AuKing Mining Limited Prospectus

A U K ING M INING L IMITED I NDEPENDENT T ECHNICAL A SSESSMENT R EPORT – W ESTERN A USTRALIAN M INERAL A SSETS CSA Global Report Nº R278.2020 23 The Sandiego deposit is located approximately 25 km southwest of Halls Creek, WA, and approximately 5 km to the southwest of the Onedin deposit (Figure 6). A Mineral Resource was estimated for the deposit by Coffey Mining Pty Ltd in 2010. The Sandiego deposit is classified as a VMS deposit, with base metals accumulating in a sub-horizontal basin floor replacement system. The deposit is interpreted to have been formed around the time of deposition of the host volcanic and sedimentary strata in which it is bound, and generally in bedding parallel lenses. Hydrothermal fluids associated with volcanic activity are interpreted to have been the source of the metals and other constituents of the mineralisation. Primary mineralisation consists of pyrite-sphalerite-pyrrhotite- chalcopyrite ± galena. The Sandiego deposit is hosted within the same strata as Onedin – the middle Mimosa Member of the Koongie Park Formation (Figure 7). The Sandiego deposit has a similar structural geology to the Onedin deposit (Figure 8), situated within the limbs of intensely folded, higher order, double-plunging anticlinal structures with axial planes interpreted to be upright, to south-southeast dipping. They trend northeast, sub- parallel to the regional transcurrent and anastomosing fault systems that dominate the Halls Creek Orogen. A deep weathering profile is exhibited at Sandiego, resulting in three weathering domains; an oxidised zone at surface, a primary zone at depth, and the transition zone in between. Each zone has very different mineral assemblages and consequently very different metallurgical properties. The oxidised zone consists of completely oxidised material, above the BOCO surface. This surface is on average about 100 m below ground level, is undulating and deepens significantly in the vicinity of steeply dipping faults. The transition zone consists of partially oxidised material and is located between the BOCO and the TOFR. Gossans are developed at surface above the mineral deposits. The mineralogy of the primary mineralisation at Sandiego is pyrite-sphalerite-pyrrhotite-chalcopyrite ± galena which is largely hosted in the magnetite-rich exhalative suite of rocks where it occurs as a massive conformable wedge-shaped lens 200 m in length with a maximum thickness of 75 m. Weak to moderate sulphide vein and stringer mineralisation occur at the base of the exhalite package in the underlying tuffs. Mineralisation is relatively rare in the carbonate zone but may extend into the talc-chlorite schists. Overall, there is poor spatial correlation between copper and zinc mineralisation at Sandiego. Moreover, discrete zinc-rich and copper-rich zones have been identified from core logging and assay results in the vertical dimension (Elliott et al., 2006). Supergene mineralisation at Sandiego is poorly developed although a supergene copper Mineral Resource is reported. The Sandiego deposit has been drilled by diamond coring and RC methods, with all holes used to support the Mineral Resource estimate. Diamond drillholes are either HQ or NQ diameter. HQ holes were used for metallurgical testwork and NQ holes were used to support the Mineral Resource estimate. A number of RC holes were extended to depth with diamond core drilling. All drill cuttings were geologically logged prior to sampling. RC drillholes were sampled at 1 m intervals, which were reduced in size to produce a sample of approximately 1–2 kg in weight. Diamond core was sampled at varying intervals ranging from 0.1 m to 4 m, by cutting the core in half using a diamond saw, with one half of the sample bagged for transportation to the analytical laboratory. Diamond drill core and RC chip samples were submitted to Genalysis Laboratory Services in Perth, WA. Each sample was analysed for gold, silver, copper, lead, zinc, barium, arsenic, bismuth, antimony, nickel, cobalt, iron and magnesium. Ore grade samples were subjected to a modified four-acid (HF, HNO3, HClO3, HCl) digest followed by OES analysis for all elements excluding gold. Gold was analysed by FA with AAS finish using a 50 g charge. Samples without visible mineralisation were treated by a normal four-acid (HF, HNO3, HClO3, HCl) digest followed by OES analysis for all elements excluding gold. These samples were analysed for gold by aqua regia digest of a 50 g charge followed by solvent extraction and flame AAS. The geological interpretation supporting the Mineral Resource estimate was guided firstly by geology, and secondly by grade envelopes to constrain mineralisation. Zinc domains were based upon a lower cut-off grade of 1% Zn, and below the TOFR interface; copper domains were based upon a lower cut-off of 0.4% Cu. Up to 2 m of internal dilution was permitted during the interpretation of the mineralisation domains. Some 6. Independent Technical Report continued 98