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 26 A block model with block sizes 5 m (X) x 10 m (Y) x 10 m (Z) was constructed, with the individual blocks assigned to the local geological domains (mineralisation and weathering) and each interpolated with a copper, zinc, gold, and silver grade. The block size dimensions were determined from approximately half the drillhole spacing. Drill samples were flagged by mineralisation and weathering domains, and the drill samples composited to 2 m length intervals. Composited sample data were statistically reviewed to determine appropriate top cuts, with top cuts applied for zinc, copper, silver, and gold where required. Variograms were modelled for copper and zinc from composited sample data within their respective mineralisation domains, with low relative nugget effects modelled, and with short ranges approximately 25 m for zinc and copper. Grade interpolation used OK for the zinc and copper grade variables and IDS for the silver and gold grade variables. All sub-blocks were assigned the grade of their parent block. Cell discretisation was used in each estimate. A sample search ellipse of 20 m x 20 m x 8 m (perpendicular to strike) was used, with a minimum of eight samples and maximum of 36 samples used to interpolate grade into any one block. A minimum of seven samples per drillhole was used for grade interpolation. Search radii were increased, and the minimum number of minimum samples reduced in subsequent sample searches if cells were not interpolated in the first pass. Octant searches were not used. The interpolated grades were validated by way of review of cross sections (block model and drill samples presented with same colour legend); swath plots, and comparison of mean grades from drillhole data with block model grades. The following density values (t/m 3 ) were applied, based upon density measurements taken from diamond core billets: • Oxide Zone = 2.4 • Transitional Zone; Zn zone = 3.1, Cu Zone = 3.3 • Primary zone; Zn Zone = 3.1, Cu Zone = 3.3 • Mixed Cu and Zn zones in Primary = 3.1. The Mineral Resource model is classified based upon drillhole spacing, quality of sampling and sample analyses, quantity of density measurements, and the relative confidence in the geological interpretation. This Mineral Resource is supported by a high level of confidence in the geological interpretations, sufficient to assume geological and grade continuity to satisfy an Indicated classification in places. The Sandiego Mineral Resource is classified as a combination of Indicated and Inferred. “Table 1” commentary on the criteria specified by the JORC Code for the Sandiego deposit are provided in Appendix B. 2.8 Metallurgy and Mining Studies At Koongie Park, the primary mineralisation at depth consists of unoxidised sulphides that have been found to be amenable to conventional flotation. However, deep weathering, which has resulted in variable oxidisation to depths of 200–250 m, has produced a complex mixture of sulphide and oxide minerals in the transition zone. Such material does not usually respond well to simple conventional flotation techniques and represents a demanding metallurgical challenge for the Koongie Park project. Significant metallurgical testwork has been undertaken for the deposit by various explorers since the 1970s. Several desktop mining studies were also undertaken by early explorers. Early work was effectively superseded by a major metallurgical testwork campaign and mining studies undertaken by AAR from 2006. The most recent testwork was conducted by AMMTEC Laboratories under the guidance of METS. The metallurgical testwork has established that saleable copper and zinc concentrates could be produced from the sulphide mineralisation at Sandiego and Onedin but obtaining concentrates from the transitional material (using conventional flotation techniques) was challenging. The 2007 testwork included 96 metallurgical sample tests on different ore types from Onedin and Sandiego to underpin a mineral processing flowsheet for economic study work. In 2007, Holly Mining & Associates and Brian Speechley were commissioned by AAR to undertake a preliminary mining assessment of the Sandiego and Onedin deposits. This study established two potential AuKing Mining Limited | PROSPECTUS 101