Announcement PDF ASX:ESR 23 May 2023 Carr Boyd Project Exploration Update HIGHLIGHTS ➔ Exploration review incorporating CSIRO study and seismic results completed at Carr Boyd ➔ Multiple new targets prospective for economic nickel sulphides + PGEs identified for further exploration ➔ Nearby 16km Colreavy Komatiite now considered an additional high priority exploration target ➔ The study has successfully identified: ➢ Controls and ages of multiple nickel mineralisation events ➢ All sulphides confirmed as magmatic in origin without tectonic remobilisation ➢ Carr Boyd nickel deposit is in-situ and formed later than T5-Broonhill deposits ➢ Trace element chemistry demonstrates potential for multiple deposits within the complex ➔ Estrella investigating potential joint venture partners to expedite & fund large long-term exploration effort Figure 1: Location of the T5 MRE in red with respect to the 16km prospective basal contact imaged by seismic Estrella Resources Limited (ASX: ESR) (Estrella or the Company) is pleased to announce the results of the Carr Boyd exploration review which incorporates all data generated to date from the Company’s partnership with the CSIRO and an innovative seismic program. The study has identified that the Carr Boyd system has exhibited many different magma pulses with potentially multiple sulphur-saturation events, providing opportunities to further unlock massive nickel sulphides. _________________________________________________________________________________ Office Address London House, Level 8, 216 St Georges Terrace, PERTH WA 6000 Postal Address GPO Box 2517, PERTH WA 6831 Phone +61 8 9481 0389 Fax +61 8 9463 6103 Email info@estrellaresources.com.au Following the review, Estrella has been able to identify 30 targets within the system, 15 of which have known Ni-Cu-PGE intersections and an additional 15 (which are closely related to the internal contacts) that have the right geology but have not been drill tested. These targets are located on the nine internal and external basal contacts revealed by the study and are shown in Figure 2. Figure 2: The nine external and internal basal contacts as interpreted from all available datasets The top targets related to the numbering above include the Carr Boyd Mine pyroxenites (6), Mossgiel base (1), the Mossgiel top (5) which coincides with mineralisation at Tregurtha, the Broonhill dyke feeder, Gossan Hill (1), Frenchman’s Hill (2) and the Porphyry Hill gold workings where Great Boulder’s Whitehead’s Shear Trend coincides with a linear internal basal contact at Carr Boyd (8+9). Notably, the 16km Colreavy Komatiite (4) has also been identified as a top tier priority. The Colreavy contact overlies a felsic sediment which also contains sulphur. The nickel target lies fully within Estrella’s ground but has not been extensively tested and has received little to no modern exploration. Commenting on the completion of the study, Estrella Managing Director Chris Daws said: “We have accomplished an incredible amount of high-quality work over the last couple of years at Carr Boyd and I remain very excited about the potential within our tenements. “The recent review combined the many different studies conducted by nickel experts from the CSIRO with all the seismic, geological and drill data acquired by Estrella and previous explorers into a coherent geological model that enables a much deeper understanding of the igneous complex and its surrounds. I’d like to thank the many scientific and technical experts that have worked with us over the last two years. “Estrella has already encountered massive nickel sulphides in the Carr Boyd area and with an advanced model we now have a host of other exciting targets which are capable of producing results. I feel we are a lot closer to unlocking the massive opportunity our ground offers for additional economic mineral discoveries.” Scientific Study – Technical Review Carr Boyd is a well-endowed mineralised complex, however the source of this mineralisation has historically been poorly understood and deposits such as the Carr Boyd mine, which has delivered total production of 202,100t at 1.43% Ni and 0.46% Cu, have never been fully explained. Through follow-up exploration, Estrella has been able to identify nickel sulphides throughout the complex and particularly at the T5 prospect. Shortly after the discovery of T5, the Company commenced a scientific program to understand the fundamentals of the igneous complex. The program aimed to test many assumptions that were made about the several historical nickel-copper discoveries at the Project and to identify and address the gaps in knowledge that remained. Industry understanding of intrusive-style Ni-Cu-PGE deposits has advanced significantly over the past decade and the opportunity to partner with a respected body such as the CSIRO offered the potential to further enhance understanding of mineralisation at the Project. In 2021 Estrella formally commenced its partnership with CSIRO through the Innovations Connections Research Agreement. 