3980cba1-05b4-4c94-8648-5d89299ed327.pdf
ACTIVITIES REPORT
For Period Ended 31 March 2016
ASX: AUZ 29 April 2016
HIGHLIGHTS
Doolgunna - Marymia Project
Dixon gold prospect
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Drilling confirms main northeast-trending sulphidic corridor is gold-bearing
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Key drilling intersections from mineralisation corridor include:
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11 metres @ 1.10 g/t gold from 136.0 metres down hole (DXRC003)
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1 metre @ 8.99 g/t gold from 65.0 metres down hole (DXRC004)
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1.1 metres @ 5.07 g/t gold from 186.9 metres down hole (DXDD001)
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Diamond drilling indicates high-grade gold at Dixon is structurally controlled
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recent holes drilled at sub-optimal orientation for piercing high-grade gold lenses
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Detailed modelling of key controlling structures is currently in progress
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will enable accurate testing of priority gold zones in upcoming drill program
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Targeted RC and diamond drill program scheduled to commence in May 2016 Cash position
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Cash reserves of $0.6 million and no debt as at 31 March 2016
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Post quarter end, $1.5 million raised (before costs) through Placement to sophisticated and professional investors
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$1.4 million Entitlement Offer extended to 2 June 2016
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enables shareholders to review upcoming drilling results prior to Closing Date
Australian Mines Limited ("Australian Mines" or "the Company") is pleased to provide shareholders with its Quarterly Activities Report for the period ended 31 March 2016.
Doolgunna - Marymia Project
The Doolgunna - Marymia Project is situated approximately 900 kilometres north of Perth and within 50 kilometres of Northern Star's Plutonic Gold Mine.
The Project is being explored under a Joint Venture Agreement with Riedel Resources Ltd (ASX: RIE) under which Australian Mines has the right to earn an 80% interest by spending $3 million on exploration by May 2018. To date, Australian Mines has spent an unaudited $2.15 million on exploration and in May 2015 the Company announced that it had earned a majority interest in the project1.
Dixon gold prospect
During this quarter, Australian Mines completed a reconnaissance drill program over the Dixon gold prospect.
This drill program, which included five RC drill holes (for a total of 1,159 metres) and a single 285 metre diamond core hole, was designed to confirm that the source of a chargeability anomaly outlined by an induced polarisation (IP) survey over the Dixon prospect area was a sulphidic (pyrite-pyrrhotite- arsenopyrite) body associated with the gold mineralisation intersected by the Company's 2015 RC drill hole MMRC016.
As announced on 18 April 2016, this drilling program intersected a thick corridor of disseminated iron sulphides that occurred within the prospective dolerite geology2.
In addition, the Company's March 2016 drill program successfully demonstrated that the extensive sulphidic corridor was gold-bearing as well as indicating that the high-grade gold lenses within the prospect area appear to occur near the junction of cross-cutting secondary (east-west trending) structures and the northeast oriented sulphidic corridor3.
Given the Company's greater understanding of possible control on gold mineralisation at Dixon resulting from its March 2016 drill program, Australian Mines is presently completing a detailed three-dimensional geological and geophysical model of the Dixon prospect area. This modelling work is expected to be completed by early May, and the Company will drill test the resulting priority target horizon from May.
Details of this upcoming drill program will be announced closer to its commencement date but it is anticipated that the program will comprise up to 2,500 metres of RC drilling and 500 metres of diamond core.
1 Australian Mines Limited, Australian Mines secures majority ownership of Marymia Project, released 29 May 2015
2 Australian Mines Limited, RC drill results received from Dixon gold prospect, released 18 April 2016
3 Australian Mines Limited, Australian Mines closes in on high-grade gold zones at its emerging Dixon prospect, released 29 April 2016
Figure 1: The Dixon gold prospect is situated within 50 kilometres of Northern Star's Plutonic Gold Mine, and is located within Australian Mines (AUZ) and Riedel Resources (RIE) joint venture tenement E52/2394 where Australian Mines is currently earning an 80% interest.
Figure 2: Schematic image showing the interpreted gold mineralised corridor (>0.1 g/t Au) at Dixon as based on Australian Mines' recent reverse circulation (RC) and diamond core drill program. Preliminary analysis of the core from diamond hole DXDD001 suggests higher-grade zones at Dixon may occur where north-dipping (east-west trending) structures cross-cut this northeast trending corridor. (A full list of drill intersections are listed in Appendix 1 of this report).