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ACN 148 860 299 E | [email protected] T | (02) 8315 3268 A | Level 13/50 Carrington Street, Sydney NSW 2000
13November2017 ASXMarketRelease
LETTERTOSHAREHOLDERS DearShareholderFollowing the recent ASX announcement (Refer ASX announcement 8 November 2017)describingourinstantsuccesswiththeSub-AudioMagneticGeophysicalSurvey(SAM)ontheMt Freda Mining Lease, I wish to personally write to all shareholders to describe thesignificanceoftheresults.Alarge~950metreconductivestructurehasbeenidentifiedextendingalongstrikefromthewestoftheMtFredaopencut.Thepresenceofsuchconductivestructures,ifmineralised,hasthepotentialtosignificantlyincreasethecurrentResourceDefinitiondrillingtargetswithintheMtFredaOpenCutgoldproject.CurrentlythecompanyiscompletingresourcedrillingatboththeMtFredaandGildedRosegoldprojectstoestablishJORC2012resourceestimatesandtheconductiveextensionsidentifiedatMtFredaarenowprioritydrillingtargetswithintheresourcedefinitiondrillprogram.(ReferASXannouncement8thNovember2017).
Figure1:Sub-AudioMagneticGeophysicalSurvey(SAM)indicatinghighprioritydrilltargetsattheMtFredaOpencut.
Conductivedrilltargets
SubtleConductivedrilltargets
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Sub-AudioMagneticGeophysicalSurvey(SAM)interpretationItappearsthattheconductivestructurescontinuebeyondtheareaofthesurveytothewestintoAusmex’sEPM14163.DuetotheexceptionalresultsfromtheMtFredaSAMtrial,theSAMsurveyisnowcurrentlybeingexpandedintoEPM14163asoutlinedinfigure2belowtocapture the entire southern gold and copper field previously identified within EPM14163(ReferASXannouncement7thAugust2017forassayresults).TheGeophysicalSurveyinvolvesinjectingelectricalcurrentintothegroundwhichisdesignedtomapgeologicalstructuresthatshowacontrastinconductivitycomparedwithsurroundingcountry rock. TheGeophysical Survey data results indicate the potential for theMt Fredaorebodymineralisedstructurestoextendtothenorthwestandadjointhe700-metregoldstructureidentifiedbythefirstphaseofexplorationonEPM14163,asinterpretedinFigure2below.
Figure2.EPM14163highgraderockchipsresults(ReferASXannouncement7thAugust2017forassayresults)with interpretedextensionofthehighlyconductivestructures identifiedbySAMextendingfromtheMtFredaOpenCutfor~950mandadjointhepreviouslyidentified700mgoldmineralisedstructure.(Combinedpotentialdrillingtargetstrikelengthof>1.7km).
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Consideringthemagnitudeoftheadditional~1.7kmdrillingtargetsidentifiedatMtFredafromtheSAMGeophysicaltrial,thereisnowpotentialtoaddsignificantscopetothecurrentResourceDefinitiondrillingprogram.DrillingwillcontinueonsiteatMtFredauntilJORC2012resourceestimatesareachieved.GildedRoseplannedSub-AudioMagneticGeophysicalSurveyFollowingtheextraordinaryresultsfromtheMtFredaSAMgeophysicaltrial,thecompanyhasplannedaSAMsurveyoverthecurrentGildedRosehighgradegoldprojectwherecurrentResourcedefinitiondrillingisunderway.ThepotentialtoidentifyfurtherconductivestructuresatGildedRosethatcorrelatewithknownmineralisationmayfurtherdefineadditionaldrillingtargetsfortheproject.ThecurrentdrillrigscommittedtotheGildedRoseProjectwillremainonsiteandcontinuedrillinguntilJORC2012resourceestimatesareachieved.
