Ann: Grace Copper-Gold Project Update, page-19

Tough question. I do not know the answer. Some stream of (un)consciousness musings.

The planned drilling is almost a scoping study to see if there is the potential along the shear zone where limited work has happened. This will give an indication that a larger deposit is possible away from the previous MRE zones.

Most of what is below is fairly predictable. To do the question justice a complete database with 3D functionality attached would be a real benefit. PSL have this and geos with more smarts than me.

The density of previous drilling at Grace possibly precludes a Tier 1 Au/Cu deposit being discovered. Having said that Havieron only had 6 NCM holes into it and they put it in the hard basket, whatever. Minyari is possibly a better comparison than Havieron as work in the last century resembles the drill density of Grace. Recent results at Minyari show the old timers should have persisted IMO and the company's response. Ultimately it may not be a Havieron or Telfer but could give a clue as to what might happen at Grace as a 1-5 Moz Au +credit deposit. Most deposits in the Telfer area are open at depth where economics control how deep they can be mined which can impact on the final size.

I suspect if Grace were closer to Kalgoorlie there would already be a couple of pits a la 1980 style. Small oxide ones which more recent explorers would follow up and perhaps do a cutback and go underground if the economics warrant.
[The Lord's pits (Henry and Nelson) at Sandstone come to mind as possible examples of this where recent exploration is finally revealing new potential - AME, not intended as cross promotion as it has some comparison with Grace and the area around Telfer. It is an area that hasn't seen much by way of exploration $s for more than decade in an area that was off the beaten track.]

Grace is east of Telfer where NCM ran their 1990 eyes over it and found it lacking. Fast forward 20+ years without significant exploration, as we all know, and the equation has changed in terms of what is economic. Grades do not need to be 1-3 g/t Au for open pit or 3+g/t UG if size and other factors align. Grace has local good grades which were followed up by NCM though how well is open to debate. Open enough that PSL are in there and seeing what was missed or can be found with more recent technology.

A stand alone operation for PSL will need results that make everybody's smile incredibly big. Unlikely but one can dream. Havieron packs a huge punch in a small package of some 300x300M (and growing) of real estate.

Not having a standalone means the main governing factor will probably be the supply and demand to feed the Telfer Mill.

Even with Havieron operating at full phase 2 proposed PFS capacity (3 Mt per year) there is a shortfall for the 15-20 Mpta capacity. So where does the extra feed come from. Quite a few options though none are fully shovel ready at the moment.

There are multiple Grace like options for NCM on their own 100% ground and probably in the Telfer complex itself that wouldn't have kept the mill going in their own right but with Havieron's feed producing enough ounces they may come into play.

NCM is involved in the Wilki and Juri JVs. Wilki has two deposits with inferred resources that aren't dissimilar to Grace/Bemm in terms of exploration development stage. Both are projects NCM walked away from and are now taking another look at through a JV.

Minyari/Waca/Grace/Lamil? and other non NCM deposits/prospects could feed the hungry beast at Telfer. Which, if any, do fit the bill is going to take a time to drill out and get all the necessary permits and approvals. Not always guaranteed or timely.


Back in the 90s(?) NCM set a possible precedent when they mined some 60 Koz Au from the Fallows Field deposit just south of Telfer. How long it would take to get some of the deposits mentioned below shovel ready? Minyari/Waca are possibly some of the closest though there are some thoughts they could be stand alone. Grace would need some more detailed drilling though shallow oxide deposits to the transition zone are a fairly well trodden path.

Lots of thoughts. Some are appropriate others could be too far out so DYOR.

Telfer is probably going to keep going for another 20-30 years with feed from Havieron providing the base load. Deposits like Grace will probably be mined at some point during this third phase of Telfer.