Highlight Results

First holes from deep drilling at El Refugio confirm continuing high-grade gold and silver, important for the considerably greater depth potential of the El Refugio system

• 5.67m @ 4.37 g/t gold, 174 g/t silver from 331.33m, (CDH-137), including
  1.67m @ 9.64 g/t gold, 399 g/t silver from 331.33m, plus
  1.00m @ 1.68 g/t gold, 67.2 g/t silver from 367.0m, plus
  1.00m @ 1.27 g/t gold, 46.1 g/t silver from 370.0m
  
• 0.50m @ 2.13 g/t gold, 118 g/t silver from 368.5m, (CDH-136), plus
  0.60m @ 0.66 g/t gold, 42.8 g/t silver from 375.5m, plus
  0.50m @ 0.39 g/t gold, 45.4 g/t silver from 377.9m, plus
  0.90m @ 1.04 g/t gold, 11.3 g/t silver from 431.85m

• Further El Refugio resource expansion/upgrade drilling is in progress on the eastern side and where the main upwelling feeder zone of the system is currently projected

• Excellent soil sampling results received, developing the La Constancia target area 3km east of El Refugio

• Continued exploration work in the middle section of the district confirms a 5.5km long E – W corridor of gold-silver mineralisation from El Gallo to La Constancia including the Refugio- La Soledad resource area

• Scoping study work progressing for El Refugio first stage development options for this attractive high-grade gold-silver resource

Mithril Resources Ltd (ASX: MTH) (Mithril or the Company) is pleased to provide exploration results for its 100% optioned Copalquin Gold Silver Project in Mexico where a maiden 529koz gold equivalent^* high-grade gold-silver JORC resource has been defined at El Refugio-La Soledad ^*(see ASX announcement 17 November 2021)

Mithril CEO and Managing Director, John Skeet, commented:

“Whilst the program of deep holes at El Refugio was technically challenging to complete, we have successfully confirmed the significant depth potential of the major El Refugio upwelling feeder structure. Recent drilling has projected the upwelling zone to target current and future drilling with considerable additional depth potential. Further drill holes CDH-141 and 142 have been completed and sent for assay with abundant silver sulphide mineralisation observed in intercepts. Drilling is now in progress on the eastern side of the main upwelling zone, successfully intercepting the main structure with drill holes CDH-143 and CDH-144. Importantly, we are observing boiling zone characteristics in the drill core. This is an exciting time as we drill to determine the excellent additional depth potential of this significant high-grade gold-silver deposit at El Refugio.

Introduction

Since acquiring the property in May 2020, Mithril has been drilling in the Copalquin district with one man- portable diamond drill rig developing several targets in the district and delivering a high-grade maiden JORC resource at El Refugio. The current program of work is exploring two main trends of historic mine workings across the district further ranking and developing drill targets and expanding/upgrading the maiden resource at El Refugio. During the maiden drill program in 2020, Mithril identified a large upwelling hydrothermal zone at El Refugio which hosts the maiden mineral resource estimate:

• 2,416,000 tonnes @ 4.80 g/t gold, 141 g/t silver for 373,000 oz gold plus 10,953,000 oz silver (Total 529,000 oz AuEq*) using a cut-off grade of 2.0 g/t AuEq*
• 28.6% of the resource tonnage is classified as indicated

This high-quality and high-grade resource is open at depth beyond where some of the highest grade intercepts were recorded. Additionally, there is significant upside beyond this maiden resource area to increase the district resources for gold and silver. Mining study work and metallurgy reported earlier this year, show the current resource material to be amenable to conventional underground mining and processing methods, yielding high gold and silver extraction.

