Announcement PDF ASX Announcement | 31 October 2024 Variscan Mines Limited (ASX:VAR) 2024 Annual Report Variscan Mines Limited (“Variscan” or the “Company”) encloses its annual report for the year ended 30 June 2024. This announcement has been approved for release by Mr Mark Pitts, Company Secretary, Variscan Mines Limited. For further information, please contact: Variscan Mines Limited (ASX:VAR) Stewart Dickson Managing Director & CEO E: stewart.dickson@variscan.com.au T: +44 (0) 7799 694195 Media & Investor Enquiries The Capital Network Julia Maguire E: julia@thecapitalnetwork.com.au P: +61 2 8999 3699 About Variscan Mines Limited (ASX:VAR) Variscan Mines Limited (ASX:VAR) is a growth oriented, natural resources company focused on the acquisition, exploration and development of high-quality strategic mineral projects. The Company has compiled a portfolio of highimpact base-metal interests in Spain, Chile and Australia. Its primary focus is the development of its advanced zinc projects in Spain. The Company’s name is derived from the Variscan orogeny, which was a geologic mountain building event caused by Late Paleozoic continental collision between Euramerica (Laurussia) and Gondwana to form the supercontinent of Pangea. To learn more, please visit: www.variscan.com.au For more information Follow us on LinkedIn Follow us on X (formerly Twitter) Visit our investor website: www.variscan.com.au ANNUAL REPORT 2024 Corporate Directory ABN REGISTERED OFFICE 87 095 092 158 5/191 St Georges Terrace Perth, Western Australia Australia Telephone: +61 419 700 493 Email: info@variscan.com.au Website: www.variscan.com.au DIRECTORS Mr Anthony Wehby Non-Executive Chairman Mr Stewart Dickson Managing Director & CEO Mr Nicholas Farr-Jones AM Non-Executive Director Dr Frank Bierlein Non-Executive Director COMPANY SECRETARY Mr Mark Pitts SHARE REGISTRY Boardroom Pty Ltd GPO Box 3993 Sydney NSW 2001 Australia Telephone: +61 2 9290 9600 AUDITORS HLB Mann Judd Level 4, 130 Stirling Street Perth WA 6000 Australia Telephone: +61 8 9227 7500 SECURITIES EXCHANGE LISTING Variscan Mines Limited’s shares are listed on the Australian Securities Exchange (ASX: VAR) 2 VARISCAN MINES ANNUAL REPORT 2024 Contents Contents Corporate Directory 2 Chairman’s Letter 4 Operational Review 6 Annual Mineral Resource Statement 25 Competant Persons Statements 26 Directors’ Report 28 Auditor’s Independence Declaration 44 Consolidated Statement of Profit or Loss and Other Comprehensive Income 45 Consolidated Statement of Financial Position 46 Consolidated Statement Of Cash Flows 47 Consolidated Statement Of Changes In Equity 48 Notes To The Consolidated Financial Statements 49 Consolidated Entity Disclosure Statement 73 Directors’ Declaration 74 Independent Auditor’s Report 76 ASX Additional Information 80 VARISCAN MINES ANNUAL REPORT 2024 3 Chairman’s Letter Chairman’s Letter We are proud of the significant progress made in executing our exploration and development plans for our flagship Novales-Udias Zinc Project in northern Spain during the year ended 30 June 2024 (FY24). This period notably saw the issue of an initial high-grade Mineral are immediately adjacent to the existing San Jose and Buenahora Resource Estimate and secured a new lease agreement over the tenements and contain attractive exploration targets. San Jose mine site and facilities. All of which supports and aligns with our rapidly evolving mine re-start strategy over the NovalesUdias Project. While successfully executing on our plans to grow the scale of the Project we at the same time met another objective, which was the extend the lease on the San Jose Mine site and facilities. This In addition, our exploration activities, led by a successful lease extension, done at a competitive, commercial rate in line underground drilling campaign, have yielded very exciting results. with prevailing local norms for industrial sites, is a key enabler Further, we significantly increased the size of the Novales-Udias to support Variscan’s current activities and future objective Project, via the addition of several new licence areas. mine re-start. We continue to generate momentum and I am pleased to say that Late