1 The partnership dovetailed with the Company’s efforts to image the basal contact using new innovative seismic technology to create a more holistic understanding of when and where nickel mineralisation was distributed around the 78km2 Carr Boyd complex. The recently completed exploration review has incorporated all of these learnings in an effort to understand and rank the areas of the tenement package that offer high potential, and to image those areas in three dimensions so that exploration and ongoing studies can work hand-in-hand to enhance cost-effective, targeted exploration. One of the most important findings of this work was to accurately identify the direction that gravity was acting at the time of deposition of the nickel through the seismic program. This has enabled Estrella to understand the location and original orientation of the basal contact and various nickel occurrences within the complex. These orientations are vastly different now due to internal deformation at the time of emplacement and regional deformation that occurred when the complex was overturned. Another important finding came from the CSIRO’s work on the distribution of trace elements within olivine crystals at the various deposits studied. In particular, it was found that the Carr Boyd Deposit was most likely formed by a melt that was depleted in PGE’s in a way that strongly suggests the initial melt had formed another nickel sulphide deposit (unlocated) deeper in the system, prior to reacquiring sulphur to form the Carr Boyd deposit. Further studies confirmed the olivines within the Mossgiel Pyroxenite most likely formed in the presence of a sulphur-enriched melt, explaining the basal contact sulphides observed in Estrella’s drilling in that area. It was also confirmed that the Mossgiel, Carr Boyd and T5-Broonhill pyroxenites are of different ages with different chemical and trace element fingerprints. These findings highlight how dynamic the Carr Boyd system is and that there are many different magma pulses with potentially multiple sulphur-saturation events. The finding explains the multiple magmatic nickel sulphide hits located in Estrella’s drilling all along the extensive basal contact, as well as at internal basal contacts (Figure 3). 1 See ASX Announcement dated: 1 November 2021 Figure 3: Northern section of the Carr Boyd Complex with regional intercepts Ni% / Cu%, also showing the actual basal contacts in red and internal basal contacts in blue. As part of the review, the study considered the formation conditions to better explain the historic Carr Boyd Deposit. Carr Boyd is located on one of the internal basal contacts and the Carr Boyd breccia pipes are what is known as an infiltration front, where an overlying sulphide pool melts its way into the underlying stratigraphy, in this case the gabbro top of an underlying magma pulse. Thus, all that can be seen in the Carr Boyd Deposit is a sulphide “breccia” with remnant overlying pyroxenite which has been rotated and faulted into its present-day location with respect to T5 and other internal pulses. This is depicted in Figure 4. The sulphides are magmatic in origin and have not been remobilised. Figure 4: Left - photograph from the underground mine at Carr Boyd; Middle – depiction of sulphides (red) infiltrating down into the underlying gabbro; Right – magnetic image showing the actual location and orientation of the Carr Boyd sulphide infultration front with respect to other internal pulses and the T5 basal contact The review has also elevated the Colreavy Komatiite to a high priority which lies immediately West of the Carr Boyd Complex. The 16km of komatiite’s basal contact overlies a felsic sediment which also contains sulphur. Exploration spend on the Carr Boyd complex has previously taken priority however this target is compelling and will be included in the next round of exploration. This is a classic Kambalda-style extrusive nickel target that has not previously been tested to any degree due to deep weathering. As a comparison, the Black Swan komatiite complex basal contact (30km to the South) is only 4km long and hosts the world-class Silver Swan and Black Swan deposits totalling more than 350kt of Ni metal (Figure 5). Figure 5: Colreavy Basal contact (16km) juxtaposed at scale with the Black Swan basal contact (4km) The Company recently released an Exploration Target just for the basal contact (#1 in Figure 2) of between 35,000 and 105,000 tonnes of Ni metal (refer to ASX Announcement dated 20 th September 2022). It is envisaged that this will be amended to include these additional internal contacts as exploration begins to test these areas in the future and acquires study data from drilling. The Industry PhD program run by the University of Western Australia with support by the CSIRO will significantly enhance Estrella’s