extensional drilling encounters further thick zones … · 2013. 7. 22. · in addition, shallow rc...

Papillon Resources Limited | ASX : PIR

T: +61 8 9225 5485 | F: +61 8 9322 6558 | E: [email protected] | W: www.papillonresources.com PO Box 5528 PERTH WA 6831 AUSTRALIA | ABN: 96 119 655 891

ASX RELEASE | 23 July 2013 | ASX:PIR

EXTENSIONAL DRILLING ENCOUNTERS FURTHER THICK ZONES OF HIGH GRADE MINERALISATION AT FEKOLA

Results from recent drilling has continued to highlight extensions of mineralisation outside of the current Mineral Resource Estimate (‘MRE’) area at the Fekola Gold Project;

Re-entry and extension of previously drilled holes intersected extensive mineralisation including 75 metres @ 4.66 g/t and 18 metres @ 2.81 g/t; and

Shallow, high grade mineralisation intersected along strike to the north of the current MRE area, including 4 metres @ 12.34 g/t and 7 metres @ 5.68 g/t.

Papillon Resources Limited (‘Papillon’ or ‘the Company’) is pleased to announce the results of a further 102 holes from its 2013 drilling program at the Company’s flagship Fekola Project (‘Fekola’ or ‘the Project’), located in south western Mali, adjacent to the border with Senegal. The Project currently hosts a Mineral Resource Estimate (‘MRE’), which comprises 54.97 million tonnes averaging 2.38 g/t gold for a contained 4.21 million ounces of gold at a lower cut-off grade of 1.0 g/t gold. The results, representing approximately 17,000 metres of drilling, comprise a mix of diamond (‘DD’) and reverse circulation (‘RC’) drill holes targeting down dip extensions of the Fekola deposit, as well as near surface mineralisation along strike to the north and south of the MRE area. Included in these results are six extension holes, which had previously been drilled and intersected zones of mineralisation but did not intersect the expected high grade shoot. Following reinterpretation, which indicated the potential for a high grade zone marginally deeper than the end point of these previously drilled holes, the decision was taken to re-enter and extend them. This re-drilling campaign was highly successful with broad zones of high grade mineralisation intercepted. Better intercepts from the current set of results include:

Hole No. Down Hole Intercept From Depth (Down Hole)

FKRD 026 * 75m @ 4.66 g/t 306m

FKRD 029 * 18m @ 2.81 g/t 234m

FKCR 176 12m @ 11.64 g/t 24m * Previously drilled holes which have been extended.

Papillon’s Managing Director and CEO, Mark Connelly, said: “The results are, once again, outstanding in terms of thickness and grade. Perhaps the most important aspect of the extended holes, from a mining perspective, is that the new observed data points of thick high grade intercepts will provide additional information to the resource model in an area that was previously considered to be low grade or barren. The thickness and grade of these intercepts again highlight the significant exploration upside at Fekola and further drilling has the potential to continue to deliver quality ounces for the Project.”

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ASX Release |23 July 2013 | ASX:PIR

In addition, shallow RC drilling along strike to the north of the MRE delivered very encouraging results with zones of high grade mineralisation encountered in the near surface lithology, including 4 metres @ 12.34 g/t and 7 metres @ 5.68 g/t. In January 2013, the Company released an updated MRE which included a 34% increase in total gold resource, and a conversion of 83% of the resource into the Measured and Indicated Resource categories. Based on this updated MRE, Papillon completed a Pre-Feasibility Study (‘PFS’) for the Project (refer ASX Announcement dated 26 June 2013). The PFS yielded extremely positive results, with average annual Life of Mine (‘LOM’) production in excess of 300,000 ounces, and C1 cash operating costs less than US$600/oz. The study re-confirmed the technical viability of the Project, and its ability to produce robust cash flows. Due to the onset of the wet season in Mali, the Company’s 2013 drilling campaign has now been concluded. The drilling season was extremely productive, with approximately 72,000 metres drilled and new mineralisation encountered external to the MRE. The data is currently being compiled and reviewed, with the aim of completing an updated MRE during the current quarter.

Papillon remains focussed on assessing the development potential of this outstanding project and advancing it towards production, while continuing to fully realise the exceptional exploration prospectivity at Fekola.