in FY24 and early in FY25 the Company undertook two further key project development milestones have been realised funding initiatives. The first was a small interim placement in the early part of FY25. which was followed by a Fully Underwritten Renounceable On behalf of the Board of Directors of Variscan Mines, I am Rights Issue to raise approximately $2m. These raisings saw pleased to report on our achievements during the financial year ended 30 June 2024 (FY24). During this year we made significant progress towards bringing the Novales-Udias Zinc Project back strong support from our largest shareholder and also attracted some new sophisticated investors with experience in the natural resources sector. At the time of writing, I am pleased to note the into production. early positive response of shareholders to this Rights Issue. Midway through FY24, Variscan announced its maiden JORC Looking ahead, it is apparent that FY25 will be a transformational Mineral Resource Estimate (MRE) for the historically producing San Jose Mine that lies within the Novales-Udias Project. The Operational Review that immediately follows this Letter will discuss the makeup of this MRE in more detail. A key take-away year for your Company. Completion of the Rights Issue will provide funds and impetus to accelerate project activities. Deliverables set to be released in the near future include an updated Mineral Resource Estimate and a Mine Re-Start Study. We are hopeful from this initial estimate is that San Jose hosts of one of the that both will be well received by investors and the wider market. highest grade zinc mineral resources currently held by an ASX- In closing, I would like to express my thanks to both our listed company. management team and staff for their unwavering commitment The Operational Review also provides shareholders with detail on the exploration successes and associated development activities undertaken during the year. These activities included successful underground drilling campaigns in the San Jose Mine, and a structural geological assessment over the linked San Jose and Udias Mines. The positive results of the drilling and study work have given us confidence that the mineral resources contained in our Novales-Udias asset have significant growth potential. Your over the past year. I also want to show my appreciation to local communities and regional authorities with whom we work, the Government of Cantabria included, for their ongoing support,. I also express my appreciation to our loyal shareholders for their support during FY24 when the share price has not reflected the achievements of the Company. Like all junior mining companies, we have faced tough market conditions. We are well positioned to capitalize on the substantial progress made to date and look Board have undertaken to report an updated MRE by the close of forward to delivering development milestones. calendar year 2024. Yours sincerely Another significant development during FY24 was the realization of our growth ambitions by substantially upsize the Project’s land area. In April 2024, Variscan was conditionally awarded five new exploration licences, comprising 36.66km2 in aggregate, by the Government of Cantabria. These new licences, which boost the Anthony Wehby land package of Variscan’s Novales-Udias Project by around 70%, Non-executive Chair 4 VARISCAN MINES ANNUAL REPORT 2024 VARISCAN MINES ANNUAL REPORT 2024 5 Operational Review Operational Review f Group Highlights – Year in Review Variscan has made great strides in executing its development plan for the Company’s exciting Novales-Udias Zinc Project in northern Spain over the course of the financial year ended 30 June 2024 (FY24). All of our exploration and development activities show demonstrable progress as we continue to advance one of the highest-grade zinc deposits in Europe towards re-starting production. FY24 Highlights ▯ Delivery of an initial maiden high-grade Mineral Resource Estimate ▯ Reporting multiple sets of positive drilling results from a successful, extended, infill and expansion underground drilling campaign defining new zones of high-grade mineralisation ▯ Comprehensive geological