ability to evaluate these new areas in a timely manner so as to maximise the coverage of our exploration dollars. The work conducted will continue the studies on mineral geochemistry and emplacement timing on each new prospect to ensure we are targeting the same internal horizons that are proven to be mineralised elsewhere, such as the Carr Boyd pyroxenite whilst evaluating the extend of newly defined internal horizons with known mineralisation. Given the substantial size of the prospective areas now being targeted within the Carr Boyd complex and the Company’s ongoing focus on bringing the near-term Spargoville nickel project into production, Estrella is actively engaging with potential partners to maintain aggressive exploration across the tenement package over the next three to four years. Estrella will continue to keep shareholders informed of any substantial developments relating to the Carr Boyd project. The Board has authorised for this announcement to be released to the ASX. FURTHER INFORMATION CONTACT Christopher J. Daws Managing Director Estrella Resources Limited +61 8 9481 0389 info@estrellaresources.com.au Media: David Tasker Managing Director Chapter One Advisors E: dtasker@chapteroneadvisors.com.au T: +61 433 112 936 Competent Person Statement The information in this announcement relating to Exploration Results is based on information compiled by Steve Warriner, who is the Exploration Manager of Estrella Resources, and a member of The Australasian Institute of Geoscientists. Mr. Warriner has sufficient experience relevant to the style of mineralisation and type of deposit under consideration, and to the activity he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resource and Ore Reserves”. Mr Warriner consents to the inclusion in the report of the matters based on their information in the form and context in which it appears. Forward Looking Statements This announcement contains certain forward looking statements which have not been based solely on historical facts but, rather, on ESR’s current expectations about future events and on a number of assumptions which are subject to significant uncertainties and contingencies many of which are outside the control of ESR and its directors, officers and advisers. APPENDIX 1 JORC TABLE 1 – CARR BOYD EXPLORATION Section 1 - Sampling Techniques and Data Criteria Sampling techniques JORC Code explanation • Nature and quality of sampling (e.g. cut channels, random chips, or specific specialised industry standard measurement tools appropriate to the minerals under investigation, such as down hole gamma sondes, or handheld XRF instruments, etc). These examples should not be taken as limiting the broad meaning of sampling. • Include reference to measures taken to ensure sample representivity and the appropriate calibration of any measurement tools or systems used. • Aspects of the determination of mineralisation that are Material to the Public Report. In cases where ‘industry standard’ work has been done this would be relatively simple (e.g. ‘reverse circulation drilling was used to obtain 1 m samples from which 3 kg was pulverised to produce a 30 g charge for fire assay’). In other cases more explanation may be required, such as where there is coarse gold that has inherent sampling problems. Unusual commodities or mineralisation types (e.g. submarine nodules) may warrant disclosure of detailed information. Drilling techniques • Drill type (e.g. core, reverse circulation, openhole hammer, rotary air blast, auger, Bangka, sonic, etc) and details (e.g. core diameter, triple or standard tube, depth of diamond tails, facesampling bit or other type, whether core is oriented and if so, by what method, etc). Drill sample recovery • Method of recording and assessing core and chip sample recoveries and results assessed. Measures taken to maximise sample recovery and ensure representative nature of the samples. Whether a relationship exists between sample recovery and grade and whether sample bias may have occurred due to preferential loss/gain of fine/coarse material. • Whether core and chip samples have been geologically and geotechnically logged to a level of detail to support appropriate Mineral Resource estimation, mining studies and metallurgical studies. Whether logging is qualitative or quantitative in nature. Core (or costean, channel, etc) photography. The total length and percentage of the relevant intersections logged. • • • Logging • • • Sub-sampling techniques • If core, whether cut or sawn and whether quarter, half or all core taken. • If non-core, whether riffled, tube sampled, Commentary • ESR drilling included diamond core - half core samples with a maximum of 2m and minimum 0.25m length. DD core samples have been half cut with an automatic core saw. • Core is cut and sampled to ensure the sample is representative and no bias is introduced. Cutting of specific, banded or stringer sulphide zoned core is done