Nepean Nickel Project, page-2

September 2014 quarterly, and the silence since, indicates that there wasn't sufficient basal contact below and between the pegmatite lenses at depth to warrant further drilling. i.e. looks like it is not worth pursuing. would love to be wrong on this, but the silence is deafening.

Nepean Nickel Mine

The Company has also recommenced exploration for additional nickel sulphide mineralisation at the Nepean project, which has mainly lain dormant since its closure in 1985. Focus last investigated the possibility of reopening the mine in 2008, however this idea was postponed due to a slump in nickel prices at the time.

One of the challenges for mining and exploration at Nepean is a series of shallow-dipping pegmatites which intrude through the mine sequence and disrupt the local stratigraphy. The deepest-known pegmatite within the local mine area was encountered at the bottom of the underground workings, approximately 530m below surface. Despite subsequent unsuccessful attempts to drill through this level and explore for additional mineralisation at depth, the thickness of this pegmatite lens remains unknown. In this regard, there are similarities between Nepean and the early exploration history of Western Areas’ Flying Fox deposit, and as a result the project has untested exploration potential at depth if the thickness of the pegmatites can be ascertained.

In order to optimise future exploration at Nepean the Company decided to conduct a seismic survey perpendicular to the strike of the deposit and approximately 100m south of the main shaft. The intent of this survey is to capitalise on the differences in acoustic impedance between the main rock types, which make seismic an ideal technique to build a two-dimensional view of the lithological contacts between surface and approximately 2,000m depth. The 2D2R technique, in which one source line is used with a parallel line of geophone receivers on either side, was chosen as a cost-effective compromise between conventional 2D seismic work and a more expensive wide-scale 3D survey.

The 2D2R seismic survey was completed in late September. The data from this traverse is still being processed, with results expected towards the end of the year. If the seismic model shows sufficient depth of uninterrupted basal contact below and between the pegmatite lenses at depth, drilling will be proposed to test these areas during 2015.