TLM: Springfield Joint Venture Exploration Update

Springfield Exploration Update

Highlights

• Springfield Joint Venture exploration budget approved for the three-month period to the end of December 2017.

Board of Directors Jeremy Kirkwood

Non-Executive Chairman

Managing Director

Non-Executive Director

Non-Executive Director

Non-Executive Director

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Contact Details

Telephone:

+61 8 9380 4230

Email: info@talismanmining.com.au

Website: www.talismanmining.com.au

Capital Structure

Shares on Issue: 185,699,879 (TLM)

Options on Issue: 9,675,000 (Unlisted)

• Budgeted exploration to include:

  • Reverse circulation (RC) drilling to further test Monty North East (Monty NE) air-core anomaly of 5.0m at 4.11% Cu1(including test of recently identified IP anomaly);

  • RC drilling to test Monty East interpreted host position;
  • RC drilling of selected geochemical anomalies in the Southern Volcanics; and
  • Air-core drilling to test Homer South host position.

• Work completed under Springfield Joint Venture exploration budget for the three-month period to the end of September 2017 included:

  • RC drilling to test the interpreted Monty host position to the west of the Mataro Fault and reinterpretation of the Mataro Fault orientation;

  • Assessment of recently identified exploration opportunities and interpretations including Monty NE, Monty East and Homer South Trend;

  • RC drilling targeting geochemical anomalies at Monty NE, Monty South and the Southern Volcanics Trend;

  • DHEM surveys of all RC drill holes; and

  • Completion of interpretation of results from the Induced Polarisation (IP) geophysical survey over the Monty deposit and Monty NE anomaly.

1 See ASX announcement "Springfield Copper Project Exploration Update" dated 13 September 2016 for details

Talisman Mining Limited (ASX: TLM, Talisman) advises that the Springfield Joint Venture (Springfield) (Talisman 30% and Sandfire Resources NL 70% (ASX: SFR, Sandfire)), has approved a $1.2 million budget (100% basis) for the quarter ending December 2017 with work scheduled to commence in the coming weeks. This budget is separate to expenditure on the ongoing development of the Monty Copper-Gold Mine (Monty).

The December quarter exploration budget focuses predominantly on testing various new geological interpretations at Monty NE, Monty East and Homer South, along with geochemical anomalies identified within the Southern Volcanics.

This planned work continues from the previous quarter which was primarily focused on detailed geological reviews, and the interpretation and assessment of Induced Polarisation (IP) geophysical data collected over the Monty and Monty NE areas. Joint Venture exploration efforts continue to re-evaluate and reinterpret geological, geochemical and geophysical data on an ongoing and iterative basis to maximise discovery opportunities within the Springfield area.

Springfield exploration during budget period 1 July to 30 September 2017

Work completed at Springfield over the three-month budget period ending 30 September 2017 was primarily focused on an internal data review, and evaluation of the geological interpretations provided by Talisman to the Joint Venture late in the June 2017 quarter. On-ground exploration was limited to five RC drill holes for a total of 2,096 metres as depicted in Figure 1.

Monty

Cu-Au Deposit

Figure 1: Springfield drill collar location plan for the three-month budget period ending 30 September 2017.

Reverse Circulation Drilling

Drilling completed at Monty NE, Monty South and within the Southern Volcanics trend targeted bottom- of-hole (BOH) lithogeochemical anomalies identified in previous air-core drilling. The three holes completed at these targets (TLRC0070, TLRC0071 and TLRC0073) did not return any significant Cu mineralisation.

The two RC drill holes completed at Monty West (TLRC0069 and TLRC0072) were designed to confirm the position of the Monty host stratigraphy to the west of the Mataro Fault which is interpreted to truncate the Monty mineralisation. The host horizon was successfully intersected in both holes, confirming the interpreted position of host stratigraphy to the north of previous interpretations (Figure 2).

Figure 2: Monty offset geological interpretation showing updated geological interpretation tested during the budget period.

With the addition of this new geological information, Sandfire completed a reinterpretation of this area including a review of the orientation of the Mataro Fault structure. This work included detailed relogging of RC and diamond drill core in the area, including TLDD0114 which was drilled to provide a deep down- hole electromagnetic (DHEM) survey platform below the existing Monty Cu-Au mineralisation.

The review resulted in a significant steepening of the interpreted dip of the Mataro Fault as illustrated in Figure 3. As a consequence, the deep diamond drill hole TLDD0114 is now interpreted to intersect the host stratigraphy to the west of the Mataro Fault structure. The DHEM survey of TLDD0114 is now interpreted to have provided geophysical coverage off-hole of TLDD0114 and immediately to the west of the Mataro Fault. There were no geochemical or geophysical indicators observed in the existing RC or deep diamond drilling completed to date.

Given that the purpose of the proposed third deep diamond hole in this area was designed to test the western side of the Mataro Fault and this outcome is interpreted to have been achieved by TLDD0114 (Figure 3), the third proposed deep diamond hole is suspended at this time.

Figure 3: Monty deposit projected long section with diamond holes, interpreted DHEM coverage and new interpreted orientation of the Mataro Fault, showing TLDD0114 pierce point to the west of the Mataro Fault.

Other Activities

In addition to the recent drilling activities, other exploration was focused on the completion of a detailed review of the ground-based IP orientation survey over the Monty deposit and Monty NE air-core anomaly. The survey consisted of a limited orientation survey, comprising two lines across Monty NE for 1.8km of data, and four lines across the Monty deposit for 7.8km of data.

The trial IP survey over the Monty deposit confirmed that massive sulphides at Monty are sufficiently polarisable to produce a measurable signal from surface. However, from a targeting perspective, the presence of secondary anomalies significantly reduces the reliability of subsequent targets and therefore any targets from an IP survey are likely to require additional justification for follow-up drilling.

The survey of the Monty NE air-core anomaly (5m interval at 4.11% Cu in hole TLAC26942), returned a clear, although weak anomalous chargeable response with a corroborating low resistivity (Figure 4). The limited amount of data (two survey lines), along with the limited deeper drilling in the area makes interpretation of the geometry of the response difficult.

Previous DHEM surveys in adjacent RC drill traverses approximately 200-300m away from the IP anomaly have not identified any off-hole responses in this area.

In the absence of additional information, Sandfire currently interpret this anomaly to be potentially associated with an interpreted east-west striking fault structure. Importantly, the budgeted RC drill hole for the forthcoming quarter is expected to provide an appropriate test of the identified anomaly.

2 See ASX announcement "Springfield Copper Project Exploration Update" dated 13 September 2016 for full details