activity report december quarter 2017 for … · activity report for personal use ... company has...

ACN 148 860 299 E | [email protected] T | (02) 8315 3268 A | Level 13/50 Carrington Street, Sydney NSW 2000

31 January 2018

ASX ANNOUNCEMENT

ACTIVITY REPORT

DECEMBER QUARTER 2017

HIGH LIGHTS

HIGH GRADE COBALT, COPPER & GOLD MINERALISATION DISCOVERED AT SURFACE

AT MT FREDA.

COBALT MINERALISATION RETURNING UP TO 2,030 G/T Co IDENTIFIED OVER ~1KM MINERALISED SHEAR ZONE WITHIN MT FREDA MINE LEASE.

DIAMOND CORE DRILLING AT MT FREDA INTERSECTING MASSIVE SULPHIDE MINERALISATION.

SUB-AUDIO MAGNETIC GEOPHYSICAL SURVEY IDENTIFIES ~ 950 M LONG CONDUCTIVE STRUCTURE, EXTENDING FROM THE MT FREDA OPEN CUT PIT TO THE WEST, ENTIRELY WITHIN THE AUSMEX MINING LEASE AND EPM14163.

ADDITIONAL HIGH-GRADE GOLD INTERSECTED AT THE GILDED ROSE GOLD MINE EXTENDS OPEN CUT TARGET WITH INTERSECTS OF UP TO 22G/T GOLD BELOW THE CURRENT GILDED ROSE OPEN CUT.

MAIDEN DRILLING ON THE CARPET PROSPECT INTERSECTS 8M @ 3.50 G/T AU

INCLUDING 2M @ 12.53G/T AU FROM A DEPTH OF 2M EXTENDING THE ZONE OF HIGH GRADE GOLD & COPPER MINERALISATION TO >2KLMS IN LENGTH.

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INTRODUCTION

Ausmex Mining Group Limited (“Ausmex” or “the Company”) Directors welcome shareholders to our December Quarterly Report. The company has maintained momentum through the December quarter generating a set of excellent exploration results produced from the highly prospective Cloncurry suite of tenements. Four exploration drill rigs completed nonstop drilling during the quarter facilitated the discovery of high grade cobalt within the Mt Freda Mining Leases, as well as intersecting high grade gold extensions to both the Mt Freda and Gilded Rose Open Cut mines. SAM (Sub Audio Magnetic) surveys defined additional structural extensions to the current Mt Freda Open cut mine, and maiden RAB drilling within EPM14163 following cultural heritage clearance intersected high grade gold at the Carpet Prospect. Over 10,000m of RC drilling and 2,000 m of Diamond core drilled since Ausmex commenced exploration. It is a major achievement for a Junior Company delivering excellent results for shareholders.

Managing Director Matt Morgan stated:

“Within approximately six months of re listing as Ausmex Mining Group Limited, the company has achieved remarkable results in the Cloncurry Copper and gold field which the company believes is outstanding mineralised ground. Over 10,000m of RC drilling and 2,000m of diamond core has defined high grade extensions to the Mt Freda and Gilded Rose open cut mines, as well as the discovery of ~ 1km of high grade cobalt mineralisation within the Mt Freda Mine leases, a dream starts for a Junior Company. With the high-quality, gold, copper and cobalt projects recently defined, all with drill ready additional targets, early 2018 will be an exciting time for Ausmex shareholders as we gain market attention”

EXPLORATION CLONCURRY QLD MT FREDA HIGH GRADE COBALT, COPPER & GOLD

Cobalt mineralisation identified returned up to 2,030 g/t Co identified over ~1km mineralised shear zone within Mt Freda Mine Leases.

