TIDMEST

RNS Number : 5888T

East Star Resources PLC

21 March 2023

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF REGULATION 2014/596/EU WHICH IS PART OF DOMESTIC UK LAW PURSUANT TO THE MARKET ABUSE (AMMENT) (EU EXIT) REGULATIONS (SI 2019/310) ("UK MAR"). UPON THE PUBLICATION OF THIS ANNOUNCEMENT, THIS INSIDE INFORMATION (AS DEFINED IN UK MAR) IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN.

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION.

21 March 2023

East Star Resources Plc

("East Star" or the "Company")

Independent Exploration Target for Verkhuba Copper-Zinc-Lead Deposit, Kazakhstan

East Star Resources Plc (LSE:EST), which is defining mineral resources in Kazakhstan for the energy revolution, is pleased to announce an independent JORC-compliant Exploration Target conducted by leading resource advisors AMC Consultants on the Verkhuba Copper-Zinc-Lead Deposit on the Rudny Altai VMS belt.

Highlights:

   --    Exploration Target of 19-23 Mt at 1.0-1.4% Cu and 1.0-1.4% Zn (1.4-1.9% CuEq) 

-- Exploration Target is defined by 97 drill holes comprising 42,178 m of historical diamond drilling, reviewed by East Star over the past 12 months, providing a reasonable level of confidence in the geological interpretation

-- Historical drilling was over 2.89 km(2) of laterally extensive mineralisation in a grid pattern of circa 100x100 m in the central part of the deposit and 200x100 m on its flanks

-- Further possible significant exploration upside exists in drill-ready satellite targets identified in 2022 helicopter electromagnetic ("HEM") survey

-- Historical metallurgical test work reported Au and Ag grades in technological samples equal to 0.3 g/t Au and 14.2 g/t Ag indicating potential to further enhance the value per tonne of ore

   --    Potential for low-CAPEX development using existing processing capacity within the region 

-- Verification and infill drilling has been planned to upgrade Exploration Target to JORC-compliant resources with drilling expected to commence this summer

Exploration Target Summary Table

 
 Mining method       Tonnes           Zn          Cu          Pb 
-------------- 
                      (kt)            (%)         (%)         (%) 
--------------  ----------------  ----------  ----------  ---------- 
 Open pit         5,000 - 6,000    0.5 - 0.8   1.4 - 1.8   0.1 - 0.2 
 Underground     14,000 - 17,000   1.2 - 1.6   0.8 - 1.2   0.1 - 0.2 
                ----------------  ----------  ----------  ---------- 
 Total           19,000 - 23,000   1.0 - 1.4   1.0 - 1.4   0.1 - 0.2 
                ----------------  ----------  ----------  ---------- 
 
   --      This is an Exploration Target and should not be considered to be a Mineral Resource 

-- The Exploration Target assumes an open pit mining method with marginal cut-off of 0.38% Cu equivalent and underground mining method with the marginal cut-off of 0.86% Cu equivalent

-- A nominal dry density values of 3.0 t/m(3) was assumed to be appropriate for the style of mineralisation

-- Cu equivalent was calculated using the following metal prices: 3,050 US$/t for Zn, 9,000 US$/t for Cu, 2,250 US$/t for Pb

   --      Tonnage is reported on dry basis 

Figure 1 Micromine model of ore bodies including modelled open pit scenario.

Alex Walker, East Star CEO, commented:

"This Exploration Target validates the statement that the Verkhuba Deposit is a game changer for East Star. The Exploration Target is based on 42,178 m of historical diamond drilling which should require a limited twin drilling programme to upgrade to JORC-compliant resources. The Exploration Target of 19-23 Mt @ 1.4% - 1.9% Cu equivalent is already significant, with potential for additional tonnage in some of the orebodies.

"The Verkhuba Deposit is 2.89 km(2) within a 30 km(2) ore district which also includes multiple drill-ready HEM targets. Furthermore, with significant infrastructure already in place and excess processing capacity within the region from both Glencore (Kazzinc) and KAZ Minerals, it may be possible to fast track the Verkhuba Deposit into production with low capital expenditure.

"With high-grade copper mineralisation already identified, significant exploration upside and a potential route to low-CAPEX development, East Star is uniquely positioned for growth in 2023 within a progressive mining jurisdiction. We are eager to commence verification and infill drilling over the Verkhuba Deposit this summer."

Webcast Presentation

A short webcast presentation about the independent Exploration Target for the Verkhuba Copper-Zinc-Lead Deposit by East Star's CEO is available via the Company's website at: https://www.eaststarplc.com/presentations .

Background

East Star Resources commissioned AMC Consultants Pty Ltd ("AMC") to prepare a Mineral Resource Estimate ("MRE") and a conceptual pit optimisation and analysis for the Verkhuba Deposit located in eastern Kazakhstan. For reporting purposes, the MRE was converted to an Exploration Target range under JORC reporting standards.

Exploration of the project area was carried out in the 1950s through to the 1990s, mostly by surface core drilling. Exploration adits and drives were also developed at the Verkhuba Deposit, but the database for underground channel sampling was not available. Mineralised bodies are represented by VMS shallow dipping sheet-like bodies and lenses.

A total of 97 diamond drillholes define the Verkhuba Deposit with a total of 42,178 m of drilling. 62 drillholes were used for the grade estimate. The deposit area was sampled using diamond drillholes at variable spacings - from 200 m x 200 m to 100 m x 100 m spacing.

To establish the Exploration Target, AMC completed the following phases of work:

   --           Database import and validation 
   --           Classical statistical analysis 

-- Interpretation and wireframing of mineralised zones using metal equivalent grades available in the database

   --           Data selection and compositing 
   --           Block model development 
   --           Grade interpolation and model validation 
   --           Preliminary pit optimisation study using a base case scenario 
   --           Pit analysis and a preliminary scoping estimate of the deposit's economic potential 
   --           Development of verification and an infill drilling programme 

Geological modelling was completed by AMC which resulted in 59 interpreted and wireframed mineralised bodies. A block model constrained by the interpreted mineralised bodies was constructed with the parent cell size of 5 mE x 5 mN x 2 mRL with standard sub-celling five times in all directions to maintain the volume resolution of the mineralised bodies. Drillhole sample intervals have been composited to 1 m length and were used to interpolate all main modelled grades (Zn, Pb, Cu) into the block model using ordinary kriging (OK) interpolation techniques. Block grades were validated both visually and statistically and all modelling was completed using Micromine software.

Constant average bulk density values of 3.0 t/m(3) were applied to each model cell, which was assumed from the historical reports.

Exploration Target

The grade estimate and subsequent Exploration Target allowed an assessment of the integrity of the input data. It was also used to confirm estimation and reporting of exploration potential ranges of tonnage and grades for the Verkhuba Deposit. The Exploration Target is to be reported in accordance with the JORC Code*.

Table 1 shows the Exploration Target for the Verkhuba Deposit for both open pit and underground mining methods. The Exploration Target is based on actual Exploration Results that were obtained during several historical exploration programmes completed between 1950 and 1990 when a total number of 97 diamond holes were drilled totaling 42,178 m. The estimated potential quantity of tonnes and grades are conceptual in nature as there has been insufficient data and evaluation to support estimation of a Mineral Resource. Tonnages and grades are expressed as ranges that are considered appropriate for the Exploration Target. There is no certainty that further exploration, verification drilling, or twinned drilling will result in the estimation of a Mineral Resource. The Exploration Target is not to be considered in any way to represent a Mineral Resource or Ore Reserve.

