralisation at the Harry Creek and Red Rock Bore targets on the Yambah Project (Figure 1). Corporate Figure 1. Project Location Plan The Company s new Managing Director, Mr David Hutton commenced with the Company on the 18th of June, with his predecessor, Mr Graham Ascough remaining with the Company as a non-executive Director. Mr Hutton is a very experienced exploration executive having worked in the mining sector for more than 22 years for a variety of companies including MIM Exploration Pty Ltd, Forrestania Gold NL, Western Metals Limited, and LionOre Australia Pty Ltd. Most recently, Mr Hutton was the Managing Director of Breakaway Resources Limited. Mr Hutton graduated with honours as a geologist from Monash University in 1989, is a Fellow of the Australasian Institute of Mining and Metallurgy (AusIMM) and a Member of the Australian Institute of Geoscientists (AIG). Base Metal Exploration Northern Territory HUCKITTA PROJECT (100% Mithril and Various Joint Ventures) The Huckitta Project is located approximately 150 kilometres east of Alice Springs, Northern Territory and is highly prospective for both copper - gold and nickel mineralisation (Figure 2). During the Quarter, Mithril maintained its focus on the Illogwa IOCG Target Area where the Company continues to find new outcropping occurrences of copper mineralisation and associated alteration consistent with a structurally controlled iron oxide copper gold (IOCG) mineralising system. New mineral occurrences have been identified at the Mini Me, El Gordo and Nigel copper prospects (See Notes Specific) and the Dixie prospect. The prospects lie within east west and / or northwest southeast trending structural zones that are readily identifiable in high resolution aeromagnetic data that the Company has previously acquired over Illogwa (Figure 3). At Mini Me, geological mapping has located outcropping mineralisation and alteration sporadically over 2,000 metres strike length with widths ranging from 2 to 50 metres. Significantly, veinlets (up to 15 centimetres wide) of primary copper sulphide mineralisation (chalcopyrite) has been observed at a number of locations with rock chip sampling of the mineralisation returning values ranging from 0.13% to 7.8% copper and 0.01 g/t to 1.4 g/t gold (See Notes Specific). At El Gordo, outcropping mineralisation and alteration has been previously identified sporadically over 800 metres strike length with widths ranging from 2 to 10 metres. Rock chip sampling of mineralised surface outcrops has returned values ranging from 0.7% to 12.6% copper, 0.1g/t to 1.0g/t gold and 1.6g/t to 12.5g/t silver. Page 2 of 9
As previously announced (ASX Announcement dated 25 June 2012), assay results from a surface channel sample at El Gordo returned 7 metres grading 0.94% copper, 2.8g/t silver and 0.05g/t gold. The result was obtained from a composite of seven 1-metre continuous surface samples collected from a north-south oriented traverse across one of the mineralised horizons at EL Gordo. The southernmost 1 metre sample returned 3% copper suggesting the mineralisation is not closed off to the south. At Nigel, outcropping copper mineralisation primarily associated with intense silica alteration has returned values of 1.7% copper from grab samples. Significantly, Mini Me, El Gordo and Nigel all lie along strike from each other within the same east west trending structural zone (Figure 3) and have not been previously drill tested. Figure 2. Huckitta Project Location Plan showing Illogwa IOCG Target Area The recognition of multiple outcropping occurrences of copper gold mineralisation and alteration over a broad area at Illogwa reinforces the potential of the area to host a large structurally controlled iron-oxide-copper-gold mineral system. To assist in defining additional targets within soil covered areas along strike from existing prospects, a regional soil sampling program (400 x 200 metre sample spacing) has commenced over the southeast portion of the Illogwa IOCG Target Area with results expected during the September 2012 Quarter. Additional work planned for the September 2012 Quarter includes drill testing of priority targets at Illogwa (subject to receipt of results from a heritage survey completed during the June 2012 Quarter), and ongoing geological mapping and sampling. Page 3 of 9