orthogonal to the banding to ensure there is no bias. • Determination of mineralisation has been based on geological logging, visual sulphide estimates and confirmation using a pXRF machine. Samples were dispatched to an accredited laboratory for multi-element analysis. • Diamond core drilling was used to obtain 6m length samples from the core barrel which are then marked in one metre intervals, based on core block measurements and core recovery. • Samples are selected based on geological logging boundaries or on nominal meter marks. Collected samples weigh a nominal 23 kg (depending on sample length). Samples have been dispatched to an accredited commercial laboratory in Perth for analysis. • Samples are being analysed using a 4-acid digest, ME- ICP for 33 elements and all samples are also being tested for Au & PGE elements using ICP analysis. • Drilling was undertaken using NQ2 sized drill core. • Holes have been collared with mud rotary from surface, HQ rough cored to top of fresh rock then NQ2 cored to EOH. • • • • • • • • Core recovery was recorded by the field crew and verified by the geologist. RQD measurements were digitally recorded to ensure recovery details were captured. Sample recovery in all mineralised zones is high with negligible core loss observed. Diamond core drilling is the highest standard and no relationship has been established between sample recovery and reported grade as the core is in very good condition. Detailed industry standard of collecting core in core trays, marking metre intervals and drawing core orientation lines were undertaken. Core trays were photographed wet and dry prior to sampling. Prior to 2021 drill hole logs were recorded in Excel spread sheets and validated in Micromine Software as the drilling progressed. In 2021 a digital logging system, Logchief, was implemented which validates data as it is recorded and uploads that data remotely to a centralised database. The entire length of all holes are logged. Core is half cut using an automatic core saw to achieve a half-core sample for laboratory submission. The sample preparation _________________________________________________________________________________ Criteria and sample preparation Quality of assay data and laboratory tests Verification of sampling and assaying JORC Code explanation rotary split, etc and whether sampled wet or dry. • For all sample types, the nature, quality and appropriateness of the sample preparation technique. • Quality control procedures adopted for all subsampling stages to maximise representivity of samples. • Measures taken to ensure that the sampling is representative of the in situ material collected, including for instance results for field duplicate/second-half sampling. • Whether sample sizes are appropriate to the grain size of the material being sampled. • The nature, quality and appropriateness of the assaying and laboratory procedures used and whether the technique is considered partial or total. • For geophysical tools, spectrometers, handheld XRF instruments, etc, the parameters used in determining the analysis including instrument make and model, reading times, calibrations factors applied and their derivation, etc. • Nature of quality control procedures adopted (e.g. standards, blanks, duplicates, external laboratory checks) and whether acceptable levels of accuracy (i.e. lack of bias) and precision have been established. Commentary technique is considered industry best standard practice. • No field duplicates have been collected for DD holes. Field duplicates will be collected once initial results are returned and resampling of the mineralised zones is warranted. • Sample sizes are appropriate to the grain size of the mineralisation. • • • • • Location of data points • • • Data spacing and distribution • • • The verification of significant intersections by either independent or alternative company personnel. The use of twinned holes. Documentation of primary data, data entry procedures, data verification, data storage (physical and electronic) protocols. Discuss any adjustment to assay data. • • • • • • • Prior to 2021 drill hole logs were recorded in Excel spread sheets and validated in Micromine Software as the drilling progressed. In 2021 a digital logging system, Logchief, was implemented which validates data as it is recorded and uploads that data remotely to a centralised database hosted by Maxgeo. Hole CBDD028 is twinning hole CBP042. No other twinning is warranted at this stage. • No adjustments undertaken. Accuracy and quality of surveys used to locate drill holes (collar and down-hole surveys), trenches, mine workings and other locations used in Mineral Resource estimation. Specification of the grid system used. Quality and adequacy of topographic control. • Data spacing for reporting of Exploration Results. Whether the data spacing and distribution is sufficient to establish the degree of geological and grade continuity