assessment and structural targeting study completed by world-renowned expert, Dr. Brett Davis ▯ 70% expansion of the tenure area to +100km2 via the addition of five new licences → new target areas with the potential to increase project scale ▯ New Lease Agreement over the San Jose Mine site and facilities secured Post Period Achievements ▯ Marketing Agreement executed with Square Resources ▯ Newly compiled, assays from historic underground face-sampling and drilling results at the Udias Mine show very high-grade zinc-lead results, confirming mineralization outside of the current Mineral Resource Estimate footprint ▯ Launched fully underwritten Rights Issue to raise ~$2.067m with significant support from Variscan’s major shareholder and attracting new sophisticated and professional investors Future Milestones & Activities in FY25 6 ▯ Maiden underground drilling campaign at Udias Mine ▯ Updated Mineral Resources Estimate ▯ Publication of Mine Re-Start Study ▯ Evaluation of additional assets VARISCAN MINES ANNUAL REPORT 2024 Operational Review f Spain Variscan holds two very attractive zinc-rich, proven producing assets in Spain. Figure 1. Variscan’s Spanish Zinc Projects Novales-Udias Project Variscan Mines’ FY24 exploration and development activities were again focussed on the Company’s flagship Novales-Udias Project, located in the Basque-Cantabrian Basin approximately 30km from the regional capital, Santander in northern Spain. Our work has significantly advanced the project and builds on the compound progress made over preceding years. The results from our exploration activities, especially drilling, and study work, notably the initial Mineral Resource Estimate and structural geology review, have reinforced our confident view that Novales-Udias Project has a realistic prospect of recommencing mining once again. This remains our primary focus and our future work plans align to deliver one of the highest-grade, development stage zinc deposits in Europe towards re-starting production. Key advantages and attributes of the Novales-Udias Project. ▯ A near term zinc production opportunity (subject to further positive exploration and development work) ▯ A maiden JORC compliant Mineral Resource Estimate of 1.08 Mt at 9% Zn defined in FY24 ▯ A large tenement holding of +100 km2 (including a number of granted mining tenements) ▯ Regional exploration potential for further discoveries analogous to Reocin (total past production and remaining resource 62Mt @ 8.7% Zn and 1.0% Pb) 1,2 VARISCAN MINES ANNUAL REPORT 2024 7 Operational Review ▯ Novales Mine is within trucking distance (~ 80km) from the zinc smelter in Asturias ▯ Classic MVT carbonate hosted zinc-lead deposits ▯ Historic production of high-grade zinc; average grade reported as ~7% Zn3 ▯ Simple mineralogy of sphalerite-galena-calamine ▯ Mineralisation is strata-bound, epigenetic, lenticular and sub-horizontal ▯ Reported historic production of super high grade ‘bolsas’ (mineralised pods and lenses) commonly 10-20% Zn and in some instances +30% Zn ▯ Assay results of targeted grab samples taken from within the underground Novales Mine recorded 31.83% Zn and 62.3% Pb4 ▯ Access and infrastructure all in place ▯ Local community and government support due to historic mining activity Note: (1) Velasco, F., Herrero, J.M., Yusta, I., Alonso, J.A., Seebold, I. and Leach, D., 2003 - Geology and Geochemistry of the Reocin Zinc Note: (2) Cautionary statement: references in this report to the publicly stated resource tonnes and grade of the Project (Reocin) are historical and foreign in nature and not reported in accordance with the JORC Code 2012, or the categories of mineralisation as defined in the JORC Code 2012. A competent person has not completed sufficient work to classify the resource estimate as mineral resources or ore reserves in accordance with the JORC Code 2012. It is uncertain that following evaluation and/or further exploration work that following evaluation and/or further exploration work that the foreign/historic resource estimates of mineralisation will be able to be reported as mineral resources or ore reserves in accordance with the JORC Code 2012. Note: (3) These figures