RC Drilling within the shear zone returned very high cobalt results including: o ESRC02 1m @ 2,030 g/t within 6m @ 1,108 g/t cobalt from 0-6m o ESRC03 4m @ 1,190 g/t Cobalt from 4 – 8m o ESRC05 3m @ 1,380 g/t Cobalt from 11 -14m o ESRC08 9m @ 400g/t Co, 1.01 g/t Gold, and 3.16% copper

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Additional discovery of ~12m wide outcropping high-grade cobalt, copper and gold mineralisation within the Mt Freda Leases with rock chips returning up to: o Cobalt 1,610 g/t Co o Copper 32.70% Cu o Gold 33.40 g/t Au

Outcrop Samples 5 (LHS) & Sample 7 (RHS) from the new discovery. The Outcrop returned assays up to 1,610 g/t Cobalt, 32.7% Copper & 33.4g/t Gold. Refer Table 1 below for all outcrop assay results.

A subsequent eight-hole RC drill hole programme to test the mineralised structure returned significant high-grade Cobalt, Copper & Gold including:

o ESRC02 6m @ 1,108 g/t cobalt from 0-6m, including 1m @ 2,030 g/t o ESRC03 4m @ 1,190 g/t Cobalt from 8 – 12m o ESRC05 3m @ 1,380 g/t Cobalt from 11 -15m o ESRC08 9m @ 400g/t Co, 1.01 g/t Gold, and 3.16% copper

The mineralisation described via the cross sections A-D below indicates that the interpreted brecciated sheer zones host the mineralisation. All RC assays from the recent drilling intersected mineralisation above the base of weathering, yet the initial grade distribution fits that of structurally controlled alteration possibly continuing at depth, and not that of a shallow supergene cap.

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ACN 148 860 299 E | [email protected] T | (02) 8315 3268 A | Level 13/50 Carrington Street, Sydney NSW 2000

High grade Cobalt drill hole results and rock chip assays, identified along the ~1km cobalt- copper-gold mineralised shear zone.

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ACN 148 860 299

E | [email protected] T | (02) 8315 3268 W | www.ausmexgroup.com.au A | Level 13/50 Carrington Street, Sydney NSW 2000

X section through holes ESRC02 & ESRC03 displaying Cobalt – Copper & Gold mineralisation including 1m @ 2,030 g/t cobalt. 1,000,000 pounds of Cobalt previously identified at Mt Freda

Historical drilling and estimations by Queensland Mining Corporation (QMN) in 2011 reported a 1 million lb of cobalt mineralisation at Mt Freda mine (Refer announcement ASX: QMN 8th March 2011). The Mt Freda orebody is located ~500m to the north of the new discovery. Cobalt is currently trading at $US65,500 tonne, $A87,000 per tonne almost 10 times the copper price!

Further investigation will be carried out during the next quarter to determine the extent of the mineralisation at depth and along strike. A major drilling campaign will commence in early 2018.

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X section through ESRC108 & ESRC 107 displaying cobalt – copper – gold mineralisation. Note that the mineralised sheer zone is completely within the meta volcanic, unlike the remaining sections where the sheer zone is the contact between Meta sediments and the meta volcanic units.

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X section through ESRC104 & ESRC106 displaying cobalt – copper – gold mineralisation

X section through ESRC105 displaying cobalt – copper – gold mineralisation

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MT FREDA OPEN CUT EXTENSION DRILLING RESULTS

First phase of RC drilling at Mt Freda gold project intersects high grade gold confirming

mineralisation is open at depth immediately below the Mt Freda open cut and along strike east and west.

Diamond core drilling at Mt Freda intersected massive sulphide mineralisation

HQ core sampling in place for metallurgical test work on high grade gold and massive sulphide cores samples

Significant assay results from initial RC drilling to date include: o DRILL HOLE MFRC 112 - 2M @ 8.45/t Au (from 158m) o DRILL HOLE MFRC 102 - 3M @ 5.63g/t Au (from 76m) o DRILL HOLE MFRC 108 - 5M @ 4.17g/t Au (from 122m) o DRILL HOLE MFRC 114 - 6M @ 3.22g/t Au (from 108m) o DRILL HOLE MFRC 113 - 6M @ 1.70g/t Au (from 136m) o DRILL HOLE MFRC 103 - 4M @ 1.82g/t Au (from 77m)

X-section Western End Mt Freda Open cut displaying gold mineralisation continuing at depth from the current pit floor.