Figure3.PlannedSAMtrialfootprintover~1.5kmGildedRosemineralisedstrikelengthcoveringhighgraderockchipslocationsofupto277gpertonneGold.(ReferASXannouncement12Julyforassayresults)
GildedRoseSAMtrialfootprint
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FurtherExplorationUpdateDrillingonAusmexEPM14163(abutstheMtFredaMiningLease)DrillingonEPM14163whichadjoinstheMtFredaMLhascommencedwiththeAusmexownedtrackmountedairimpactdrillrig,aimingtoquicklyidentifytargetsfortheRCandDiamondCorerigs.Thedrillinghasstartedonthe4mainoutcropsthatmakeupthepossible700mgoldsystempreviouslyidentifiedbyrockchipsampling.(figure2above).Rockchipassaysofup to 79.8 g/t Au have previously been recorded along strike of the four surface quartzoutcropsthatmadeupthe700mpossiblecontinuoussystem.(ReferASXannouncement7thAugust2017forassayresults).Culturalheritageclearances,havebeencompletedfacilitatingdrilling.Afifthquartz/ironstoneoutcropover3minwidthand3mhigh,strikingE/W,hasnow been identified approx. 1 km to the west of themost westerly outcrop. This largeroutcropwhichisidenticalinrocktypetothe4outcrops,ispossiblyacontinuationofthe700msystem.OncetheairtrackimpactdrillhasidentifiedtargetsfromtheassayingtheRCanddiamondcorerigswillbeassignedtofollowupthedrilling.Attimeofreporting28holeshavebeendrilledalonga300mstrikelength.
Fig4:Ausmex’sImpactairdrill,drillingthe700mpossiblecontinuousgoldsystemidentifiedbyrockchipsamplingalongthe700mwithgradesupto79.8g/tAu
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TheJoker,Trump,BelgiumandAnswerLeasesexplorationupdateReversecirculationdrillinghasalsojustcommencedonthehistoricalcopper/gold“JokerProspect”,whichislocatedwithintheEPM15858locatednorthofEPM14163.(SeeFig8)TheJokerisanhistoricalCoppermineinproductionuntil1928withanaveragecopperproductiongradeof21%Cu.DrillinghasalsocommencedattheTrumpCopperMiningLeasesouthofMalbonand30kmssouthofCloncurry.DrillingwillalsocommenceontheBelgiumandAnswerMiningLeaseswhicharelocatedwithintheSelwynarea70kmssouthofCloncurry.Ourpreviouslowimpactexplorationonthehistoricalhigh-gradeBelgiumprospectresultedinthefaceoftheorebody,inthesmallopenpit,acrossthe23mwideorebodyfacewithanaveragegradeof2.93%[email protected]%Cu.(Refer,ASXannouncement23rdAugust2017).
Fig5:AssaysfromhistoricalJokerCopperMineFig6:AssayingthefaceoftheBelgiumMine [email protected]%Cuincl:[email protected]%Cu
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Fig7:DrillingcommencesattheTrumphistorical Fig8:DrillingcommencesattheJokerCopperMinelocatednearMalbon(SofCloncurry)ProspectwithinAusmexEPM15858Drill pads have also been cleared for RC drilling at another Ausmex historical high-gradeCoppermine, the “Answer”mining lease, located a little further south from the Belgiummininglease.WeexpectthatallthreeoftheabovegrantedleaseswillhavephaseonedrillingcompletedpriortotheXmasshutdownofexploration.TwofieldexplorationcrewswillworkthroughtheChristmasshutdownperiod.AusmexhasnowestablisheditselfintheCloncurryGoldandCoppermineralfieldasthemostactiveexplorerintheregion,with5Drillrigsexploringthehighlyprospectivemineralgroundheld by the Company. In four months we have established an exploration team with 9geologists and 8 field and service personnel in the exploration crew. The service crew isparamount for an effective and smooth exploration program by cutting in access roads,cuttingandformingdrillpadsandprovidingwaterandfuelfortherigs,managingtheon-sitefuelfarm,maintenanceofourfleetofvehicles,servicingourownrigetc.ACloncurryregionaloffice,workshops,vehicles,core,mineralsamplefarmandcorecuttingfacility,fullysecuredtogetherwithhousinghaveallbeenestablishedwithinthe4-monthperiod.TheCompanyhasalready, in this short time identifiedmultiplemajor high-quality targets.Weare also veryfortunate, tohavebeenable to secureknowngolddeposits thathadprevious JORC2004compliantgoldandcobaltresourcesandnowintheprocessofupgradingthemtothe2012JORCCode.InadditiontotheseprojectstheCompanyhassecuredseveralotherhistoricalCopper andGoldmines that have had perviousmining and significant grades of gold andcopper.
