Background

The Company‘s Gold Project is associated with two exploration licences comprising Mt Oscar Main Project (E47/1379) and Mt Oscar North Project (E47/1378), which are perspective with gold, particularly conglomerate hosted gold mineralisation.

The recent discoveries of gold nuggets in conglomerate units are at the base of the Fortescue Group, where Mt Roe basalt overlies the older Pilbara craton rocks unconformably. The base of the Fortescue Group is the Mt Roe basalt.

Encouraged by the discovery of gold nuggets which come from conglomerates underlain by Mt Roe basalt from the adjacent gold prospect – Purdy’s Reward, a geological mapping was completed by Fathom Geophysics Australia for the two tenements to map out Mt Roe basalt which is linked to potential gold-bearing conglomerates.

The Fortescue Group within the Exploration Licences comprise the Mount Roe Basalt (massive and vesicular basalt), the Hardey Formation (conglomerates, sandstones and shales) and the Cooya Pooya Dolerite. Gold-bearing conglomerates occur at the base of the Fortescue group units, below the Mt Roe Basalt. The 500K interpretation indicates that tenement E47/1379 has the base of the Mt Roe basalt running through them, and that the 2.9 Ga unconformity exists at this location within both these tenements. It is purely because the basement rocks are outcropping within E47/1379 that this key horizon is able to be readily marked on the map. There may be Mt Roe basalt under cover within E47/1379.

Mt Oscar Main Gold Project

Mt Oscar Main tenement E47/1379 covers 105km2, located about 35km south-east of Karratha, adjacent to the north-east of Novo’s Purdy’s Reward conglomerate hosted gold project, and adjacent to the south of Artemis’ Mt OscarWits conglomerate hosted and orogenic/shear zone gold project.

View of Mt Oscar Main Gold Project area (Photoed in March 2018) showing topography and vegetation

Geological mapping has shown that there is a large outcropping area of Mt Roe basalt within this tenement, as green colored in the below figure a. Outcropping area of Mt Roe basalt is about half of the tenement area, around 50 km2. There may be Mt Roe basalt under cover within E47/1379. The perspective area of outcropping and undercover Mt Roe basalt would be around 80 km2. From the prospect of gold-bearing conglomerate at the Purday’s Reward, the prospective gold-bearing conglomerate units are shallow within this tenement.

Mt Roe Basalt (green colored) and strike, conglomerates identified on the ground of E47/1379

Work was completed with rock chip and stream sediment sampling in 2017 at Mt Oscar Main which has identified conglomerates, as shown in the above figure b, confirmed about 7km strike length via several field trips. The outcropping conglomerates found recently are similar to the ones identified in Comet Well of Novo Resources, shown in the below figure.

Gold-bearing conglomerates occur at the base of the Fortescue group units, below the Mt Roe Basalt. The 500K interpretation indicates that E47/1379 has the base of the Mt Roe basalt running through them, and that the 2.9 Ga unconformity exists at this location within both these tenements. It is purely because the basement rocks are outcropping within E47/1379 that this key horizon is able to be readily marked on the map. There may be Mt Roe basalt under cover within E47/1379.

The work has focused exclusively on the contact between the Mount Roe Basalt and basement as well as the sedimentary package mapped at the base of the Mount Roe Basalt up till now.

The exploration work undertaken up till now at Mt Oscar Main Gold Project is at a very early stage. The project is known to host pre-Mount Roe sedimentary units and approximately 15 km of mapped unconformity contact between the Fortescue Group and underlying Archaean basement rocks. Whilst the source of gold at neighbouring prospects (principally Comet Well and Purdy’s Reward, held under joint venture by Artemis and Novo) is subject to debate, there is no doubt that there is potential for similar mineralisation to be discovered within Mt Oscar Main Gold Project.

The discoveries of conglomerates on the tenement surface shows certainty of shallow of the conglomerate units, which makes exploration and future mine development more economical compared to the deep ones.

Mt Oscar North Gold Project

Mt Oscar North tenement E47/1378 covers 58km2, located about 35km south-east of Karratha, adjacent to the north of Artemis’ Mt OscarWits conglomerate hosted gold project, 7km north to the Company’s Mt Oscar Main tenement.

The Company has recently completed geological mapping. Because most of the surface rocks across tenement E47/1378 are transported cover(estimated to be around 20m), surface investigation techniques such as radiometric surveying or ASTER/Landsat data cannot help reveal what type of rocks are below this surface cover. Magnetic data cannot tell you the rock type or formation it belongs to. It can only give an indication of the mafic content of the rock and by inference, the likely rock type.

