Highlights

• Drill hole CDH-050 designed to test further down-dip at the El Refugio target returned the exceptional result:

o 4.17m @ 62.0 g/t gold and 445 g/t silver from 233.43m (285 gram-metres gold equivalent¹)

• CDH-050 intercept supports the geologic model at El Refugio with significantly increased grade-thickness with depth

• CDH-050 minerals in the core (kaolinite) show evidence of fluid mixing, a powerful process for deposition of high-grade gold and silver

• 12 hole campaign starts at El Refugio to systematically test to the west

• Assays pending for holes CDH-054 – CDH-060 from nearby La Soledad and Los Reyes targets.

Mithril Resources Ltd (ASX: MTH) (Mithril or the Company) is pleased to provide an update on drilling activities at its Copalquin Gold Silver District, Mexico.

Drilling restarted in January to follow up the successful maiden drill program funded by a recent $5m capital raising.

Mithril CEO and Managing Director, John Skeet, commented:

“Drill hole CDH-050 is our best intercept to date in the district with 285 gram-metres AuEq¹ over 4.17m showing a significant (3x) increase in grade-thickness as we drill deeper at El Refugio (CDH-033 with 92 gram-metres AuEq¹).

The very high-grade gold and silver at El Refugio is important in establishing the strength of this epithermal centre for gold and silver in the district. Further drilling at El Refugio will seek to systematically extend the mineralisation and test for further ‘clavos’ (ore shoots), typical in these types of deposits. Holes have also been completed to the north at La Soledad and over 1.5km to the east at Los Reyes and we look forward to reporting assays shortly.”

1 Gold equivalent grades calculated at 70 g/t Ag = 1 g/t Au, using gold price of USD1,610 per ounce and silver price of USD23 per ounce.

Drilling Program 2021

Following the successful 2020 maiden drill program, drilling recommenced in January this year with drill holes designed to test the depth extension at El Refugio target, Cometa Project and to infill the area on the eastern side of the El Refugio target. Hole CDH-050 was drilled to test the depth extension at El Refugio and holes CDH-051 to 053 are shallower infill holes drilled on the eastern side of the El Refugio target.

Hole CDH-050 (4.17m @ 62.0 g/t gold and 445 g/t silver from 233.43m) has intercepted the same clavo (ore shoot) intercepted by last year’s hole CDH-033 (9.35m @ 7.84 g/t gold and 138g/t silver from 206.3m) and hole CDH-020 (8.7m @ 3.06 g/t Au and 93.6 g/t Ag from 176.85m). The grade-thickness of the clavo has increased with depth and visible gold is observed in the drill core.

The long section below in Figure 2 shows the pierce points of drill holes completed at the El Refugio target and the current the grade thickness contour interpretation. Further drilling will target depth extensions and systematically extend mineralisation to the west.

Below in Figure 3 is a map covering the majority of the Copalquin District concession area with the main project and target areas and drill intercept highlights to date. Further drilling at the El Refugio target that commenced this week seeks to extend the gold and silver mineralisation to the west where extensive surface alteration is observed.

The above cross section in Figure 4 illustrates the apparent grade thickness has increased with depth at the El Refugio target. Below in Figure 5 is a digital microscope image of drill core from hole CDH-050 showing visible gold and silver minerals.

The mineralogy and textures observed in the core suggest the existence of multiple boiling zones and multiple mineralisation events. El Refugio is very near the upwelling zone of a hydrothermal cell where the breccia zone reaches widths of up to 30 meters true width. The hole CDH-050 intercept is characterized by abundant black sulphide (ginguro) which is made up of silver sulphides and sulphosalts plus gold. The same interval also contained kaolinite, a clay mineral that only forms under very acidic conditions. Acid conditions in a low sulphidation system are an indicator of fluid-mixing which is known to be a very efficient trigger for gold/silver deposition.

Infill drill holes on the eastern side of the El Refugio target towards the El Cometa target intercepted high-grade gold and silver mineralisation.

Hole CDH-051 (3.4m @ 4.72 g/t gold and 170.8 g/t silver from 135.6m), and hole CDH-053 (11.6m @ 2.28 g/t gold and 55.3 g/t silver from 151m) plus CDH-052 (8.07m @ 0.92g/t gold and 39.2 g/t silver from 143.8m) have infilled the area between El Refugio and El Cometa and show excellent continuity of structure and grade.

The drill hole results for CDH-051 to 053 and the geologic logging suggest deeper drilling is warranted in this area towards the El Cometa target and at the El Cometa target itself.

ABOUT THE COPALQUIN GOLD SILVER PROJECT

The Copalquin mining district is located in Durango State, Mexico and covers an entire mining district of 70km2 containing several dozen historic gold and silver mines and workings, ten of which had notable production. The district is within the Sierra Madre Gold Silver Trend which extends north-south along the western side of Mexico and hosts many world class gold and silver deposits.

Multiple mineralisation events, young intrusives thought to be system-driving heat sources, widespread alteration together with extensive surface vein exposures and dozens of historic mine workings, identify the Copalquin mining district as a major epithermal centre for Gold and Silver.

Mithril Resources is earning 100% interest in the Copalquin District mining concessions via a purchase option agreement detailed in ASX announcement dated

-ENDS-

Released with the authority of the Board.

For further information contact:

Competent Persons Statement

The information in this report that relates to sampling techniques and data, exploration results and geological interpretation has been compiled by Mr Hall Stewart who is Mithril’s Chief Geologist. Mr Stewart is a certified professional geologist of the American Institute of Professional Geologists. This is a Recognised Professional Organisation (RPO) under the Joint Ore Reserves Committee (JORC) Code.

Mr Stewart has sufficient experience of relevance to the styles of mineralisation and the types of deposits under consideration, and to the activities undertaken, to qualify as a Competent Person as defined in the 2012 Edition of the Joint Ore Reserves Committee (JORC) Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Stewart consents to the inclusion in this report of the matters based on information in the form and context in which it appears. The Australian Securities Exchange has not reviewed and does not accept responsibility for the accuracy or adequacy of this release.

Original Article: https://investi.com.au/api/announcements/mth/e12979e5-a23.pdf