El Refugio Drilling May-June 2022

Drilling recommenced at El Refugio in May 2022 with a program of six deep holes, drilled from a location slightly oblique to the main structure, in order to reduce the length of the drill holes to reach the targeted depth. Assays have been received for the first holes. The program successfully achieved the objective of locating the main structure and confirming high-grade gold and silver while providing additional information for the location of the upwelling feeder zone. The main intercept in hole CDH-137 of 5.67m @ 4.37 g/t gold, 174g/t silver from

331.33m, (CDH-137), including 1.67m @ 9.64 g/t gold, 399 g/t silver from 331.33 plus 1.00m @ 1.68 g/t gold, 67.2 g/t silver from 367.0m and 1.00m @ 1.27 g/t gold, 46.1 g/t silver from 370.0m. The remaining drill hole samples are in the laboratory for assay.

El Refugio Drilling June-July 2022

Drilling is currently in progress on the eastern side of El Refugio targeting deep and near to where the main El Refugio upwelling zone is projected.

Core from the most recent holes have the first observed occurrences of platy quartz after calcite, a texture indicative of boiling and gold deposition. Late amethyst is also observed filling what was open space at the time of mineralization. This texture is indicative of boiling. Visible silver minerals are commonly observed in the mineralized veins.

Soil Sampling Results – Constancia Area

Results from the soil sampling program at the La Constancia area on the eastern end of the Copalquin District Middle Section are given below. The results highlight gold in soils values which are generally consistent with mapped surface veins and historic workings (shown in black on the map below). These results support further work to progress the area for exploration drilling in the future.

Scoping Study Work

Work is progressing to assess the first stage development options to optimally exploit the high-grade El Refugio resource. There are options to reduce the mine development meterage and to take advantage of topography and high-grade zones within the El Cometa-El Refugio resource on the eastern side of the deposit to potentially produce attractive development economics.

District South Section

The Las Brujas-El Peru target is drill ready following positive results from the rock chip sampling program from within the historic mine working and the soils sampling program that revealed a good gold and silver anomaly. The historic mine workings at Las Brujas and at El Peru are connected by a 500m long surface trace of quartz vein.

Mapping and rock chip sampling of a north-south oriented structure at El Guamuchilito has been completed. Aerial drone surveying will continue until the end of the dry season usually around mid-late June.

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.

Within 15 months of drilling in the Copalquin District, Mithril delivered a maiden JORC mineral resource estimate demonstrating the high-grade gold and silver resource potential for the district. This maiden resource is detailed below.

• 2,416,000 tonnes @ 4.80 g/t gold, 141 g/t silver for 373,000 oz gold plus 10,953,000 oz silver (Total 529,000 oz AuEq*) using a cut-off grade of 2.0 g/t AuEq*
• 28.6% of the resource tonnage is classified as indicated

*AuEq. = gold equivalent calculated using and gold:silver price ratio of 70:1. That is, 70 g/t silver = 1 g/t gold. The metal prices used to determine the 70:1 ratio are the cumulative average prices for 2021: gold USD1,798.34 and silver: USD25.32 (actual is 71:1) from kitco.com

Mining study and metallurgical test work supports the development of the El Refugio-La Soledad resource with conventional mining methods indicated as being appropriate and with high gold-silver recovery to produce metal on-site with conventional processing.

Mithril is currently exploring in the Copalquin District to expand the resource footprint in 2022 to demonstrate its multi-million ounce gold and silver potential.

Mithril Resources is earning 100% interest in the Copalquin District mining concessions via a purchase option agreement detailed in ASX announcement dated 25 November 2019.

-ENDS-

Released with the authority of the Board. For further information contact:

John Skeet
Managing Director and CEO
[email protected]
+61 435 766 809

Mark Flynn
Investor Relations
[email protected]
+61 416 068 733

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 information in this report that relates to metallurgical test results, mineral processing and project development has been compiled by Mr John Skeet who is Mithril’s CEO and Managing Director. Mr Skeet is a Fellow of the Australasian Institute of Mining and Metallurgy. This is a Recognised Professional Organisation (RPO) under the Joint Ore Reserves Committee (JORC) Code.

Mr Skeet 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 Skeet 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.

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/37bd20f8-83d.pdf