Thor Mining PLC (THR.ASX.L) Mineral Resource Estimate Updated

The directors of Thor Mining Plc (“Thor” or the “Company”) (AIM, ASX: THR, OTCQB: THORF), the diversified resource company, are pleased to provide an update to the Mineral Resource Estimate of its 100% owned critical minerals tungsten asset, the Molyhil Project (“Molyhil”), in the Northern Territory of Australia.

Highlights:

§ The Molyhil Mineral Resource Estimate now comprises Measured, Indicated, and Inferred Mineral Resources totalling 4.4 million tonnes at 0.27% WO3 (Tungsten trioxide), 0.10% Mo (Molybdenum), 0.05% Cu (Copper) and 17.75% Fe (Iron) using a 0.07% WO3 cut-off (Table A).

§ New Measured classification in the upper portion of the Southern Lode

§ Concurrent 3D geological modelling identifies priority drill targets to increase resource.

§ New exploration targets identified near the existing resource.

§ July 2020 – the Northern Territory government announced that the Molyhil Project had been awarded Major Project Status

§ Next Steps: Geotechnical drilling for pit wall optimisation, ore sorting review, and drill testing of priority resource and regional targets.

§ Continued discussions with potential financiers and joint venture partners to advance the project

Mick Billing, Executive Chairman of Thor Mining, commented:

“This revised Mineral Resource Estimate using Support Matrix Kriging has generated a more robust resource with the upper portion of the Southern Lode now classified as Measured, the minimum standard required by many project financiers.

“The Thor team is encouraged by the 3D geological model and the drill targets it has generated. With the steady recovery of the tungsten price, the testing of these targets, in conjunction with the proposed geotechnical drilling and ore sorting review, are anticipated to significantly enhance the economic outcomes of the Project.

“Global commodity pricing for both tungsten and molybdenum have shown encouraging improvement since recent lows during the period of August to November 2020 and, with post-Covid-19 global growth recovery and increased global infrastructure spending, Thor’s Directors expect this to continue.”

Thor Mining PLC (Thor) commissioned a review of the in situ mineral resource estimate for the 100% owned Molyhil Deposit. The resource was estimated for tungsten and molybdenum with ancillary iron and copper.

Previous resource estimations completed by mining consultants RPM Global in October 2019 have used modifying factors to accommodate the differences between the different sample types used in the estimation – reverse circulation (“RC”) drilling, diamond drilling and bulk sampling. This is considered by Thor to be an unsatisfactory solution. The current estimation uses Mixed Support Kriging to manage the differences in tungsten (WO3) and molybdenum (Mo) grades in the RC drilling, diamond drilling and bulk sampling.

https://www.thormining.com/sites/thormining/media/pdf/asx-announcements/20191011-molyhil-mineral-resource-estimate-enhanced.pdf

The estimation of WO3 and Mo using Mixed Support Kriging was undertaken by Golder Associates (“Golder”). Estimation of Fe and Cu by Ordinary Kriging was undertaken by Resource Evaluation Services (“RES”)

PROJECT TENURE

Molyhil is located 220 kilometres north-east of Alice Springs (320 km by road) within the prospective polymetallic province of the Proterozoic Eastern Arunta Block in the Northern Territory (place name ‘Moly Hill’). The mine is located on Jervois Station and is east of the Elua Range. Tungsten and molybdenum mineralisation was originally discovered at Molyhil in 1973.

MINERAL RESOURCE STATEMENT OVERVIEW

Pursuant to ASX listing rule 5.8.1, and in addition to the JORC tables (attached) the Company provides the following in respect to the Molyhil Mineral Resource Estimate.

Molyhil Mineral Resource Estimate and Reporting Criteria

The Molyhil Mineral Resource Estimate was compiled in accordance with the guidelines of the Australasian Code for Reporting of Identified Mineral Resources and Ore Reserves (JORC, 2012).

The data for the Molyhil Mineral Resource Estimate was prepared and validated by Thor Mining under the supervision of Nicole Galloway Warland who is a Member of the Australian Institute of Geoscientists. Ms Galloway Warland has sufficient relevant experience to be considered a “Competent Person” as defined by the JORC Code (2012).

The resource estimate for WO3 and Mo was undertaken by Johan van Zyl, Senior Geostatistician with Golder Associates, who is a Member of the Australasian Institute of Mining and Metallurgy. Mr van Zyl has sufficient relevant experience to be considered a “Competent Person” as defined by the JORC Code (2012).