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SAM – (SUB AUDIO MAGNETIC SURVEY) MT FREDA

Sub-audio magnetic geophysical survey identifies ~ 950 m long conductive structure, extending from the Mt Freda open cut pit to the west, entirely within the Ausmex mining lease and EPM14163

Initial sub-audio magnetic geophysical survey interpretations indicate a potential ~ 1.7 km extension of conductive structures from Mt Freda into EPM14163

Sub-Audio Magnetic Geophysical Survey (SAM) indicating the varying conductivity to the west from the Mt Freda Open cut. The high resolution, high current geophysical survey is continuing on all ML’s and EPM’s owned by Ausmex in the Cloncurry Mineral Field.

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EPM14163 high grade rock chips results (Refer ASX announcement 7th August 2017 for assay results) with interpreted extension of the highly conductive structures identified by SAM extending from the Mt Freda Open Cut for ~ 950 m and adjoin the previously identified 700 m gold mineralised structure. (Combined potential strike length of > 1.7 km)

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Gilded Rose

HIGH GRADE GOLD INTERSECTED AT THE GILDED ROSE GOLD MINE

Early RC drilling confirms and extends high grade gold mineralisation

High grade gold intersects of up to 22g/t gold below the current Gilded Rose Open Cut

RC drilling result highlights include:

o GR17RC23: 3 metres @ 11.16 g/t Au from 79 metres incl. 1 metre @ 22g/t Au

o GR17RC25: 5 metres @ 6g/t Au from 64 metres incl. 1 metres @ 17.25g/t Au

o GR17RC03: 1 metre @ 9.29g/t Au from 79 metres

and further intersection of 1 metre @ 9.54g/t Au from 88 metres o GR17RC19: 1 metre @7.01g/t Au From 73 metres

and further intersection of 1 metre @ 9.53g/t Au from 81 metres

The current JORC 2012 resource definition drilling program currently being conducted

along a ~ 1.5km strike length at the Gilded Rose Project has been designed to target a

potential shallow open cut gold operation followed by a high margin, high grade gold

underground mine.

HQ core drilling continues at the Gilded Rose for additional metallurgical bulk sample

test work.

The initial assay results for the first phase of RC drilling have been received with high grade gold intersected. A total of 34 RC holes have been drilled including pre-collars for 10 Diamond Core Holes at Gilded Rose.

The initial RC drilling has returned outstanding intersects of gold including:

Hole ID Significant Intercept From (m) To (m)

Interval (m) Interval Grade (Au g/t)

GR17RC03 and

1m @ 9.29 g/t Au from 79m 79 80 1 9.29

1m @ 9.54 g/t Au from 88m 88 89 1 9.54

GR17RC19 and

1m @ 7.01 g/t Au from 73m 73 74 1 7.01

1m @ 9.53 g/t Au from 81m 81 82 1 9.53

GR17RC23 3m @ 11.16 g/t Au from 79m 79 82 3 11.16

GR17RC23 Including 1m @ 22g/t Au from 80m 80 81 1 22.0

GR17RC23 1m @ 3.27g/t Au from 89m 89 90 1 3.27

GR17RC25 5m @ 6.00 g/t Au from 64m 64 69 5 6.00

GR17RC25 Including 1m @17.25 g/t Au from 80m 64 65 1 17.25

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Significant high-grade gold intercepts from the initial RC drilling at Gilded Rose. Note that the holes were not drilled in numerical order.

Figure 2. Cross section displaying GR17RC25 high grade gold results confirming previous high-grade gold results under the Gilded Rose open cut. F

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Figure 3. Cross section displaying GR17RC23, and other significant high-grade gold results confirming previous high-grade gold results under the Gilded Rose open cut

The results confirm that the known high-grade mineralisation at Gilded Rose continues at depth under the current open cut pit and supports historical drill results previously drilled by Queensland Mining Corporation (ASX: QMN) in 2010. (Refer Queensland Mining Corporation ASX announcement August 6th, 2010 for results) Including:

GR10RC07: 9 metres @ 5.53g/t Au from 52 metres incl. 4 metres @ 20.68g/t Au from 52

metres

GR10RC12: 11 metres @ 2.19g/t Au from 46 metres incl. 3 metres @ 7.28g/t Au from 54

meters

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THE CARPET - EPM14163

HIGH GRADE GOLD FROM RAB DRILLING ON EPM 14163 (adjoins Mt Freda Mining Lease) Maiden RAB drilling within EPM 14163 at the Carpet Project intersected high grade Gold with 8m @ 3.5g/t Au including 2m @ 12.53/t Au from shallow RAB QE003 drilling on a 10m wide quartz outcrop during reconnaissance drilling. The RAB drilling is targeting previous high-grade rock chip sampling result and testing the possible >2km extension of the Carpet Gold and Copper prospect.

Location plan of the maiden RAB drilling at the Carpet Project within EPM14163 including QE003 that intersected 8m @ 3.5g/t Au with 2m @ 12.53g/t Au. Note the mineralised structure at the Carpet Project exceeds 2km in strike length and continues to the north.

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BURRA SOUTH AUSTRALIA

Following a technical review of recent geophysical data available an AusLAMP interpreted

signals under the Burra region was identified. Subsequently trial MT Geophysical surveys as well

as Gravity traverses were conducted during the quarter to test conductivity responses and

assess the suitability of the geophysical techniques for a large regional trial at Burra together

with Adelaide University, targeting a large IOCG signature. The initial trial results due in the first

quarter 2018.

MONGOLIAN GOLD AND TUNGSTEN PROJECT

Chuluun Khoroot tungsten deposit and gold occurrence, XV-015591.

No field work was completed during the quarter on the prospective Tungsten and Gold project. Further expressions of interest by several parties to potentially purchase the project have been received, in the light of rising Tungsten prices, the Board is reviewing all options for the project and may consider divesting.

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Cloncurry South Group of Tenements

Tenement

Project Name

Holder

Ausmex

Beneficial

Interest

(%)

Grant Date

Expiry

Date

Area

(km2/ha)

Status

EPM14163 White Range #2 Mt Norma Mining Company Pty Ltd1

80 19/10/2004 18/10/2019 17 Granted

EPM14475 White Range #4 Spinifex Mines Pty Ltd2 80 27/06/2005 26/06/2017 36

Renewal Lodged

23/03/2017

EPM15858 Sunny Mount QMC Exploration Pty Ltd3 80 23/10/2008 22/10/2018 17 Granted

EPM18286 Elder Creek Flamingo Copper Mines Pty Ltd 80 14/01/2013 13/01/2018 20 Renewal Lodged 13/10/2017

ML2517 Answer North Queensland Mines Pty Ltd 1004 01/12/1973 30/11/2025 8.09 Granted

ML2541 Belgium Qld Mining Corporation Limited 100 01/02/1974 31/01/2021 4.05 Granted

ML2549 The Trump North Queensland Mines Pty Ltd 100 01/02/1974 31/01/2021 12.14 Granted

ML2709 Gilded Rose Spinifex Mines Pty Ltd 80 21/01/1982 31/01/2024 2.03 Granted

ML2713 Gilded Rose Extd East Spinifex Mines Pty Ltd 80 21/01/1982 31/01/2024 18.21 Granted

ML2718 Gilded Rose Extd West Spinifex Mines Pty Ltd 80 20/09/1984 30/09/2026 14.17 Granted

ML2719 Gilt Edge Extd East 1 Spinifex Mines Pty Ltd 80 29/03/1984 31/03/2026 32.00 Granted

ML2741 Mt Freda Spinifex Mines Pty Ltd 80 29/05/1986 31/05/2028 3.80 Granted

ML2742 Evening Star Spinifex Mines Pty Ltd 80 29/05/1986 31/05/2028 8.09 Granted

1 Mt Norma Mining Company Pty Ltd is a wholly owned subsidiary of Qld Mining Corporation Limited 2 Spinifex Mines Pty Ltd is a wholly owned subsidiary of Ausmex Mining 3 QMC Exploration Pty Ltd is a wholly owned subsidiary of Qld Mining Corporation Limited 4 See ASX announcement 06/07/2017

