EEE Empire Metals Limited

TIDMEEE

RNS Number : 9420D

Empire Metals Limited

25 October 2022

Empire Metals Limited / LON : EEE / Sector: Natural Resources

25 October 2022

Empire Metals Limited

("Empire " or "the Company")

"Giant" Copper Province Potential at Pitfield Confirmed by Expert Review

Empire Metals Limited (LON: EEE), the AIM-quoted resource exploration and development company, is pleased to announce the results of an expert review on the Pitfield Copper Project ('Pitfield'), located in Western Australia. Results from the review which evaluated recent geophysical surveys and the historical exploration database at Pitfield, confirmed that Pitfield has all the hallmarks of a "Giant" copper mineralised system.

Highlights

-- Pitfield confirmed as having all the hallmarks of a "Giant" copper mineralised system, potentially containing multiple sediment-hosted stratabound copper (SSC) deposits.

-- An exceptionally large, magnetic anomaly, extending over 40km N-S has been identified at Pitfield.

-- SSC deposits are globally significant geological systems which deliver 20% of copper production globally and are often very large and high-grade deposits.

-- The Pitfield geological setting compares favourably with the sandstone sub-type of SSC, exemplified by the massive Udokan Ore Region in Russia.

-- Empire to accelerate exploration activities at Pitfield in Q1 2023 including surface mapping, Induced Polarisation (IP) surveying and geochemical sampling with multiple exploration targets already identified

-- Expert Review undertaken by the Company's exploration team under the supervision of Ed Baltis (Exploration Consultant) who has more than 30 years' experience with Western Mining Corporation, Gold Fields and as a consultant in gold, copper and nickel exploration with a strong focus in Western Australia, and Dr Neil O'Brien, a PhD economic geologist and former mining executive with 35 years of international experience including with Giant copper deposits worldwide.

Shaun Bunn, Managing Director, said: "We previously held a strong belief that Pitfield had the potential to contain a major copper deposit with world-wide significance. The results of this expert review, which drew on the findings of the recently completed geophysical surveys, confirm the accuracy of the historical data we inherited and have identified the regional geological features consistent with a Giant copper mineralised system. This makes Pitfield an exciting exploration target for a SSC deposit and an exceptional project for us to focus our exploration efforts on.

"SCC type deposits are often very large and high-grade deposits and account for approximately 20% of the world's copper production. We are looking forward to increasing our understanding of Pitfield as we embark on our next phase of exploration which will include surface mapping, Induced Polarisation (IP) surveying and geochemical sampling. Work is expected to commence in Q1 2023."

Technical Highlights

-- Pitfield lies within the Neoproterozoic Yandanooka intracratonic sedimentary basin which has all the hallmarks of a "Giant" copper mineralised system, potentially containing multiple SSC deposits.

-- The Neoproterozoic is one of the major SSC mineralisation epochs, temporally associated with the break-up of the Rodinia supercontinent and is associated with several of the largest copper SSC deposits discovered to date, the most important deposits being located in the Central African Copperbelt of Zambia and the DRC.

-- Widespread copper, silver, nickel and zinc anomalism has already been identified over large parts of the Yandanooka basin by previous explorers, particularly in association with magnetite-altered rocks.

-- An exceptionally large, oxidised fluid event has occurred, extending over 40km N-S, as evidenced by magnetite-altered stratigraphy and corresponding reduced conductance - likely due to removal of graphite in the siltstone.

-- This basin-scale alteration extends beyond the magnetite altered domain as seen in sporadic diamond drilling (which also indicated widespread Cu depletion in the basement rock) and the formation of the Three Springs (Imerys) talc deposit to the immediate east of Pitfield.

-- Our Pitfield geological model is based on a basin scale alteration event, involving hot oxidising, fluids carrying copper leached from the "red beds" and basement mafic rock, which upon contact with reductants within the upper siltstones/sandstones resulted in the copper precipitating and depositing along the reduced stratigraphic layers.

Future Work Planned

Pitfield remains an early phase exploration project and as such requires further surface exploration work to effectively define geochemical (soils, auger and AC drilling) and geophysical anomalies (electrical surveys such as IP) prior to evaluating their economic significance through drilling.

