Wednesday, August 8th, 2012

Mithril Resources announces the maiden drilling program at the Illogwa Iron Oxide Copper Gold (IOCG) Target Area has commenced, following successful completion of heritage clearance surveys.

Base metals explorer Mithril Resources Ltd (ASX: MTH) is pleased to advise that the maiden drilling program at the Illogwa Iron Oxide Copper Gold (IOCG) Target Area has commenced, following successful completion of heritage clearance surveys.

Illogwa is located on the Company’s Huckitta Project approximately 150 kilometres east of Alice Springs, Northern Territory and lies within three tenements, two of which (ELs 25643 and 25653) are subject to a joint venture with Sammy Resources Pty Ltd, a wholly owned subsidiary of ASX-listed Cazaly Resources Ltd (ASX: CAZ), and where Mithril may earn an 80% interest.

The 3,800 metre program of air core, reverse circulation and diamond drilling will test four priority drill targets, as well as multiple conceptual geophysical targets.

Each of the four priority drill targets has significant outcropping copper mineralisation and associated alteration.

The diamond drilling is co-funded (up to $100,000) by the Northern Territory Government under the Geophysics and Drilling Collaborations Program.

Illogwa represents a newly recognised Proterozoic copper – gold province characterised by a 50 kilometre long belt of structurally deformed granite and sedimentary sequences that contain variable amounts of quartz veining, strong iron and fluorite alteration, and outcropping copper - gold mineralisation (Figures 2 and 3).

Geological mapping suggests the style of mineralisation and alteration is consistent with structurally controlled IOCG systems found within the world class Mt Isa–Cloncurry District, of North West Queensland. Significantly, the Illogwa IOCG Target has never been drilled.

The four priority targets comprise the Mini Me, El Gordo, Austin and Bigglesworth prospects.

At Mini Me, geological mapping has located sporadic outcropping mineralisation and alteration over 2,000 metres strike length with widths ranging from 2 to 50 metres. Significantly, veinlets (up to 15 centimetres wide) of primary copper sulphide mineralisation (chalcopyrite) have also been observed at a number of locations with rock chip sampling returning values ranging from 0.13% to 7.8% copper and 0.01 g/t to 1.4 g/t gold.

At El Gordo, outcropping mineralisation and alteration has been identified sporadically over 800 metres strike length with widths ranging from 2 to 10 metres. Rock chip sampling of mineralised surface outcrops has returned values ranging from 0.7% to 12.6% copper, 0.1g/t to 1.0g/t gold and 1.6g/t to 12.5g/t silver.

As previously announced (ASX Announcement dated 25 June 2012), assay results from a surface channel sample at El Gordo returned 7 metres grading 0.94% copper, 2.8g/t silver and 0.05g/t gold. The result was obtained from a composite of seven 1-metre continuous surface samples collected from a north-south orientated traverse across one of the mineralised horizons at EL Gordo. The southernmost 1 metre sample returned 3% copper suggesting the mineralisation is not closed off to the south.

At Austin, outcropping copper mineralisation (both malachite and chalcopyrite) primarily associated with intense silica, carbonate and iron alteration has returned values of 0.85% copper from grab samples. Significantly, a wide spaced induced polarisation (IP) survey (3 lines over the 2km strike extent of Austin) identified four anomalies, two of which comprise high priority drill targets as they are modelled to lie directly beneath outcropping copper mineralisation and/or intense alteration.

At Bigglesworth, located on 100% owned Mithril tenement (EL28335) outcropping copper and gold mineralisation has been identified at surface associated within a >50m wide zone of intensely hematite and silica altered granite. Again both copper in sulphides (chalcopyrite) and in secondary minerals (malachite) have been identified with grab samples returning up to 3.2 % copper and 0.2g/t gold.

Drilling will also test a number of conceptual targets derived from interpretation of gravity and magnetic geophysical data that lie along strike from the initial walk–up drill targets.

Under the Sammy Joint Venture Mithril can earn an 80% interest in the tenements through expenditure of $2 million. It is important to note that this expenditure commitment will be met very early in the drilling program as the company has expended close approximately $1.95 million on the tenements to date.

First results from the drilling are expected by late August 2012 and the Company looks forward to informing the market as they come to hand.

Competent Persons Statement:

The information in this report that relates to Exploration Results and Mineral Resources is based on information compiled by Mr David Hutton (Managing Director), who is a full?time employee of the Company and a Fellow of the Australasian Institute of Mining and Metallurgy (AusIMM). Mr D Hutton has more than five years’ experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”.

Mr Hutton consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

Richard Sproull

phone: (08) 8267 6888
mobile: 0418 585517

Contact Profile

Mithril Resources Ltd

Mithril Resources Ltd is an Australian exploration company focused on the discovery and development of base metal deposits - primarily nickel and copper. Mithril is a frontier explorer in the Northern Territory and Western Australia, with an experienced team operating out of Adelaide.
David Hutton, Managing Director, Mithril Resources
P: 08 8378 8200


Exploration, Mining, Resources, exploration update Northern Territory IOCG



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