Papua Mining Plc Rock samples return over 1 ounce/tonne gold (3718H)

TIDMPML

RNS Number : 3718H

Papua Mining Plc

12 March 2018

12 March 2018

This announcement contains inside information

Papua Mining plc

("Papua" or "the Company")

Rock samples return over 1 ounce/tonne gold

The Board of Papua Mining (LON: PML), is pleased to announce high grade gold-in-rock samples from its Lighthouse Gold Project in Queensland and provides an update to shareholders on exploration activities at its 100%-owned projects in Australia and Papua New Guinea.

Highlights:

   --     Rock sampling completed at the Double Event Prospect, part of the Lighthouse Project; 
   --     Results include high grade gold and silver from most rock samples; 
   --     25% of all rock samples assay above 10g/t Au; 
   --     Reverse circulation ("RC") drilling planned at Double Event; 
   --     Papua field team currently in PNG to assess core from previous drilling; 

-- Review of drilling from the Nov/Dec 2017 program at Plateau Prospect now complete, placing Plateau in the distal zones (upper levels) of a large, mafic mineralising system.

DOUBLE EVENT

Papua Mining has completed rock sampling and structural mapping at the Double Event Prospect which forms part of the Lighthouse Project. Forty-nine (49) surface rock samples have been collected from along the mapped strike of the Double Event Prospect.

Whilst sampling and mapping, the PML geologists have reported abundant quartz veining and subsequent sampling of the veins has returned some gold assays in excess of 1 ounce/tonne gold including; 37.7g/t, 33.3g/t, 33.1g/t, 25.9g/t, 24.3g/t, 23.5g/t and a number of additional high-grade gold results. Silver results include 56.8g/t, 54.0g/t, 52.7g/t, 46.7g/t, 38.7g/t and 37.1g/t and other high-grade silver values. High lead values include 4.46%, 3.64% and 3.29% Pb. A full list of results is provided in the table below.

The average of all rock samples collected by the Company was 8.45g/t Au, with 76% of results over 1g/t Au and just over 50% of rocks returning assays above 3g/t Au. A quarter of all samples (25%) returned gold in excess of 10g/t Au. These results validate and in-fill historical rock sampling data at Double Event from 1987, which also returned high grade gold assays up to 87g/t Au and 400g/t Ag.

The rock sampling at Double Event was aimed at validating rock sampling information collected in 1987, as well as refining the position and orientation of gold lodes within the limits of and beyond the mapped historical workings. The historic mine workings and anomalous rock samples extend for over 3km in length. Only the eastern and central parts of the lode were sampled by Papua during the February 2018 campaign, however it is intended that the entire 3km strike will be sampled in up-coming field programs.

The rock sampling, geological and structural mapping carried out by the Company has helped to refine the orientation of the lodes. Previously, the strike of mineralisation was thought to be east-west, however the true orientation of the lodes is now understood to be 115deg. With this new orientation being clarified, the interpretation is of multiple, parallel lodes, which provides a more specific target for future RC drilling at Double Event to delineate a near-surface, high-grade gold resource. The map below shows the historic workings and rock sampling carried out at Double Event:

http://www.rns-pdf.londonstockexchange.com/rns/3718H_-2018-3-12.pdf

Table showing all rock samples collected at Double Event Prospect, February 2018

 
 Papua Mining plc 
 Lighthouse Project, Double 
  Event Prospect 
 Rock sampling February 
  2018 
------------------------------  ------  -------  ----- 
 Sample                     Au      Ag       Pb     Pb 
 Number                    ppm     ppm      ppm      % 
-------------------  ---------  ------  -------  ----- 
 BDERS001                19.15   52.70   13,750   1.38 
 BDERS002                 2.33   54.00    8,070   0.81 
 BDERS003                 2.89   33.60   18,400   1.84 
 BDERS004                <0.01    0.14       61   0.01 
 BDERS005                 7.85   14.55    4,570   0.46 
 BDERS006                 0.28    1.43      340   0.03 
 BDERS007                 2.76    2.62      665   0.07 
 BDERS008                21.50   23.90   18,500   1.85 
 BDERS009                 2.84   10.25    7,270   0.73 
 BDERS010                 0.49    4.28      284   0.03 
 BDERS011                 0.32    0.20       79   0.01 
 BDERS012                <0.01    0.01       21   0.00 
 BDERS013                 0.18    0.34      369   0.04 
 BDERS014                13.80   24.30   12,300   1.23 
 BDERS015                 0.99    3.81    2,180   0.22 
 BDERS016                 0.22    0.50    1,200   0.12 
 BDERS017                 6.25   12.05    1,035   0.10 
 BDERS018                37.70   46.70   18,250   1.83 
 BDERS019                 2.87    1.92    1,015   0.10 
 BDERS020                 3.30    1.40    1,315   0.13 
 BDERS021                21.90   26.10    8,940   0.89 
 BDERS022                33.30   32.20   17,150   1.72 
 BDERS023                 7.11   19.40    4,260   0.43 
 BDERS024                 2.84    1.36    1,640   0.16 
 BDERS025                 1.38    2.70      681   0.07 
 BDERS026                 1.13    3.56    1,230   0.12 
 BDERS027                 9.41   17.45    7,030   0.70 
 BDERS028                 2.33    3.15    1,070   0.11 
 BDERS029                 5.55    6.65    2,450   0.25 
 BDERS030                15.80    7.70    6,700   0.67 
 BDERS031                 0.45    0.95       90   0.01 
 BDERS032                 0.15    0.73      131   0.01 
 BDERS033                 3.62   29.10      209   0.02 
 BDERS034                 1.32    5.70      236   0.02 
 BDERS035                 2.21    7.27    1,750   0.18 
 BDERS036                 3.08    2.49    2,490   0.25 
 BDERS037                33.10   13.95    3,910   0.39 
 BDERS038                 7.54    9.21   15,650   1.57 
 BDERS039                 7.22   12.85    2,160   0.22 
 BDERS040                 0.27    2.03      294   0.03 
 BDERS041                23.10   56.80   44,600   4.46 
 BDERS042                24.30   17.20   16,000   1.60 
 BDERS043                 1.24    5.76    1,540   0.15 
 BDERS044                 2.16    2.72    4,080   0.41 
 BDERS045                 8.77   37.10   32,900   3.29 
 BDERS046                 2.09    2.31    5,310   0.53 
 BDERS047                 0.53    1.37    3,080   0.31 
 BDERS048                25.90   38.70   36,400   3.64 
 BDERS049                23.50   17.30    1,480   0.15 
-------------------  ---------  ------  -------  ----- 
 
 

BACKGROUND AND HISTORY AT DOUBLE EVENT

Hand-held mining of quartz lodes occurred at Double Event in 1900 and only remnant, shallow workings remain. Government mining records from this time indicate that 1,744 ounces of gold were won from mining 1,889 tons of ore, giving an average mined head grade of 28.7g/t Au.

Battle Mountain (Australia) Inc. ("Battle Mountain") and Newcrest Mining Limited ("Newcrest") have both conducted drilling at Double Event. In 1987, Battle Mountain drilled 25 holes, totalling 798m with an average depth of just 31m. Newcrest drilled 2 holes in 1998 to a maximum of 150m.

Drilling by Battle Mountain to a vertical depth of only 20m on several sections of the 3km long line-of-lode identified a section with an average grade quoted in Battle Mountain's 1987 Annual Report of 3.25g/t Au.**

** This quoted grade is an historical average and does not comply with the guidelines as established by the Joint Ore Resource Committee for the Reporting of Mineral Resources and Ore Reserves (2012). The potential grade quoted is conceptual in nature, and there has been insufficient exploration to estimate a Mineral Resource and it is uncertain if further exploration will result in the determination of a Mineral Resource.

The historic drilling completed by Battle Mountain in 1987 was considered to be successful, with 72% of holes intersecting gold values within the top 20m vertically from surface. The results from this drilling was reported by Battle Mountain in 1987 and further details are set out in the table below. Battle Mountain withdrew from the project citing that their corporate target of a minimum of +2 million ounces gold reserve was unlikely to be identified at Double Event. At the time of drilling, Battle Mountain was amongst the top gold mining companies globally, with gold sales topping US$300 million annually.

Subsequent drilling of only 2 holes along the entire 3km strike by Newcrest in 1998 targeted the deep sulphide potential (+80m) at Double Event. This drilling hit 2m @ 0.55g/t Au and Newcrest concluded that significant gold beneath the oxide zone was downgraded. The Newcrest 1989 Annual Technical Report states that "...smaller companies may be interested in farming into the narrow, surface-enriched structures".

The Board of Papua is of the opinion that 2 deep drill holes into a 3 kilometre long mineralised structure is not adequate exploration and considers the prospect under-explored.The Board views Double Event as opportunity for a smaller company, such as Papua, to identify material, near-surface oxide ounces which could potentially prove highly profitable for a company with lower operational and administrative overheads.

