Middle Island Announces Multiple High-Grade Gold Intercepts at Plum Pudding; Stock Soars by ~12%

Summary

• Middle Island reported multiple high-grade gold intercepts from infill and extension drilling at Plum Pudding deposit.
• Plum Pudding is one of the five new satellite open pit deposits identified in Phase 1 RC drilling campaign.
• The Phase 2 infill and extension RC drill intercepts at Plum Pudding encompass consistent, broad, shallow (less than 40m downhole depth) drill intercepts of up to 90m width and over a 300m strike length.
• The resource definition component of the Phase 2 drilling campaign is now complete.
• Given the significant success of Phase 1 and Phase 2 programs in 2020 till date, MDI intends to undertake Phase 3 exploration drilling campaign at Sandstone.

The stock of Australian gold explorer, Middle Island Resources Limited (ASX:MDI) rallied by ~12 per cent to $0.019 during the early trading session on 27^th August 2020. Middle Island’s latest results from Phase 2 reverse circulation (RC) drilling at Plum Pudding deposit stimulated the rise in its share price on ASX.

The Plum Pudding deposit is situated just 850m to the south of Middle Island’s wholly owned gold processing plant, within granted Mining Lease M57/129. Besides, this deposit is one of the five new satellite open pit deposits identified by the Company from Phase 1 RC drilling campaign undertaken in 1H CY20, with other four deposits being McClaren, McIntyre, Ridge and Old Town Well.

The Company has so far completed over 45,000m of drilling in 2020 Phase 1 and Phase 2 programs, discovering these five new satellite open pit deposits and extending numerous existing Sandstone deposits.

Notably, the resource definition component of the Phase 2 drilling campaign is now complete, with assays of 10,000 RC samples yet to be received. Middle Island will incorporate these results in its Feasibility Study.

Multiple High-Grade Gold Results from Plum Pudding

The infill and extension drilling of 62 new RC holes (3,676m) at Middle Island’s Plum Pudding deposit has returned multiple high-grade gold intercepts, as summarised in the below figure:

These Phase 2 infill and extension RC drill intercepts encompass consistent, broad, shallow (less than 40m downhole depth) drill intercepts of up to 90m width and over a 300m strike length. Moreover, these intercepts complement more significant, previously announced Phase 1 and historic RC drill intercepts from Plum Pudding deposit, including:

• 17m @ 8.16g/t Au (from 33m in PP003R),
• 11m @ 22.5g/t Au (from 17m in PP030R),
• 12m @ 3.52g/t Au (from 34m in PP030R),
• 8m @ 6.98g/t Au (from 22m in PP094D), and
• 10m @ 3.08g/t Au (from 41m in MSRC420).

Gold Mineralisation at Plum Pudding

The Phase 2 drilling has also discovered that saprolite gold mineralisation at Plum Pudding relates to a sub-vertical, broad, north-trending zone of quartz-veined ultramafic and brecciated rocks, with internal mineralised lenses inferred to be dipping moderately east.

The mineralised saprolite envelope has a width of about 60m to 90m and a strike length of around 300m, all of which is veneered by an extensive, laterite, gold mineralised blanket at surface.

Moreover, the Phase 2 RC infill drilling (nominal 20m x 20m pattern) undertaken at Plum Pudding confirms and extends the high grade, broader gold intercepts logged from the Phase 1 and historic drilling.

The intercepts derived from Plum Pudding collectively represent a more extensive, low stripping ratio, shallow, higher grade, oxide open pit gold deposit, comprising substantial remnant laterite mineralisation from surface.

Status of Drilling Campaign

In addition to the 62 RC holes, the Company has also completed a further two HQ3 diamond core holes (110m) at Plum Pudding deposit, for which assays are yet to be received. Besides, the large diameter (HQ3) oxide diamond drilling of five new satellite deposits, including Plum Pudding, is close to completion, with just one hole remaining to be drilled.

Middle Island notified that the bulk density determinations are at an advanced stage while geotechnical testwork is underway. The Company has planned to evaluate the core prior to the metallurgical testwork.

Given the significant success of Phase 1 and Phase 2 programs in 2020 till date, Middle Island has planned to undertake a further (Phase 3) exploration drilling campaign at Sandstone. The Phase 3 campaign will potentially be directed at testing further open-pit targets, which are either not evaluated in the Phase 1 campaign or discovered by the Phase 1 and 2 programs.

The Company intends to conduct this exploratory drilling, along with sterilisation drilling in October 2020, once suitable waste dump locations and footprints are established.

As the resource definition component of the Phase 2 drilling campaign is now complete, it marks the official cut-off point for drill data contributions to Middle Island’s Sandstone Feasibility Study, which will now be finalised as a priority. The Company expects the Plum Pudding satellite deposit to make a significant contribution to a positive feasibility study outcome.

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