   Table 1    Verkhuba Exploration Target estimate for open pit and underground mining methods 
 
 Mining method       Tonnes           Zn          Cu          Pb 
-------------- 
                      (kt)            (%)         (%)         (%) 
--------------  ----------------  ----------  ----------  ---------- 
 Open pit         5,000 - 6,000    0.5 - 0.8   1.4 - 1.8   0.1 - 0.2 
 Underground     14,000 - 17,000   1.2 - 1.6   0.8 - 1.2   0.1 - 0.2 
                ----------------  ----------  ----------  ---------- 
 Total           19,000 - 23,000   1.0 - 1.4   1.0 - 1.4   0.1 - 0.2 
                ----------------  ----------  ----------  ---------- 
 

Notes:

   --      This is an Exploration Target and should not be considered to be a Mineral Resource 

-- The Exploration Target assumes an open pit mining method with marginal cut-off of 0.38% Cu equivalent and underground mining method with the marginal cut-off of 0.86% Cu equivalent

-- A nominal dry density values of 3.0 t/m(3) was assumed to be appropriate for the style of mineralisation

-- Cu equivalent was calculated using the following metal prices: 3,050 US$/t for Zn, 9,000 US$/t for Cu, 2,250 US$/t for Pb

   --      Tonnage is reported on dry basis 

Following the Exploration Target, AMC made the following findings:

-- The quality of procedures for the historical data collection used for the Exploration Target estimate is believed to be of sufficient standard

-- The Exploration Target for the Verkhuba Deposit was prepared using data, geological interpretation and understanding, and estimation practices that are appropriate for the style of mineralisation

-- The cut-off grades which have been calculated for reporting open pit and underground Exploration Target are considered reasonable and based on justifiable assumptions and parameters

-- The Exploration Target has potential to be developed via open pit and underground mining methods, and it has been delineated and reported in accordance with the JORC Code

-- Further verification and infill drilling are required to upgrade the current Exploration Target to a Mineral Resource

*Note: Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. The JORC Code, 2012 Edition. Prepared by: The Joint Ore Reserves Committee of The Australasian Institute of Mining and Metallurgy, Australian Institute of Geoscientists and Minerals Council of Australia (JORC).

Next Steps

As part of ongoing studies, AMC recommend that ten new drillholes, twined to historical drillholes, should be drilled as verification holes to support further mineral resource estimation and classification. It is the intention of the Company to drill these holes in summer 2023 to expediate the estimation of JORC- compliant resources over the Verkhuba Deposit.

Upon conversion to JORC-compliant resources, East Star will be able to undertake a Scoping Study on both the open pit and underground development scenarios to confirm the potential economics of the project. East Star hopes to complete and publish the results of this work by the end of 2023.

The Company will abide by industry standard QA/QC protocols for quality assurance and intend on conducting geotechnical logging on all core for the purpose of saving time and money on the subsequent stages of feasibility assessment.

Figure 2 Arial view of mineralisation with OP outline and planned drillholes (yellow)

Rudny Altai Region

The Rudny Altai region is one of the largest VMS provinces in the world, part of the Central Asian Orogenic Belt. The Company's newest 1794-EL, 1795-EL (containing the Verkhuba Deposit) and 1799-EL licences are located adjacent to the Company's existing 847-EL and 914-EL licences (together, the "Licences"). Administratively, the Licences are within the Shemonaikha District and are extraordinarily well connected to infrastructure. The regional centre of Ust-Kamenogorsk is located 45 km, and its international airport is located 35 km, southeast of the Licences. The railway connecting Ridder (Kazzinc Mine) and Tomsk cities crosses the Licences from the south to the northwest with two railway stations located on the territory of the Licences. There is a network of dirt roads within the Licences that are suitable for driving all year round. A hard-surfaced road from Ust-Kamenogorsk to Shemonaikha crosses the western part of the Licences.

The area is characterised by moderately hilly terrain with elevations ranging between 270 m and 630 m above the mean sea level.

For further information visit the Company's website at www.eaststarplc.com , or contact:

East Star Resources Plc

Alex Walker, Chief Executive Officer

Tel: +44 (0)20 7390 0234 (via Vigo Consulting)

Peterhouse Capital Limited (Corporate Broker)

Duncan Vasey / Lucy Williams

Tel: +44 (0) 20 7469 0930

Vigo Consulting (Investor Relations)

Ben Simons / Peter Jacob

Tel: +44 (0)20 7390 0234

About East Star Resources Plc

East Star Resources is focused on the discovery and development of strategic minerals required for the energy revolution. With an initial nine licences covering 1,321.5 km(2) in three mineral rich districts of Kazakhstan, East Star is undertaking an intensive exploration programme, applying modern geophysics to discover minerals in levels that were not previously explored. The Company also intends to further expand its licence portfolio in Kazakhstan. East Star's management are based permanently on the ground, supported by local expertise, and joint ventures with the state mining company.

Follow us on social media:

LinkedIn: https://www.linkedin.com/company/east-star-resources/

Twitter: https://twitter.com/EastStar_PLC

The person who arranged for the release of this announcement was Alex Walker, CEO of the Company.

Competent Persons Statement

The information in this Report that relates to the Exploration Target is based on and fairly represents information which has been compiled by Mr Dmitry Pertel who is a member of the Australian Institute of Geoscientists. Mr Pertel has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity that is being undertaken to qualify as a Competent Person, as defined in the 2012 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr Pertel is a full-time employee of AMC Consultants Pty Ltd..

The information in this Report that relates to QAQC (JORC Code Table 1 Sections 1 and 2) is based on and fairly represents information which has been compiled by Dr Mikhail Tsypukov who is a Fellow of the Institute of Materials, Minerals and Mining (UK). Dr Tsypukov has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity that is being undertaken to qualify as a Competent Person, as defined in the 2012 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr Tsypukov is an independent Consulting Geologist (not associated with AMC) and has consented to the inclusion of the matters in this report based on his information in the form and context in which it appears.

JORC Table 1. Verkhuba Deposit

Section 1 Sampling Techniques and Data

(Criteria in this section apply to all succeeding sections)

 
 