appropriate for the Mineral Resource and Ore Reserve estimation procedure(s) and classifications applied. Whether sample compositing has been applied. • For drill collars, RC and DD holes were surveyed with DGPS equipment using the MGA94, Zone 51 coordinate system. Mineral Resource estimation was carried out on this grid. Topography is relatively flat and control is more than adequate given the early stage of the project. A 3D drone ortho-photographic survey has been used to create a DTM of the project area. Drill data spacing of all drill data is sufficient to establish the degree of geological and grade continuity appropriate for estimating a Mineral Resource. Drill hole spacing ranges from 10m by 10m in the most well-drilled portion of the deposit and broadens to approximately 40m by 80m over the remaining areas. Spacing is adequate to establish the degree of geological and grade continuity for estimating a Mineral Resource. Samples were composited to 1m lengths prior to Mineral Resource estimation. The geometry of drill holes relative to the mineralised zones achieves unbiased sampling of this deposit type. No orientation-based sampling bias has been identified. • • • Orientation of data in relation to geological structure Samples are selected based on geological logging boundaries or on nominal meter marks. Collected samples weigh a nominal 23 kg (depending on sample length). Samples have been dispatched to an accredited commercial laboratory in Perth for analysis. Samples are being analysed at Intertek and ALS Laboratories in Perth using a 4-acid digest, ME- ICP for 33 elements and all samples are also being tested for Au & PGE elements using ICP analysis. For ESR drilling, QAQC included Certified Reference Material (CRM’s) and blank (Blanks) samples inserted at the laboratory. Whether the orientation of sampling achieves unbiased sampling of possible structures and the extent to which this is known, considering the deposit type. If the relationship between the drilling orientation and the orientation of key • • to assay data were Criteria Sample security Audits or reviews JORC Code explanation mineralised structures is considered to have introduced a sampling bias, this should be assessed and reported if material. • The measures taken to ensure sample security. Commentary • • The results of any audits or reviews of sampling techniques and data. • Samples are in the possession of ESR personnel from field collection to laboratory submission in Kalgoorlie. No independent audit or review has been undertaken. Section 2 - Reporting of Exploration Results Criteria Mineral tenement and land tenure status Exploration done by other parties JORC Code explanation • Type, reference name/number, location and ownership including agreements or material issues with third parties such as joint ventures, partnerships, overriding royalties, native title interests, historical sites, wilderness or national park and environmental settings. • The security of the tenure held at the time of reporting along with any known impediments to obtaining a license to operate in the area. • Acknowledgment and appraisal of exploration by other parties. Commentary • Carr Boyd Nickel Pty Ltd (a wholly owned subsidiary of ESR) holds a 100% interest in the nickel and base metal rights to the project. • All of the tenements are current and in good standing. • • • • • • • • • • The Carr Boyd Rocks deposit was discovered by Great Boulder Mines, in a joint venture with North Kalgurli Ltd in 1968. The deposit was mined between 1972 and 1975, during which time they explored for additional breccia pipe occurrences near the mine. WMC acquired Great Boulder Mines Ltd in 1975, briefly reopening the mine in 1977 before closing it permanently shortly thereafter due to a collapse in the nickel price. The mine had produced 210,000t at 1.44% Ni and 0.46% Cu before its closure. From 1968 Pacminex Pty Ltd held most of the ground over the CBLC outside of the immediate mine area. Between 1968 and 1971 they conducted extensive exploration programs searching for large basal contact and/or stratabound Ni-Cu deposits. It was during this time that most of the disseminated and cloud sulphide occurrences such as those at Tregurtha, West Tregurtha and Gossan Hill were discovered. Defiance Mining acquired the regional tenements from Pacminex in 1987 and focused on exploration for PGE deposits between 1987 and 1990. In 1990 Defiance purchased the Carr Boyd Rocks mine from WMC and switched focus to the mine area between 1990 and 2001, leaving many PGE targets untested. From 1990 Defiance dewatered the mine to conduct testwork and feasibility studies on the remnant mineralisation. Metallurgical testwork, Mineral Resource estimations, and scoping studies were completed. Around 1996 the focus shifted again to regional exploration for large tonnage basal contact deposits. In 2001 Titan Resources Ltd (Titan) acquired the project and recommenced