have been taken from historical production data from the School of Mines in Torrelavega historical archives Note: (4) Refer to ASX announcement dated 19 December 2019 Award of new licences substantially increases size of the Novales-Udias Project In early April 2024, Variscan’s Novales-Udias Project was significantly increased, after the Company was conditionally awarded five new exploration licences, comprising 36.66km2 in aggregate, by the Government of Cantabria (see ASX announcement dated 8 April 2024). Figure 2. Map of enlarged licence areas and extension of Novales Trend to the North-East 8 VARISCAN MINES ANNUAL REPORT 2024 Operational Review Licence Area Size (km2) Esperanza 34.44 Estela 0.56 Elena 0.28 Candela 1.11 Valeria 0.28 TOTAL 36.66 Table 1. Map of enlarged licence areas and extension of Novales Trend to the North-East These new licences, which have increased the land package of Variscan’s Novales-Udias Project by around 70%, are immediately adjacent to the existing San Jose and Buenahora tenements. They extend the Novales Trend to the northeast to approximately 12 km in strike length. These additional tenements represent a de-risked exploration opportunity for the Company, which extend over very prospective areas, increase the scale of the Novales-Udias Project. One of these newly acquired licences, the Estela licence, hosts the main shaft of the Udias Mine (Pozo Madroño) and some major underground developments, and infills a previous gap in the San Jose licence. This excellent step forward in the growth of the Novales-Udias project has the potential to increase scale and tonnage in this proven, high grade zinc district. This is supported by the positive results from historical exploration, collated by Variscan. The Variscan exploration team identified the location of 53 drillholes over the Esperanza licence area (see Figure 3) which include: ▯ DDH S-21: 6.0m @ 9.62% Zn ▯ DDH S-163: 7.3m @ 6.50% Zn ▯ DDH S-162: 3.2m @ 9.57% Zn. The more significant zinc anomalies identified from historical geochemical sampling typically range 4,000 – 9,000 ppm Zn (maximum 33,600 ppm Zn) and 380 – 2280 ppm Pb, making for compelling drill targets. VARISCAN MINES ANNUAL REPORT 2024 9 Operational Review Figure 3. Map of enlarged licence areas and historical drilling over the Esperanza Licence The future workplan for these new tenements includes drilling with applications already submitted. FY24 Novales-Udias exploration and development activities During the year, the Variscan team have been busy on the ground with all work-streams aligned towards the achievement of an initial JORC-compliant Mineral Resource Estimate as well as working towards the re-start of mining operations. That has been and remains our main effort. Acquiring and interpreting historical data to gain operational leverage Since we acquired the Novales-Udias project, we have sought to acquire available exploration and production data to augment our own fieldwork and studies. Having collated a significant and valuable drilling database, as well as geological and mine plans, we have gained operational leverage. Our extensive geological understanding has been developed efficiently and effectively, saving time and money. In August 2023, Variscan Mines announced exploration and archival work at the San Jose Mine (see ASX announcement dated 7 August 2023) which confirmed a south-west extension and continuity of mineralisation from the San Jose Mine, on the Novales-Udias Trend. The extension of mineralisation, along strike, revealed from new data collated by Variscan Mines, comprised, 131 historical drillholes for 7,398 metres. Undoubtedly this shed a bright light on the upside potential to the south-west of the San Jose Mine and drew focus onto the potential significance of the Udias Mine. This evolved with further positive sampling data reported post period (see ASX Announcement dated 10 September 2024) and has advanced further with Variscan expecting to commence drill-testing the Udias Mine complex for the first time in the fourth quarter of 2024. 