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ML2750 Evening Star North Extd Spinifex Mines Pty Ltd 80 26/01/1989 31/01/2028 5.14 Granted

ML2752 Mt Freda Extd Spinifex Mines Pty Ltd 80 23/02/1989 29/02/2028 116.48 Granted

ML2763 Evening Star North Spinifex Mines Pty Ltd 80 08/06/1989 30/06/2028 8.00 Granted

Burra Project Group of Tenements

Tenement Project Name Holder Status

Ausmex Beneficial

Interest Area (sqkm)

Application

Date Grant Date Expiry Date

EL 4970 PNX Burra North PNX METALS

Renewal

Pending Option to earn 60% 300 06/03/2012 05/03/2017

EL 5382

PNX Burra

Central PNX METALS Granted Option to earn 60% 84 24/02/2014 23/02/2019

EL 5411 PNX Mongolata PNX METALS Granted Option to earn 60% 60 10/03/2014 09/03/2019

EL 5473 PNX Bagot Well PNX METALS Granted Option to earn 60% 71 05/08/2014 04/08/2019

EL 5557 PNX Washpool PNX METALS Granted Option to earn 60% 135 10/11/2014 09/11/2019

EL 5874 PNX Burra West PNX METALS Granted Option to earn 60% 69 25/07/2016 24/07/2018

EL 5881 Burra

AUSMEX

MINING Granted 100% 970 04/11/2016 03/11/2018

EL 5910 PNX Spalding PNX METALS Granted Option to earn 60% 157 02/01/2017 01/01/2019

EL 5918

PNX Princess

Royal PNX METALS Granted Option to earn 60% 314 23/11/2016 22/11/2018

ELA

2017/00111 Burra East

AUSMEX

MINING

Application –

offered for grant 100% 929 02/06/2017

ELA

2017/00112 Burra North West

AUSMEX

MINING

Application –


ELA

2017/00113 Worlds End South

AUSMEX

MINING

Application –


ELA 2017/00170 Burra Far South

AUSMEX MINING Application 100% 128 10/08/2017

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Mongolian Project Tenement

XV-015591 Chuluun Khoroot Centreville LLC 100 Granted

Tenement Project Name Registered Holder

Ausmex

Beneficial Status

Interest (%)

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Ausmex Cloncurry current tenement suite location plan

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Ausmex Burra EL5881 location plan

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Forward Looking Statements The materials may include forward looking statements. Forward looking statements inherently involve subjective judgement, and analysis and are subject to significant uncertainties, risks, and contingencies, many of which are outside the control of, and may be unknown to, the company.

Actual results and developments may vary materially from that expressed in these materials. The types of uncertainties which are relevant to the company may include, but are not limited to, commodity prices, political uncertainty, changes to the regulatory framework which applies to the business of the company and general economic conditions. Given these uncertainties, readers are cautioned not to place undue reliance on forward looking statements. Any forward-looking statements in these materials speak only at the date of issue. Subject to any continuing obligations under applicable law or relevant stock exchange listing rules, the company does not undertake any obligation to publicly update or revise any of the forward-looking statements, changes in events, conditions or circumstances on which any statement is based.

Competent Person Statement Statements contained in this report relating to exploration results and potential are based on information compiled by Mr. Matthew Morgan, who is a member of the Australasian Institute of Mining and Metallurgy (AusIMM). Mr. Morgan is the Managing Director of Ausmex Mining Group Limited and Geologist whom has sufficient relevant experience in relation to the mineralisation styles being reported on to qualify as a Competent Person as defined in the Australian Code for Reporting of Identified Mineral resources and Ore reserves (JORC Code 2012). Mr. Morgan consents to the use of this information in this report in the form and context in which it appears.

JORC Code, 2012 Edition – Table 1 report

Section 1 Sampling Techniques and Data (Criteria in this section apply to all succeeding sections.)