economic evaluations of the remnant material at Carr Boyd Rocks before embarking on another regional exploration program focusing on the basal contact. An aeromagnetic survey, airborne EM reprocessing, and several programs of RAB and RC drilling were completed. From 2005 Yilgarn Mining entered a JV with Titan and continued with some regional exploration but focused most attention in and around the Carr Boyd Rocks mine. In 2007 Titan was acquired by Consolidated Minerals Ltd (Consmin). Consmin conducted IP surveys and detailed gravity surveys but did not drill any targets before selling the project to Salt Lake Mining (SLM) in 2013. SLM completed limited drilling to meet expenditure commitments, before selling the project to Apollo Phoenix Resources in 2016. Criteria JORC Code explanation Geology • Drill hole information • A summary of all information material to the under-standing of the exploration results including a tabulation of the following information for all Material drill holes: • easting and northing of the drill hole collar • elevation or RL (Reduced Level – elevation above sea level in metres) of the drill hole collar • dip and azimuth of the hole • down hole length and interception depth • hole length • If the exclusion of this information is justified on the basis that the information is not Material and this exclusion does not detract from the understanding of the report, the Competent Person should clearly explain why this is the case. • In reporting Exploration Results, weighting averaging techniques, maximum and/or minimum grade truncations (e.g. cutting of high grades) and cut-off grades are usually Material and should be stated. Data aggregation methods Deposit type, geological setting and style of mineralisation. Commentary • Apollo sold the project to ESR in 2018. • The Project lies within the Achaean Yilgarn Craton in a 700km belt of elongate deformed and folded mafic, ultramafic rocks and volcanic sediments intruded by granitoids which is referred to as the Norseman-Wiluna Belt. The belt has been divided into several geological distinct terranes, with the project area lying at the northern end of the Gindalbie terrane (Swager, 1996). The geology of the Carr Boyd area is dominated by the Carr Boyd mafic-ultramafic intrusive complex (“CBIC”). • Several distinctive styles of Ni and Ni-Cu mineralisation have been identified within the CBIC. At the Carr Boyd Rocks Nickel Mine NiCu mineralisation is hosted within several 20 to 60m diameter brecciated pipe-like bodies that appear to be discordant to the magmatic stratigraphy. Mineralisation is hosted by a matrix of sulphides (pyrrhotite, pentlandite, pyrite and chalcopyrite) within brecciated bronzite and altered country rock clasts. • Stratiform Ni-Cu-PGE mineralisation has been identified at several different locations within the layered magmatic complex. • ESR is in the process of re-mapping and reclassifying the Carr Boyd Igneous Complex. Previous “Layered Intrusive” models are misleading as the complex is made up of many overprinted and juxtaposed, smaller layered and non-layered intrusives that have progressed from ultramafic to mafic over time. The complex is better described as a magma feeder zone, where the earliest melts passing through the Morelands Formation have assimilated graphitic sulphidic shales, reached sulphur saturation and deposited nickel sulphides along basal contacts. • These basal contacts are not restricted to the base of the complex, but can form within the complex, wherever access was gained by these earlier flows. • The complex has then been intruded and inflated over time by progressively more mafic, barren magmas to produce what we see today. • Exploration results with all relevant drillhole information are reported in the body of the text. • All drill hole information relevant to this resource report/statement has been included in the appendices. No relevant drill hole information has been excluded. • • Exploration results with all relevant drillhole information are reported in the body of the text. Significant Grade Intersections are reported on a 0.5% Ni cut-off Criteria Relationship between mineralisation widths and intercept lengths Diagrams Balanced Reporting Other substantive exploration data Further work JORC Code explanation • Where aggregate intercepts incorporate short lengths of high grade results and longer lengths of low grade results, the procedure used for such aggregation should be stated and some typical examples of such aggregations should be shown in detail. • The assumptions used for any reporting of metal equivalent values should be clearly stated. • These relationships are particularly important in the reporting of Exploration Results. • If the geometry of the mineralisation with respect to the drill hole angle is known, its nature should be reported. • If it is not known and only the down hole lengths are reported, there should be a clear statement to