Mila Resources Plc / Index: LSE / Epic: MILA /
Sector: Natural Resources
This
announcement contains Inside Information as stipulated under the UK
version of the Market Abuse Regulation No 596/2014 which is part of
English law by virtue of the European (Withdrawal) Act 2018, as
amended. On publication of this announcement via a regulatory
information service, this information is considered to be in the
public domain.
31 October
2024
Mila
Resources Plc
('Mila' or the 'Company')
Mila
to Acquire Three Highly Prospective Gold Exploration Projects in
Queensland, Australia
& Kathleen Valley Gold Project Update &
Investor Presentation
Mila
Resources Plc (LSE:MILA), the post-discovery gold exploration
accelerator, is pleased to announce that it has signed an exploration and option
agreement (the 'Option Agreement') relating to three highly
prospective gold projects in Queensland, Australia (the
'Exploration Portfolio') with EMX Broken Hill Pty Ltd and EMX - NSW
1 Pty Ltd (both wholly owned subsidiaries of EMX Royalty Corp
(TSX-V:EMX and NYSE AMERICAN: EMX)) ('EMX'). The Exploration
Portfolio is intended to complement Mila's primary asset, the
Kathleen Valley Gold Project ('Kathleen Valley'), located in
Western Australia.
Highlights
· Option to purchase three highly
prospective projects with proven gold mineralisation, each with the
potential to materially expand Mila's mineral resource
inventory.
· The Company is fully funded to undertake
the exploration work, with A$450,000 (approx. £230,000) to be
committed within one year of executing the Option
Agreement.
· The Company will initially pay A$25,000 in
cash and issue 16 million warrants exercisable at 1p per Ordinary
Share for the Option Agreement. The Option must be exercised within
12 months. However, any further payments are subject to exploration
and development success. (Further details of the Option Agreement
are set out below.)
· The Option Agreement underlines the
Company's post-discovery gold exploration accelerator model with
the aim of building value from applying systematic exploration
work, metallurgical studies and initial ESG work to best determine
the optimum path to production.
· The Company's priority remains the
advancement of Kathleen Valley, together with its partner, ASX
listed Liontown Resources Ltd ("Liontown"), to unlock value from
both the lithium and gold mineralisation identified at the
project.
· Following the commencement of spodumene
production at Liontown's Kathleen Valley Project in July 2024,
engagement with local stakeholders with regard to ongoing
exploration activities is continuing with further news expected in
Q4 2024.
Mark Stephenson, Executive Chairman of
Mila Commented: "We are looking forward to advancing these
projects alongside Kathleen Valley, as we continue to build
critical mass within our exploration accelerator portfolio.
Importantly, we have structured a transaction to ensure that new
funds are "going in the ground" and milestone payments are linked
to geological success and development. Mila will now employ a
targeted and strategic work programme across all of the properties
to further prioritise the Company's resources.
"We expect
ground exploration work to commence at Yarrol, the most advanced of
the three projects within the Exploration Portfolio, within the
coming weeks whilst the team plan for geophysical surveys across Mt
Steadman and Mt Weary in early 2025. Our technical team, led
by Neil Hutchison and Alistair Goodship, have been on site earlier
this month and are extremely enthusiastic about the potential
across the Exploration Portfolio.
"Alongside
this new work, our attention remains very much focussed on our
Kathleen Valley project, and, following Liontown's announcement
confirming that it commenced production of spodumene concentrate in
July, engagement with local Tjiwarl people has continued to
progress and we look forward to our advancing dialogue. It remains
our primary objective to advance and unlock value from this
project, in respect to both lithium and gold development, and we
will update shareholders in due course with expected
timetables."
Overview of the Exploration
Portfolio
The
Yarrol Project
Gold
mineralisation at Yarrol has several geological expressions,
including IRGS-type vein swarms developed in and around
Permian-aged dioritic intrusions, as well as sediment-hosted gold
mineralisation. Elsewhere on the property, mineralisation appears
to be developed along cross structures that intersect the regional
structural trends.