The interpretive geological mapping has provided multiple exploration targets which will be followed up with further field work in the coming months. Land access agreements with local farmers are required for some of the areas of interest.

Geological Model for a Sediment-Hosted Stratabound Copper Deposit

SSC deposits are the second most important source of copper in the world behind porphyry copper deposits. Around 20% of the copper in the world is produced from this class of often very large and high-grade deposits. These deposits a lso typically have potential for large scale, low-cost bulk mining.

SSC deposits are bodies of disseminated, cementing, and lesser veinlet-hosted copper (Cu) minerals that typically follow the same structures within their sedimentary or metasedimentary host rocks. These SSC deposits are characterized by strong zoning of the ore minerals laterally along and across the host rock bedding from pyrite, to chalcopyrite, to bornite, to chalcocite, and to hematite. Chalcocite and bornite zones are typically the ore zones.

SSC deposits occur where there are strong reductants present that can precipitate sulphur (S) and copper (Cu) from warm ( 75-220 degC), oxidized (hematite-stable), metals-transporting, sedimentary brines.

They are divided into three sub-types of deposits based on rock varieties:

-- reduced facies type deposits (e.g. Kupferschiefer) are hosted in black to gray to green shales or siltstones;

-- sandstone-type deposits (e.g. Revett) are hosted in gray, well-sorted, fine to coarse grained sandstones; and

   --    redbed-type deposits are hosted in otherwise oxidized sandstones. 

These host rocks either lie atop or are enclosed within thick (greater than 300m and commonly greater than 1km) sequences of red beds. The association with red beds is an important distinction from other Cu deposits found in sedimentary rocks.

SSC deposits are an important source of other metals, ranking first among all deposit types in the world for cobalt (Co) production and fourth among all deposit types in silver (Ag) production. However, those that contain byproduct Ag do not contain byproduct Co and vice versa.

The important key parameters that, when found in combination can lead to a world class SSC deposit (as illustrated in Figure 1.) include:

-- intracratonic rift basin setting allowing oxidised fluids to evolve and persist for a significant period - in other words a "closed" basin;

-- a basal sequence of red bed sediments that provide a source for oxidized fluids and metals (red beds being hematite-bearing sandstones, conglomerates, siltstones), the presence of reduced carbonaceous rocks (containing organic matter, graphite or hydrocarbons) stratigraphically higher in the sequence that provide a redox trap to allow for the precipitation of copper;

-- a basin scale oxidised fluid flow system that leaches large areas of source rocks,ideally over a prolonged period of time.

Figure 1: Conceptual sequence favourable for SSC deposits (Hitzmann et al Economic Geology 2010)

Pitfield Copper Project Comparison with the SSC Model

Pitfield lies in a unique setting along the boundary of Western Yilgarn province, where a major craton-scale structure internal to Southwest Gneiss province intersects and offsets the Yilgarn margin and controls the position of the Neoproterozoic Yandanooka basin, the only example of this globally important copper prospective age adjacent to the western Yilgarn craton (Figure 2).

Figure 2- Location Map - Showing Yandanooka Basin

Surface geological and structural mapping has been combined with the new geophysical mapping and historical drillhole logging to produce a detailed geological interpretive map of the basin and surrounding region which clearly shows the structures most prospective for a SSC deposit, and in particular the Mt Scratch siltstones (Figure 3).

Figure 3: Pitfield Interpretative Geology and Structural Map

The 9,000m thick Mt Scratch siltstone has been subdivided based on geophysical character as follows:

-- the conductive sequence is shown in darker blue and likely contains reduced graphite bearing units;

   --    the highly magnetic units (magnetite bearing) are highlighted in stippled fill; and 
   --    low magnetic units and low/variable conductivity are in light blue. 

