AuMEGA Metals: Quarterly Activities Report
AuMEGA Metals: Quarterly Activities Report
for the Three Months Ended 30 June 2024
Highlights
Exploration
Fully funded exploration program progressing to plan.
Highly successful Canadian winter reverse circulation ("RC") drilling program defined three large,
mineralised zones, including O-2 West at Malachite which delivered a several mineralised holes
including 627 ppb gold and 1.99% copper from six metres, with diamond drilling now planned.
Also defined a 1.2 km anomalous trend at O-2 East to be followed up with diamond drilling.
Conducted technical workshop in Newfoundland defining 37 exploration targets including
identification of nine new early-stage targets.
Spring/Summer exploration activities commenced with diamond drilling within the resource
corridor, mainly at Central Zone.
The first phase of diamond drilling was completed on 12 July 2024.
Corporate
Strong cash position with cash balance of approximately $6.2 million (A$6.8 million) as at the end
of June 2024.
Listing on the Toronto Venture Exchange completed ("TSXV") providing expanded access to
another major stock exchange for the mining industry. Trading began on 26 June 2024 under the
trading symbol "AUM".
Rebranded the business to AuMEGA Metals Ltd to better reflect the Company's growth strategy
and focus on delivering long-term value through world-class exploration in Newfoundland.
ASX trading symbol changed to "AAM".
Change in management with departure of Crispin Pike, VP Exploration at the end of September
2024, with transition currently in progress.
Option Agreement completed to acquire the Blue Cove Copper Project in southeastern
Newfoundland.
Edmonton, Alberta--(Newsfile Corp. - July 29, 2024) -
AuMEGA Metals Ltd
(formerly Matador Mining
Ltd)
(ASX: AAM) (TSXV: AUM) (OTCQB: AUMMF)
("AuMEGA" or the "Company") is pleased to
provide its Quarterly Activities Report for the quarter ended 30 June 2024. All dollar amounts are
Canadian dollars unless stated otherwise.
AuMEGA is a mineral exploration company focused primarily on the discovery of precious and critical
metals in Newfoundland and Labrador ("Newfoundland"), Canada. AuMEGA employs a world-class,
systematic approach to exploration which is necessary for a terrain that has significant cover and a
complex glacial history such as in south-west Newfoundland.
The Company holds a district scale land package that spans 110 kilometres along the Cape Ray Shear
Zone ("CRSZ"), a significant under-explored geological feature recognised as Newfoundland's largest
identified gold structure. This structure currently hosts Calibre Mining's Valentine Gold Project, which is
the region's largest gold deposit (+5 million ounces), along with AuMEGA's Mineral Resource.
AuMEGA's portfolio over the CRSZ hosts a few dozen high potential targets and its existing gold Mineral
Resource of 6.1 million tonnes of ore grading an average of 2.25 g/t, totaling 450,000 ounces of
Indicated Resources, and 3.4 million tonnes of ore grading an average of 1.44 g/t, totaling 160,000
ounces in Inferred Resources.
The Company is supported by a diverse shareholder registry of prominent global institutional investors,
and strategic investment from B2Gold Corp, a leading, multi-million-ounce a year gold producer.
Additionally, AuMEGA holds a 27-kilometer stretch of the highly prospective Hermitage Flexure and has
also secured an Option Agreement for the Blue Cove Copper Project in southeastern Newfoundland,
which exhibits strong potential for copper and other base metals.
Second Quarter 2024 Overview
The Company successfully completed its first winter RC drill program during the quarter, a technique the
Company believes to be a best-in-class approach to sampling below moderate overburden, and a first in
recent time for Newfoundland exploration.
Three large, mineralised zones were defined by this RC program, which will be further drill tested deeper
into the bedrock in the upcoming second phase diamond drill program.
The first phase of the 2024 diamond drill program focused on high-priority targets within the resource
corridor, mainly at Central Zone. Following extensive analysis and interpretation the Company identified
a number of structural and geochemical targets that were not previously assessed during past mineral
resource drill programs.
Subsequent to the quarter end, the Company completed the first phase of diamond drilling with eight
holes drilled for a total of approximately 1,900 metres. The second phase of diamond drilling is expected
to involve 3,000 to 4,000 metres depending on results.
