Catalyst Metals : Quarterly activities and cash flow report (6.66 Mb)

ASX: CYL‌

Quarter ended 31 March 2017

• Very high grade gold mineralisation intersected at Boyd's Dam at Four Eagles Gold Project:
  • 6m @ 50.4g/t Au including 1m @ 247.0g/t Au
  • 19m @ 9.5g/t Au including 1m @ 100.0g/t Au
• Further high grade gold intersections confirm Boyd North Prospect:

   4m @ 20.0g/t Au

   5m @ 8.0g/t Au

• RC Blade/Hammer and Air Core drilling programmes still in progress at Four Eagles Gold Project and Tandarra Gold Project
• Four applications lodged for TARGET exploration funding from Victorian Department of Economic Development, Jobs, Transport and Resources
• Share placement to St Barbara Limited for $1,500,000

The March 2017 Quarter involved almost continual drilling activity with air core and reverse circulation drills in operation. RC Blade/Hammer drilling focussed on the Boyd's Dam Prospect and Air Core drilling was carried out at Boyd North, Hayanmi and Discovery Prospects. Because of the extensive quartz development at Boyd North, RC Hammer drilling follow-up was also required where air core was unable to penetrate the structure.

Boyd's Dam and Boyd North have produced some excellent gold intersections with two zones assaying in excess of 100 g/t Au over one metre intervals (maximum 247.0g/t Au). The drilling appears to have confirmed that Boyd's Dam and Boyd North are the same structure although drill spacing in the latter area is still 150 metres along strike. Air Core drilling at the northern end of Hayanmi produced some significant gold intersections however the major RC Blade drilling programme at Hayanmi did not commence until April 2017.

Further modelling of the shapes of the gold mineralisation was undertaken on the Tomorrow Zone at the Tandarra Gold Project to assess the viability of potential open pit development and an RC drilling programme in April 2017 will test the shallow sections of this zone.

The Four Eagles Gold Project and the Tandarra Gold Project are situated about 15 kilometres apart along the Whitelaw Fault Corridor which is considered to be a major structural control of gold mineralisation north of Bendigo in Victoria. Catalyst Metals Limited (Catalyst) manages the entire Whitelaw Gold Belt and has interests in eight Exploration Licences which extend for 75 kilometres along the Whitelaw and Tandarra Faults north of Bendigo (Figure 1).

RC Blade/Hammer and Air Core drilling commenced in mid-January 2017 at the Four Eagles Gold Project as part of a 20,000 metre programme. The 2017 programme will test the three known prospects at Four Eagles as well as other regional reconnaissance targets identified by gravity geophysics in 2016. An RC drilling programme was planned for the Tandarra Gold Project and commenced post the March 2017 Quarter. Drill results received to date have further confirmed the gold potential in the Whitelaw Fault corridor which is still largely untested because the favourable Ordovician rocks are concealed by younger sediments deposited in the Murray Basin.

The Whitelaw-Tandarra Fault corridor is believed to be very important for gold deposition but is still largely untested north of Bendigo because the favourable gold-bearing rocks are hidden beneath barren Murray Basin cover sediments. Prospectors and miners who mined over 22 million ounces of high grade gold (15g/t Au) from the exposed areas of Bendigo in the 1800s were unable to find gold in the Catalyst areas because they had no method of locating the gold beneath these barren rocks.

The objective of Catalyst is to use modern geophysical and drilling techniques to discover high grade gold deposits that can be mined by open cut or underground methods. The discoveries at Four Eagles and Tandarra have confirmed the high prospectivity of the Whitelaw Fault Corridor.

The Four Eagles Gold Project is a joint venture between Catalyst, Providence Gold and Minerals Pty Ltd (Providence) and Gold Exploration Victoria Pty Ltd (GEV) (a wholly owned subsidiary of Hancock Prospecting Pty Ltd). Catalyst is retaining its 50% interest whilst GEV has earned a 25% interest in the project and has elected to spend a further $2.1 million to earn the remaining 25% from Providence. The project is managed by Catalyst within the Four Eagles Joint Venture.

The Four Eagles Joint Venture covers an envelope of gold mineralisation about 6 kilometres long and 2.5 kilometres wide with gold occurring in at least three structural zones trending roughly north south (Eagle 2, Eagle 3 and Eagle 4 on Figures 2a and 2b). Three prospects have produced high grade gold intersections (Discovery, Hayanmi and Boyd's Dam). Only a small portion of the total area has been tested by drilling and the current 2017 programme will aim to carry out drilling on many of the targets interpreted from the 2016 gravity survey.

This programme involves the drilling of angled large diameter air core holes (RC Blade/Hammer) on the Hayanmi and Boyd's Dam gold structures to give a better understanding of the shapes of the gold mineralisation. Approximately 10,000 metres of drilling will test strike lengths of 1.2 kilometres on Hayanmi and about 900 metres on Boyd's Dam (Figures 2a and 2b) at a traverse spacing of about 50 metres. Most of the assays received to date refer mostly to the programme at Boyd's Dam and Boyd North.

Boyd's Dam - Boyd North Prospects

Drilling on the Boyd's Dam and Boyd North Prospects commenced in January 2017 and was designed to test a 900 metre long strike length at Boyd's Dam at a traverse spacing of about 50 metres using RC Blade/Hammer. This spacing should enable gold mineralised shapes to be interpreted. In addition to the RC Blade/Hammer programme, Air Core drilling was carried out at Boyd North where two previous intersections 600 metres apart contained significant gold intersections (3 metres @ 154g/t Au in FE732

and 1 metre @ 6.2g/t Au in FE728). The objective of the Air Core programme was to test the 800 metre long structure at a traverse spacing of about 150 metres.

