Highlight Results

• Continued success in expanding targets and resource potential in the Copalquin District with fully funded drill program progressing, following $3.5m placement in April 2022

• First drill holes 1km west along trend from the El Refugio high-grade JORC resource (529koz AuEq)* has intercepted high-grade gold and silver veins within 8 – 16 metre wide and shallow mineralised zones from the first drill holes at the El Gallo target. Further drilling down dip and along strike is scheduled to develop this westerly target
  • 0.54m @ 4.48 g/t gold, 412 g/t silver from 21.37m, (CDH-127), plus
  • 1.00m @ 2.69 g/t gold, 179 g/t silver from 25.50m,

• 2.00m @ 2.55 g/t gold, 184 g/t silver from 50.0m, (CDH-128), including
  • 1.00m @ 4.72 g/t gold, 326 g/t silver from 51.0m, plus
  • 1.00m @ 1.64 g/t gold, 5.0 g/t silver from 43.0m

• New roads and drill pads are in progress for deep drill testing at El Refugio in the area where high-grade intercepts have been previously reported from CDH-077 (8.26m @ 80.3 g/t Au, 705 g/t Ag) and CDH-084 (8.85m @ 7.2 g/t Au, 235 g/t Ag). Drilling here commences early May 2022

• The first drill holes at the recently identified La Montura target 2km east and along trend of El Refugio are almost complete with assays expected late June 2022

• The first line of drill holes at this 700m long target has confirmed the quartz stockwork and vein 80m down dip in the structure
  • Deeper hole 160m down dip has confirmed continuation of the structure with chalcedonic quartz breccia.
  • Drill hole targeting the structure 240m down dip is in progress

• At the eastern end of the middle trend, mapping and sampling in the historic El Jabali workings has been completed 800m north of the La Constancia/Guadalupe workings

• Exploration work in the district has confirmed over 4km of gold-silver mineralisation from El Gallo to La Montura and within a 5.5km trend with further extension work in progress

• Soil sampling results and rock chip sampling at the 500m long Las Brujas-El Peru target along the district south section has confirmed this as a highly prospective target for drill testing in July 2022 following the upcoming El Refugio resource drilling

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 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:

“Exploration work in the Copalquin District has advanced significantly to map and define numerous targets within this 70km2 historic mining district. Since the publication of the high-grade maiden JORC MRE for El Refugio-La Soledad in November 2021, we have completed dry season mapping and soil sampling programs, greatly expanding the near-term drill targets in the district beyond the maiden JORC resource area. With the completion of the recent funding, we are now well positioned to expand the 529,000oz AuEq* El Refugio resource as well as develop drill targets east and west of this area. There is significant ‘smoke’ across the district and drill plans are designed to look for the sources of the ‘fire’ which clearly exist. Copalquin is a well- endowed district for gold and silver which has already delivered a high-grade resource with excellent metallurgical and mining study work reported earlier this year. The Copalquin District has area and depth potential to host multi-million ounce resources for gold and silver.”

Introduction

Since acquiring the property in May 2020, Mithril has been drilling in the Copalquin district with one man- portable diamond drill rig for 21 months developing several targets in the district, including delivering a high- grade maiden JORC resource within the first 15 months of drilling. The current program of work aims to explore two main trends of historic mine workings across the district further ranking and developing drill targets and expanding the maiden resource at El Refugio. During the maiden drill program in 2020, Mithril identified a large upwelling hydrothermal zone at El Refugio and drilled this to resource stage with:

• 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

There is opportunity to expand this high-quality resource which is open at depth beyond where some of the highest grade intercepts were recorded plus early signs of a westerly extension. 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.

Drilling at El Gallo

The first diamond core drilling at the El Gallo target 1km west of the El Refugio resource has produced multiple shallow intercepts with high-grade gold and silver mineralisation. Of particular note is the silver sulphide ginguro banding coincident with high-grade silver assay values. The drilling follows soil sampling and mapping, that identified El Gallo as a high-priority drill target. These excellent first round drill results support further drilling along strike and deeper as we develop this target.

This area of the district and to the east and north, feature high-grade gold and silver at El Refugio, La Soledad, Los Pinos, Los Reyes and now at El Gallo. As can be seen in Figure 1, above there is widespread gold and silver now proven over a large part of the district.

Drilling at La Montura

La Montura is a recently discovered drill target along the District Middle Trend and features a 700m wide quartz vein at the surface and a gold in soils anomaly over this area. The first round of drilling to test this target is almost complete with a line of drill holes intercepting quartz stockwork and quartz vein 80m below the surface. Two further holes, target the structure 160m and 240m down dip. The first of the deeper holes has intercepted chalcedonic quartz breccia. The deepest hole is scheduled for completion first half of May. Receipt of assays is anticipated for late June 2022.

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:

Original Article: https://investi.com.au/api/announcements/mth/79b37866-f8e.pdf