Criteria JORC Code explanation Commentary

Sampling techniques

Nature and quality of sampling (eg cut channels, random chips, or specific specialised industry standard measurement tools appropriate to the minerals under investigation, such as down hole gamma sondes, or handheld XRF instruments, etc). These examples should not be taken as limiting the broad meaning of sampling.

Include reference to measures taken to ensure sample representivity and the appropriate calibration of any

RC Drilling chip samples recovered via cyclone and splitter

Samples were ~2-3kg in weight

reverse circulation drilling was used to obtain 1 m samples for targeted ore zones, and 4 m cumulative samples between ore zones from which ~3 kg was pulverised to produce a 30 g

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measurement tools or systems used.

Aspects of the determination of mineralisation that are Material to the Public Report.

In cases where ‘industry standard’ work has been done this would be relatively simple (eg ‘reverse circulation drilling was used to obtain 1 m samples from which 3 kg was pulverised to produce a 30 g charge for fire assay’). In other cases more explanation may be required, such as where there is coarse gold that has inherent sampling problems. Unusual commodities or mineralisation types (eg submarine nodules) may warrant disclosure of detailed information.

charge for Gold fire assay analysis and further ICP analysis for Cobalt and Copper.

Samples analysis completed at SGS laboratory QLD

Random Rock Chips were collected along the outcropping shear zone. Samples were ~3kg each.

Drilling techniques

Drill type (eg core, reverse circulation, open-hole hammer, rotary air blast, auger, Bangka, sonic, etc) and details (eg core diameter, triple or standard tube, depth of diamond tails, face-sampling bit or other type, whether core is oriented and if so, by what method, etc).

Reverse Circulation drilling with cyclone and splitter.

Drill sample recovery

Method of recording and assessing core and chip sample recoveries and results assessed.

Measures taken to maximise sample recovery and ensure representative nature of the samples.

Whether a relationship exists between sample recovery and grade and whether sample bias may have occurred due to preferential loss/gain of fine/coarse material.

Samples recovered via cyclone and spitter, sample weights indicate representative for 1m

Logging Whether core and chip samples have been geologically and geotechnically logged to a level of detail to support appropriate Mineral Resource estimation, mining studies and metallurgical studies.

Whether logging is qualitative or quantitative in nature. Core (or costean, channel, etc) photography.

The total length and percentage of the relevant intersections logged.

RC chips were geologically logged every 1 m

Sub-sampling techniques and sample

If core, whether cut or sawn and whether quarter, half or all core taken.

If non-core, whether riffled, tube

No sub sampling taken from 1 metre RC chips.

Field duplicates and standards were

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preparation sampled, rotary split, etc and whether sampled wet or dry.

For all sample types, the nature, quality and appropriateness of the sample preparation technique.

Quality control procedures adopted for all sub-sampling stages to maximise representivity of samples.

Measures taken to ensure that the sampling is representative of the in situ material collected, including for instance results for field duplicate/second-half sampling.

Whether sample sizes are appropriate to the grain size of the material being sampled.

entered for analysis with the results indicating that representative sampling and subsequent analysis were completed.

Quality of assay data and laboratory tests

The nature, quality and appropriateness of the assaying and laboratory procedures used and whether the technique is considered partial or total.

For geophysical tools, spectrometers, handheld XRF instruments, etc, the parameters used in determining the analysis including instrument make and model, reading times, calibrations factors applied and their derivation, etc.

Nature of quality control procedures adopted (eg standards, blanks, duplicates, external laboratory checks) and whether acceptable levels of accuracy (ie lack of bias) and precision have been established.

Industry standard Fire assays for Au were completed by SGS laboratories for Gold.

Industry standard ICP analysis was completed for Cobalt and Copper samples and subsequent assays

Repeat and checks were conducted by SGS laboratories whilst completing the analysis.

Standard and duplicates entered by Ausmex

The level of accuracy of analysis is considered adequate with no bias samples reported.

Verification of sampling and assaying

The verification of significant intersections by either independent or alternative company personnel.

The use of twinned holes.

Documentation of primary data, data entry procedures, data verification, data storage (physical and electronic) protocols.

Discuss any adjustment to assay data.