Pitfield's favourable geology has attracted major mining companies that have historically carried out preliminary exploration activities within the area, including:

-- BHP (1984) who identified similarities between the Yandanooka basin and African copper belt sequences and completed IP geophysics, shallow RAB, and four stratigraphic diamond holes focussed along the western contact of the Yandanooka basin within the basement Mullingarra gneiss, which indicated a significant depletion of base metals (including Cu) in the basement rock;

-- CRA (1993) which completed IP geophysics and auger sampling defining a significant Cu-in-auger anomaly (plus Ag) over some 7km strike length open to the east and south and they followed up with two diamond holes, the southern hole on Pitfield recording copper anomalism with a maximum value of 570ppm (from 4m chip samples of drillcore) associated with fracture-controlled malachite and minor native copper. CRA also carried out soil sampling in the Mt Scratch area which shows a strong correlation between more strongly anomalous copper-in-soils with magnetic units within the stratigraphy. Rock chip samples taken by CRA from surface exposures returned very encouraging Cu-Ag values (up to 2.3% Cu and 20.8 g/t Ag) within the magnetic units highlighting a large, highly prospective SSC target.

The 7km Cu anomaly in the south at Pitfield is located higher in the sequence than the nearby historic Baxters copper mine at Arrino (which produced 106 tonnes of copper at a grade between 20-30% Cu) and thus more proximal to the contact between the lower red-bed source rocks and the reduced layers in the Mt Scratch siltstone that provide an effective redox trap for the copper fluids. This, along with numerous other prospects including the Mt Scratch workings in the northern section of the project licence demonstrates that the copper mineralisation process has occurred extensively across the Pitfield project area.

The stratigraphic mapping by BHP in the 1980s provides a very good description of the lower "red bed" part of the Yandanooka succession, confirming red beds of 1.0 to 1.5km in thickness, increasing in thickness to the south and dominantly siltstone and sandstone with local carbonate rocks in the north (Figure 4).

The geophysical surveys have confirmed that the Yandanooka basin contains geological features that make this an attractive sediment-hosted copper exploration target, evidenced by:

-- the Airborne Electro-Magnetic (AEM) survey which has identified significant variations in rock conductivity including a suite of anomalous conductive features within the Mt Scratch siltstone, which indicates the presence of sulphides and/or importantly reductants such as graphite.

-- the Airborne Magnetic (AM) survey which has distinguished a widespread, stratabound, over 40km long regional magnetic anomaly (magnetite-bearing alteration), which coincides with previously defined copper anomalies based on historical shallow drilling and regional rock, soil and stream sediment sampling.

Figure 4. Historic BHP stratigraphic section focussed on the lower Yandanooka Group, 1984.

The lower +1,000m of the basin includes substantial thicknesses of sandstone and mafic clast conglomerate which provides copper-bearing source rocks for the basin outcropping adjacent to and overlying the Mullingarra gneiss (refer Figure 4), while the overlying reduced Mt Scratch siltstone acts as a redox trap for the copper fluids mobilised from deeper in the basin. This fits the reduced sediment hosted copper model very nicely.

The massive magnetic anomaly, extending over 40km north-south, shows that the project area has been impacted by a large alteration event such as the influx of warm, oxidized, metals-transporting, sedimentary brines. It is important to note that the deeper diamond drilling by BHP (1984) confirmed that the basement rock was depleted in Cu, indicating that the base metals have been leached and mobilised by the fluids passing through and most likely explains the Cu anomalies identified within the upper zones of siltstone/sandstone.

Further evidence of a regional scale alteration event can be found at the adjacent Three Springs Talc Mine lying just to the east of Pitfield. This large talc deposit was formed when hot fluids carrying silica passed through massive dolomite formations, leaving silica and transporting away calcium to be replaced by magnesium - creating talc.

Comparison with other World Class Copper Provinces

The geology at Pitfield aligns closely with the SSC Model described above and given the scale of alteration identified by the geophysical surveys, which extends well over 40km north to south, the project area could contain a "Giant" mineralised system which hosts multiple SSC deposits.

SSCs have been found on every continent (except Antarctica) however more than 80% of total resources contained in SSCs occur in the Central African Copper Belt in the Democratic Republic of Congo (DRC) and Zambia, and Kupferschiefer in Germany and Poland.

The most important deposits are located in the Central African Copperbelt of Zambia and the DRC. These reduced-facies and sandstone-hosted deposits have large tonnages and unusually high grades (2.5%). Known resources in the belt are 152Mt contained copper across more than 80 deposits, with the USGS estimating a further 168Mt Cu remaining to be discovered, 75% of which is in the DRC. These deposits are the world's main source of Co, which adds significantly to the value of these deposits.

