STTCOMP PNX FA LONGNorthern TerritoryProject DevelopmentoUpdated...

STTCOMP PNX FA LONG

Northern TerritoryProject DevelopmentoUpdated Mineral Resource estimate completed for the Fountain Head Gold Project (reported in accordance with JORC Code, 2012)(ASX release 16 June 2020):•2.94 Mt at 1.7 g/t Au for 156,000 oz Au(Indicated and Inferred)
oResource update adds 18koz Au, representing a 13% increase in contained gold, including a 20.5% increase to the Indicated resource category
oTechnicalstudies and development plans for near-term gold production at the Fountain HeadGoldProject (Project) progressing on schedule
oProject Environmental Impact Statement (EIS) technical studies complete subject tofinal edits,prior to submission during August 2020oProject dewatering mine management plan (MMP) proposal completed and ready for submission
oDevelopment of an exploration strategy with theaim ofprovidinga continuing pipelineof gold mineral resources for processingCorporateoNon-binding Term Sheetfor a proposed financial commitment of up to A$40m and a proposed joint venture (JV)to develop the Fountain Head Gold Project signed with private company Halifax Capital (HC) and its subsidiary Bridge Creek Mining (BCM) (PNX ASX release 15 July 2020)oFormal documentation is being drafted to reflect the non-binding term sheet
oThe proposed capital commitment by HC and JV representsa significant opportunity to establish the Project Infrastructure necessary to fast track the development of Fountain Head,and to generate a continuous pipeline of gold mineral resources through which both PNX and BCM will benefit equally.
o$1.97million cash on hand at 30June2020


Fountain Head Gold ProjectWith the recently executed non-binding term sheet with HC and BCM, and the parties intentionto negotiate a binding joint venture agreementin good faith within a 90-day timeframe,the Company is working with BCM to assess the positive impact of the proposed milling and carbon-in-leach (CIL) process over previously envisaged gold heap leaching by PNX at the Fountain HeadGold Project.TheCIL process route under considerationis expected todeliver material operating benefits throughincreased overall goldrecoveries, andmorestable and earlier cashflowfrom operations.KEY TERMS OF THE NON-BINDING TERM SHEET
•HC to provide an unconditional and legally binding commitment at the time of execution of the Formal JV Agreement to fund $40m of direct pre-development and development costs associated with the infrastructurefor the Project (Project Infrastructure)
•BCM to be operator of the JV under the direction of the Management Committee (with equal PNX and BCM representation) andwill be responsible for the co-ordination and delivery of the Project Infrastructure, operating performance, distribution of production share and invoicing of related costs
•The Project Infrastructure is to be owned by HC and located on PNX’s tenure at Fountain Head with the parties to contribute the following projects to the JV;
oPNX to contribute the Fountain Head Gold Project, the Santorini exploration project and, under certain terms (see below) the Hayes Creek zinc-gold-silver deposits;
oBCM to contribute the Yam Creek exploration project and Bridge Creek gold deposit that hosts historical gold resources that are to be updated and reported in accordance with the JORC Code 2012•PNX is to be granted an option to acquire the Project Infrastructure on payment of an agreed amount or an independent market value subject to;
oprocessing of Mineral Resources havingoccurred for at least 7 years after commencement of commercial production; oroall gold Mineral Resources from the PNX and BCM Projects having been mined, whichever occurs first.