There is
significant upside potential that exists along the 10-15-kilometre
trend of gold mineralisation that has been historically
under-explored. EMX re-processed the historical geophysical data
from the project area, which highlighted additional targets along
strike of, and below, the historically defined zones of
mineralisation.
Exploration
programmes conducted by EMX in 2021 included the collection of 544
soil samples, which identified two new gold-in-soil anomalies. The
northern anomaly, known as the Limestone Creek area, lies
approximately five kilometres northwest of the historical Yarrol
gold resources. This new anomaly has dimensions of 200 by 600
metres, with the strongest results along the southernmost line. The
area was identified as a target by EMX on the basis of magnetic
inversion geophysical models, previous geochemical results and the
presence of numerous historical prospecting pits. The Limestone
Creek anomaly also coincides with a zone of albite-silica-goethite
alteration developed adjacent to a monzonite porphyry and remains
open to the south. The anomaly has a scale and tenor that resembles
those over the historical gold resources on the Yarrol
Project.
Other
gold-in-soil anomalies have been delineated immediately northwest
of the historical Yarrol resources, along a contact zone between
geological formations within folded and faulted sediments, which
also merit follow-up exploration.
In the
process of carrying out the sampling programmes at the Yarrol
Project, EMX geologists also noted boulders of dark manganiferous
material in several drainages in the northern part of the
exploration licence. The boulders were traced back to an
outcropping stratigraphic horizon of dark, manganiferous material
that has the appearance of a conglomeratic unit.
Nine rock
chip samples collected from various boulders, float materials and
outcrop exposures averaged 1.1% cobalt, 0.15 % nickel and 10.0%
manganese, with a high of 1.6% cobalt with 0.25% nickel. This has
the potential to be a significant discovery of additional mineral
potential on the Yarrol Project, as previous efforts had strictly
focused on Yarrol's intrusion-related gold
mineralisation.
A drill
campaign was conducted in Q4 2023 by Many Peaks Minerals Limited,
which was at that time had secured the right to acquire a 100%
interest in the Yarrol Project. The drilling included initial
drill tests on two targets generated from reprocessing and
inversion modelling of aerial magnetic data and historical IP
ground geophysics. Drilling successfully identified new zones of
mineralisation and alteration at both targets located approximately
1.6km apart along the eastern margin of the 4km long intrusion
related gold system.
Despite
very encouraging results from this drill programme and the
additional work conducted in 2023 and 2024 by Many Peaks, the
company was required to reallocate its resources to its West
African portfolio at that time, and Many Peaks concluded that they
would not exercise its right to acquire the Yarrol
Project.
Mt
Steadman Project
The
57km2 Mt Steadman project is an intrusion-related gold
system ("IRGS") in the New England Orogenic Belt in Queensland,
Australia, a province that hosts IRGS-type gold, porphyry and
epithermal deposits. Mt Steadman is located along the Perry Fault
system, a major structural feature in the area. The Mt Steadman
project was the focus of exploration in the 1990s when shallow
reconnaissance drilling programmes led to the recognition and
definition of historical gold resources at the Fitzroy prospect,
however there has been limited exploration since
then.
Examples of
historical reverse circulation drill intercepts at Mt Steadman's
Fitzroy prospect include 23 metres averaging 1.04 g/t gold in
RC95MS7, 24 metres averaging 1.13 g/t gold in RC85MS10, and 21
metres averaging 1.15 g/t gold in RC95MS11 5 (true widths unknown).
The zones of drill defined mineralisation at Fitzroy are shallow
(generally less than 60 metres from surface) and remain open in
multiple directions.
Gold
mineralization at the Fitzroy prospect is developed in the near
surface environment as sheeted quartz veins hosted within a
granitic intrusion and is associated with broad zones of sericitic
alteration. Similar styles of gold mineralisation, alteration and
geologic occurrences are developed in numerous locations elsewhere
along the trace of the Perry Fault on the property. Several of
these peripheral target areas have never been drill
tested.