10 VARISCAN MINES ANNUAL REPORT 2024 Operational Review Figure 4. Plan view of drill-hole data illustrating significant exploration potential as mineralisation extends on strike to the south west of San Jose Mine Revised structural and geological assessment highlights continuity and new drill targets at San Jose Mine Mid-February 2024 saw Variscan report the findings of a comprehensively updated, structural geological assessment and structural targeting study at the San Jose Mine and the surrounding Novales Trend (see ASX announcement dated 19 February 2024). The study, completed by world renowned expert, Dr. Brett Davis, resulted in a significantly improved understanding of the controls on multi-phase Zn-Pb mineralization within the San Jose and Udias mine systems. Its outcomes confirm the orientation of the dominant structural trends as a highly effective vectoring tool for drilling and future exploration. The study identified new targets within the San Jose Mine for immediate drill-testing and highlighted numerous target zones within the broader Novales – San Jose – Udias corridor. VARISCAN MINES ANNUAL REPORT 2024 11 Operational Review Figure 5. Approximate orientation of the dominant D1 and D2 structures overlaid with existing mine development at the San Jose Mine Figure 6. Interpreted tectonic evolution of the structurally controlled -mineralization-fluid flow system at San Jose 12 VARISCAN MINES ANNUAL REPORT 2024 Operational Review Figure 7. Regional-scale structures overlaid on JORC Exploration Target and proposed surface drillhole locations proximal and further afield to the Udias – San Jose – Novales mine system and Zinc Trend. Variscan quickly started to drill test some of the newly identified targets within the San Jose Mine as part of the ongoing underground drilling campaign at the time. Successful underground drilling campaign yields excellent high grade zinc results and is expanded Drilling is at the centre of our exploration activities and during the reporting period Variscan has been pleased to report multiple sets of positive drilling results. In recent years, the Variscan management team made the decision to acquire its own portable drill rig which means that by using our trained staff, we are able to conduct underground drilling programs efficiently, cost effectively and with a high degree of flexibility. Throughout the reporting period and beyond, having this in-house capability has allowed Variscan to continue drilling in contrast to the wider junior mining sector which signalled reduced drilling activity amid challenging capital market conditions. This strategy has proved highly successful. In October 2023 (see ASX announcement dated 5 October 2023), high grade zinc assay results from underground drilling defined a new lower lens of high-grade zinc mineralization below La Catedral stope in the San Jose Mine. Selected drilling results included: ▯ NDDT007B: 21.85m @ 8.50% Zn, 0.38% Pb ▯ NDDT012: 10.30m @ 5.09% Zn, 0.19% Pb ▯ NDDT007: 23.35m @ 7.09% Zn, 1.72% Pb ▯ NDDT010: 3.80m @ 24.58% Zn, 3.13% Pb ▯ NDDT014: 14.55m @ 5.81% Zn, 0.90% Pb ▯ NDDT008: 9.30m @ 5.18% Zn, 0.13% Pb VARISCAN MINES ANNUAL REPORT 2024 13 Operational Review Figure 8. Plan view of drill-hole data illustrating newly defined La Catedral Lower Lens, Central Zone, San Jose Mine Figure 9. Cross-section of newly defined La Catedral Lower Lens, Central Zone, San Jose Mine 14 VARISCAN MINES ANNUAL REPORT 2024 Operational Review Early March 2024 saw Variscan report the discovery of further high-grade zinc intercepts from its underground diamond drilling program at the San Jose Mine (see ASX announcement dated 4 March 2024). Selected drilling results included: ▯ NDDT027 14.5 m @ 8.93% Zn, 0.50% Pb ▯ NDDT028 6.0 m @ 6.59% Zn, 0.62% Pb ▯ NDDT029 11.6 m @ 8.43% Zn, 1.61% Pb ▯ NDDT020 ▯ NDDT026 7.0 m @ 5.30% Zn, 0.04% Pb 3.0 m @ 5.55% Zn, 0.41% Pb Figure 10. Plan view of new drill-hole data over the Central Zone, San Jose Mine This round of drilling results supported the Mineral Resource Estimate model (having been published in November 2023 – see below for further discussion) with positive infill drill intercepts. It also confirmed the potential for additional lenses below the existing model and further extensions. To follow-up success, the Variscan