Enquiries:

Mark Connelly Hayden Locke Managing Director & CEO Corporate Executive

+61 8 9222 5400 +61 8 9222 5400

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Introduction Papillon Resources Limited (‘Papillon’ or ‘the Company’) is pleased to report further assay results from the 2013 drilling program at the Company’s flagship Fekola Project, located in south western Mali (Figure 1 and 2), adjacent to the border with Senegal.

Figure 1: Fekola Project – Location Map

Figure 2: Mali West – Regional Geology, Gold Deposits and Papillon Tenements

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2013 Drilling Program The 2013 drilling program, which commenced in November 2012, has comprised approximately 72,000 metres of diamond (‘DD’) and reverse circulation (‘RC’) drilling at the Project, including a total of 19,874 metres from 88 DD holes, 45,491 metres from 278 RC holes and 6,710 metres from 19 holes of combined RC/DD holes. The program concluded in June 2013, due to the onset of the wet season in Mali. The program has successfully:

• Extended mineralisation down dip and down plunge of the existing MRE;

• Refined the geological understanding of the deposit enabling the successful targeting of fault offset mineralisation, and mineralisation below the depth of previously drilled holes;

• Intersected mineralisation along strike to the north and south of the MRE area, within the broader, highly prospective, Fekola Corridor which covers over 11 kilometres of strike; and

• Completed geotechnical and hydrogeological programs to support the future Definitive Feasibility Study (‘DFS’).

The extensive drilling completed to date has significantly reduced the requirement for additional resource drilling to support the DFS. Drilling will resume after the wet season to address the minor remaining DFS work, including geotechnical and hydrogeological drilling, and on developing near surface open pitable opportunities to unlock the resource potential of the Fekola Corridor. Drilling Results Assay results from a further 102 holes, representing approximately 17,000 metres of both RC and DD drilling, have been received. This drilling, which has yielded extremely positive results, targeted extensions down dip of the main deposit and included the extension of six holes previously drilled which were interpreted to have been stopped prior to the high grade shoot. A reinterpretation and review of the drilling database was undertaken incorporating all current knowledge of the deposit. From this, six previously drilled holes were identified which had been stopped short of the interpreted location of the high grade mineralised shoot. Consequently a program of extending holes was undertaken providing a number of outstanding results. These results are significant in that they will provide new data points, within the area of the current MRE, that had previously been inferred to be of a lower grade, barren or had no estimation completed (for example Figure 3). These new results will be incorporated into an updated MRE, which is due to be released during the current quarter. Better intercepts from the current set of drill results include:


FKRD 026 * 75m @ 4.66 g/t 306m

FKRD 029 * 18m @ 2.81 g/t 234m

FKCR 176 12m @ 11.64 g/t 24m * Previously drilled holes which have been extended.

The locations of the holes released are shown in Figure 4. All significant intersections returned from the new drill holes, along with the details of the collar positions, dips, azimuths and depths, are summarised in Table 1.

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In addition to the above significant results, encouraging RC results to the north of the deposit have been received, including 4 metres @ 12.34g/t from 213 metres and 7 metres @ 5.68g/t from 6 metres, which continue to confirm the potential to add shallow mineralisation along the Fekola Corridor.

Figure 3: Cross section 1387800mN showing resource block model and location of extension of FKRD 026

With the cessation of drilling on the Project due to the onset of the wet season, data is currently being compiled and reviewed, while final assay results are received and validated. The company intends to update the Fekola MRE during the current quarter. All drilling results obtained since the January 2013 MRE, including the results reported herein and all previously reported high grade results external and down dip of the current MRE (see Table below), will be incorporated into the updated MRE.


FKD 136 73m @ 3.11 g/t 284m

FKD 137 22m @ 1.36 g/t 50m @ 1.65 g/t

222m 332m

FKD 142 72m @ 2.65 g/t 219m

FKD 146 105m @ 4.30 g/t (including 21m @ 9.34 g/t)

310m

FKD 147 31m @ 6.99 g/t 416m

Summary of selected intercepts from ASX announcements dated 17/3/2013, 16/4/2013 and 16/5/2013

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Figure 4: Fekola Project – Drill Hole Location, and Selected Intercepts

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Geological Setting Gold mineralisation at Fekola is hosted within a sequence of finely laminated sedimentary rocks. The mineralised zone is characterised by the strong association between gold and widespread carbonate and pyrite alteration. The alteration consists primarily of a hematite, carbonate, albite, and sericite assemblage with the presence of pyrite being a strong indicator of the gold mineralisation. Mineralisation trends in a north-north-west orientation with the broad mineralised package dipping steeply to the west at approximately 80 degrees. A high grade shoot is observed to be shallowly plunging at approximately 20 degrees in a north-north-west trend.

