Ann: Second Antimony-Gold Vein System Discovered, page-2

A good start to the week

The 10 high-grade intersections within the MCOG zones for the C1 and C2 vein systems to date average 16.3 g/t AuEq (6.3% antimony, 4.3 g/t gold) and have an average potential stope width of 1.8m EHT. The average of 16.3 g/t AuEq is 5.4 times the estimated mineable cut-off grade (MCOG) of 3.0 g/t AuEq. This indicates potentially very-low operating cost, very-high operating margin mineralisation.

Nagambie Resources’ Executive Chairman, Mike Trumbull, commented: “Intersecting two potential stopes in the C2 vein system with our first wildcat hole, NAD012 which tested to the west of the C1 vein system, is an exceptional result. Our new structural model for the Nagambie Mine predicted the hole would be successful but a lot of exploration models don’t survive the drill-bit, assay-lab test. Success in locating C2 greatly increases the likelihood of progressively locating C3, C4, C5 etc to the SW of the West Pit, as predicted by the model. In exploration terms, we are now considering a very significant ultimate target to 1,000m vertical depth but we are committed to exploring from underground as soon as possible. “We intend to continue drilling the C1 and C2 vein systems and search for the next one, C3, in the coming months. Consideration will be given to contracting a second diamond drilling rig to speed up the calculation of a maiden resource, a necessary precursor for the permitting of an exploration decline and strike-driving of the vein systems underground on our Mining Licence MIN5412. “Nagambie has been working through a backlog of detailed core logging and the core-sawing of mineralised logged samples and we expect to have largely caught up by the end of February. The purchase of an Almonte 3-phase-powered auto core saw now gives the best possible half-core samples for assaying and eliminates any possible injuries. Changing to the On Site lab in Bendigo is also expected to speed up the delivery of assays. “When reporting our gold-antimony exploration drilling results, a point of difference with Nagambie is that we don’t only report all significant downhole sample assays, we simultaneously report all economically-mineable intersections (or potential stopes) that meet our thresholds of being greater than or equal to 1.2m EHT and being equal to or greater than our mineable cut-off grade (MCOG) of 3.0 g/t AuEq. All relevant criteria are considered - including the weighting of sample assays for both downhole length and bulk density, the dip of the veins intersected, the mining method, and the AuEq factor. The aim of this detailed reporting method is to provide the most accurate, consistent and meaningful way of reporting the gold-antimony drilling results (see Appendix 1 for further information).”