Sampling Techniques                     ! Nature and quality of sampling (eg         ! The deposit was explored by 
                                        cut channels, random chips, or               drilling producing 59 and 76 mm 
                                        specific specialised industry                diameter core. Sampling was 
                                        standard measurement tools appropriate       performed only on mineralised 
                                        to the minerals under investigation,         intervals identified by visual 
                                        such as down hole                            core logging and downhole 
                                        gamma sondes, or handheld XRF                geophysics 
                                        instruments, etc). These examples            (X-ray radiometric and/or 
                                        should not be taken as limiting              electric downhole logging). 
                                        the broad meaning of sampling.               ! Mineralised core of different 
                                        ! Include reference to measures taken        mineralogy was sampled separately 
                                        to ensure sample representivity and          at intervals ranging from 
                                        the appropriate                              0. 1 to 2.0 m in length. 
                                        calibration of any measurement tools         ! 59 mm core was sampled in full, 
                                        or systems used.                             76 mm core was cut in half, one 
                                        ! Aspects of the determination of            half of core was sampled 
                                        mineralisation that are Material to          for laboratory studies. 
                                        the Public Report.                           ! Host rocks in hanging wall and 
                                        ! In cases where 'industry standard'         footwall of mineralisation were 
                                        work has been done this would be             sampled by 1 m long samples, 
                                        relatively simple (eg                        2-3 samples were collected from 
                                        'reverse circulation drilling was used       each contact. 
                                        to obtain 1 m samples from which 3 kg        ! Non-mineralised core was 
                                        was pulverised                               sampled by 10 m long composite 
                                        to produce a 30 g charge for fire            core samples by collecting rock 
                                        assay'). In other cases, more                chips every 10 cm of core for 
                                        explanation may be required,                 rock chemical and mineralogical 
                                        such as where there is coarse gold           studies. 
                                        that has inherent sampling problems.         ! In case of low core recovery 
                                        Unusual commodities                          (<50%) sampling intervals were 
                                        or mineralisation types (eg submarine        increase to 3 m to provide enough 
                                        nodules) may warrant disclosure of           sampling material for chemical 
                                        detailed information.                        studies. 
                                                                                     In the opinion of the Competent 
                                                                                     Person, the sampling techniques 
                                                                                     were appropriate for the geology, 
                                                                                     scale of deposit, and are of an 
                                                                                     acceptable standard for the 
                                                                                     purpose of data used in 
                                                                                     estimating 
                                                                                     an Exploration Target. 
--------------------------------------  --------------------------------------  -------------------------------------- 
Drilling Techniques                     ! Drill type (eg core, reverse               ! Double barrel wireline system 
                                        circulation, open-hole hammer, rotary        was used in Exploration Target 
                                        air blast, auger, Bangka,                    definition drilling. 
                                        sonic, etc) and details (eg core             ! Upper 10-20 m transported 
                                        diameter, triple or standard tube,           deposits were drilled by 132 mm 
                                        depth of diamond tails,                      diamond drill bit, followed by 
                                        face-sampling bit or other type,             112 mm bit up to depth of 35-70 m 
                                        whether core is oriented and if so, by       below the surface. After casing 
                                        what method, etc).                           of drill hole by 89 mm casing 
                                                                                     pipes, the drilling was continued 
                                                                                     by 76 mm bit (core diameter 57 
                                                                                     mm), followed by 59 mm drill 
                                                                                     bit (core diameter 42 mm). 
                                                                                     ! Most of the mineralised 
                                                                                     intervals were drilled with 59 mm 
                                                                                     drill bits. 
                                                                                     In the opinion of the Competent 
                                                                                     Person, the drilling techniques 
                                                                                     are suitable for estimating 
                                                                                     Exploration Target: the core 
                                                                                     sizes are appropriate, but the 
                                                                                     standards of work completed in 
                                                                                     the Soviet era should be 
                                                                                     quantified and compared to the 
                                                                                     planned verification drill 
                                                                                     programme. 
                                                                                     The data obtained using the older 
                                                                                     drilling techniques is acceptable 
                                                                                     for the definition of 
                                                                                     an Exploration Target. 
--------------------------------------  --------------------------------------  -------------------------------------- 
Drill Sample Recovery                   ! Method of recording and assessing          ! On undisturbed core, the 
                                        core and chip sample recoveries and          recovery was estimated by 
                                        results assessed.                            dividing of core length by the 
                                        ! Measures taken to maximise sample          length 
                                        recovery and ensure representative           of drilling run reduced to 100%. 
                                        nature of the samples.                       Most of the core was presented by 
                                        ! Whether a relationship exists              broken and fragmented core 
                                        between sample recovery and grade and        and its recovery was measured 
                                        whether sample bias                          using weight method. 
                                        may have occurred due to preferential        ! To increase core recovery on 
                                        loss/gain of fine/coarse material.           mineralised intervals the length 
                                                                                     of drilling runs was reduced 
                                                                                     to 1 m and drill bit load was 
                                                                                     also reduced. 
                                                                                     ! Core recovery on mineralised 
                                                                                     intervals was reported above the 
                                                                                     limit of 70% and above 60% 
                                                                                     within the bioherm sequence. 
                                                                                     ! There were no requirements on 
                                                                                     core recovery on non-mineralised 
                                                                                     intervals and host rocks, 
                                                                                     where core recovery varied within 
                                                                                     23-40% (1987-1990). 
                                                                                     ! No relationship between sample 
                                                                                     recovery and grade was reported 
                                                                                     nor it was apparent. 
                                                                                     In the opinion of the Competent 
                                                                                     Person, the drill sample 
                                                                                     recoveries are suitable for data 
                                                                                     used in estimating an Exploration 
                                                                                     Target. 
--------------------------------------  --------------------------------------  -------------------------------------- 
Logging                                 ! Whether core and chip samples have         ! All drill holes were 
                                        been geologically and geotechnically         geologically logged except upper 
                                        logged to a level                            sections of drill holes with 
                                        of detail to support appropriate             transported 
                                        Mineral Resource estimation, mining          sediments, however only limited 
                                        studies and metallurgical                    original information from 
                                        studies.                                     geological archives has been 
                                        ! Whether logging is qualitative or          obtained 
                                        quantitative in nature. Core (or             to date. 
                                        costean, channel, etc)                       ! No results of historical 
                                        photography.                                 geotechnical logging are 
                                        ! The total length and percentage of         available. 
                                        the relevant intersections logged.           ! Historical logging was 
                                                                                     qualitative, in many cases rock 
                                                                                     nomenclature is not confirmed by 
                                                                                     rock chemistry and by other 
                                                                                     exploration campaigns. 
                                                                                     ! No core photos were taken 
                                                                                     during historical exploration. 
                                                                                     In the opinion of the Competent 
                                                                                     Person, the available geological 
                                                                                     logging is sufficient to 
                                                                                     support estimate of an 
                                                                                     Exploration Target. 
--------------------------------------  --------------------------------------  -------------------------------------- 
Sub-sampling Techniques and Sample      ! If core, whether cut or sawn and          ! 57 mm core was cut along the 
Preparation                             whether quarter, half or all core           core axe, half core subsamples 
                                        taken.                                      were taken for control purposes. 
                                        ! If non-core, whether riffled, tube        42 mm core was sampled in full, no 
                                        sampled, rotary split, etc and whether      geological duplicates were 
                                        sampled wet or                              available for control purposes. 
                                        dry.                                        ! Sample preparation was robust 
                                        ! For all sample types, the nature,         and included all necessary 
                                        quality and appropriateness of the          procedures, including multiple 
                                        sample preparation                          crushing controlled by sieving, 
                                        technique.                                  staged size reduction, pulverizing 
                                        ! Quality control procedures adopted        and collection of one analytical 
                                        for all sub-sampling stages to              sample and three duplicates of 
                                        maximise representivity                     sufficient weight for analytical 
                                        of samples.                                 studies. 
                                        ! Measures taken to ensure that the         ! Sample size was appropriate to 
                                        sampling is representative of the in        the grain size of the sampling 
                                        situ material collected,                    material. 
                                        including for instance results for          The Competent Person's opinion 
                                        field duplicate/second-half sampling.       that the subsampling techniques 
                                        ! Whether sample sizes are appropriate      and sample preparation were 
                                        to the grain size of the material           suitable for data used in 
                                        being sampled.                              estimating an Exploration Target. 