Competent Persons Statement

The information in this Report that relates to Exploration Results is based on information compiled by Mr Andrew Boyd of Cairn Geoscience Limited. Mr Boyd is a Member of the Australian Institute of Geoscientists and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (‘The JORC Code’). Mr Boyd consents to the inclusion in this Report of the statements based on his information in the form and context in which it appears.

The information in this Report that relates to Mineral Resources is based on information compiled by Mr Nic Johnson of MPR Geological Consultants. Mr Johnson is a Member of the Australian Institute of Geoscientists and has sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration, and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (‘The JORC Code’). Mr Johnson consents to the inclusion in this Report of the statements based on his information in the form and context in which it appears.

The information in this Report that relates to the Pre-Feasibility Study is based on information compiled by Mr Glenn Bezuidenhout of DRA Mineral Projects. Mr Bezuidenhout is a Fellow of The South African Institute of Mining and Metallurgy, and has sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration, and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (‘The JORC Code’). Mr Bezuidenhout consents to the inclusion in this Report of the statements based on his information in the form and context in which it appears.

Forward Looking Statement

Statements regarding plans with respect to the Company’s mineral properties are forward-looking statements. There can be no assurance that the Company’s plans for development of its mineral properties will proceed as currently expected. There can also be no assurance that the Company will be able to confirm the presence of additional mineral deposits, that any mineralisation will prove to be economic or that a mine will successfully be developed on any of the Company’s mineral properties.

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Table 1: Summary of Drill Hole Intersections

Hole ID Easting (mE)

Northing (mN)

Depth (m)

Dip (deg)

Azimuth (deg) From To Length

(m) Grade (g/t)

FER_026 240867 1388771 193 -55 98.5 102 103 1 2.36 105 106 1 5.99 FER_027 240977 1388748 210 -55 98.5 8 19 11 4.07 FER_028 240938 1388688 96 -55 98.5 28 35 7 1.32

61 62 1 1.18

67 68 1 1.07 75 76 1 3.11 FER_029 240806 1388369 110 -55 98.5 80 84 4 4.14 FER_030 241003 1388929 100 -55 98.5 33 48 15 2.77 FKCR_263 242200 1384920 252 -60 90 No Significant Intercepts FKCR_264 242234 1385076 250 -60 89.5 No Significant Intercepts FKCR_265 242301 1384920 204 -60 89.5 No Significant Intercepts FKCR_266 242400 1384921 252 -60 89.5 82 84 2 1.58 FKCR_267 242532 1384918 270 -60 89.5 No Significant Intercepts FKCR_268 242116 1384759 250 -55 83.5 142 143 1 2.85 FKCR_269 242242 1384757 252 -60 89.5 9 13 4 2.04 FKCR_270 242379 1384756 252 -60 83.5 126 127 1 3.17

144 145 1 16.40

FKCR_271 242511 1384759 250 -60 83.5 16 17 1 5.88

30 32 2 2.87

FKCR_272 242305 1384601 250 -60 89.5 155 157 2 4.24 FKCR_273 242566 1384600 250 -60 83.5 No Significant Intercepts FKCR_274 242127 1386524 120 -55 89.5 83 93 10 2.29 100 102 2 2.41 FKCR_275 242498 1385640 175 -55 89.5 No Significant Intercepts FKCR_276 242359 1386520 66 -55 89.5 24 36 12 11.65 FKCR_277 242600 1385639 192 -55 89.5 No Significant Intercepts FKCR_278 242706 1385639 175 -55 89.5 No Significant Intercepts FKCR_279 242197 1386520 54 -55 89.5 25 27 2 1.61 FKCR_280 242397 1386442 108 -55 89.5 4 6 2 16.16

