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NICKEL SULPHIDE MINERALISATION INTERSECTED ALONG STRIKE AT NEPEAN

 

Highlights

• Nickel sulphide mineralisation hosted by a thick fertile ultramafic unit intersected along strike from the historic Nepean nickel mine

• Several thick zones of elevated nickel (>0.3%Ni) and logged disseminated nickel sulphides were intersected within the ultramafic rocks in close proximity to the footwall contact with the underlying basalt unit, which is typical of Kambalda-style nickel sulphide deposits

• Down Hole Electromagnetic surveys have identified several anomalous conductors coincident with the elevated nickel intersections, providing discrete high-priority drill targets

• Next phase of drilling to test these targets is scheduled to commence in early May

• High-powered ground Moving Loop Electromagnetic survey has commenced at Nepean over most prospective areas of the 10km of potential strike

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from elsewhere (probably paid for)

Shares in Auroch Minerals Limited have soared roughly 300% in the last six months, but there could be more upside. This nickel sulphide focused base-metal resource company, is building value through targeted high-impact exploration in Western Australia. AOU has three nickel projects in Western Australia and all sit in the Norseman-Wiluna Greenstone Belt, home to some of the best nickel projects globally including Leinster, Mt Keith, Kambalda and Widgiemooltha.

 

All of AOU's projects, including Leinster, Saints and Nepean are highly prospective for near surface, high grade nickel sulphide mineralisation.

 

High grade nickel is a feature of the Leinster region and today's results show that the second hole (HNDD002) has confirmed thick shallow high-grade nickel-copper-PGE sulphide mineralisation, with the logged massive sulphides interval reporting 7.3 metres at 2.2% nickel, 0.53% copper from 143 metres. The first hole accepted 4.1 metres of high-grade nickel-copper sulphide mineralisation grading 2.4% nickel and 0.61% copper from 119 metres.

 

Both the quality of the grades and the near surface nature of the mineralisation suggest that this could be a highly economical project.

 

The drill program at Leinster consists of four diamond drill-holes and will be followed by reverse-circulation drilling to test strike potential and some of the more-advanced regional targets across the Leinster tenure. The combined diamond and RC drill programs will consist of approximately 1200 metres of diamond drilling and 1800 metres of RC drilling.

 

Drilling success at Leinster would be highly material given that BHP has expressed a desire to ramp up its nickel production to meet growing global demand fuelled by the shift to electric vehicles.

 

Mining giant BHP could boost production on commercially viable terms and has commenced trying to source contracts with Nickel Sulphide deposits to feed into its Nickel West refineries.

 

AOU is also expecting the delivery of assay results from its maiden drilling program at the Nepean Nickel Project, which contains the historic high-grade Nepean nickel sulphide mine and was the second producing nickel mine in Australia, producing just over 1.1 million tonnes of ore between 1970 and 1987. The ore was treated by Western Mining Corporation (WMC, now BHP Group Ltd) at its Kambalda processing facilities.

 

The Nepean mine closed in 1987 due to low nickel prices, leaving significant nickel sulphide resources unmined. At the end of 1986 when a fight or flight decision had to be made, the nickel price was hovering in the vicinity of US$1.60 per pound, about 80% below current levels. Today, the nickel price is over US$7.00 per pound.

 

The Nepean nickel mine has a remnant high-grade JORC (2004) compliant resource: 13,250t contained nickel @ 2.20% Ni. (It should be noted that the resource is JORC(2004) only (i.e. historic estimate) and not compliant with the JORC (2012) code required now.) There is high potential at Nepean to build on the existing remnant resources with drill targets along strike and at depth.

 

Nepean is just 70km from BHP's Kambalda Nickel Concentrator and Smelter and again the presence of nearby processing facilities operated by third parties, including BHP's Kambalda smelter, is a substantial benefit for AOU as BHP looks for more nickel supply.

 

AOU has identified several high-priority areas at Nepean, and a 3,500 metre reverse-circulation (RC) drill programme has already yielded some extremely promising results including 3 metres at 3.7% nickel, including 2 metres at 5.1% nickel, as well as one metre at 5.6% nickel.

 

With plenty more drilling results to filter through in the coming weeks, there are plenty of catalysts investors can look forward to.

 

Looking beyond this drilling program, AOU expects to complete a resource estimate by year-end, enabling it to fast track Nepean to production

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AOU keen to resume its high-grade copper and zinc search in South Australia and that is now imminent following successful land access talks and recent bolstering of Auroch's treasury. Follow-up reverse circulation drilling at the Ragless Range zinc prospect at Arden is expected to start in coming weeks.

 

The work will pick up from Auroch's maiden drilling success in the area in 2018 when it intersected a spectacular 15.47 per cent zinc over 3.65m from 62.15m depth and hit sedimentary-exhalative style, or "SEDEX" base metals mineralisation in all 10 holes of the initial program. The rich intercept was contained in a broader 8.15m grading 7.52 per cent zinc and 0.02 per cent lead.

 

SEDEX zinc mineralisation in up to three horizons was said to extend over at least 3km of strike and remain open "in every direction".

We know from our previous drilling that there is high-grade zinc mineralisation in the area and we have potential for scale with a compelling anomaly with over 2km of strike, so we look forward to the program and the results it will bring.

Auroch Managing Director, Aidan Platel

About 1,000m of RC drilling in 3-5 holes is planned with a rig currently being sourced and final preparations underway.

 

Also, a diamond drill program testing high-priority EM targets at the Nepean Nickel Project has been underway since early May and the second phase of RC drilling to test geochemical and geophysical targets along the Nepean strike is due to commence at the end of this month.

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