In 2021,
EMX conducted a broad soil geochemical survey to the north of the
Fitzroy historical resource. A total of 351 samples were collected
on 200 metre and 400 metre spaced traverses with samples collected
every 50 metres along each line. This programme resulted in the
delineation of multiple anomalous gold-in-soil trends. The most
prominent anomaly extends for 400 metres along trend and reaches a
maximum width of 200 metres at its northern extent. The anomaly
remains open to the north and includes a sample of 2.17 ppm gold.
This soil anomaly is similar in scale and tenor to those around the
historic Fitzroy prospect located 1km to the southeast. This
anomaly also exhibits coincident anomalous molybdenum and tellurium
geochemistry, similar to geochemical signatures seen at Fitzroy,
and closely correlates with the mapped extent of a zone of
hydrothermal breccias, quartz veining and alteration.
A drill
campaign was conducted in Q4 2023 by Many Peaks Minerals Limited,
which was at that time had secured the right to acquire a 100%
interest in the Mt Steadman Project. The RC drilling results
included an intercept of 8m @ 2.63g/t gold from 8m drill depth, and
demonstrated a significant extension to the footprint of gold
mineralisation, intersecting the targeted gold corridor at the
Fitzroy prospect more than 120m south from a 300m zone of
outcropping mineralisation confirmed in historical drilling with
intercepts including 22m @ 1.21g/t gold from surface, 25m @ 1.02g/t
gold from surface, and 19m @ 1.25g/t gold. The results highlighted
the higher tenor gold grades at the Fitzroy prospect within a
corridor of gold mineralisation that remains open in all directions
within a more than 3km long surface gold anomaly.
Despite
very encouraging results from this drill programme and the
additional work conducted in 2023 and 2024 by Many Peaks, the
company was required to reallocate its resources to its West
African portfolio at that time, and Many Peaks concluded that they
would not exercise its right to acquire the Mt Steadman
Project.
Mt
Weary Project
The
476km2 Mt Weary Project is located in southern
Queensland and covers multiple exploration targets with styles of
mineralisation including IRGS, skarn, reef-type veins, and sediment
hosted copper-silver mineralisation. Many of the exploration
targets are associated with suites of Permian-Triassic aged
volcanic and intrusive rocks.
The Mt
Weary Project has been the site of historical mining and
exploration activities for over a century. The project last saw
intensive exploration in the mid-1990s, when CRA Exploration and
North Ltd (both precursor companies to what is now Rio Tinto
Exploration Pty Limited) drilled the Boggy Creek prospect,
intersecting long intervals (i.e., >25 metres) of near surface
gold mineralisation associated with quartz vein stockworks in
rhyolitic-dacitic intrusions, which is typical of IRGS systems.
Multiple historical gold mines are located elsewhere on the
project, including the Monal Goldfields, which saw production from
1892 through the 1930s.
Rock chip
samples from the Rawlins prospect at the "Apple Tree" target area
include a grab sample assaying 31.1 g/t gold (n=5, min 0.015 g/t
Au, max 31.1 g/t Au, avg 12.74 g/t Au). Two grab samples from the
Eastern Star workings returned with multi-gram gold (1.12 g/t Au
and 9.55 g/t Au) and multi-percent copper (2.84% Cu and 10.07% Cu,
respectively). At the Malakoff sediment-hosted copper prospect,
rock chip samples from outcrop returned multi-gram gold (n=7, min
<0.005g/t Au, max 2.49g/t Au, avg 0.71g/t Au) and multi-percent
copper (min 0.001% Cu, max 12.15% Cu, avg 2.61% Cu) (see comments
on sampling protocols below
Option Agreement Terms
Mila has
signed an exploration and option agreement to purchase a 100%
interest over three project areas: Yarrol (EPM8402, EPM27561,
EPM28230 and EPM28658), Mt Steadman (EPM12834 and EPM27750) and Mt
Weary (EPM26317 and EPM27252) (collectively the 'Exploration
Portfolio').