--------------------------------------  --------------------------------------  -------------------------------------- 
Quality of assay data and laboratory    ! The nature, quality and                    ! Atomic absorption spectral 
tests                                   appropriateness of the assaying and          analysis was used for 
                                        laboratory procedures used and               determination of Cu, Pb and Zn. 
                                        whether the technique is considered          Fire assay 
                                        partial or total.                            analysis with atomic absorption 
                                        ! For geophysical tools,                     finish was use for determination 
                                        spectrometers, handheld XRF                  of Au and Ag. 
                                        instruments, etc, the parameters used        ! Analytical test results for Cu, 
                                        in determining the analysis including        Pb and Zn on main and duplicate 
                                        instrument make and model, reading           samples performed in main 
                                        times, calibrations                          and umpire laboratories 
                                        factors applied and their derivation,        demonstrated discrepancy within 
                                        etc.                                         the acceptable limits. 
                                        ! Nature of quality control procedures       ! There is no available 
                                        adopted (eg standards, blanks,               information on internal QAQC 
                                        duplicates, external                         procedures in main and umpire 
                                        laboratory checks) and whether               laboratories. 
                                        acceptable levels of accuracy (ie lack       The Competent Person is satisfied 
                                        of bias) and precision                       that the overall quality of the 
                                        have been established.                       assay results is acceptable 
                                                                                     and fit for the purpose of 
                                                                                     estimating an Exploration Target. 
--------------------------------------  --------------------------------------  -------------------------------------- 
Verification of Sampling and Assaying   ! The verification of significant           ! No verification drilling has 
                                        intersections by either independent or      been performed by ESR at this 
                                        alternative company                         stage. 
                                        personnel.                                  ! No twinning of historical drill 
                                        ! The use of twinned holes.                 holes was performed by ESR. 
                                        ! Documentation of primary data, data       ! Limited primary historical data 
                                        entry procedures, data verification,        as core lithological and 
                                        data storage (physical                      structural logs, drill hole 
                                        and electronic) protocols.                  inclination 
                                        ! Discuss any adjustment to assay           etc. is available by the time of 
                                        data.                                       preparation of the report. 
                                                                                    ! Location of mineralised 
                                                                                    intervals can be corrected after 
                                                                                    obtaining of historical 
                                                                                    topographic 
                                                                                    survey results, drill hole logs 
                                                                                    and on-site inspection. 
                                                                                    No control or verification results 
                                                                                    were available at the time of 
                                                                                    reporting; thus estimated 
                                                                                    grades and tonnes were not 
                                                                                    classified. 
--------------------------------------  --------------------------------------  -------------------------------------- 
Location of Data Points                 ! Accuracy and quality of surveys used      ! Location and deviation of 
                                        to locate drill holes (collar and           historical drill holes was 
                                        down-hole surveys),                         digitised from georeferenced 
                                        trenches, mine workings and other           geological 
                                        locations used in Mineral Resource          sections and maps at scale 
                                        estimation.                                 1:10,000, which is considered as 
                                        ! Specification of the grid system          appropriate for Exploration Target 
                                        used.                                       mineral inventory. 
                                        ! Quality and adequacy of topographic       ! By the time of preparation of 
                                        control.                                    the report no historical drill 
                                                                                    hole logs with collar coordinates 
                                                                                    were available. ESR is in the 
                                                                                    process of obtaining this 
                                                                                    information from geological 
                                                                                    archives. 
                                                                                    ! Topography of the deposit area 
                                                                                    was presented as digital terrane 
                                                                                    model with sufficient resolution 
                                                                                    which is considered as appropriate 
                                                                                    for Exploration Target mineral 
                                                                                    inventory. 
                                                                                    The Competent Person is satisfied 
                                                                                    that the location of data points 
                                                                                    is fit for the purpose 
                                                                                    of estimating an Exploration 
                                                                                    Target. 
--------------------------------------  --------------------------------------  -------------------------------------- 
Data Spacing and Distribution           ! Data spacing for reporting of              ! Data spacing is appropriate for 
                                        Exploration Results.                         delineation of Exploration Target 
                                        ! Whether the data spacing and               assessment of volume of 
                                        distribution is sufficient to                mineralised material and metal 
                                        establish the degree of geological           endowment and grades. 
                                        and grade continuity appropriate for         ! Historical data spacing and 
                                        the Mineral Resource and Ore Reserve         distribution is sufficient to 
                                        estimation procedure(s)                      establish mineralised bodies, 
                                        and classifications applied.                 continuity of lithology and grade 
                                        ! Whether sample compositing has been        appropriate for delineation of 
                                        applied.                                     Exploration Target. Verification 
                                                                                     drilling and twinning of some 
                                                                                     drill holes are required for 
                                                                                     subsequent Mineral Resource 
                                                                                     Estimate 
                                                                                     in Inferred and Indicated 
                                                                                     categories. 
                                                                                     ! Exploration grid includes 97 
                                                                                     diamond holes drilled with 200 m 
                                                                                     by 200 m to 100 m by 100 m 
                                                                                     spacing. 
                                                                                     ! Most mineralised zones do not 
                                                                                     outcrop, but some of them do 
                                                                                     outcrop. Mineralised bodies were 
                                                                                     traced to a depth exceeding 800 m 
                                                                                     from the surface, using adit 
                                                                                     levels and inclined core 
                                                                                     drillholes. 
                                                                                     Drillholes were located along the 
                                                                                     profiles, oriented across the 
                                                                                     mineralised bodies strike, 
                                                                                     the profiles strike at 100-105 . 
                                                                                     The Competent Person is satisfied 
                                                                                     that data spacing is appropriate 
                                                                                     for estimating an Exploration 
                                                                                     Target. 
--------------------------------------  --------------------------------------  -------------------------------------- 
Orientation of Data in relation to      ! Whether the orientation of sampling        ! Most of the drill holes were 
Geological Structure                    achieves unbiased sampling of possible       sub-vertical, intersecting of 
                                        structures and                               flat lying lithology at steep 
                                        the extent to which this is known,           angles. Thus, no correction of 
                                        considering the deposit type.                width of mineralised 
                                        ! If the relationship between the            intersections was applied which 
                                        drilling orientation and the                 is considered 
                                        orientation of key mineralised               as appropriate to the considered 
                                        structures is considered to have             deposit type. 
                                        introduced a sampling bias, this             ! The sampling orientation was 
                                        should be assessed and reported              appropriate for the reliable 
                                        if material.                                 sampling of the identified 
                                                                                     structures, 
                                                                                     considering the mineralisation 
                                                                                     type. 
                                                                                     ! Drilling profiles were oriented 
                                                                                     across the mineralisation. 
                                                                                     ! The flat lying mineralised 
                                                                                     bodies were sampled by inclined 
                                                                                     or vertical drillholes, oriented 
                                                                                     across the mineralised zone 
                                                                                     strike. 
                                                                                     ! Sampling bias from the 
                                                                                     orientation of the drilling was 
                                                                                     not identified. 
                                                                                     The Competent Person is satisfied 
                                                                                     that orientation of data in 
                                                                                     relation to geological structure 
                                                                                     is appropriate for estimating an 
                                                                                     Exploration Target. 
--------------------------------------  --------------------------------------  -------------------------------------- 
Sample Security                         ! The measures taken to ensure sample   ! Not appropriate. All historical core 
                                        security.                               and laboratory samples were disposed 
                                                                                of shortly after 
                                                                                completion of exploration programmes. 
--------------------------------------  --------------------------------------  -------------------------------------- 
Audits or Reviews                       ! The results of any audits or reviews  ! As far as Competent Person aware, 
                                        of sampling techniques and data.        there were no audits or reviews of 
                                                                                sampling techniques 
                                                                                and data related to Verkhuba deposit 
                                                                                performed by any third party. 
--------------------------------------  --------------------------------------  -------------------------------------- 
 