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As the Managing Director of the Company I wish to thank the current Board and allshareholdersfortheircurrentsupportofthecompanyandtrustyousharemyenthusiasmregardingthefutureprospectivityofthehighvalueprojectsthecompanyhasacquiredwithinbothCloncurryQueenslandandBurraSouthAustralia.IexpectsoontobeabletoprovideyouwithanupdateonexplorationprogressofthecompanytenementsinSouthAustralia.I lookforwardtocontinuallyupdatingshareholderswithresultsandactivities,andhopetomeetasmanyinpersonaspossibleattheupcomingCompanyAGMon24thNovember.Yourtruly
MatthewMorganManagingDirectorAusmexMiningGroupLimited
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Figure9.Ausmexcurrenttenementlocationplan
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Ends.Forfurtherinformation,pleasecontact:MattMorganManagingDirectorAusmexMiningGroupLtdForwardLookingStatementsThematerialsmayincludeforwardlookingstatements.Forwardlookingstatementsinherentlyinvolvesubjectivejudgement,andanalysisandaresubjecttosignificantuncertainties,risks,andcontingencies,manyofwhichareoutsidethecontrolof,andmaybeunknownto,thecompany.Actualresultsanddevelopmentsmayvarymateriallyfromthatexpressedinthesematerials.Thetypesofuncertaintieswhicharerelevant tothecompanymay include,butarenot limitedto,commodityprices,politicaluncertainty,changestotheregulatoryframeworkwhichappliestothebusinessofthecompanyandgeneraleconomicconditions.Given theseuncertainties, readersarecautionednot toplaceunduerelianceonforwardlookingstatements.Any forward looking statements in thesematerials speak only at the date of issue. Subject to anycontinuingobligationsunderapplicablelaworrelevantstockexchangelistingrules,thecompanydoesnot undertake any obligation to publicly update or revise any of the forward looking statements,changesinevents,conditionsorcircumstancesonwhichanystatementisbased.CompetentPersonStatementStatements contained in this report relating to exploration results and potential are based oninformationcompiledbyMr.MatthewMorgan,whoisamemberoftheAustralasianInstituteofMiningandMetallurgy(AusIMM).Mr.MorganistheManagingDirectorofAusmexMiningGroupLimitedandGeologist whom has sufficient relevant experience in relation to the mineralization styles beingreported on to qualify as a Competent Person as defined in the Australian Code for Reporting ofIdentifiedMineralresourcesandOrereserves(JORCCode2012).Mr.Morganconsentstotheuseofthisinformationinthisreportintheformandcontextinwhichitappears. JORCCode,2012Edition–Table1reportSection1SamplingTechniquesandData(Criteriainthissectionapplytoallsucceedingsections.)Criteria JORCCodeexplanation Commentary
Samplingtechniques
• Natureandqualityofsampling(egcutchannels,randomchips,orspecificspecialisedindustrystandardmeasurementtoolsappropriatetothemineralsunderinvestigation,suchasdownholegammasondes,orhandheldXRFinstruments,etc).Theseexamplesshouldnotbetakenaslimitingthebroad
• RandomRockchip
samplestakenbyGpick• Sampleswere~2-3kgin
weight• Sampleswereselected
fromoutcroppingmineralisationwithin
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Criteria JORCCodeexplanation Commentary
meaningofsampling.• Includereferencetomeasurestakento
ensuresamplerepresentivityandtheappropriatecalibrationofanymeasurementtoolsorsystemsused.
• AspectsofthedeterminationofmineralisationthatareMaterialtothePublicReport.
• Incaseswhere‘industrystandard’workhasbeendonethiswouldberelativelysimple(eg‘reversecirculationdrillingwasusedtoobtain1msamplesfromwhich3kgwaspulverisedtoproducea30gchargeforfireassay’).Inothercasesmoreexplanationmayberequired,suchaswherethereiscoarsegoldthathasinherentsamplingproblems.Unusualcommoditiesormineralisationtypes(egsubmarinenodules)maywarrantdisclosureofdetailedinformation.