Business development activities during the quarter included the Company entering into a low-cost
Option Agreement to acquire the Blue Cove Copper Project in southeastern Newfoundland. The project
has identified outcropping of high-grade copper-gold-silver targets ready for immediate assessment.
Shareholders approved a company change of name to AuMEGA Metals Ltd during the quarter, with
change in listing symbol from MZZ to AAM. The Company also completed a secondary listing on the
TSXV under the ticker AUM.
Exploration Activities
Commencement of Spring and Summer Exploration Program
The Company commenced its spring and summer exploration program during the quarter
1
. The
exploration team mobilised for early stage works and preparations for the start of diamond drilling, which
commenced early in June 2024.
The 2024 exploration program is one of the most comprehensive programs planned for the Company.
Several meaningful exploration initiatives have been scheduled on the Company's district-scale land
package covering multiple projects including Malachite, Cape Ray, Bunker Hill, Intersection, Hermitage
and Blue Cove.
Following the successful completion of the 157 holes drilled in the winter in the Company's first ever RC
program, diamond drilling is now being undertaken over two quality-focussed phases.
The first phase is solely focussed on new, high-priority targets within the mineral resource corridor in
areas never before drill tested. The second phase planned for later in the Canadian summer will include
drilling at Malachite following up on targets defined by the RC program, and other new targets defined
during the Company's targeting workshop which was completed at the end of June 2024.
The workshop was led by the world-renowned structural geologist Brett Davis and included geologists
from B2Gold and our full AuMEGA team including Chair Justin Osborne who adds a wealth of gold
targeting and exploration experience.
Phase-One Diamond Drilling at Central Zone
On 12 June 2024, the Company announced the commencement of the first phase of the 2024 diamond
drilling program with the initial phase focused on drilling high-priority targets at new zones within the
resource corridor, mainly at Central Zone. This drilling was recently completed and assays are pending
holes from this program as well as three geotechnical holes drilled historically by the Company that were
never assayed.
Historical Untested Geochemical and Structural Anomalies
7
The first phase of diamond drilling was based on recent interpretation and analysis completed by the
Company which identified new targets in the footwall to the known Central Zone deposits. In 2018, the
Company identified a 500 metre by 300 metre gold-in soil anomaly, greater than 40 ppb, which is almost
15 times the average crustal abundance of gold. This zone is situated in the footwall to the Z04 deposit
and appears to be coincident with interpreted disruption of the Strawberry Hill Granite, which is
geologically similar to the Window Glass Hill Granite to the west.
The Company also identified a second, highly prospective historical geochemical anomaly in the footwall
of the Central Zone Z41 deposit. This anomaly consists of a 560-metre-long linear gold-in-soil trend with
values up to 1,440 ppb (or 1.44 g/t) gold. This gold anomaly is coincident with an untested occurrence of
potentially sheared Windsor Point Group, the most prospective sedimentary host of the Company's
Central Zone Mineral Resources.
The Company's recent analysis on the structural movement of CRSZ mineralisation, coupled with this
historical data, supports the favourability and prospectivity of the largely overlooked Central Zone
footwall geological zone.
FIGURE 1: OVERVIEW UNTESTED GEOCHEMICAL TARGETS IN THE CENTRAL ZONE
FOOTWALL
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Technical Workshop
2
The targeting Technical Workshop entailed a review of the significant data that has been collected
historically and by the Company from the CRSZ and Hermitage Flexure through geophysical surveys,
diamond and RC drilling, prospecting, sampling, mapping and desktop analysis.
Targets were ranked using a mineral systems approach, defined by the key criteria common to world-
class gold deposits. The resultant conceptual rankings are used in conjunction with factual empirical data
and are subdivided by stage in the exploration pipeline. This objective ranking methodology allows for
targets in various stages of exploration, with different empirical data sets, to be ranked against each
other to best select targets for further work. Such a systematic approach to ranking and prioritisation
allows for efficient and effective deployment of capital to drive discovery.