The resource estimate for Fe and Cu was undertaken by Stephen Godfrey, Principal Resource Geologist with Resource Evaluation Services (RES), who is a Fellow of the Australasian Institute of Mining and Metallurgy and a Member the Australian Institute of Geoscientists. Mr Godfrey has sufficient relevant experience to be considered a “Competent Person” as defined the JORC Code (2012).

Measured, Indicated and Inferred Resources have been identified for Molyhil. A summary of the Mineral Resource Estimate is provided in Table A.

Table A: Molyhil Mineral Resource Estimate by JORC (2012) classification as at March 31 2021, reported at a cut-off grade of 0.07% WO3 Tungsten which is consistent with the assumed open cut mining technique.

Note:

§ Figures are rounded to reflect appropriate level of confidence. Apparent differences may occur due to rounding.

§ Cut-off of 0.07% WO3

§ 100% owned by Thor Mining Plc

§ To satisfy the criteria of reasonable prospects for eventual economic extraction, the Mineral Resources have been reported down to 200 mRL which defines material that could be potentially extracted using open pit mining methods.

Geology and Geological Interpretation

The Molyhil tenements straddle the boundary between the Neoproterozoic Georgina Basin and the Palaeoproterozoic Strangways Metamorphic Complex. The area is dominated by the east to southeast trending Delny Shear Zone, subdividing the Strangways Metamorphic Complex into two units – the Strangways Metamorphic Complex to the north and the Kanandra Granite to the south.

The Jinka Granite crops out to the east where its northern boundary is faulted against Georgina Basin sediments. A west to south-westerly trending extension to the Entire Point Shear Zone also marks the northerly extent of the younger Harts Range Group rocks.

The Molyhil Deposit consists of two adjacent outcropping iron-rich skarn bodies, the northern ‘Yacht Club’ lode and the ‘Southern’ lode. Both lodes are marginal to a granite intrusion; both lodes contain scheelite (CaWO4) and molybdenite (MoS2) mineralisation. Both the outlines of the lodes and the banding within the lodes strike approximately north and dip steeply to the east. The lodes are arranged in an en-echelon manner.

Interpretation of mapping and drill-hole logging suggests that the lodes are two fault-displaced sections of an original single mineralised skarn unit. The mineralisation is coarse-grained and its distribution is irregular. Two broad lithological variations are present within the skarn (Barraclough, 1979):

· “Black Rock Skarn”: a dark calc-silicate rock containing a high proportion of magnetite, pyrite, and iron-rich minerals such as andradite-garnet, actinolite, and ferro-amphibole. It is irregularly mineralised with scheelite, molybdenite, and chalcopyrite. The mineralisation is, in general, both coarse-grained and heterogeneous. Decimetre wide bands rich in molybdenite and/or scheelite are separated by metre scale bands of apparently barren black rock skarn; and

· Unmineralised skarn: a pale green calc-silicate rock containing diopsidic pyroxene and garnet. This variation is defined as granitic hornfels by Thor geologists.

Within each of the two distinct skarn lodes the “Black Rock Skarn” portion forms a relatively coherent layer-parallel unit. The skarn lodes are ellipsoidal with a north-south long axis and a steep east dip. Drill intercepts indicate that they have greater depth than length. Neither of the mineralised lodes is closed at depth. The north end of the Southern lode appears to be faulted off by a northwest trending southwest dipping structure. Minor faults with various orientations cut and displace both skarn banding and mineralisation.

Drilling Technique and Hole Spacing

A total of 19,165 m of drilling from 162 drill holes was available for this MRE. Mineralisation interpretations were informed by RC, diamond drilling and underground shafts/winzes for 4,822 m of sampling intersecting the MRE.

Sample Method

Diamond Drillhole Sampling

Diamond drilling is standard HQ size with oriented core. Core samples were collected from cut half core with the cut line perpendicular to the core orientation line. The majority of RC drilling used a 5″ face sampling bit with drill material passing through a cyclone and industry standard sample splitter.

RC Drillhole Sampling

Sampling has been mainly undertaken at 1 m intervals for both drill core and RC holes. There are minor 2 m and 4 m samples as well as some shorter than, and longer than, 1 m core sample intervals. These intervals would have been dictated by geological boundaries and/or visible mineralisation.

