ECR Minerals plc (ECR.L) Creswick Project Update

ECR Minerals plc (LON: ECR), the gold exploration and development company focussed on gold exploration in Australia, is pleased to provide an update regarding the Creswick exploration project to shareholders.

ECR Minerals plc has 100% ownership of EL006184 and EL006907 located at Creswick, Central Victoria, Australia. Exploration is being undertaken by ECR’s Australian wholly owned subsidiary Mercator Gold Australia Pty Ltd (“MGA”).

ECR Chairman David Tang commented: “On behalf of our board I am pleased to report that these results show that Creswick, while complex in its geology and the nature of its mineralisation, has provided a solid platform of data that fully justifies our decision to progress Creswick and EL006184 to the next phase of exploration. The latest data also further justifies the strategy behind the purchase of the Brewing Lane property in September 2021, as it now provides a centre for our operations in Creswick and the potential to develop a mine decline should we decide to embark on that course in the future. Our board and exploration team are also excited by the potential at the recently awarded license area at EL006907, adjacent to Creswick”

“I would also like to apologise to shareholders for the delay in publishing the Creswick results. The prevalence of COVID-19 in Victoria in recent months has resulted in delays in results from the laboratory and interruptions in the supply chain supporting exploration activities.”

“Our search for a CEO continues, some early candidates have been identified and the interviewing process is underway. I would ask shareholders to bear with us during this time. I am also aware that some shareholders are concerned that our social media communication process has fallen below previous levels. We are working to address this.”

SUMMARY:

    • Anomalous gold results have been received from the remaining samples from the diamond drilling program completed at the end of 2021.
    • Recent duplicate sampling is revealing erratic gold results due to the presence of coarse gold, potentially undervaluing the true estimated grade.
    • Assay result turn-around time has been delayed due to COVID-19 management and related staff shortages at the laboratory.

BACKGROUND

The Creswick project is located approximately 18km to the north of the City of Ballarat. Ballarat itself has a rich history of gold and is still producing at the nearby Ballarat East Goldmine. The Creswick project consists of two active tenements respectively EL006184 and EL006907, plus MGA are awaiting the outcome of licence applications in the surrounding adjacent ground.

Intense historic alluvial gold workings exist within the tenements. Mapping the extent of the alluvial gold workings has traced the potential source of the gold to quartz veining associated with a wide, shale rich rock unit termed the Dimocks Main Shale (“DMS”). The company believes the strike extent of the DMS can be traced for at least 15km. On September 2nd 2021 ECR announced the acquisition of a property at 35 Brewing Lane, Springmount, which sits in our existing license area EL006184. As stated in the announcement of Sept 2nd, the property has provided the Company with an operational base and, in future, can be developed as a site for the decline access to existing, and potential, vein mineralisation. Link to the Brewing Lane property announcement here

Our recent work has been concentrated within EL006184 close to Springmount, and the last three years has seen the Company complete RC drilling totalling 1691 metres and most recently complete 16 diamond drill holes for a total of 3433 metres. A detailed plan view showing the location of exploration activities undertaken during the 2021 year is linked below:

https://www.ecrminerals.com/images/2022/Fig1_Plan_of_Creswick_Project_Area_2021-1.png

OUTCOME OF DIAMOND DRILLING ACTIVITIES DURING 2021

Diamond drilling was undertaken to confirm the structural architecture of quartz mineralisation that was interpreted from the 2019 RC drilling program. The hypothesis was that quartz is situated in both bedding and axial cleavage planes formed within the DMS horizon which in places can be up to 25 metres in width. The substantial width and strike length of the DMS means the target is of great importance to ECR. Initial results from diamond holes CSD001 and CSD002 showed early success for gold mineralisation. Geological logging of diamond core also successfully proved that quartz mineralisation has preferentially developed within the shales. Drilling continued at broad spaced intervals approximately 300m apart and along strike of the DMS to the south for 2.1 km. Results show quartz mineralisation is still present along the strike limits of the drilling completed to date. Anomalous gold was detected in the southern most drill hole (CJD001) with 0.5m @ 0.54 g/t Au from 324m. As previously reported, the best intercept was from hole CSD003 drilled on top of a ridge south of Blue Gum Track. This important hole is located in an area with no previous mining history. Follow up drilling to CSD003 intercepted quartz mineralisation where expected, however grades were not as extraordinary as hole CSD003 with the best intercept being in CSD013 for 1m @ 1.98 g/t Au from 80.5m downhole. Drilling of hole CSD005 and CSD006 intercepted a large milled fault zone, believed by MGA geologists to be a cross-course fault, as commonly seen at the Ballarat East goldfield. All gold intercepts from the 2021 drilling considered anomalous above the lowest reportable levels are shown in Table 1 below.