Section 2 Reporting of Exploration Results

(Criteria listed in the preceding section also apply to this section)

 
 
Mineral         ! Type, reference name/number, location and ownership including        ! Verkhuba deposit is located in the eastern part of exploration licence 1795-EL, owned by 
Tenement and    agreements or material issues                                           Discovery Ventures Kazakhstan Ltd. The licence was issued on 27 July 2022 for initial period 
Land Tenure     with third parties such as joint ventures, partnerships,                of 6 years with a possibility of further five years extension subject to reduction of the 
Status          overriding royalties, native title                                      licence area by 40%. The licence has an area of 37.1 km(2) and contains VHMS deposits Pokrovskoe-2 
                interests, historical sites, wilderness or national park and            (mined out in 1960-1970(th) ) and Verkhuba and several VHMS occurrences. No native title interests, 
                environmental settings.                                                 historical sites, wilderness or national park and environmental setting identified by ESR 
                ! The security of the tenure held at the time of reporting along        appointed environmental consultants. 
                with any known impediments                                              ! Discovery Ventures Kazakhstan Ltd is a 100% owned entity of East Star Resources. 
                to obtaining a licence to operate in the area.                          ! Ministry of Industry and Infrastructural Development of the Republic of Kazakhstan does 
                                                                                        not carry any negotiations with any other party in respect of the property. All required documents 
                                                                                        including Exploration programme, Environmental impact assessment (EIA) and enhanced technical 
                                                                                        and economic calculations studies are completed by ESR and approved by the Kazakhstan mining 
                                                                                        authorities allowing ESR to perform exploration on the property. 
                                                                                        ! According to Kazakh mining legislation, exploration licence can be converted to mining licence 
                                                                                        after completion of exploration in case the applicants is compliance with qualification requirements 
                                                                                        of Subsoil Use Code of the Republic of Kazakhstan. 
                                                                                        The Competent Person is satisfied that mineral tenement and land tenure status are appropriate 
                                                                                        for Exploration Target estimation. 
--------------  ----------------------------------------------------------------  --------------------------------------------------------------------------------------------------------------------------------------------------------------- 
Exploration     ! Acknowledgment and appraisal of exploration by other parties.              ! The deposit was discovered in 1948-1949 during geological survey at scale 1:50,000 of topographic 
done by other                                                                                 sheets M-44-57-D and M-44-69-B (Yakovlev et al., 1950) 
parties                                                                                       ! Several exploration campaigns through 1950-1990s were carried out within the deposit area 
                                                                                              by East Kazakhstan Geological Enterprise mostly by surface core drilling: 
                                                                                              o 1956-1957 ( Yusupov et al., 1957 ); 
                                                                                              o 1970-1972 ( Anoshin et al., 1973); 
                                                                                              o 1974-1976 (Rodionov et al., 1976); 
                                                                                              o 1985-1987 (Radchenko et al., 1 987); 
                                                                                              o 1987-1990 (Grigorovich et al., 1990); 
                                                                                              ! Exploration adit and drives totalling 3001 m were also developed at the deposit, but the 
                                                                                              database for underground channel sampling and metallurgical sampling was not available. 
                                                                                              ! Historical exploration was completed in 1990 by Technical Economic Consideration supported 
                                                                                              by Mineral Resource Estimate (Yermolaev et al., 1990). 
--------------  ----------------------------------------------------------------  --------------------------------------------------------------------------------------------------------------------------------------------------------------- 
Geology         ! Deposit type, geological setting and style of mineralisation.        ! Verkhuba polymetallic deposit belongs to volcanogenic hosted massive sulphide deposit type 
                                                                                        (VHMS), formed in Devonian time within Rudny Altai VHMS province as a result of hydrothermal 
                                                                                        activity in the vicinity of spreading centre or subduction zone. 
                                                                                        ! Mineralised bodies are represented by shallow dipping thin sheet-like bodies and lenses 
                                                                                        hosted mainly by volcanogenic sedimentary rocks including, tuffaceous siltstone and sandstone, 
                                                                                        marl, carbonate rock, felsic tuff and lava. 
                                                                                        ! Mineralisation is considered as a distal to a volcanic centre due to significant amount 
                                                                                        of sedimentary rocks. Mineralised bodies are controlled by a contact of Berezovskaya and Losishinskaya 
                                                                                        suites (Eifelian-Frasnian stages) and are represented by disseminated, string and massive 
                                                                                        Cu-Zn mineralisation. 
                                                                                        The Competent Person is satisfied that geological understanding of this deposit is appropriate 
                                                                                        to support Exploration Target estimation. 
--------------  ----------------------------------------------------------------  --------------------------------------------------------------------------------------------------------------------------------------------------------------- 
Drill hole            ! A summary of all information material to the              ! Verkhuba VHMS deposit had been explored by sub-vertical or steeply dipping drill holes that 
Information           understanding of the exploration results including           provided a grid of ca. 100x100 m in the central part of the deposit and 200x100 m on its flanks. 
                      a tabulation of the following information for all Material   ! The area studied by drilling is approximately 1.7 x 1.7 km and contains 97 drill holes, 
                      drill holes:                                                 totalling 42,178 m. The drill holes varied in length from 120 to 893 m (average length of 
                       *    easting and northing of the drill hole collar          434 m). 
                                                                                   ! Polymetallic mineralisation was intersected on several stratigraphic levels at depth from 
                                                                                   to 13.5 to 849 m below the surface. 
                       *    elevation or RL (Reduced Level - elevation above sea   ! Information on historical drilling, including collar coordinates, drill hole inclination 
                            level in metres) of the drill hole collar              and length was extracted by ESR from georeferenced geology maps and geological sections at 
                                                                                   scale 1:10 000. Depth of mineralised intervals and grades were taken from historical mineral 
                                                                                   resource estimate reports (Ermolaev et al., 1990, Grigorovich et al., 1990) and require verification 
                       *    dip and azimuth of the hole                            and correction during the follow-up exploration and delineation of JORC Code-compliant Mineral 
                                                                                   Resources. 
                                                                                   ! A table of drill hole collars and relevant mineralised intersections is presented in the 
                       *    down hole length and interception depth                report. 
                                                                                   ! All the available geological information has been included into the report. 
 
                       *    hole length. 
 