Shaft and Winze Sampling

Three shafts were sunk. The north shaft was sunk to 24 m with samples collected over 2 m vertical intervals. A 26 m crosscut was driven from the 20-22 m level. The Central shaft was sunk to 33 m and crosscut 36 m from the 30-32 m level. The South shaft was sunk to 39 m with a 40 m crosscut from 35-37 m. The crosscuts were sampled at 2 m intervals (CRM, 2005).

Sampling and Sub Sampling

Sample data was composited to one metre for statistical and geostatistical analysis and grade estimation. Analysis was undertaken on the four analytes, WO3, Mo, Fe and Cu. The composites were flagged to the geological interpretations and statistical analysis performed by domain. A 3D block model was constructed with parent block dimensions 10 m NS by 5 m EW by 5 m vertical and sub-cells of 2.5 m by 1.25 m by
1.25 m. The parent block size was selected on the basis of being approximately 40% of the average drill hole spacing. No assumptions were made on selective mining units.

Cut-Off Grades

The deposit mineralisation was constrained by wireframes constructed using a 10-15% Iron Oxide cut-off grade with a minimum intercept of 2 m required. The wireframes were applied as hard boundaries in the estimate. Three dimensional mineralised wireframes were used to domain the mineralised data.

The Mineral Resource has been reported at a tungsten cut-off grade of 0.07% WO3based on parameters defined by an Ore Reserve update in 2017 and RES’s experience in these types of deposits.

Estimation Methodology

A Surpac block model was used for the mineral resource estimate with a block size of 10 m N by 5 m E and 5 m in elevation with sub-cells of 2.5 m by 1.25 m by 1.25 m. No rotation was applied to the block model as the overall strike of mineralisation is north-south.

For WO3 and Mo, Mixed Support Kriging (“MSK”) was used to estimate blocks in the Southern Lode to approximately 70 m below surface. The remaining blocks were estimated with Ordinary Kriging (“OK”). For Cu and Fe all blocks were estimated with OK. Multi pass estimates with subsequent passes relaxing the estimation parameters ensure all blocks were estimated.

The influence of extreme grade values was addressed by reducing high outlier values by applying high grade cuts to the data. These cut values were determined through statistical analysis.

Classification Criteria

The current resource estimation is classified as Measured, Indicated, and Inferred. The classification of the mineral resource estimation is based principally on the confidence in the geological interpretation and the density of data; sample spacing, continuity of the interpreted zones and geostatistical measurement of estimation errors.

In previous resource estimates no Measured material was defined due to the uncertainty surrounding the factors used to adjust the estimated grades. With the MSK estimate replacing the factored estimate the confidence in the upper portion of the Southern Lode as Measured.

Mineralised areas below the 200 mRL were not classified as further work is required to determine economic grade cut-offs below this level. A Feasibility Study completed in January 2018 identified this material as economic for underground mining techniques subject to further geotechnical work.

https://www.thormining.com/sites/thormining/media/pdf/asx-announcements/20172018/20180115-asx-mh-ore-reserve-clarification.pdf

Mining and Metallurgy

The Molyhil Deposit occurs in two adjacent skarn bodies that contain outcropping molybdenite and scheelite mineralisation. Since mid-2004 it has been the subject of systematic test work comprising geophysical exploration, diamond and RC drilling programmes, surface and underground bulk sampling, metallurgical test work and a geotechnical study. Based on this work the Mineral Resource Estimate reported has reasonable prospects for economic extraction by open cut mining methods, using a tungsten cut-off of 0.07% WO3 (above 200 mRL).

Eventual Economic Extraction

To satisfy the criteria of reasonable prospects for eventual economic extraction, the Mineral Resources have been reported down to 200 mRL which defines material that could be potentially extracted using open cut mining methods.

Thor completed a Feasibility Study in August 2018. This study confirmed that the project is technically and economically viable and has a 7-year life with strong financial returns and rapid capital payback.

https://www.thormining.com/sites/thormining/media/pdf/asx-announcements/20182019/20180823-asx-molyhil-dfs.pdf

EXPLORATION POTENTIAL

In parallel to the Mineral Resource Estimation work Thor engaged Independent consultant Jennifer Gunter, Virga Pty Ltd to undertake 3D geological modelling of the Molyhil Project. 3D Modelling encompassed interpretation and modelling of all available geological, geochemical and geophysical information including MRE wireframes.