Table 1. Summary of drill intercepts containing reportable anomalous levels of gold (0.11 g/t Au for the diamond drilling program completed on EL006184 during 2021. (*highlights in RED bold)

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COARSE GOLD REVEALED IN SAMPLING

Geologists generally consider coarse gold deposit results above 0.2 g/t Au as anomalous and worth duplicating. Recently, a series of rock chips were taken by MGA geologists from exposed quartz veins in historic pits and trenches adjacent to Blue Gum Track. Duplicate sampling has revealed a large variability in gold grades. In particular, a chip sample 0.4m wide (true width) across outcrop initially showed 0.15 g/t Au. Replicating this sample with the same sampling protocols revealed 0.4m @ 31.8 g/t Au.

Previous bulk sampling of 1m drill composite samples from the 2019 RC drilling highlighted the presence of coarse gold which showed significant variability to the grades received from the initial 2kg riffle split samples from the RC drill rig. Samples that showed detectable gold were later bulk sampled in entirety from the remaining 1m drilled, 50 kg sample. Random nuggetty gold particles within the bulk samples increased the overall grade. Examples of this is shown in fig 2 linked below:

https://www.ecrminerals.com/images/2022/Fig2_Creswick_gold_particle_examples.png

The variability in gold grade is a reflection of the sample size (known as the volume-variance relationship). The larger the sample size, the better representation of the true average grade. Gold at Creswick is coarse and unevenly distributed, although the different size particles are located close together. HQ sized diamond drilling produces a core of rock 63.5mm in diameter with half of this diameter sent as a sample. The probability of sampling a coarse particle of gold within the core is low. RC drilling is larger in diameter and therefore produces a larger sample size increasing the probability of sampling a particle of gold. RC drilling however produces rock chips where geological quality is lost and understanding of the structural host to the best mineralisation cannot be interpreted and followed up on. A balance between drilling for structure by diamond drilling combined with grade drilling by RC drill methods targeted at the most extensively mineralised part of the system is now believed to be the best methodology with which to progress the Creswick asset.

The volume-variance relationship between diamond and RC drill methods in a coarse gold mineralised system is visually shown in fig 3 in the following link:

https://www.ecrminerals.com/images/2022/Fig3_volume-variance_drill_sizes.png

PROPOSED DEVELOPMENT PLAN

MGA have applied to renew EL006184 for another 5 years and are awaiting final approval. As the current incumbent, MGA has first rights over the license, and MGA Director and Geologist Adam Jones is proposing the next phase of exploration within EL006184 as follows;

  • Soil sampling programmes over the up-dip projections of quartz mineralisation identified from the 2021 diamond drilling campaign to test for sub-cropping gold shoots.
  • ECR’s property at Brewing Lane, Springmount contains numerous old abandoned gold workings with some underground exposures that offer opportunities for mapping and sampling, followed up by drilling.
  • The Company is currently seeking advice on which appropriate geophysical techniques may highlight important structures that control the distribution of gold mineralisation within the DMS.
  • Follow up drilling to include detailed RC and diamond drilling within the Brewing Lane property and adjacent ground with emphasis on bulk sampling techniques as was done in 2019.
  • Furthermore, MGA will start to evaluate prospects further south of existing drilling in the recently approved EL006907 using exploration techniques that proved successful on EL006184.

MGA is continuing to progress with drilling at the Bailieston tenements (EL5433), focussing on the Maori Reef and parallel reef systems within the HR3 goldfield. The geology team is also making progress with plans to re-enter and continue exploration on the Blue Moon prospect located on the southern extent of EL5433.

REVIEW OF ANNOUNCEMENT BY QUALIFIED PERSON

This announcement has been reviewed by Adam Jones, a director of ECR Minerals plc. Adam Jones is a professional geologist and is a Member of the Australian Institute of Geoscientists (MAIG). He is a qualified person as that term is defined by the AIM Note for Mining, Oil and Gas Companies.

MARKET ABUSE REGULATIONS (EU) No. 596/2014

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 (MAR). Upon the publication of this announcement via Regulatory Information Service (RIS), this inside information is now considered to be in the public domain.

FOR FURTHER INFORMATION, PLEASE CONTACT:

ECR Minerals plc

Tel: +44 (0) 20 7929 1010

David Tang, Non-Executive Chairman


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