The
consideration for the Option Agreement is as follows:
a) A cash payment of
A$25,000;
b) The issue of
16,000,000 warrants at an exercise price of £0.01 to EMX
exercisable within 12 months; and
c) The issue of
£50,000 of new Mila ordinary shares to EMX if the Mila share price
exceeds 1.0p for more than 12 continuous trading days.
d) a payment of
A$125,000 on the second anniversary of the Optioh Agreement payable
in cash or by the issue of new Mila ordinary shares valued by
reference to the volume weighted average price of the shares during
thirty consecutive trading days prior to the day of
issue.
Work Commitments
a) Under the terms of the
Option Agreement, Mila has committed to undertake a minimum work
programmes spendingA$450,000 collectively across all three project
areas by the first anniversary of the Option Agreement with a
commitment to meet the minimum work programmes required to keep
each licence in good standing.
Exercise of the Option
In the
event that Mila wishes to exercise the Option (on or before 31
October 2025) Mila will issue £110,000 of new ordinary shares
valued by reference to the volume weighted average price of the
shares during thirty consecutive trading days prior to the day of
issue.
Mila is
fully funded to deliver this work programme and earn into the
Exploration Portfolio.
Milestone/Performance related
payments
In the
event the Option is exercised there is a commitment:
a) to complete an
upgraded resource by the second anniversary of signature of the
Option Agreement;
b)
to complete 30,000 metres of drilling across the project
areas and/or establish resources of >400k oz with at least 40%
being indicated resources with the remainder as inferred resources
by the fifth anniversary of signature of the Option
Agreement;
c) to pay an
annual advance royalty of 20oz gold, increasing to 35oz from the
fifth anniversary of signature of the Option Agreement and to 50 oz
on the delivery of a scoping study (payable in cash, gold, or
ordinary shares of the Company); and
d) on completion of a
scoping study, to pay A$250,000 in cash or new ordinary
shares;
e) on completion of a
feasibility study, to pay A$500,000 in cash or new ordinary shares
of the Company.
Each of the
Tenements is subject to a 2.5% Net Smelter Royalty, payment of
which will be secured. Annual advance royalties will be set off
against any Net Smelter Royalty due. On completion of a feasibility
study on a project, Mila will have the right to reduce the Net
Smelter Royalty to 1.25% on payment of 65% of the post-tax royalty
net present value (NPV) of the project.
Corporate
Presentation:
An updated
corporate presentation which provides further details on the
Queensland Gold properties can be found using the following link:
http://www.rns-pdf.londonstockexchange.com/rns/3176K_1-2024-10-30.pdf.
Investor Presentation via Investor Meet
Company:
Mila
Resources is pleased to announce that Mark Stephenson and Alastair Goodship will
provide a live presentation via Investor Meet Company on Tuesday 5
November 2024 at 12:00 GMT.
The
presentation is open to all existing and potential shareholders.
Questions can be submitted pre-event via the Investor Meet Company
dashboard up until 4 November 2024 at 09:00 GMT, or at any time
during the live presentation.
Investors
can sign up to Investor Meet Company for free and add to meet Mila
Resources Plc via:
https://www.investormeetcompany.com/mila-resources-plc/register-investor
Investors
who already follow Mila Resources Plc on the Investor Meet Company
platform will automatically be invited.
**ENDS**
For more information visit
www.milaresources.com or contact:
Mark Stephenson
Mila Resources Plc
|
info@milaresources.com
|
Jonathan Evans
Tavira Financial Limited
|
+44 (0) 20
7100 5100
|
Nick Emerson
SI Capital
|
+44 (0) 20
3143 0600
|
Damon Heath
Shard Capital Partners
LLP
|
+44 (0) 20
3971 7000
|
Susie Geliher / Charlotte Page
St Brides Partners
Limited
|
+44 (0) 20
7236 1177
|