10 18 8 3.24

48 50 2 1.34 73 84 11 3.10 FKCR_281 242158 1386441 70 -55 89.5 20 27 7 1.79 FKCR_282 242078 1386440 100 -55 89.5 No Significant Intercepts FKCR_283 241410 1385897 260 -55 89.5 62 63 1 3.09

179 180 1 20.40

FKCR_284 242323 1386039 180 -55 89.5 25 28 3 1.26

51 53 2 1.21

59 61 2 2.11

155 162 7 1.39

165 169 4 1.35 FKCR_285 242299 1386443 193 -55 89.5 No Significant Intercepts FKCR_286 242376 1386362 132 -55 89.5 29 43 14 1.63 121 124 3 1.09

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FKCR_287 242405 1385721 168 -55 83.5 6 9 3 1.44

17 20 3 1.08

25 29 4 1.20

73 84 11 1.67

FKCR_288 242463 1385719 92 -55 89.5 33 41 8 3.79 FKCR_289 242457 1386360 60 -55 89.5 9 12 3 1.29

24 27 3 1.05

FKCR_290 242345 1386280 168 -55 89.5 37 39 2 1.88

54 57 3 1.30

111 116 5 2.35 FKCR_291 242356 1386202 180 -55 89.5 7 8 1 3.52

30 32 2 1.16

44 47 3 1.68

61 69 8 1.28

111 117 6 1.37

156 161 5 2.03

FKCR_292 242779 1385640 175 -55 89.5 55 56 1 6.63 FKCR_293 242430 1386278 100 -55 89.5 54 70 16 1.34 FKCR_294 242672 1384758 186 -55 89.5 125 127 2 2.57 FKCR_295 242403 1386043 110 -55 83.5 76 78 2 1.28

106 107 1 4.88

FKCR_296 242407 1386122 110 -55 89.5 26 32 6 1.24 74 80 6 1.17 FKCR_297 242556 1385080 90 -55 83.5 No Significant Intercepts FKCR_298 242337 1385639 150 -55 89.5 No Significant Intercepts FKCR_299 242418 1385641 180 -55 89.5 168 169 1 2.45 FKCR_300 242361 1385476 175 -55 89.5 No Significant Intercepts FKCR_301 242384 1385960 130 -55 89.5 81 83 2 1.43

89 94 5 2.14

FKCR_302 242309 1385957 186 -55 83.5 60 69 9 1.28 FKCR_303 242411 1386204 120 -55 89.5 6 16 10 2.89

74 80 6 1.84

88 96 8 2.35 FKCR_304 242676 1385080 168 -55 89.5 15 17 2 1.67 FKCR_305 242764 1385083 150 -55 89.5 No Significant Intercepts FKCR_306 242748 1384755 175 -55 89.5 39 41 2 1.89 FKCR_307 242554 1385001 150 -55 89.5 No Significant Intercepts FKCR_308 242562 1385161 168 -55 83.5 No Significant Intercepts FKCR_309 242340 1385800 138 -55 89.5 54 58 4 1.25

82 84 2 1.84

97 100 3 1.14 FKCR_310 242514 1385240 186 -55 89.5 153 160 7 1.06 FKCR_311 242019 1387959 214 -55 89.5 184 194 10 2.70 FKCR_312 242057 1387957 175 -55 89.5 100 103 3 2.17

133 135 2 1.63

138 140 2 1.87 142 145 3 1.50 FKCR_313 241610 1386202 174 -55 89.5 93 94 1 5.88

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FKCR_314 241530 1386201 174 -55 89.5 155 157 2 12.43 FKCR_315 241454 1386200 180 -55 89.5 No Significant Intercepts FKCR_316 241694 1386201 150 -55 89.5 No Significant Intercepts FKCR_317 242598 1385244 150 -55 89.5 No Significant Intercepts FKCR_318 242671 1385240 150 -55 89.5 No Significant Intercepts FKD_038 R 242057 1387517 182 -55 89.5 142 159 17 1.63 FKER_041 243339 1388440 198 -54.7 89.5 No Significant Intercepts FKER_042 243443 1388440 175 -55.0 89.5 No Significant Intercepts FKER_043 243542 1388441 200 -54.7 89.5 No Significant Intercepts FKER_044 243665 1388440 204 -55.0 89.5 No Significant Intercepts FKER_045 243770 1388440 175 -55.3 89.5 No Significant Intercepts FKER_046 243860 1388439 192 -56.7 89.5 No Significant Intercepts FKER_047 243985 1388439 175 -55.0 89.5 No Significant Intercepts FKRD_008 R 241977 1387439 356.2 -55 89.5 284.2 300.2 16 1.70