Figure 3. Illogwa IOCG Target Area (RTP magnetic image) showing mineral prospects YAMBAH PROJECT (100% Mithril) The Yambah Project is located approximately 60 kilometres north of Alice Springs, Northern Territory and includes a number of significant base and precious metal mineral occurrences (including copper, lead, zinc, silver and gold) that have not been the subject of modern exploration. A desktop review of historical data and subsequent field assessment has identified two prospects, Red Rock Bore and Harry Creek for further immediate follow up (Figure 4). At Red Rock Bore, shallow wide spaced reconnaissance drilling on 100 metre sections over 1000 metres strike length to test outcropping copper lead zinc mineralisation has returned a best intersection of 12.35m @ 0.1% copper, 0.5% lead, 3.3% zinc, 5.1g/t silver from 131.25 metres in drill hole RRK31 including 2.00m @ 10.9% zinc from 132.3 metres. At Harry Creek, one poorly targeted shallow diamond drillhole completed in 1966 to test beneath outcropping mineralisation intersected 4m @ 0.21% copper, 0.27% lead, and 1.8% zinc from 39 metres with no subsequent follow up. Significantly both prospects contain multiple untested ground EM geophysical conductors, which at Red Rock Bore are interpreted to coincide with the drilled mineralisation. To further assess the significance of both the mineralisation and historic EM conductors, the Company commenced a ground electromagnetic survey at both prospects subsequent to the Quarter s end. The aim of this program is to identify targets for drill testing in the latter parts of 2012. Page 4 of 9
Figure 4. Yambah Project Location Plan showing priority prospects MMG Nickel Joint Venture Huckitta Project (MMG earning 80%) To ensure that the Company s efforts at the Huckitta Project remain focussed on copper gold exploration, it has previously entered into a commodity specific joint venture with Minerals and Metals Group (MMG), whereby they can earn up to 80% of the nickel rights on Mithril 100% owned tenements at Huckitta, by completing expenditure of $4 million and a Pre Feasibility study on a JORC Indicated Mineral Resource. Under the terms of the joint venture agreement, MMG must spend a minimum of $1.5 million by 31 October 2013. If MMG doesn t satisfy this requirement then it is obliged to pay Mithril the difference between actual expenditure and the $1.5 million. During the Quarter, MMG completed an initial field reconnaissance campaign involving members of its Australian and North American nickel specialist teams. During this campaign numerous mafic-ultramafic intrusions were identified, mapped, sampled and analysed for a full suite of elements. This campaign also included field checking of previously flown VTEM survey anomalies. Results of this campaign are still being interpreted in conjunction with an ongoing analysis of regional-scale remote sensing and other geophysical datasets. MMG have also completed a geochemical sampling review and planned a helicopter-supported regional stream sediment sampling program which is scheduled for the September quarter. Page 5 of 9
Base Metal Exploration Western Australia EAST PILBARA PROJECT (100% Mithril) The East Pilbara Project is located approximately 200 kilometres south east of Port Hedland, Western Australia and is prospective for nickel, iron and copper lead zinc mineralisation (Figure 5). Figure 5. East Pilbara Location Plan showing VTEM (chanel 33) image and prospects. Subsequent to the Quarter s end, the Company completed a four hole (922 metres) reverse circulation drilling program within the eastern portion of the project area targeting coincident VTEM geophysical anomalies and outcropping surface mineralisation. Three drill holes (CTWRC001 CTWRC003) were completed at the Talga East prospect beneath an outcropping gossanous horizon. A fourth drill hole (CTWRC004) at the Gorge North prospect, which is located immediately west of Talga East, targeted a VTEM anomaly modelled beneath an ironstone outcrop that reported weakly elevated base metals. The rock types observed in the three Talga East holes are predominantly amphibolite-facies mafic gneiss with varying degrees of shearing and silica alteration. Quartz veining, trace pyrite and pyrrhotite are observed throughout each hole, along with an increased sulphide zone commonly associated with magnetite-rich intervals. The hole at Gorge North intersected a similar sequence of mafic gneiss without any sulphides observed. At the time of writing, assay results were expected by mid September 2012. Page 6 of 9
SANDSTONE PROJECT (100% Mithril) Following a detailed review of the Sandstone Project a decision has been made to divest the Sandstone Project and the Company is actively seeking a joint venture partner (Figure 6). Discussions with a number of interested parties are ongoing. Figure 6. Sandstone Project Location Plan Investments Mithril is the largest shareholder in Musgrave Minerals Limited (ASX: MGV) with 9.28 million shares and 2.5 million options. Mithril vended tenements to Musgrave Minerals as part of their successful IPO that was completed on April 29th, 2011. Musgrave Minerals is actively exploring the prospective Musgrave Province in South Australia with two drilling programs currently underway. Outlook The primary focus of activity for the September 2012 Quarter will be the drilling of high priority copper - gold targets at the Illogwa IOCG Area which is located within the Huckitta Project. David Hutton Managing Director Page 7 of 9