Table 2: Double Event Drilling results from 1987 (Battle Mountain (Australia) Inc)

 
 Lighthouse Project, Double Event 
  Prospect 
 Battle Mountain RC drilling 
  results 1987 
 Hole           From      To    Interval    Gold   Silver 
 Number          (m)     (m)         (m)     g/t      g/t 
-----------  -------  ------  ----------  ------  ------- 
 LTR0001       30.00   31.00        1.00    0.66      2.0 
 LTR0002                 no significant assays 
 LTR0003                 no significant assays 
 LTR0004       24.00   25.00        1.00    0.62      0.5 
 LTR0005                 no significant assays 
 LTR0006       29.00   30.00        1.00    1.04      0.5 
 LTR0007       28.00   29.00        1.00    7.40     24.0 
 LTR0008       24.00   26.00        2.00   13.19     10.0 
 LTR0009       10.00   12.00        2.00    2.70      2.0 
 LTR0010       14.00   16.00        2.00    4.14      6.0 
 LTR0011       10.00   11.00        1.00    3.25     17.0 
 LTR0012                 no significant assays 
 LTR0013       14.00   15.00        1.00    3.93     18.0 
 LTR0014                 no significant assays 
 LTR0015       18.00   20.00        2.00    2.11      6.0 
 LTR0016                 no significant assays 
 LTR0017       20.00   21.00        1.00    0.65      0.5 
 LTR0018       16.00   17.00        1.00    2.94      3.0 
 LTR0019        4.00    6.00        2.00    1.00      0.5 
 LTR0020       18.00   19.00        1.00    0.59      0.5 
 LTR0021       20.00   21.00        1.00    0.50     12.0 
 LTR0022                 no significant assays 
 LTR0023       14.00   18.00        4.00    0.67      1.3 
 LTR0024       31.00   35.00        4.00    4.65      4.3 
 LTR0025       20.00   22.00        2.00    1.17      0.5 
-----------  -------  ------  ----------  ------  ------- 
 

Chief Executive Officer of Papua Mining, David Price commented:

"Despite the inclement weather, our field crews are continuing to work and are identifying some exciting targets. We are preparing for RC drilling at Double Event, as well as geophysics at Plateau and Marengo. A PML geological crew is currently in PNG to re-examine old drill core from Mt Visi and Tripela.

Our current work program is designed as preparatory ground work prior to geophysics and then drilling, which will commence as soon as possible and most likely in May/June. In the meantime, we look forward to providing further updates on our current field activities and results as they come to hand."

PLATEAU

A thorough review of the drilling completed at Plateau last November/December has been undertaken, with the review examining grade, geology and various elemental ratios including Cu (copper), As (arsenic), Ag (silver), K (potassium), magnetite and pyrite. The technical analysis has shown that there is an increase in K and pyrite with depth, as well as sericite/silica alteration below historical hole PL092.

When compared with other intrusion-related mineralisation models, Plateau is interpreted to lie within the distal zones (upper levels) of a large, mafic mineralising system. The upper levels of mineralisation between PL092 and BPL003 are open to the north and south and the North Zone remains open at depth. To enhance our understanding of the potential and to ensure our exploration strategy targets the highest gold potential, a geophysical survey involving CSAMT (Controlled Source Audio-frequency Magnetotellurics) is being planned for Plateau.

MARENGO

A rock sampling program is planned to commence in April which will be focused on the One Mile Mountain Area. One Mile Mountain hosts several old workings including Albion, Homeward Bound, Toomey's, Quartz Blow and Westwood Prospects. Marengo represents the least advanced project in the PML portfolio but holds real potential for epithermal and Intrusion-related Gold System (IRGS) mineralisation.

Competent Person Statement:

Information in this announcement that relates to exploration results is based on information compiled by Mr David Price, a Director of Papua Mining plc, who is a Fellow of the Australasian Institute of Mining and Metallurgy (FAusIMM). Mr Price has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which has been undertaken to qualify as a Competent Person as defined by the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the JORC Code) and under the AIM Rules - Note for Mining and Oil & Gas Companies. Mr Price consents to the inclusion in the announcement of the matters based on their information in the form and context in which it appears.

For further information on the Company please visit www.papuamining.com or contact the following:

 
 
Papua Mining plc                        [e-mail] 
 David Price, Chief Executive Officer 
 Cenkos Securities plc                   [phone] 
 Nominated Adviser & Broker, 
 Derrick Lee/Beth Kiernan 
 

This information is provided by RNS

The company news service from the London Stock Exchange

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March 12, 2018 03:07 ET (07:07 GMT)