A total of 3,510 metres of RC Blade in 24 holes at Boyd's Dam and a further 23 holes (2,427 metres) at Boyd North were reported in the ASX announcement dated 28 April 2017. A further 13 holes on the northern end of the Hayanmi trend using the smaller diameter Air Core rig are also discussed. Most of the assays quoted are from 25 gram samples using aqua regia digest and AAS but where available, the bulk leach assay on a 2 kilogram sample are used. These two assay methods have tended to show good correlation in the past and indicate that the gold is finely distributed and much less nuggetty than present at Bendigo. Although data is still pending and cross sections still need to be completed, the following significant intersections have been recorded. They are shown in plan view on Figure 3 and diagrammatically on the longitudinal projection as Figure 4. A full list of drill results was set out in Appendices 1 and 2 of the ASX Announcement dated 28 April 2017:

• 6.0 m @ 50.4g/t Au including 1.0 m @ 247g/t Au from 114 metres (FERC152)

• 19.0m @ 9.5g/t Au including 1.0m @ 100.0g/t Au from 59 metres (FERC158)

• 4.0m @ 20.0g/t Au including 1.0m @ 70.6g/t Au from 110 metres (FE776)

• 10.0m @ 6.4g/t Au from 42 metres (FERC147)

• 4.0m @ 9.3g/t Au from 83 metres (FERC153)

• 5.0m @ 7.97g/t Au from 50 metres (FE782)

• 10.0m @ 3.4g/t Au from 109 metres (FERC154)

• 13.0m @ 2.9g/t Au from 81 metres (FERC155)

• 1.0 m @ 30.9g/t Au from 91 metres and 1.0m @14.1g/t Au from 112 metres(FERC149)

• 2.0m @ 6.3g/t Au from 95 metres (FERC146)

• 5.0m @ 4.4g/t Au from 98 metres (FE766)

• 6.0m @ 2.4g/t Au from 84 metres (FERC161)

• 9.0m @ 1.7g/t Au including 1.0m @10.0g/t Au from 100 metres (FERC157)

• 6.0m @ 1.32g/t Au from 90 metres (FE816)

  These results show strong gold mineralisation in the core section of Boyd's Dam and also confirm the high gold grades obtained at Boyd North with air core in 2016. The total length of the Boyd's Dam - Boyd North structure is now about 1.8 kilometres long with sporadic high gold grades scattered over the entire length. Boyd North is still only tested at 150 metre intervals and will require RC hammer drilling to penetrate the common quartz veins that occur along the structure.

  Geological logging is showing plentiful quartz veining with associated arsenopyrite and visible gold was even logged in one of the RC drill holes at Boyd's Dam (FERC154). The gold occurred within an overall 10 metre mineralised zone with assays up to 14.8g/t Au.

  Mr Bruce Kay, Catalyst's Technical Director, stated, "The drilling programme at Boyd's Dam and Boyd North has produced some of the best intersections yet recorded at Four Eagles. Spectacular grades of greater than 100 g/t Au in an area where cover depth is only 20 to 40 metres deep are very encouraging".

  Probable visible gold seen in FERC154 (Boyd's Dam). The grain is associated with arsenopyrite and approximately 0.3mm diameter.

  Hayanmi North Air Core Drilling

  Thirteen Air Core holes were drilled at the northern end of the Hayanmi Trend to test a 300 metre long section of the strike length (Figure 5). Most holes were drilled at a 60 degree angle to the west with one vertical hole (FE792). Gold mineralisation was present on most traverses with one hole west of the structure showing a significant gold intersection (6.0 metres @ 4.6g/t Au in FE797). Significant drill intersections from the 2017 drill programme are highlighted on the Hayanmi Longitudinal Projection in Figure 6.

  Assays received from the three holes show the following intersections:

  • 8m @ 2.1 g/t Au from 79 metres (FE789)

  • 6.0m @ 4.6 g/t Au including 1.0m @ 17.7g/t Au from 76 metres (FE797)

  • 2.0m@ 3.1g/t Au from 118 metres (FE787)

  • 1.0m @ 4.9g/t Au from 107 metres (FE791)

A complete interpretation will not be possible on the Hayanmi Structure until the RC Blade/Hammer programme is completed and all assays are received. This is unlikely to be before the end of May 2017.

Full location data on the RC Blade/Hammer holes, maximum gold values and a Summary of Sampling Techniques and Reporting of Exploration Results according to the JORC Code 2012 Edition were tabulated in Appendix 1 of the ASX Announcement on 28 April 2017. Previous intersections shown on Figures 2a and 2b have been reported under the 2004 JORC Code.

Location data and maximum gold values in each hole for the air core drill holes together with a Summary of Sampling Techniques and Reporting of Exploration Results according to the JORC Code 2012 Edition were tabulated in Appendix 2 of the ASX announcement dated 28 April 2017.

Regional Air Core Drilling

Air core drilling is also in progress on the Discovery Zone and to test regional gravity geophysical targets at the Four Eagles Gold Project. This programme will not be completed until mid-May 2017 and very few assays are currently available.