 
                      ! If the exclusion of this information is justified on the 
                      basis that the information is not 
                      Material and this exclusion does not detract from the 
                      understanding of the report, the Competent 
                      Person should clearly explain why this is the case. 
--------------  ----------------------------------------------------------------  --------------------------------------------------------------------------------------------------------------------------------------------------------------- 
Data            ! In reporting Exploration Results, weighting averaging                ! Exploration results are not the subject of this report. 
Aggregation     techniques, maximum and/or minimum                                      ! The following metal equivalent calculations were used: 
Methods         grade truncations (eg cutting of high grades) and cut-off grades        No metallurgical metal recoveries were not applied in the metal equivalent formula dues to 
                are usually Material and                                                the conceptual nature of the estimate of Exploration Target. 
                should be stated.                                                       Copper equivalent was calculated using conversion factor of 0.3389 for zinc and 0.2500 for 
                ! Where aggregate intercepts incorporate short lengths of high          lead. Metal prices used were 9,000 US$/t for copper, 3,050 US$/t for zinc and 2,250 US$/t 
                grade results and longer lengths                                        for lead. 
                of low grade results, the procedure used for such aggregation           The resultant formula was: CuEq = Cu(%) + Zn(%) x 0.33889 + Pb(%) x 0.250000 
                should be stated and some typical                                       Where: CuEq - copper equivalent (%), Zn - in situ zinc grade (%), Cu - in situ copper grade 
                examples of such aggregations should be shown in detail.                (%), Pb - in situ lead grade (%). 
                ! The assumptions used for any reporting of metal equivalent            The Competent Person is satisfied that appropriate data aggregation methods have been applied 
                values should be clearly stated.                                        to support Exploration Target estimation. 
--------------  ----------------------------------------------------------------  --------------------------------------------------------------------------------------------------------------------------------------------------------------- 
Relationship    ! These relationships are particularly important in the           ! Exploration results are not the subject of this report. 
between         reporting of Exploration Results.                                  ! No true thickness of mineralisation has been calculated in the current study. 
Mineralisation  ! If the geometry of the mineralisation with respect to the        ! Relationships between thickness of mineralisation and length of intercepts were interpreted 
widths and      drill hole angle is known, its                                     during historical exploration by core observations and correlation of lithology and mineralisation 
intercept       nature should be reported.                                         between adjacent drill holes confirming flat lying stratigraphy and polymetallic mineralisation 
lengths         ! If it is not known and only the down hole lengths are            concordant to layering. 
                reported, there should be a clear                                  ! According to historical reports most of drill holes were steeply dipping or sub-vertical 
                statement to this effect (eg 'down hole length, true width not     and intersected mineralisation at steep angle so it is assumed that the width of mineralised 
                known').                                                           intervals in most drill holes is close to true thickness of mineralisation. 
--------------  ----------------------------------------------------------------  --------------------------------------------------------------------------------------------------------------------------------------------------------------- 
Diagrams        ! Appropriate maps and sections (with scales) and tabulations of  ! Historical geology maps and sections at scale 1:10,000 are included into the report as well 
                intercepts should be included                                      as and most significant historical mineral intersections. 
                for any significant discovery being reported These should 
                include, but not be limited to a 
                plan view of drill hole collar locations and appropriate 
                sectional views. 
--------------  ----------------------------------------------------------------  --------------------------------------------------------------------------------------------------------------------------------------------------------------- 
Balanced        ! Where comprehensive reporting of all Exploration Results is     ! Mineral inventory presented in the report is based on historical drilling results including 
Reporting       not practicable, representative                                    both barren and mineralised drill holes. 
                reporting of both low and high grades and/or widths should be      ! All material historical exploration results and conclusions in which the authors are confident 
                practiced to avoid misleading                                      in are reported, as well as main concerns related to continuation of mineralisation. 
                reporting of Exploration Results. 
--------------  ----------------------------------------------------------------  --------------------------------------------------------------------------------------------------------------------------------------------------------------- 
Other           ! Other exploration data, if meaningful and material, should be   ! Based on historical drilling results, a Technical-Economic Consideration supported by a 
Substantive     reported including (but not                                        historical mineral resource estimate was produced by Ermolaev et al.(1990). The historical 
Exploration     limited to): geological observations; geophysical survey           resource estimate considered three cut-off grades 3.0, 2.0 and 0.8% sum of metals (Zn equivalent), 
Data            results; geochemical survey results;                               minimal thickness of mineralised bodies as 1.6 m and maximal thickness of barren rocks included 
                bulk samples - size and method of treatment; metallurgical test    into the mineralised interval - 3 m. Results of the estimate are presented in table below.Cut-off   Ore     Cu    Pb    Zn     Cu     Pb      Zn     Au     Ag 
                results; bulk density, groundwater,                                 grade 
                geotechnical and rock characteristics; potential deleterious or       %       Kt     %     %     %      Kt     Kt      Kt     t      t 
                contaminating substances.                                            3.0    2,714   1.84  0.27  4.65  49.90   7.41   126.25  0.81  38.50 
                                                                                     2.0    5,445   1.34  0.22  3.19  74.62   4.73   173.94  1.66  77.30 
                                                                                     0.8    10,897  1.14  0.14  1.91  124.22  15.68  208.54  3.27  154.70 
                                                                                   -------  ------  ----  ----  ----  ------  -----  ------  ----  ------ 
 
                                                                                   ! Au and Ag resources were calculated based on Au and Ag grade in technological sample 4 equal 
                                                                                   to 0.4 g/t Au, 14.2 g/t Ag. 
                                                                                   ! Au and Ag recovery to concentrates was below 50%:Cut-off   Cu concentrate    Zn concentrate       Pyrite        Tailings 
                                                                                    grade                                         concentrate 
                                                                                      %       Au       Ag       Au       Ag       Au      Ag     Au     Ag 
                                                                                     3.0     11.15    51.93    15.5     31.26   15.37    4.7    57.98  12.17 
                                                                                     2.0     8.29     38.5     12.8     21.45   15.81   27.24   63.82  12.81 
                                                                                     0.8     6.89     31.96    6.28     11.2    23.78    43.5   63.05  13.34 
                                                                                   -------  -------  -------  -------  -------  ------  ------  -----  ----- 
 
                                                                                   ! Bulk density for mineralised material was estimated as 3.0 t/m(3) based on 500 samples collected 
                                                                                   from drill core and underground channels. 
                                                                                   ! It was concluded by Ermolaev et al. (1990) that the mining could be profitable with 3 % 
                                                                                   of sum of metals as a cut-off grade in accordance with economic conditions and costs of 1990. 
                                                                                   ! According to Yermolaev et al. (1990), total of 9 metallurgical tests were performed on Verkhuba 
                                                                                   mineralised material by Central Laboratory of East Kazakhstan Geological Expedition (Vostkazgeologia) 
                                                                                   and All Union Scientific Institute (VNIIzvetmet, Ust-Kamenogorsk, 1989) . The 9 individual 
                                                                                   and composite samples differed in ore mineralogy and varied in weight from 14 to 1500 kg. 
                                                                                   Several treatment sc hemes were applied producing Cu, Pb, Zn and pyrite concentrate with the 
                                                                                   recovery varying within 86-96% (Cu), 75-85% (Pb), 75-94% (Zn), 48-60 (pyrite). Based on test 
                                                                                   results it was recommended to use bulk-differential flotation which provide 83-84% Cu and 
                                                                                   Zn recovery to concentrates. 
--------------  ----------------------------------------------------------------  --------------------------------------------------------------------------------------------------------------------------------------------------------------- 
Further Work    ! The nature and scale of planned further work (eg tests for           ! ESR intends to verify continuity and grades of mineralisation and perform metallurgical 
                lateral extensions or depth extensions                                  test work, hydrogeological and geotechnical and other appropriate studies. 
                or large-scale step-out drilling).                                      ! Model geology of the deposit using results of verification and infill drilling and whole 
                ! Diagrams clearly highlighting the areas of possible                   rock geochemistry. 
                extensions, including the main geological                               ! Produce JORC compliant Mineral Resource Estimate at Indicated and Inferred categories by 
                interpretations and future drilling areas, provided this                completion of field and laboratory programme. 
                information is not commercially sensitive.                              The Competent Person is satisfied that the proposed work is appropriate to support subsequent 
                                                                                        objectives. 
--------------  ----------------------------------------------------------------  --------------------------------------------------------------------------------------------------------------------------------------------------------------- 
 

Section 3 Estimation and Reporting of Mineral Resources

(Criteria listed in Section 1, and where relevant in Section 2, also apply to this section)

AMC comments that this section is provided to support some aspects of the determination of the Exploration Target. It is not strictly required for public reporting of an Exploration Target nor are all items applicable to an Exploration Target. AMC provides this information for the purposes of transparency and materiality.