There are three styles of mineralization possible within tenement E47/1378. All require the presence of greenstone rocks within the bedrock. Deposit models to be considered are as follows:

1. Conglomerate gold [Au]
2. Orogenic/shear zone gold [Au]
3. Intrusive hosted Nickel & Copper [Ni-Cu]

The Sholl shear zone [SSZ, refer to Figure 13] is a major divide within the West Pilbara and there does not appear to be any mapped Fortescue Group rocks north of this zone. This doesn’t mean it is not possible [perhaps localized incursions?], but it does mean that if interpreted VMB units within E47/1378 are indeed greenstone, the rocks are more likely to be part of the Roebourne Group than the Fortescue Group. The presence of the Sholl shear zone provides a perfect conduit for gold bearing fluids to travel past [or hopefully into] E47/1378.

Surface mapping of E47/1378 and the Sholl shear zone (SSZ)

The exact surface trace of the unconformity may be quite different from that indicated by the surface mapping. It is possible that incursions of Mt Roe basalt exist north of the Sholl shear zone in E47/1378.

Target zones defined for the three deposit types of Ni-Cu and gold in E47/1378

Target zones have been defined for the three deposit types and follow-up traverses designed to cover these zones have been proposed, which is shown in the figure as above.

A surface soil sampling programme was planned, which included four passes of surface soil sampling. Assay Results from the second pass of surface soil sampling programme confirmed presence of gold, silver and arsenic mineralisation at Mt Oscar North Tenement E47/1378. The final stage of surface sampling programme which combines the third and fourth passes was completed at the end of 2018. Assay results will come out early 2019.

MT OSCAR GOLD PROJECT SUMMARY

The Witwatersrand Basin in South Africa is the single largest gold district in the world, having produced 2 billion ounces, or about one-third, of the yellow metal ever mined by man since its discovery in 1886. Witwatersrand style gold has been mined over a 300 km by 150 km area to depths of up to 4 kilometers.

At the Witwatersrand, the gold occurs within specific sedimentary horizons across this extensive sedimentary basin. Although gold occurs in a number of sedimentary horizons, it is primarily localized in a lower quartz pebble conglomerate and an upper polymictic conglomerate. A potential Witwatersrand type basin that covers thousands of square kilometers - the Fortescue basin in the Western Pilbara has been identified, which are thought to be siblings. Gold mineralization occurs in a regionally extensive conglomerate unit directly beneath Mt Roe Basalt.

Oscar Resources has 100% control over approximately 163 sq km in areas along strike from Purdy’s Reward and Comet Well. The Company believes that these gold-bearing conglomerates may underlie significant areas within the Company’s tenements, particularly within E47/1379 which is within the Fortescue basin:

• Close to and along the strike of Mt Roe basalt from the Comet Well and Purdy’s Reward prospects where gold nuggets and fine gold have been discovered by metal detectors and trenching, and strong continuity of targeted gold-bearing conglomerates has been supported by the core drillings. Gold nuggets have been also found from drilling core samples;
• Along the strike of Mt Roe basalt from the Mt OscarWits where gold nuggets have been uncovered from the gold-bearing conglomerates in the base of the outcropping Mt Roe basalt, and where the outcropping Mt Roe basalt has a continuity with the one in E47/1379;
• Large outcropping Mt Roe basalt area, covering half of the tenement area of E47/1379, plus under cover Mt Roe basalt area in E47/1379;
• Large shallow area of the Mt Roe basalt units (<100m-200~500m deep) and potential gold-bearing conglomerates under the Mt Roe basalt of Oscar Resources compared to many other companies’ targeted Mt Roe basalt (500m-1000~2000m deep) and potential gold-bearing conglomerates make the project exploration and development more viable;
• Development of geological model of areas along strike by Novo Resources is at no cost to Oscar Resources. Continued success of trenching and/or drilling activities, and bulk samples processing methods at their sites by two companies operating in parallel (Artemis Resources and Novo Resources) delivers substantial value uplift for Oscar Resources at no cost.
• Gold nuggets coming from conglomerates under Mt Roe Basalt are the focus of the exploration. Early stage exploration work has found gold from the conglomerates under Mt Roe Basalt. In addition, gold has also been achieved from the stream samples coming from the Hardey Formation conglomerates in E47/1379, which might provide another source of gold for exploration in E47/1379.
• Assay Results from the surface soil sampling programme have confirmed presence of gold mineralisation at Mt Oscar North Tenement E47/1378. E47/1378 has potential to host primary mesothermal gold deposits. Several multi element soil anomalies were generated. More sampling work and possibly drilling work need to be done to test it.