325.2 327.2 2 2.64

331.2 335.2 4 1.87 FKRD_026 R 241861 1387795 404 -55 89.5 306 381 75 4.66 FKRD_029 R 241980 1387679 272 -55 89.5 234 252 18 2.81 FKRD_049 R 241983 1388230 221 -55 89.5 194 195 1 1.23 FKRD_050 R 242163 1386839 221 -55 91.5 158 161 3 1.71

212 216 4 1.40

FKRD_051 241933 1387878 306.4 -55 83.5 196.4 206.4 10 2.05

235.4 246.4 11 2.57

248.4 253.4 5 1.30

255.4 259.4 4 1.37

263.4 265.4 2 1.61 272.4 280.4 8 3.39 FNER_112 241198 1391800 144 -55 89.5 No Significant Intercepts FNER_113 241414 1389700 128 -55 89.5 No Significant Intercepts FNER_114 242001 1390517 150 -55 89.5 No Significant Intercepts FNER_115 242000 1390597 150 -55 89.5 No Significant Intercepts FNER_116 242029 1390758 150 -55 89.5 63 66 3 1.88 FNER_117 241992 1390756 200 -55 89.5 No Significant Intercepts FNER_118 242039 1390842 96 -55 89.5 35 37 2 3.58

42 50 8 1.42

FSER_084 241969 1389999 210 -55 83.5 No Significant Intercepts FSER_085 242051 1389999 177 -55 83.5 22 27 5 1.49

45 47 2 2.64

FSER_086 242130 1389999 92 -55 89.5 No Significant Intercepts FSER_087 242389 1389998 147 -55 89.5 No Significant Intercepts FSER_088 242513 1388917 110 -55 89.5 No Significant Intercepts FSER_089 242387 1389081 180 -55 89.5 177 180 3 2.66 FSER_090 242435 1388921 180 -55 89.5 80 82 2 1.51 162 168 6 1.55 FSER_091 242466 1389082 175 -55 89.5 109 114 5 1.98

117 119 2 3.22

FSER_092 242344 1389080 222 -55 83.5 213 217 4 12.35 FSER_093 242081 1388920 120 -55 89.5 65 67 2 2.21

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FSER_094 242062 1389081 120 -55 89.5 69 73 4 1.33 FSER_095 242064 1388760 140 -55 89.5 84 86 2 1.98

92 100 8 1.79

FSER_096 241947 1390680 200 -55 89.5 163 167 4 2.11 FSER_097 241976 1390921 132 -55 89.5 104 109 5 7.00

118 123 5 1.86

FSER_098 242096 1388398 86 -55 89.5 51 56 5 1.15 FSER_099 242387 1388401 100 -55 89.5 No Significant Intercepts FSER_100 242059 1390917 80 -55 89.5 6 13 7 5.69 FSER_101 242379 1389839 175 -55 89.5 No Significant Intercepts FSER_102 242090 1388060 156 -55 89.5 11 16 5 3.48

63 66 3 1.45

80 84 4 2.14 89 104 15 1.42 FSER_103 242383 1390159 175 -55 89.5 No Significant Intercepts

Notes:

1. Hole with an R postfix are holes that have been drilled in a previous program and have been re-entered and extended to the indicated depth.

2. Co-ordinates are in UTM grid (WGS 84 Zone 29P) and have been measured by GPS (+/- 5m accuracy). 3. Samples at 1m intervals. 4. All Intercepts calculated using a 1.0 g/t lower cut and no upper cut. 5. Intervals are all down-hole length. 6. Assaying conducted by SGS Analabs in Mali using industry standard 50g lead collection fire assay with AAS finish. 7. Reference standards, field duplicates and blank samples are routinely inserted; quality control samples are routinely

monitored. 8. The broad mineralised zone at Fekola dips to the west at approximately 800. Local variations in mineralisation dip occur

within the broad mineralised zone.

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extensional drilling encounters further thick zones … · 2013. 7. 22. · in addition, shallow rc...

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