Ann: AGP Update - Exceptional Drill Results & De Grey Update, page-8

Ashburton project: Takeover option extended by De Grey

https://www.axinocapital.de/news/kalamazoo-resources/ashburton-projekt-uebernahmeoption-durch-de-grey-ausgeweitet

Kalamazoo Resources reports significant progress in the evaluation of the Ashburton gold project by De Grey Mining.Recent drilling results confirm high-grade gold grades averaging 2.8 g/t and show the potential of the resource of 1.44 million ounces of gold.
De Grey has extended the purchase option for the project until August 2025 to conduct further metallurgical and geological studies.Financial framework of the takeoverDe Grey Mining has been evaluating the Ashburton gold project in the Pilbara region since February 2024 under an exclusive option agreement.
The potential takeover is valued at AUD 33 million.A non-refundable option fee of AUD 3 million was paid at the start of the contract.In the event of an acquisition, an additional AUD 30 million will be paid in two instalments: AUD 15 million upon exercise of the option and a further AUD 15 million within 18 months of completion of the acquisition.

Outstanding results from metallurgical drillingDe Grey Mining has completed a comprehensive metallurgical drilling program that included ten diamond drill holes totaling 2,252.3 metres.The objective of the program was to analyse the geological and metallurgical characteristics of the project and to provide the basis for future mining plans.Notable results include:
• 47.0 metres grading 5.5 g/t gold from 30 metres depth
• 55.5 metres grading 4.1 g/t gold from 177.6 metres depth
• 15.3 metres grading 6.5 g/t gold from 69 metres depth
• 4.9 metres grading 17.1 g/t gold from 20.7 metres depthIn addition, additional intercepts with significant gold grades ranging from 1.4 g/t to 6.5 g/t were discovered in several other holes.These results confirm the potential of the Ashburton Gold Project, which has an estimated resource of 1.44 million ounces of gold at an average grade of 2.8 g/t.
The resource estimate is based on previous exploration data and has been further supported by the current drilling programs.Extensive due diligenceAs part of the purchase option, De Grey Mining has undertaken extensive studies to fully evaluate the potential of the Ashburton Gold Project.In order to complete additional analyses and studies, the option, originally due to expire in early 2025, has been extended to August 4, 2025. This extension gives De Grey more time to gain detailed insights and lay the foundation for a potential acquisition.The measures included metallurgical testing that analyzed gold recovery from the sulphide-rich ore and confirmed the economics of extraction.
In addition, geochemical analyses were carried out on historical drill core and sample powders to characterize the mineralization in detail.In addition, geological modeling and optimization were carried out to investigate potential open pit mining options and to maximize resource utilization.These studies have not only validated the existing resource, but also identified new exploration targets within the project area.The results underscore the strategic value of the project for both Kalamazoo and De Grey Mining.The extension of the time frame also shows De Grey's serious interest in thoroughly evaluating the feasibility and profitability of the project.
Location map showing the drill collar locations and drill hole trajectories for the metallurgical studiesA win-win situationThe Ashburton gold project is an important addition to De Grey Mining's existing resources and could bring even more benefits through the potential acquisition of De Grey by Northern Star Resources.
Since Ashburton is close to the planned Hemi gold project, it would be possible to share infrastructure.This could create synergies that make both projects more efficient and economical.With an average gold grade of 2.8 grams per tonne, Ashburton is of higher quality than the Hemi project, which grades around 1.5 grams per tonne.This high quality makes processing Ashburton gold not only more efficient, but also more cost-effective and environmentally friendly, as less material and energy is required.

Northern Star plans to develop Hemi as a Tier 1 project and prioritize it as a regional processing center.This could also benefit Ashburton as Hemi's infrastructure could be shared.The combination of Hemi's large processing capacity and Ashburton's high-grade ore would significantly increase the efficiency and profitability of both projects.
In addition, testing and drilling results have shown that Ashburton offers great potential for further high-quality gold discoveries, which could increase the production capacities of Northern Star and De Grey in the long term.Kalamazoo is very positive about Northern Star's acquisition of De Grey.The company expects that Ashburton could benefit greatly from the prioritization of Hemi and the geological proximity of the projects.Kalamazoo's CEO Luke Reinehr stated that this acquisition offers an ideal opportunity for a collaboration that could make both Hemi and Ashburton economically successful.Potential impact on KalamazooFor Kalamazoo, an acquisition would be a crucial step in tapping into new financial resources.
The additional AUD$30 million could be used to accelerate existing projects such as the Mallina West Gold Project and the Victorian Goldfields.In addition, a successful acquisition would enable Kalamazoo to develop new strategic projects and further diversify the portfolio.CEO Dr Luke Mortimer stated: “The recent results confirm the high value of the Ashburton Gold Project and provide us with the opportunity to generate significant financial resources for our continued growth plans.A successful acquisition would not only benefit our shareholders but also contribute to the further development of the entire Pilbara region.”