EPM14163
Drillingtechniques
• Drilltype(egcore,reversecirculation,open-holehammer,rotaryairblast,auger,Bangka,sonic,etc)anddetails(egcorediameter,tripleorstandardtube,depthofdiamondtails,face-samplingbitorothertype,whethercoreisorientedandifso,bywhatmethod,etc).
• Nodrilling,loggingorsamplingwasconductedaspartofthisrelease.
Drillsamplerecovery
• Methodofrecordingandassessingcoreandchipsamplerecoveriesandresultsassessed.
• Measurestakentomaximisesamplerecoveryandensurerepresentativenatureofthesamples.
• Whetherarelationshipexistsbetweensamplerecoveryandgradeandwhethersamplebiasmayhaveoccurredduetopreferentialloss/gainoffine/coarsematerial.
• Nodrilling,loggingorsamplingwasconductedaspartofthisrelease
Logging • WhethercoreandchipsampleshavebeengeologicallyandgeotechnicallyloggedtoalevelofdetailtosupportappropriateMineralResourceestimation,miningstudiesandmetallurgicalstudies.
• Whetherloggingisqualitativeor
• Nodrilling,loggingorsamplingwasconductedaspartofthisreleaseF
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Criteria JORCCodeexplanation Commentary
quantitativeinnature.Core(orcostean,channel,etc)photography.
• Thetotallengthandpercentageoftherelevantintersectionslogged.
Sub-samplingtechniquesandsamplepreparation
• Ifcore,whethercutorsawnandwhetherquarter,halforallcoretaken.
• Ifnon-core,whetherriffled,tubesampled,rotarysplit,etcandwhethersampledwetordry.
• Forallsampletypes,thenature,qualityandappropriatenessofthesamplepreparationtechnique.
• Qualitycontrolproceduresadoptedforallsub-samplingstagestomaximiserepresentivityofsamples.
• Measurestakentoensurethatthesamplingisrepresentativeoftheinsitumaterialcollected,includingforinstanceresultsforfieldduplicate/second-halfsampling.
• Whethersamplesizesareappropriatetothegrainsizeofthematerialbeingsampled.
• Nodrilling,loggingorsamplingwasconductedaspartofthisrelease
Qualityofassaydataandlaboratorytests
• Thenature,qualityandappropriatenessoftheassayingandlaboratoryproceduresusedandwhetherthetechniqueisconsideredpartialortotal.
• Forgeophysicaltools,spectrometers,handheldXRFinstruments,etc,theparametersusedindeterminingtheanalysisincludinginstrumentmakeandmodel,readingtimes,calibrationsfactorsappliedandtheirderivation,etc.
• Natureofqualitycontrolproceduresadopted(egstandards,blanks,duplicates,externallaboratorychecks)andwhetheracceptablelevelsofaccuracy(ielackofbias)andprecisionhavebeenestablished.
• IndustrystandardFireassaysforAuwerecompletedbySGSlaboratoriesforGoldandICPanalysisforcopper
• RepeatandcheckswereconductedbySGSlaboratorieswhilstcompletingtheanalysis
Verificationofsamplingandassaying
• Theverificationofsignificantintersectionsbyeitherindependentoralternativecompanypersonnel.
• Theuseoftwinnedholes.• Documentationofprimarydata,data
entryprocedures,dataverification,data
• Nodrilling,loggingorsamplingwasconductedaspartofthisrelease
• Noassayswereadjusted
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Criteria JORCCodeexplanation Commentary
storage(physicalandelectronic)protocols.
• Discussanyadjustmenttoassaydata.Locationofdatapoints
• Accuracyandqualityofsurveysusedtolocatedrillholes(collaranddown-holesurveys),trenches,mineworkingsandotherlocationsusedinMineralResourceestimation.
• Specificationofthegridsystemused.• Qualityandadequacyoftopographic
control.