 
 
Database Integrity                      ! Measures taken to ensure that data         This relates only to the 
                                        has not been corrupted by, for               estimation of an Exploration 
                                        example, transcription                       Target which is conceptual in 
                                        or keying errors, between its initial        nature. 
                                        collection and its use for Mineral           A database with 97 diamond holes 
                                        Resource estimation                          was used for estimation of 
                                        purposes.                                    Exploration Target of the 
                                        ! Data validation procedures used.           deposit. 
                                                                                     The historical database was 
                                                                                     created based on previous 
                                                                                     studies, in accordance with the 
                                                                                     mining 
                                                                                     industry regulations of the USSR 
                                                                                     and Russia. 
                                                                                     All historical drilling results 
                                                                                     were entered into electronic 
                                                                                     database in Excel format. 
                                                                                     The following error checks were 
                                                                                     carried out during the final 
                                                                                     database creation: 
                                                                                     ! Missing collar coordinates 
                                                                                     ! Missing values in fields FROM 
                                                                                     and TO 
                                                                                     ! Cases when FROM values equal or 
                                                                                     exceed TO ones (FROM>=TO) 
                                                                                     ! Data availability. The data 
                                                                                     availability was checked for each 
                                                                                     drillhole in the tables: 
                                                                                     ! Collar coordinates 
                                                                                     ! Sampling data 
                                                                                     ! Downhole survey data 
                                                                                     ! Lithological characteristics 
                                                                                     ! Duplicate drillhole numbers in 
                                                                                     the table of the drillhole collar 
                                                                                     coordinates. 
                                                                                     ! Duplicate sampling intervals 
                                                                                     ! Duplicate downhole measurement 
                                                                                     data 
                                                                                     ! Duplicate intervals of the 
                                                                                     lithological column 
                                                                                     ! Sample "overlapping" (when the 
                                                                                     sample TO value exceeds FROM 
                                                                                     value of the next sample). 
                                                                                     ! Negative-grade samples. 
                                                                                     The Competent Person is satisfied 
                                                                                     that database integrity is 
                                                                                     appropriate to support 
                                                                                     Exploration 
                                                                                     Target estimation. 
--------------------------------------  --------------------------------------  -------------------------------------- 
Site Visits                             ! Comment on any site visits            ! No site visit was deemed necessary 
                                        undertaken by the Competent Person and  for determination of an Exploration 
                                        the outcome of those visits.            Target. 
                                        ! If no site visits have been 
                                        undertaken indicate why this is the 
                                        case. 
--------------------------------------  --------------------------------------  -------------------------------------- 
Geological Interpretation               ! Confidence in (or conversely, the          This relates only to the 
                                        uncertainty of ) the geological              estimation of an Exploration 
                                        interpretation of the                        Target which is conceptual in 
                                        mineral deposit.                             nature. 
                                        ! Nature of the data used and of any         The interpretation of the 
                                        assumptions made.                            mineralised structures was based 
                                        ! The effect, if any, of alternative         on geological logging and metal 
                                        interpretations on Mineral Resource          equivalent grades, and also used 
                                        estimation.                                  scanned and georeferenced 
                                        ! The use of geology in guiding and          historical geological cross 
                                        controlling Mineral Resource                 sections. 
                                        estimation.                                  Different metals were not 
                                        ! The factors affecting continuity           interpreted separately. ESR 
                                        both of grade and geology.                   supplied AMC with the validated 
                                                                                     database, 
                                                                                     topography surface and scanned 
                                                                                     cross sections with interpreted 
                                                                                     geology of the deposit and 
                                                                                     mineralised bodies. 
                                                                                     There is a reasonable level of 
                                                                                     confidence in the geological 
                                                                                     interpretation of the main 
                                                                                     mineralised 
                                                                                     bodies is traceable over a number 
                                                                                     of drillholes and drill sections. 
                                                                                     Drillhole intercepts with 
                                                                                     geological logging, assay results 
                                                                                     and structural interpretations 
                                                                                     have formed the basis for the 
                                                                                     geological interpretation. 
                                                                                     Interpretation of the main 
                                                                                     polymetallic mineralised 
                                                                                     envelopes forms the basis for 
                                                                                     modelling. 
                                                                                     0.5% Zn equivalent was used to 
                                                                                     interpret polymetallic 
                                                                                     mineralisation. 
                                                                                     The Competent Person is satisfied 
                                                                                     that the geological 
                                                                                     interpretation is appropriate to 
                                                                                     support 
                                                                                     determination of an Exploration 
                                                                                     Target. 
--------------------------------------  --------------------------------------  -------------------------------------- 
Dimensions                              ! The extent and variability of the          This relates only to the 
                                        Mineral Resource expressed as length         estimation of an Exploration 
                                        (along strike or                             Target which is conceptual in 
                                        otherwise), plan width, and depth            nature. 
                                        below surface to the upper and lower         59 sheet-like flat-lying 
                                        limits of the Mineral                        mineralised bodies were 
                                        Resource.                                    interpreted and modelled at the 
                                                                                     deposit. 
                                                                                     All modelled bodies vary in size. 
                                                                                     The largest one is over 1,100 m 
                                                                                     along strike and over 1,000 
                                                                                     m across strike with an average 
                                                                                     thickness of about 2 m. All other 
                                                                                     bodies are smaller with 
                                                                                     the length along and across 
                                                                                     strike of about 100 to 200 m. The 
                                                                                     depth below surface varies from 
                                                                                     0 m to 800 m. 
                                                                                     The Competent Person is satisfied 
                                                                                     that the dimensions interpreted 
                                                                                     are appropriate to support 
                                                                                     determination of an Exploration 
                                                                                     Target. 
--------------------------------------  --------------------------------------  -------------------------------------- 
Estimation and Modelling Techniques     ! The nature and appropriateness of          This relates only to the 
                                        the estimation technique(s) applied          estimation of an Exploration 
                                        and key assumptions,                         Target which is conceptual in 
                                        including treatment of extreme grade         nature. 
                                        values, domaining, interpolation             A preliminary block model was 
                                        parameters and maximum                       based on surface diamond drill 
                                        distance of extrapolation from data          core using ordinary kriging (OK) 
                                        points. If a computer assisted               to form 5 x 5 x 5 m blocks. The 
                                        estimation method was chosen                 block model was constrained by 
                                        include a description of computer            wireframes modelled using 
                                        software and parameters used.                sectional 
                                        ! The availability of check estimates,       interpretation at a nominal 0.5% 
                                        previous estimates and/or mine               ZnEq wireframing cut-off grade 
                                        production records and                       for mineralisation. 
                                        whether the Mineral Resource estimate        All parameters and estimates 
                                        takes appropriate account of such            supporting the Exploration Target 
                                        data.                                        are preliminary. 
                                        ! The assumptions made regarding             The Competent Person is satisfied 
                                        recovery of by-products.                     that estimation and modelling 
                                        ! Estimation of deleterious elements         techniques are appropriate 
                                        or other non-grade variables of              to support Exploration Target 
                                        economic significance                        estimation. 
                                        (eg sulphur for acid mine drainage 
                                        characterisation). 
                                        ! In the case of block model 
                                        interpolation, the block size in 
                                        relation to the average sample 
                                        spacing and the search employed. 
                                        ! Any assumptions behind modelling of 
                                        selective mining units. 
                                        ! Any assumptions about correlation 
                                        between variables. 
                                        ! Description of how the geological 
                                        interpretation was used to control the 
                                        resource estimates. 
                                        ! Discussion of basis for using or not 
                                        using grade cutting or capping. 
                                        ! The process of validation, the 
                                        checking process used, the comparison 