In total, the Company has now defined 37 targets within its portfolio. As a result of the workshop, nine
new targets were identified based on geophysical and geochemical data previously collected and re-
interpreted. These new targets were then combined with existing targets and subsequently assigned a
score based on both conceptual and empirical criteria with the overarching defining criteria being the
potential of the target to host a multi-million-ounce deposit. Three (O-2 West, O-2 East and Grandy's
East) of these nine targets are a result of the Company's successful winter RC drill program at Malachite.
Of the total targets that the Company has identified, 30 are in the early stages of exploration while five
targets are in the intermediate stage and two in the advanced stage, both of which we are currently
drilling within the resource corridor. Another three intermediate targets are part of the phase two
diamond drill program including O-2 West, which delivered the best results from the winter RC drill
program.
FIGURE 2: AUMEGA TOP EXPLORATION TARGETS
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The Company is currently ranking each of the targets and will create more specific work plans for each
that don't currently have them in place. The work plans will be on the top-ranking targets and will include
the scope of work and expected outcomes, including the necessary outcomes required to continue to
advance targets through the exploration pipeline. This work is expected to be completed in the coming
weeks in conjunction with ongoing field exploration work.
Malachite Winter RC Drill Program
During the quarter, the Company announced the completion of the initial winter RC drill program at
Malachite
3
. Approximately 80% of the designed program was completed, including the entire drill
program for the high priority O-2 target, prior to curtailing the program due to continued adverse weather
conditions. In total, 157 holes were drilled in the program.
The reconnaissance-style RC drill program was designed to cover a large, prospective area at the
Malachite Project with an aim to delineate gold and pathfinder anomalies in the bedrock and glacial till
that vector to undercover gold mineralisation. This exploration program is akin to Australian style rotary
air blast and air core programs and Scandinavian style base-of-till programs that have led to major
global discoveries. The RC drill rig proved to be highly productive and far exceeded the output the
Company had expected.
The results of the program
4
identified three large, mineralised zones. The assay results from the initial
batch of the RC drill program have identified two large, mineralised zones located west of the
Company's high-priority O-2 target. This area, which appears to be located on a faulted geological
contact previously interpreted from magnetics and mapping, is located to the northwest of the O-2 target.
This is an area where the Company previously defined two anomalous gold and pathfinder occurrences
in bedrock.
RC drilling intersected significant anomalous gold and copper from drillhole CRC0037 with assays of
627 ppb (0.63 g/t) gold and 1.99% copper only seven metres below surface and 224 ppb (0.2 g/t) gold a
further metre below. These results are considered significant as gold mineralisation along the CRSZ is
typically associated with chalcopyrite within gold-bearing zones including the Central Zone mineral
resource
5
. This target area is now dubbed O-2 West.
The second new, large, mineralised zone now dubbed Grandy's East is located 3.5 kilometres west of
the main O-2 target and is situated within the Grandy's Project area. The target comprises a trend
located on a flat lying plain with virtually no outcrop and complete post-mineralisation cover. In 2022,
prospecting by the Company discovered high-grade float and boulders in the area with gold assays up
to 15.30 g/t gold
6
. Drill hole CRC004 intersected 155 ppb (0.16 g/t) gold in bedrock, approximately 370
metres east of the highest-grade boulder sample and represents the first occurrence of anomalous gold
in bedrock in the area. This trend continues eastward 800 metres where drilling on the next RC drill line
returned anomalous gold associated with a lead-silver-antimony anomalism. Ankerite and sericite
alteration are also present within the trend.
The third zone included a zone with alteration that extended over 1.2 kilometres in strike (FIGURE). The
results also included a large area of basal till gold anomalism indicating a compelling drill target. The
combination of gold and pathfinder anomalism in bedrock, combined with multigram prospecting
samples suggests significant mineralised fluid flow and potential for large under-cover gold deposits.
This area is dubbed O-2 East.
The Company is continuing to analyse the full spectrum of data received from the RC program; however,
the geological team is confident on the definition of several highly prospective diamond drill targets with
the aim of testing them in the second phase of diamond drilling this summer.
FIGURE 3: RC BOTTOM-OF-HOLE PROGRAM AT MALACHITE
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As an exploration targeting tool, the RC program proved to be a relatively low-cost and extremely
efficient method of screening a sizeable area resulting in rapid progression to advanced target
generation. Given the success of the program, the Company will be looking to expand its use in future
exploration campaigns.