• RockChipsamplelocationswerecollectedfromwithinEPM14163.ThesamplelocationwasrecordedbyHandHeldGPS(accuracy+/-5)andrecordedinMGA94,Zone54datum
Dataspacinganddistribution
• DataspacingforreportingofExplorationResults.
• WhetherthedataspacinganddistributionissufficienttoestablishthedegreeofgeologicalandgradecontinuityappropriatefortheMineralResourceandOreReserveestimationprocedure(s)andclassificationsapplied.
• Whethersamplecompositinghasbeenapplied.
• Rockchipsamplesweretakenrandomlyalongthestrikeofthemineralisation.
• DataspacinganddistributionisNOTsufficientforMineralResourceestimation
• Nosamplecompositinghasbeenapplied.
Orientationofdatainrelationtogeologicalstructure
• Whethertheorientationofsamplingachievesunbiasedsamplingofpossiblestructuresandtheextenttowhichthisisknown,consideringthedeposittype.
• Iftherelationshipbetweenthedrillingorientationandtheorientationofkeymineralisedstructuresisconsideredtohaveintroducedasamplingbias,thisshouldbeassessedandreportedifmaterial.
• Theorientationofsamplesisnotlikelytobiastheassayresults.
Samplesecurity
• Themeasurestakentoensuresamplesecurity.
• SamplesweretakentoCloncurrybycompanypersonnelanddespatchedbycouriertotheSGSLaboratoryinTownsville
Auditsorreviews
• Theresultsofanyauditsorreviewsofsamplingtechniquesanddata.
• Noauditsorreviewshavebeenundertakenatthisstage.
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Section2ReportingofExplorationResults(Criterialistedintheprecedingsectionalsoapplytothissection.)Criteria JORCCodeexplanation Commentary
Mineraltenementandlandtenurestatus
• Type,referencename/number,locationandownershipincludingagreementsormaterialissueswiththirdpartiessuchasjointventures,partnerships,overridingroyalties,nativetitleinterests,historicalsites,wildernessornationalparkandenvironmentalsettings.
• Thesecurityofthetenureheldatthetimeofreportingalongwithanyknownimpedimentstoobtainingalicencetooperateinthearea.
• ML2718,ML2709,ML2713,ML2719,ML2741&EPM14163areowned100%bySpinifexMinesPtyLtd.AusmexMiningGroupLimitedowns80%ofSpinifexMinesPtyLtd.QueenslandMiningCorporationLimitedown20%ofSpinifexMines.ExplorationiscompletedunderanincorporatedJointVenture.
• EPM14475,EPM15858,&EPM18286areheldbyQMCExplorationPtyLimited.AusmexMiningGroupLimitedowns80%ofQMCExplorationPtyLimited.QueenslandMiningCorporationLimitedown20%ofSpinifexMines.ExplorationiscompletedunderanincorporatedJointVenture.
• ML2549,ML2541,ML2517are100%ownedbyAusmex.
Explorationdonebyotherparties
• Acknowledgmentandappraisalofexplorationbyotherparties.
• AllRockChipsamplingandexplorationprogramswereconductedbyAusmexMiningGroupLimited.SAMGeophysicalsurveywasconductedbyGAPGeoPhysicsExplorationServicesPtyLimited
Geology • Deposittype,geologicalsettingandstyleofmineralisation.
• ML2718,ML2709,ML2713,ML2719hoststheGildedRosesheerhostedquartzreef.Thereareseveralgoldmineralisedhydrothermalquartzreefswithinthedeposit.
• ML2741hoststheshear
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Criteria JORCCodeexplanation Commentary
hostedquartzrichMtFredaGolddepositcontainingAu,Cu,&Co.
• ML2549,ML2541,ML2517hostcoppermineralisationassociatedwithcarbonateintrusionsintoalteredmafichostrocks
• EPM14163&EPM15858containThereareseveralgoldmineralisedhydrothermalquartzreefswithinthedepositcontainingAu,Cu,&Co
DrillholeInformation
• AsummaryofallinformationmaterialtotheunderstandingoftheexplorationresultsincludingatabulationofthefollowinginformationforallMaterialdrillholes:o eastingandnorthingofthedrill
holecollaro elevationorRL(ReducedLevel–
elevationabovesealevelinmetres)ofthedrillholecollar
o dipandazimuthoftheholeo downholelengthandinterception
deptho holelength.