                                        of model data to drill 
                                        hole data, and use of reconciliation 
                                        data if available. 
--------------------------------------  --------------------------------------  -------------------------------------- 
Moisture                                ! Whether the tonnages are estimated         This relates only to the 
                                        on a dry basis or with natural               estimation of an Exploration 
                                        moisture, and the method                     Target which is conceptual in 
                                        of determination of the moisture             nature. 
                                        content.                                     Moisture was not considered in 
                                                                                     the bulk density assignment and 
                                                                                     all tonnage estimates were 
                                                                                     based on dry tonnes. 
                                                                                     The Competent Person accepts that 
                                                                                     moisture was not considered due 
                                                                                     to the conceptual nature 
                                                                                     of an Exploration Target. 
--------------------------------------  --------------------------------------  -------------------------------------- 
Cut-off Parameters                      ! The basis of the adopted cut-off           This relates only to the 
                                        grade(s) or quality parameters               estimation of an Exploration 
                                        applied.                                     Target which is conceptual in 
                                                                                     nature. 
                                                                                     Nominal cut-off grades of 0.38% 
                                                                                     CuEq and 0.86% CuEq (copper 
                                                                                     equivalent) were used to report 
                                                                                     the Exploration target for open 
                                                                                     pit and underground mining 
                                                                                     methods respectively. 
                                                                                     Cut-off grades were based on open 
                                                                                     pit and underground mining 
                                                                                     methods, according to an ESR's 
                                                                                     in-house estimates of unit costs 
                                                                                     and using metal's spot prices at 
                                                                                     the day of reporting. Copper 
                                                                                     equivalent was calculated using 
                                                                                     the following metal prices: 3,050 
                                                                                     US$/t for Zn, 9,000 US$/t 
                                                                                     for Cu, 2,250 US$/t for Pb. 
                                                                                     The Competent Person is satisfied 
                                                                                     that cut-off parameters were 
                                                                                     appropriately considered, to 
                                                                                     support an Exploration Target. 
--------------------------------------  --------------------------------------  -------------------------------------- 
Mining Factors or Assumptions           ! Assumptions made regarding possible        This relates only to the 
                                        mining methods, minimum mining               estimation of an Exploration 
                                        dimensions and internal                      Target which is conceptual in 
                                        (or, if applicable, external) mining         nature. 
                                        dilution. It is always necessary as          Mining is assumed to be by open 
                                        part of the process                          pit and underground methods. 
                                        of determining reasonable prospects          Mining losses were assumed to 
                                        for eventual economic extraction to          be 5% and mining dilution was 
                                        consider potential                           assumed 5% for open pit mining, 
                                        mining methods, but the assumptions          and 10% dilution was assumed 
                                        made regarding mining methods and            for underground mining method. 
                                        parameters when estimating 
                                        Mineral Resources may not always be 
                                        rigorous. Where this is the case, this 
                                        should be reported 
                                        with an explanation of the basis of 
                                        the mining assumptions made. 
--------------------------------------  --------------------------------------  -------------------------------------- 
Metallurgical Factors or Assumptions    ! The basis for assumptions or               This relates only to the 
                                        predictions regarding metallurgical          estimation of an Exploration 
                                        amenability. It is always                    Target which is conceptual in 
                                        necessary as part of the process of          nature. 
                                        determining reasonable prospects for         No material assumptions are 
                                        eventual economic                            considered at this stage. 
                                        extraction to consider potential             The Competent Person is satisfied 
                                        metallurgical methods, but the               that conceptual metallurgical 
                                        assumptions regarding metallurgical          factors and assumptions were 
                                        treatment processes and parameters           appropriately considered to 
                                        made when reporting Mineral Resources        support Exploration Target 
                                        may not always be                            estimation. 
                                        rigorous. Where this is the case, this 
                                        should be reported with an explanation 
                                        of the basis 
                                        of the metallurgical assumptions made. 
--------------------------------------  --------------------------------------  -------------------------------------- 
Environmental Factors or Assumptions    ! Assumptions made regarding possible        This relates only to the 
                                        waste and process residue disposal           estimation of an Exploration 
                                        options. It is always                        Target which is conceptual in 
                                        necessary as part of the process of          nature. 
                                        determining reasonable prospects for         No environmental factors or 
                                        eventual economic                            assumptions were made. 
                                        extraction to consider the potential 
                                        environmental impacts of the mining 
                                        and processing operation. 
                                        While at this stage the determination 
                                        of potential environmental impacts, 
                                        particularly for 
                                        a greenfields project, may not always 
                                        be well advanced, the status of early 
                                        consideration 
                                        of these potential environmental 
                                        impacts should be reported. Where 
                                        these aspects have not 
                                        been considered this should be 
                                        reported with an explanation of the 
                                        environmental assumptions 
                                        made. 
--------------------------------------  --------------------------------------  -------------------------------------- 
Bulk Density                            ! Whether assumed or determined. If          This relates only to the 
                                        assumed, the basis for the                   estimation of an Exploration 
                                        assumptions. If determined,                  Target which is conceptual in 
                                        the method used, whether wet or dry,         nature. 
                                        the frequency of the measurements, the       A nominal bulk density of 3.0 
                                        nature, size and                             t/m(3) was used for the 
                                        representativeness of the samples.           Exploration Target based on 
                                        ! The bulk density for bulk material         historical 
                                        must have been measured by methods           data. 
                                        that adequately account                      The Competent Person is not aware 
                                        for void spaces (vugs, porosity, etc),       of the nature and quality of the 
                                        moisture and differences between rock        historical bulk measurement 
                                        and alteration                               methods and quality. However, the 
                                        zones within the deposit.                    applied value is considered 
                                        ! Discuss assumptions for bulk density       reasonable for the purposes 
                                        estimates used in the evaluation             of Exploration target reporting. 
                                        process of the different 
                                        materials. 
--------------------------------------  --------------------------------------  -------------------------------------- 
Classification                          ! The basis for the classification of        This relates only to the 
                                        the Mineral Resources into varying           estimation of an Exploration 
                                        confidence categories.                       Target which is conceptual in 
                                        ! Whether appropriate account has been       nature. 
                                        taken of all relevant factors (ie            No classification was applied to 
                                        relative confidence                          Exploration Target estimate. 
                                        in tonnage/grade estimations, 
                                        reliability of input data, confidence 
                                        in continuity of geology 
                                        and metal values, quality, quantity 
                                        and distribution of the data). 
                                        ! Whether the result appropriately 
                                        reflects the Competent Person's view 
                                        of the deposit. 
--------------------------------------  --------------------------------------  -------------------------------------- 
Audits or Reviews                       ! The results of any audits or reviews       This relates only to the 
                                        of Mineral Resource estimates                estimation of an Exploration 
                                                                                     Target which is conceptual in 
                                                                                     nature. 
                                                                                     The Exploration Target estimate 
                                                                                     was reviewed internally by Ingvar 
                                                                                     Kirchner, who is employed 
                                                                                     by AMC as a Geology Manager / 
                                                                                     Principal Geologist, who 
                                                                                     concluded that the procedures 
                                                                                     used 
                                                                                     to estimate the Exploration 
                                                                                     Target are appropriate. 
--------------------------------------  --------------------------------------  -------------------------------------- 
Discussion of Relative Accuracy /       ! Where appropriate a statement of the       This relates only to the 
Confidence                              relative accuracy and confidence level       estimation of an Exploration 
                                        in the Mineral                               Target which is conceptual in 
                                        Resource estimate using an approach or       nature. 
                                        procedure deemed appropriate by the          This is not relevant to reporting 
                                        Competent Person.                            of an Exploration Target. 
                                        For example, the application of 
                                        statistical or geostatistical 
                                        procedures to quantify the relative 
                                        accuracy of the resource within stated 
                                        confidence limits, or, if such an 
                                        approach is not deemed 
                                        appropriate, a qualitative discussion 
                                        of the factors that could affect the 
                                        relative accuracy 
                                        and confidence of the estimate. 
                                        ! The statement should specify whether 
                                        it relates to global or local 
                                        estimates, and, if local, 
                                        state the relevant tonnages, which 
                                        should be relevant to technical and 
                                        economic evaluation. 
                                        Documentation should include 
                                        assumptions made and the procedures 
                                        used. 
                                        ! These statements of relative 
                                        accuracy and confidence of the 
                                        estimate should be compared 
                                        with production data, where available. 
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(END) Dow Jones Newswires

March 21, 2023 03:00 ET (07:00 GMT)

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