Orion Gold NL : Outstanding High-Grade Zinc-Copper Hits from Drill Program (25/07/16)

Microsoft Word - 20160725 ORN ASX PC Drill Results Final.docx ASX Announcement / Media Release

25 July 2016

ASX Code: ORN Issued Capital:

Ordinary Shares: 475M Options: 91M

Directors: Denis Waddell

Chairman

Errol Smart

Managing Director, CEO

Bill Oliver

Technical Director

Alexander Haller

Non-Executive Director

Management: Martin Bouwmeester

Company Secretary &

Business Development Manager

Suite 2

64 Thomas Street West Perth WA 6005 ABN 76 098 939 274

T: +61 8 9485 2685

E: info@oriongold.com.au

W: www.oriongold.com.au

Outstanding High-Grade Zinc-Copper Hits from Maiden Drill Program at Historical Prieska Copper Mine Project, South Africa

Grades of up to 21.7% zinc and 7.5% copper confirm and enhance historical results; drilling continuing

Highlights:

• Excellent initial results from the Company's maiden drilling program at the historic Prieska Copper Mine Zinc-Copper Project, including:
  • 22m at 10.8% zinc and 1.38% copper (OCOR016) including 7m at 17.8% zinc and 1.41% copper.
  • 12m at 4.14% copper and 1.89% zinc (OCOR017) including 3m at 7.4% copper and 4.34% zinc.
• Results confirm and enhance historical drilling results.
• Drilling at the +105 Exploration Target continues to intersect massive sulphides, with further results anticipated in the coming weeks.

  Orion Gold NL (ASX: ORN) is pleased to advise that it has made a strong start to its maiden drilling program at the historical Prieska Copper Mine Zinc- Copper Project (PC Project) in South Africa, with initial assays including some outstanding zinc and copper grades.

  The Prieska Copper Mine, which is now a key part of Orion's emerging mineral portfolio within the Areachap Belt in the Northern Cape of South Africa, is recorded as one of world's 30 largest Volcanogenic Massive Sulphide (VMS) base metal deposits, with recorded historical production of 0.43Mt of copper and 1Mt of zinc from 46.8Mt of sulphide ore milled(1).

  The PC Zinc-Copper Project covers unmined dip and strike potential which has been previously delineated by extensive drilling and geophysics.

  The current drilling program is designed to confirm, in-fill and extend historical drilling at the +105 Exploration Target (Figure 1, Table 1). To date, 14 holes have been completed for 909m drilled and results have been received from the first six holes. All significant intersections are tabulated in Appendix 1 with best results including:

• 22m at 10.8% Zn, 1.38% Cu and 0.3g/t Au from 57m incl. 7m at 17.8% Zn and 1.41% Cu (OCOR016);  12m at 4.14% Cu, 1.89% Zn and 0.29g/t Au from 57m incl. 3m at 7.4% Cu and 4.34% Zn (OCOR017);
• 5m at 2.1% Cu and 0.34% Zn from 35m (OCOR014); and
• 5m at 0.92% Cu and 1.56% Zn from 15m (OCOR013A).

1. Source: Mine records

Figure 1: Plan showing the PC Project with completed, proposed and historical drilling at the

+105 Level Exploration Target.

PC Project - Exploration Targets
Area	Tonnage Range	Cu range (%)	Zn range (%)
+105 Level	3,000,000 - 4,500,000	1.0 - 1.6	1.3 - 2.0
Deep Sulphide	7,000,000 - 11,000,000	1.2 - 1.8	3.9 - 5.9

Table 1. Exploration Targets at the PC Project. Detail and supporting information relating to these Exploration Targets is contained in the ASX Release of 18 November 2015.

4.45 4.03 4.06 7.49 7.39 7.31

Figure 2: Massive sulphides in OCOR017 between 60 m and 66 m (left to right) annotated with Copper assays (%Cu). Note each divider shows chips from a 1m interval.

Figure 3: Section showing drilling at the PC Project with results from OCOR016.

Drilling to date has intersected high grade zinc-copper mineralisation principally hosted in massive and semi-massive sulphides (Figure 2). While oxide mineralisation is intersected from 0-40m vertical depth, zonation in grade and metal content (refer intercepts above) are encountered as expected. Grades of both copper and zinc are most elevated in the supergene and primary sulphides, which have been intersected below 40m depth, with some outstanding individual assays such as 21.7%, 21.0% and 18.1% zinc (OCOR016, 64 - 67m; refer Appendix 2) and 7.49%, 7.39% and 7.31% copper (OCOR017, 63-66m; refer Appendix 2). The oxide mineralised zone, directly up dip of the sulphide interface, appears to be strongly leached.

Encouragingly, review of current and historic drill results show that from approximately 40m vertical depth the higher grade mineralisation is sulphidic. This means that standard sulphide metallurgical processing techniques, similar to those successfully employed at the historic Prieska Copper Mine, may be used to effectively extract the metals from this material.

Of further interest is the presence of associated gold-silver mineralisation and even elevated lead results in certain samples, with peak results of 1.15g/t gold and 39g/t silver (OCOR016, 70-71m; refer Appendix 2). These results within broader intersections of 0.3g/t gold and 10g/t silver indicate potential for significant precious metal credits. It is worth noting that the previous operator of the historic Prieska Mine did not routinely assay for precious metals.

Drilling is ongoing at the PC Project with further massive sulphides intersected in recent drilling. A portable XRF analyser is being used to efficiently select intervals for analysis, allowing rapid sample preparation and submission to ALS in Johannesburg for analysis.

As a result, the Company anticipates being able to release results regularly over the remainder of the drilling program.

Marydale Project

Drilling has been completed at the Marydale Project, a virgin gold discovery of possible high sulphidation epithermal origin located 60km from the PC Project. Drilling aimed to test the geological model for the Marydale mineralisation by in-filling historic drilling at the project.

Results from historic drilling include:

 50.4m at 2.68g/t gold from 8.1m (WC08);

 37.1m at 2.72g/t gold from 61.1m (WC09);

 25.7m at 2.72g/t gold from 47.8m (WC22);

 11.3m at 3.36g/t gold from 1.4m (WC10);

• 12.1m at 2.37g/t gold from 56.2m (WC01) and

 27.4m at 2.18g/t gold from 72.6m (WC01).

(Refer Figure 5 and ASX Release 18 November 2015)

Two holes focused on obtaining oriented drill core through the higher grade zones historically intersected, have been completed for 278m. From inspection of the core, the lithologies and alteration intersected in both holes are similar to those drilled in WC08 and WC22, sulphide minerals (predominantly pyrite) present in similar quantities (Figure 4, locations shown on Figure 5). Significantly, multiple zones of mineralisation were intersected in OWCD032, which may imply a repetition of the mineralisation due to folding and faulting. Initial interpretations based on data from the oriented core have made it clear that the host lithology is in a structurally complex folded and sheared package.

Figure 4: Highly mineralised core intersected in hole OWCDO33 between 70 - 74m. Pyrite (5%- 15%) is partially oxidised to haematite and limonite at this depth. Lithology is structurally complex, folded and sheared. The white line marks orientation reference line.