• IftheexclusionofthisinformationisjustifiedonthebasisthattheinformationisnotMaterialandthisexclusiondoesnotdetractfromtheunderstandingofthereport,theCompetentPersonshouldclearlyexplainwhythisisthecase.
• Nodrilling,loggingorsamplingwasconductedaspartofthisrelease.
Dataaggregationmethods
• InreportingExplorationResults,weightingaveragingtechniques,maximumand/orminimumgradetruncations(egcuttingofhighgrades)andcut-offgradesareusuallyMaterialandshouldbestated.
• Whereaggregateinterceptsincorporateshortlengthsofhighgraderesultsandlongerlengthsof
• Nodrilling,loggingorsamplingwasconductedaspartofthisrelease
• Nomaterialinformationisexcluded.
• Nointersectionshavebeenreportedaspartofthisrelease.
• Allsamplelocationsandfire
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Criteria JORCCodeexplanation Commentary
lowgraderesults,theprocedureusedforsuchaggregationshouldbestatedandsometypicalexamplesofsuchaggregationsshouldbeshownindetail.
• Theassumptionsusedforanyreportingofmetalequivalentvaluesshouldbeclearlystated.
assayAuresultshavebeendisplayedinthepreviousreportedASXannouncementon7thAugust2017.
•
Relationshipbetweenmineralisationwidthsandinterceptlengths
• TheserelationshipsareparticularlyimportantinthereportingofExplorationResults.
• Ifthegeometryofthemineralisationwithrespecttothedrillholeangleisknown,itsnatureshouldbereported.
• Ifitisnotknownandonlythedownholelengthsarereported,thereshouldbeaclearstatementtothiseffect(eg‘downholelength,truewidthnotknown’).
• Nodrilling,loggingorsamplingwasconductedaspartofthisrelease
• Nomaterialinformationisexcluded.
• Nointersectionshavebeenreportedaspartofthisrelease.
Diagrams • Appropriatemapsandsections(withscales)andtabulationsofinterceptsshouldbeincludedforanysignificantdiscoverybeingreportedTheseshouldinclude,butnotbelimitedtoaplanviewofdrillholecollarlocationsandappropriatesectionalviews.
• MapsshowingthelocationoftheEPMsandMLsarepresentedintheannouncement,resultsandmapswerealsopreviouslyreportedtoASX,referannouncement7thAugust2017.DiagramsproducedbyGAPGeoPhysicswereattacheddisplayingconductivityidentifiedfollowingaSAMsurvey.
Balancedreporting
• WherecomprehensivereportingofallExplorationResultsisnotpracticable,representativereportingofbothlowandhighgradesand/orwidthsshouldbepracticedtoavoidmisleadingreportingofExplorationResults.
• AllcomprehensiveassayresultswerepreviouslyreportedtoASX,referannouncement7thAugust2017.
Othersubstantiveexplorationdata
• Otherexplorationdata,ifmeaningfulandmaterial,shouldbereportedincluding(butnotlimitedto):geologicalobservations;geophysicalsurveyresults;geochemicalsurveyresults;bulksamples–sizeand
• GAPGeophysicshaveconducteda“SAM”SubAudioMagneticGeophysicalsurveywithresultsdisplayingtheconductivitywithinthesurvey.
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Criteria JORCCodeexplanation Commentary
methodoftreatment;metallurgicaltestresults;bulkdensity,groundwater,geotechnicalandrockcharacteristics;potentialdeleteriousorcontaminatingsubstances.
•
Furtherwork • Thenatureandscaleofplannedfurtherwork(egtestsforlateralextensionsordepthextensionsorlarge-scalestep-outdrilling).
• Diagramsclearlyhighlightingtheareasofpossibleextensions,includingthemaingeologicalinterpretationsandfuturedrillingareas,providedthisinformationisnotcommerciallysensitive.
• Additionalmapping,costeans,geophysicalsurveys,RAB,RC,andCoredrilling
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