Notes Specific HUCKITTA PROJECT - Sammy Joint Venture The Mini Me, El Gordo, Nigel and Austin Prospects are located on EL25643 where Mithril may earn an 80% interest under a joint venture with Sammy Resources Pty Ltd, a wholly owned subsidiary of ASX-listed Cazaly Resources Ltd (ASX:CAZ). HUCKITTA PROJECT Rock Chip Sampling Sample Number Prospect Easting Northing Au g/t Cu % 62152 Mini Me 560833 7370977-0.01 0.20 62153 Mini Me 560839 7370971 0.02 0.49 62155 Mini Me 560815 7370919-0.01 0.13 62158 Mini Me 561021 7370930 0.28 0.54 62160 Mini Me 561032 7370935 0.18 1.57 62161 Mini Me 561040 7370930 0.03 1.24 62162 Mini Me 560543 7371172-0.01 0.14 62184 Mini Me 561411 7370684 0.08 1.10 62185 Mini Me 561415 7370685 1.40 7.80 89926 Mini Me 561979 7370618 0.01 0.49 89927 Mini Me 562015 7370616 0.06 0.39 89928 Mini Me 562032 7370616 0.01 0.61 89929 Mini Me 562039 7370614 0.23 2.81 89930 Mini Me 562114 7370619-0.01 0.14 89931 Mini Me 561955 7370611 0.01 0.17 89932 Mini Me 561664 7370635-0.01 0.59 89934 Mini Me 561642 7370662-0.01 0.13 89936 Mini Me 561680 7370742 0.09 0.18 89939 Mini Me 561438 7370693 0.01 5.44 89940 Mini Me 561386 7370719 0.03 1.17 89941 Mini Me 561331 7370759 0.13 0.47 89942 Mini Me 561173 7370772 0.09 0.34 89944 Mini Me 562349 7370740 0.01 0.15 Notes: All rock chip results were obtained from analysis of a nominal 1 kilogram grab sample (unless otherwise specified). All samples are prepared and analysed at ALS Global Pty Ltd. s Perth Minerals Laboratory following preparation at ALS s Alice Springs Sample Preparation facility. Sample preparation is by pulverisation of the entire sample to a nominal 85% passing 75 microns in size. Base metal analysis is carried out by subjecting a 25-gram portion of the sample to a multi acid digest and analysing the sample by Inductively Coupled Plasma Atomic Emission Spectrometry (method ME-ICP61). Gold and precious metal analysis is carried by 25g Fire Assay and an AAS finish (method Au-AA25). Sample locations were determined using a handheld GPS achieving +/- 4 metre accuracy - MGA datum (Zone 53). YAMBAH PROJECT Historic Drilling Hole ID Prospect Easting Northing Dip Azi Mag From Width Cu% Pb% Zn% RRK31 Red Rock Bore 374416 7684832-60 030 131.25 12.35 0.1 0.5 3.3 Notes: All drilling results are historic and as such, analytical methods are unknown. The location of drill holes were determined from coordinates provided in historical reports. Page 8 of 9
EAST PILBARA PROJECT Reverse Circulation Drilling Hole ID Prospect Easting Northing Dip Azi Mag From Width Cu% Pb% Zn% CTWRC001 Talga East 797801 7684832-60 180 Assays Awaited CTWRC002 Talga East 796704 7684728-60 185 Assays Awaited CTWRC003 Talga East 796713 7684811-60 185 Assays Awaited CTWRC004 Gorge North 778117 7687106-60 320 Assays Awaited Notes: All Reverse Circulation drill hole results are obtained from analysis of 1 metre samples (unless otherwise specified). Sampling is undertaken following logging of geological boundaries within the drill hole. All samples are prepared and analysed at ALS Global Pty Ltd. s Perth Minerals Laboratory. Sample preparation is by pulverisation of the entire sample to a nominal 85% passing 75 microns in size. Base metal analysis is carried out by subjecting a 25-gram portion of the sample to a multi acid digest and analysing the sample by Inductively Coupled Plasma Atomic Emission Spectrometry (method ME-ICP61). Gold and precious metal analysis is carried by 25g Fire Assay and an AAS finish (method Au-AA25). Intersections are reported as down hole widths, not true widths. Reported intersections are calculated as length weighted average grades typically using the following cut off grades - a 0.5% copper, lead and zinc, and 0.5g/t gold and silver. Au gold, Ag silver, Cu copper, Pb lead, and Zn zinc. The location of drill holes were determined using a handheld GPS achieving +/- 4 metre accuracy - MGA datum (Zone 50). ENDS For Further Information Contact: Mithril Resources Ltd David Hutton, Managing Director admin@mithrilresources.com.au 58 King William Road Goodwood, South Australia 5034 ABN: 30 099 883 922 T: (61 8) 8378 8200 F: (61 8) 8378 8299 www.mithrilresources.com.au For Media Inquiries Contact: Michels Warren Richard Sproull 0418 585 517 Kristy Macfarlane 0402 557 527 Competent Persons Statement: The information in this report that relates to Exploration Results and Mineral Resources is based on information compiled by Mr David Hutton (Managing Director), who is a fulltime employee of the Company and a Fellow of the Australasian Institute of Mining and Metallurgy (AusIMM). Mr D Hutton has more than five years experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Hutton consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. About Mithril Resources Ltd: Mithril Resources Ltd is an Australian exploration company focused on the discovery and development of base metal deposits primarily copper. Mithril is a frontier explorer with a small but highly experienced team based in Adelaide. Combining advanced technology with a proven field based approach ensures the bulk of the company s expenses go directly into the ground. Page 9 of 9