The 3D modelling has identified two prominent structures – Yacht Club fault and South Offset fault . At this stage, these faults are interpretative and need validation however based on the geological timing of these faults they may have a significant impact on mineralization, creating targets for potential extensions.

Modelling of the 3D magnetics and the position of the modelled South Offset Fault, strongly implies an offset of the magnetic material associated with the mineralisation, identifying the potential for a magnetic anomaly, south of the fault. Although there are a few drillholes to the south of the South Offset Fault, these have not intersected the magnetic body .

Molyhil deposit is a strong regional anomaly in RTP magnetics, with the 3D magnetics modelling closely correlating to the mineralised wireframes. Based on this modelling several regional magnetic targets have been identified for follow up exploration.

NEXT STEPS

To enhance the Project economics the following activities are to be undertaken:

1. Geotechnical drilling for pit slope optimisation:

The pit walls are within competent granite, and Thor have identified the potential via targeted geotechnical drilling to increase the pit slope angles from 48 degrees which, if successful, would ultimately reduce the waste to ore ratio and hence operating costs. This would allow economic mining deeper in the open pit, and also reduce the footprint of the waste storage dump.

https://www.thormining.com/sites/thormining/media/pdf/asx-announcements/20182019/20180823-asx-molyhil-dfs.pdf

2. Ore sorting review:

X-Ray (XRT) ore sorting was at two sizes, initially set at -55 mm to +25 mm, and -25 mm to +10 mm; this technology has since been improved, allowing sorting with improved precision and also allowing sorting of finer particles, warranting further testing.

3. Depth Potential – MRE Classification:

The Measured, Indicated and inferred Mineral Resource Estimate is currently based only on mineralisation above 200 mRL; drilling at depth in conjunction with pit design and optimisation has the potential to grow the mineral resource estimate at depth.

Based on Feasibility Study completed in 2018 mineralised areas below the 200 mRL appear economic for mechanised underground mining techniques however requires further geotechnical work to determine economic grade cut-offs below this level

https://www.thormining.com/sites/thormining/media/pdf/asx-announcements/20172018/20180115-asx-mh-ore-reserve-clarification.pdf

4. Drilling Targets:

Drill test geological and magnetic anomalies identified within the area of mineralisation.

5. Regional Exploration:

Follow up the priority regional magnetic targets with geochemical analysis.

6. Revise Feasibility Study based on the outcomes of the activities listed above.

MARKET OUTLOOK FOR TUNGSTEN and MOLYBDENUM

Tungsten

The majority of tungsten resources are located in China, Canada, Russia and the United States, with the main consumer of tungsten China (about 50% of global tungsten demand), followed by the USA and Europe.

The outstanding and unique physical properties of tungsten (melting point/hardness/tensile strength) and lack of substitutes makes tungsten critical in industrial, oil & gas, mining and agricultural applications and as such is considered a strategic commodity in the USA, China & the European Union.

In February 2018 the United States, Department of the Interior confirmed that tungsten remains on the Federal Register of commodities classified as critical by the Unites States Government.

Hard metals account for around half of the tungsten consumption; with steels and alloys sector consuming about 25%.

Chinese restrictions on its tungsten industry (concerning mining, exports, foreign investment) brought changes to world supply pattern.

Production outside China is expected to increase, with new projects being started, and closed facilities reopening.

Tungsten prices are expected, by Thor directors to rise steadily in 2021 on expectations of a recovery in the global economy and as COVID production cuts take effect on supply and demand. Tungsten consumption is closely linked to the global economy’s development, as tungsten carbide, alloy and chemicals are widely used in the construction, electronics, mining, automotive and petrochemical industries.

Molybdenum

Molybdenum is a key component of many of the higher quality stainless steels, along with nickel and can be substituted for a portion of the nickel component when nickel prices are elevated. In consequence, when nickel prices climb, often molybdenum pricing will follow. Much of global molybdenum supply is as co-product from a number of large porphyry copper mining operations. Supply, therefore, can be somewhat non-elastic with over-supply in times where demand is weak, and conversely under-supply when demand is high.

The information contained within this announcement is deemed to constitute inside information as stipulated under the UK Market Abuse Regulation. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

http://www.share-talk.co.uk/announcements/rns/thor-mining-plc/mineral-resource-estimate-updated/202104080708138079U


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