FIGURE 4: NEWLY IDENTIFIED GOLD AND SILVER TREND
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Historic Core Analysis
During the June quarter, the Company processed five of the nine geotechnical drillholes that were drilled
in 2022 at Central Zone to support the Company's previous study works
7
. These holes were drilled to
provide geotechnical information for pit wall optimisation, which formed part of the Company's previous
strategy of developing a "starter" mine on the Cape Ray Gold Project. These holes had never been
sampled, however recent relogging of drillhole CGT006 revealed a significant zone of visual
mineralisation in a footwall location that was selected for sampling.
Recent assay results from previously drilled geotechnical diamond drillhole (CGT006) returned 11
metres at 2.39 g/t gold (not true thickness) including 0.55 metres at 8.2 g/t gold from 126.75 metres and
1 metre at 10.3 g/t gold from 135 metres from the Central Zone footwall.
Geotechnical drillhole (CGT005) returned 3 metres at 8.24 g/t gold from 127 metres, including 1 metre at
13.9 g/t gold from 129 metres within the Z41 deposit.
FIGURE 5: OVERVIEW OF THE GEOTECHNICAL DRILLHOLES FROM THE CENTRAL ZONE
DEPOSITS
7
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Early-Stage Activities
The Company's Spring/ Summer exploration program also includes low-cost prospecting. High-value
early-stage exploration works planned include high-resolution airborne magnetics at Bunker Hill where
AuMEGA and historic samples delivered several high-grade gold, silver and copper samples over the
24 kilometres of strike.
The Company is also flying high resolution magnetics at Hermitage to aid the development of
comprehensive geological maps for this highly prospective project. The aim is to advance specific high-
priority areas within the Hermitage Project for future discovery drill programs.
Corporate
Corporate Name Change - AuMEGA Metals Ltd
During the quarter, shareholders overwhelmingly approved the name change from Matador Mining Ltd to
AuMEGA Metals Ltd, with the name becoming effective in early June 2024. The Company's ASX ticker
also changed from MZZ to AAM at that time.
Secondary Listing on TSX-V
On 26 June 2024, the Company's shares commenced trading on the Toronto Stock Exchange's Venture
Exchange (TSXV) under the ticker AUM. There was no equity offering associated with the Listing.
AuMEGA shares are fully fungible across both the ASX and TSXV allowing flexibility for shareholders to
hold and trade shares in either market. Volumes will remain low on this listing until shares transferred
from the ASX and then traded.
The Company believes that having its shares traded on two of the predominant resources exchanges
provides opportunities for exposure to a wider investor base.
Management Changes
The Company's Vice President, Exploration, Crispin Pike will depart the Company effective 28
September 2024. The Company is expected to replace Mr. Pike in due course.
Cash
As at 30 June 2024, the Company had a cash balance of approximately $6.2 million (A$6.8 million). This
compares to a cash balance of $7.7 million (A$8.6 million) in the previous quarter.
Cashflow Discussion
Operating cash outflow for the quarter was $0.3 million compared with $0.5 million in the previous
quarter. The quarter-on-quarter reduction relates to the receipt of a $0.12m rebate for the Junior
Exploration Assistance grant from the Newfoundland and Labrador government.
Exploration expenditure for the June quarter was $1.2 million compared with $0.8 million in the March
quarter. Exploration activities increased with the completion of the initial reverse circulation (RC) drill
program at Malachite and the commencement of the Spring and Summer program.
Share Capital
As at 30 June 2024, the Company had 525,834,322 fully paid Ordinary shares on issue. As at 30 June
2024, there were 57,186,719 unlisted Options outstanding and 9,968,086 unlisted Performance Rights
outstanding, none of which have vested.
Payments to Related Parties
During the quarter, the Company made payments to related parties of $187,000, which were made to
directors' fees and the salary of the Managing Director.
Business Development
Blue Cove Copper Project Option Agreement
8
During the quarter, the Company announced that it had entered into an Option Agreement to acquire the
Blue Cove Copper Project in southeastern Newfoundland, Canada. Blue Cove is an early-stage, copper
± lead, zinc and silver exploration project with samples that graded up to 10.6% copper and up to 106 g/t
silver in historic sampling.