The recent opening of the massive Khoemacau mine in the Kalahari Copperbelt in Botswana is a potentially significant development. The project, which entered production in June 2021, has total resources of 503Mt at 1.4% Cu and 17 g/t Ag.

The Kupferschiefer deposits of western Poland and eastern Germany have produced much of Europe's Cu for more than 800 years. The name comes from the German words for copper (Kupfer) and shale (schiefer). Since 1958 they have produced 15 Mt Cu, with another 30 Mt awaiting development. The USGS estimates 110 Mt Cu remains undiscovered, with the large majority in southwestern Poland.

The Revett Formation in Montana and Idaho is also known also to host significant developed and undeveloped Cu-Ag resources in sandstone-style deposits. However, given the geological setting at Pitfield the most obvious comparison, on a worldwide, large scale basis, is Udokan.

The Udokan mine is a large copper mine located in the south of Russia in Zabaykalsky Krai, around 30 km south of the town of Novaya Chara on the Baikal Amur Mainline. The mine is part of the massive Udokan Ore Region that includes the Udokan, Kalar and Kodar ranges. The Udokan Ore Region represents the largest copper deposit in Russia and third largest in the world, having estimated reserves of 1.2 billion tonnes of ore grading 2% Cu.

Udokan has several key features which are common to Pitfield, including:

   --    Udokan is a sandstone sub-type of SSC deposits; 
   --    Copper mineralisation assemblages are of three types; 

o chalcocite-bornite, always associated with magnetite, and makes up >80% of the potentially economic primary resource

o chalcopyrite-bornite or

o chalcopyrite-pyrite

-- Within higher grade chalcocite-bornite mineralisation, sulphide or quartz-carbonate-epidote-sulphide veins with magnetite haloes crosscutting or sub-parallel to bedding are always present in association with the dominant bedding-parallel disseminated to stringer sulphides;

-- Individual orebodies are 300 - 2,000m in strike, can continue for up to 2,500m down-dip, and 16-52m in thickness; and

   --    Main mineralisation is Cu-Ag-Fe, minor Co, Ni, Zn, Mo, Au 

Figure 5: Udokan deposit geologic map and cross sections, where red denotes a bornite-chalcocite-chalcopyrite ore body.

Market Abuse Regulation (MAR) Disclosure

Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014, as incorporated into UK law by the European Union (Withdrawal) Act 2018, until the release of this announcement.

**S**

   For further information please visit www.empiremetals.co.uk   or contact: 
 
 Empire Metals Ltd                    Tel: 020 7907 9327 
  Shaun Bunn / Greg Kuenzel 
 S. P. Angel Corporate Finance LLP    Tel: 020 3470 0470 
  (Nomad & Broker) 
  Ewan Leggat / Adam Cowl 
                                     ------------------- 
 Shard Capital Partners LLP (Joint    Tel: 020 7186 9950 
  Broker) 
  Damon Heath 
                                     ------------------- 
 St Brides Partners Ltd (Financial    Tel: 020 7236 1177 
  PR) 
  Susie Geliher / Ana Ribeiro / Max 
  Bennett 
                                     ------------------- 
 

About Empire Metals Limited

Empire Metals is an AIM-listed (LON: EEE) exploration and resource development company with a project portfolio comprising gold interests in Australia and Austria.

The Company's strategy is to develop a pipeline of projects at different stages in the development curve. Its initial focus has been on the high-grade Eclipse and Gindalbie Gold Projects in Western Australia. The Company expanded its exploration licence area in April 2022 from 9.5km(2) to 1,728km(2) with the acquisition of the Pitfield Copper-Gold Project and the Walton Copper-Gold Project in Western Australia, and the Stavely Copper-Gold Project in the Stavely Arc region of Victoria.

Empire also holds a portfolio of three precious metals projects located an historically high-grade gold production region comprising the Rotgulden, Schonberg and Walchen prospects in central-southern Austria.

The Board continues to evaluate opportunities through which to realise the value of its wider portfolio and reviews further assets which meet the Company's investment criteria.

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October 25, 2022 02:00 ET (06:00 GMT)