Significant intersections inspected and verified by JORC competent personnel

No assays were adjusted

There were no twinned holes drilled

All drill hole logging was completed on site by Geologists, with data entered into field laptop and verified as entered into a geological database

Significant intersections for all minerals were reported as a combined down hole interval average received assay grade, and are not down hole weighted averages.

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Ass all significant intersections reported for Cobalt, Cooper and Gold were average down hole assays, with no internal waste has been calculated or assumed.

Location of data points

Accuracy and quality of surveys used to locate drill holes (collar and down-hole surveys), trenches, mine workings and other locations used in Mineral Resource estimation.

Specification of the grid system used.

Quality and adequacy of topographic control.

The drill collars have been surveyed by a permanent base station (accuracy +/- 150mm) and recorded in MGA94, Zone 54 datum

Rock Chip locations were surveyed by hand held GPS.

Data spacing and distribution

Data spacing for reporting of Exploration Results.

Whether the data spacing and distribution is sufficient to establish the degree of geological and grade continuity appropriate for the Mineral Resource and Ore Reserve estimation procedure(s) and classifications applied.

Whether sample compositing has been applied.

Data spacing and distribution is NOT sufficient for Mineral Resource estimation

No sample compositing has been applied.

Orientation of data in relation to geological structure

Whether the orientation of sampling achieves unbiased sampling of possible structures and the extent to which this is known, considering the deposit type.

If the relationship between the drilling orientation and the orientation of key mineralised structures is considered to have introduced a sampling bias, this should be assessed and reported if material.

The orientation of samples is not likely to bias the assay results.

Sample security

The measures taken to ensure sample security.

Samples were taken to Cloncurry by company personnel and despatched by courier to the SGS Laboratory in Townsville

Audits or reviews

The results of any audits or reviews of sampling techniques and data.

No audits or reviews have been undertaken at this stage.

Section 2 Reporting of Exploration Results (Criteria listed in the preceding section also apply to this section.)


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Mineral tenement and land tenure status

Type, reference name/number, location and ownership including agreements or material issues with third parties such as joint ventures, partnerships, overriding royalties, native title interests, historical sites, wilderness or national park and environmental settings.

The security of the tenure held at the time of reporting along with any known impediments to obtaining a licence to operate in the area.

ML2718, ML2709, ML2713, ML2719, ML2741 & EPM14163 are owned 100% by Spinifex Mines Pty Ltd. Ausmex Mining Group Limited owns 80% of Spinifex Mines Pty Ltd. Queensland Mining Corporation Limited own 20% of Spinifex Mines. Exploration is completed under an incorporated Joint Venture.

EPM14475, EPM15858, & EPM18286 are held by QMC Exploration Pty Limited. Ausmex Mining Group Limited owns 80% of QMC Exploration Pty Limited. Queensland Mining Corporation Limited own 20% of Spinifex Mines. Exploration is completed under an incorporated Joint Venture.

ML2549, ML2541, ML2517 are 100% owned by Ausmex.

Exploration done by other parties

Acknowledgment and appraisal of exploration by other parties.

All exploration programs conducted by Ausmex Mining Group Limited.

Historic exploration drilling and results completed by QMC was referenced.

Geology Deposit type, geological setting and style of mineralisation.

ML2718, ML2709, ML2713, ML2719 hosts the Gilded Rose sheer hosted quartz reef. There are several gold mineralised hydrothermal quartz reefs within the deposit.

ML2741 hosts the shear hosted quartz rich Mt Freda Gold deposit containing Au, Cu, & Co.

ML2549, ML2541, ML2517 host copper mineralisation associated with carbonate intrusions into altered mafic host rocks

EPM14163 & EPM 15858 contain There are several gold mineralised hydrothermal quartz reefs within the deposit containing Au, Cu, & Co

Drill hole Information

A summary of all information material to the understanding of the exploration results including a tabulation of the following information for all Material drill holes:

Details within tables within the release

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o easting and northing of the drill hole collar

o elevation or RL (Reduced Level – elevation above sea level in metres) of the drill hole collar

o dip and azimuth of the hole o down hole length and interception

depth o hole length.

If the exclusion of this information is justified on the basis that the information is not Material and this exclusion does not detract from the understanding of the report, the Competent Person should clearly explain why this is the case.

Data aggregation methods

In reporting Exploration Results, weighting averaging techniques, maximum and/or minimum grade truncations (eg cutting of high grades) and cut-off grades are usually Material and should be stated.

Where aggregate intercepts incorporate short lengths of high grade results and longer lengths of low grade results, the procedure used for such aggregation should be stated and some typical examples of such aggregations should be shown in detail.

The assumptions used for any reporting of metal equivalent values should be clearly stated.

Significant average combined down hole assay intersections have been reported as part of this release for Co, Cu & Au. These average intersections are not weighted averages. No weighted down hole averages were reported.

Significant intersections for all minerals were reported are an average received assay grade for that down hole significant intersection.

The average combined down hole significant intersection Cut-off grade for Cobalt was assessed at 200 g/t (ppm), therefore there was no minimum individual sample cut off, yet only a combined down hole intersection average > 200g/t Co. Within these reported Co intersections there were individual 1m assays < 200g/t.

Within these average downhole sections of >200g/t Cobalt, aggregations of >700 g/t Cobalt were highlighted and additionally reported. An example can be seen in X- section B, where within ESRC103 a Cobalt intersection was reported that averaged 18m @ 572g/t Co, yet contained a higher aggregation within of 4m @ 1,190 g/t Co.

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Significant intersections for copper and gold were based on the average grade for the same intersection, as it may be assumed they represent a combined potential mining unit in the future. Therefore, a minimum average down hole intersection cut off at 0.5g.t Au and 0.8% Copper was displayed, yet individual 1m samples received within these intersections may report below these grades.

As all significant intersections reported for Cobalt, Cooper and Gold were a combined total average down hole grade, no internal waste has been calculated or assumed.

Relationship between mineralisation widths and intercept lengths

These relationships are particularly important in the reporting of Exploration Results.

If the geometry of the mineralisation with respect to the drill hole angle is known, its nature should be reported.

If it is not known and only the down hole lengths are reported, there should be a clear statement to this effect (eg ‘down hole length, true width not known’).

No material information is excluded.

intersections have been displayed reported as part of this release.

Interpreted X sections attached to the announcement displaying the geometry of mineralisation

Diagrams Appropriate maps and sections (with scales) and tabulations of intercepts should be included for any significant discovery being reported These should include, but not be limited to a plan view of drill hole collar locations and appropriate sectional views.

Maps showing the location of the EPMs and MLs are presented in the announcement

Appropriate relevant and labelled X sections attached

Maps showing the location of the EPMs and MLs are presented in the announcement, results and maps were also previously reported to ASX, refer announcement 7th August 2017. Diagrams produced by GAP Geo Physics were attached displaying conductivity identified following a SAM survey.

Balanced reporting

Where comprehensive reporting of all Exploration Results is not practicable, representative reporting of both low and high grades and/or widths should

All comprehensive Fire assay results for Gold were reported.

All ICP analytical results for Cobalt and Copper were reported.

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be practiced to avoid misleading reporting of Exploration Results.

Other substantive exploration data

Other exploration data, if meaningful and material, should be reported including (but not limited to): geological observations; geophysical survey results; geochemical survey results; bulk samples – size and method of treatment; metallurgical test results; bulk density, groundwater, geotechnical and rock characteristics; potential deleterious or contaminating substances.

There is mention of historic resources completed by QMC in 2011.

There is reference to drilling completed in 2008 previously reported by Queensland Mining Corporation via the ASX on 27TH

October 2008

GAP Geophysics have conducted a “SAM” Sub Audio Magnetic Geophysical survey with results displaying the conductivity within the survey.

Further work The nature and scale of planned further work (eg tests for lateral extensions or depth extensions or large-scale step-out drilling).

Diagrams clearly highlighting the areas of possible extensions, including the main geological interpretations and future drilling areas, provided this information is not commercially sensitive.

Additional mapping, costeans, geophysical surveys, RC and Core drilling

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