management team upscaled and extended the drilling campaign, further details of which are set out in post-period exploration results set out below. An initial, maiden high-grade Mineral Resource Estimate published In late November 2023, Variscan announced an initial, maiden JORC Mineral Resource Estimate (MRE) for the historically producing San Jose Mine of 1.1Mt @ 9.0% Zn and 1.2%Pb at a cut-off grade of 2% Zn (see ASX announcement dated 28 November 2023). The maiden MRE for the San Jose Mine is one of the highest grade zinc mineral resources currently owned by an ASX-listed company. VARISCAN MINES ANNUAL REPORT 2024 15 Operational Review Deposit Classification Tonnes (Kt) Zn % Pb % Zn + Pb % Indicated 490 10.0 1.7 11.7 Inferred 250 12.3 1.6 14.0 Sub-total 740 10.8 1.7 12.5 San Jose (NE) Inferred 260 4.7 0.1 4.8 Udîas (NE) Inferred 90 6.5 0.4 6.8 Total Indicated 490 10.0 1.7 11.7 Inferred 590 8.2 0.8 8.9 1,080 9.0 1.2 10.2 San Jose TOTAL Table 2. JORC Mineral Resource Estimate for San Jose Mine and north-eastern Udías by deposit and classification reported above a 2% Zn cut-off Notes: ▯ Due to effects of rounding, the total may not represent the sum of all components. ▯ Mineral resource is reported from all blocks, classified as either Indicated or Inferred, where interpolated block grade is ≥2.0% Zn. ▯ Block model is coded where blocks have been depleted by historical underground mining activities. ▯ A density value of 3 t/m3 is applied to all blocks. Table 11. JORC Mineral Resource Estimate for San Jose Mine and north-eastern Udías by deposit 16 VARISCAN MINES ANNUAL REPORT 2024 Operational Review Resources in the Indicated category represent 45% of the MRE, with grades notably higher (10% Zn) than those in the Inferred category (8.2% Zn), providing potential for significant grade and tonnage increases with infill drilling. Figure 12. Mineral Resource Estimate categories in 3D View Importantly, the deposit is already considered to be of sufficient grade, quantity, and continuity to have reasonable prospects for eventual economic extraction. This initial, maiden resource for the San Jose Mine is a significant milestone for the Company. It validates the success of our exploration activities to date and establishing a platform upon which we can continue to build a resource inventory as well as advance mine re-start assessments. Mineralization remains open along strike, and at depth. Subsequent drilling and exploration work undertaken by VAR has confirmed the potential to grow the MRE. Variscan expect to publish an updated MRE before the end of calendar year 2024. Lease San Jose Mine site & facilities extended; a key enabler supporting our mine re-start strategy In early calendar year 2024, Variscan signed a new agreement to lease the San Jose Mine site and facilities for a period of three years, extendable up to six years, at the option of Variscan, at a competitive, commercial rate in line with prevailing local norms for industrial sites (see ASX announcement dated 29 January 2024). The site owners, Groupo Anibal are a supportive local partner and Variscan shareholder. As this site is already permitted for mineral exploration, development and mining activities, with extensive insitu facilities and infrastructure already in place, the signing of the extended lease is a key enabler to support Variscan’s stated mine re-start strategy. By leveraging these facilities, we can hopefully lower our re-start capex requirements and timeframes. The site confers a number of advantages to Variscan: ▯ 31,199m2 site adjacent to the village of Novales is already permitted for use for mineral exploration, development and mining activities; ▯ Access to the main portal of the underground San Jose Mine; ▯ The site comprises 5 permanent buildings. The total area of constructed buildings is 1,157m2 with the ability add more warehouse area if required; ▯ The property has existing water supply, which is being upgraded and single-phase power. The site was previously supplied with overhead 3-phase power, re-connection will be assessed during Mine Re-Start Study work; ▯ Excellent core logging and storage facilities established (see Figures 14 & 15); ▯ Direct access via sealed roads capable of taking heavy goods vehicles; ▯ Site is within trucking distance (~145km) from the San Juan de Nieva zinc smelter operated by Asturiana de Zinc (100% owned by Glencore). ▯ Site is ~30km southwest from the regional capital, Santander which has an international airport and a deep water port with freight terminals. VARISCAN MINES ANNUAL REPORT 2024 17 Operational Review Figure 13. Aerial view of San Jose Mine Site & Facilities Figure 14. San Jose Mine Site Core Logging Area 18 VARISCAN MINES ANNUAL REPORT 2024 Operational Review Figure 15. San Jose Mine Site Core Storage VARISCAN MINES ANNUAL REPORT 2024 19 Operational Review Guajaraz Project (central Spain). The Guajaraz Project is a prospective brown-field zinc-rich polymetallic opportunity with known mineral occurrences. The Project is located in the highly mineralised Central Zone of the Iberian Massif, which ranks as one of the most mineralised units globally and represents the internal zone of the prolific European Variscan Orogenic belt. Variscan believes Guajaraz represents an excellent, derisked brownfield polymetallic project. Reflective of this belief in the prospectivity of this Project, the Company filed an application with the authorities in Castilla-La Mancha during FY24 for a 3-year extension of the current exploration licence over the Guajaraz tenement area. This 3-year extension, covering the period 2023 through 2026 was granted to Variscan Mines’ local Spanish subsidiary, Variscan La Mancha in late October 2023. f Post FY24 year end Further exploration activities. Subsequent to the end of Variscan’s FY24, exploration activities have continued apace. Extended underground drilling continues to yield positive intercepts Variscan has continued and expanded its drilling activities. In very early FY25, Variscan informed investors that drilling had intersected significant zinc mineralisation outside of the Mineral Resource Estimate model delivering growth potential (see ASX announcement dated 11 July 2024. The strong assay results received from this underground infill and extensional drilling campaign with significant drilling results include: ▯ NDDT033: 14.10 m @ 5.31% Zn, 0.44% Pb ▯ NDDT034: 4.65 m @ 5.49% Zn, 0.14% Pb ▯ NDDT032: 11.00 m @ 6.66% Zn, 0.72% Pb ▯ NDDT035: 4.00 m @ 5.92% Zn, 0.26% Pb Figure 16. Plan view of new drill-hole data over the Central Zone, San Jose Mine 20 VARISCAN MINES ANNUAL REPORT 2024 Operational Review Figure 17. 3D section view of drill-hole locations testing D2 structural targets between Stope 200 and beside the La Caseta Trend in the San Jose Mine Drilling has continued seamlessly from FY24 into FY25. The program is targeting previously untested southwest extensions of the San Jose Mine as well as testing geologically informed potential feeder zones in the central zone of the San Jose Mine. Results are yet to be published. All available drilling results will be incorporated into the Mineral Resource Estimate update scheduled for release in late CY2024 Historic underground face-sampling Sampling data a positive prelude to maiden drilling in the Udias Mine Towards the end of Q1 FY25, (ASX announcement dated, 10 September 2024) Variscan announced that newly compiled, assays from historic underground face-sampling at the Udias Mine had revealed very high-grade zinc-lead results, further confirming mineralization outside of the current Mineral Resource Estimate footprint (see ASX announcement dated 10 September 2024). 337 samples were compiled over distance of 2.2km which includes the following high-grade sample results taken along development drives and faces: ▯ Sample UTS-15: 4.50m @ 26.47% Zn, 19.46% Pb ▯ Sample UTB-65L: 2.80m @ 35.87% Zn, 0.17% Pb ▯ Sample UTB-11: 4.00m @ 21.50% Zn, 0.32% Pb ▯ Sample B-20: 3.00m @ 28.20% Zn, 5.90% Pb ▯ Sample UTB-32: 2.00m @ 36.95% Zn, 0.41% Pb ▯ Sample UTB-132: 2.00m @ 35.39% Zn, 0.07 % Pb ▯ Sample UTB-86: 4.00m @ 16.39% Zn, 2.18% Pb ▯ Sample D-5: 1.55m @ 41.00% Zn, 0.22% Pb These samples together with historic drilling results report August 2023 (see previous discussion above) have supported the definition of exciting high-priority targets for our forthcoming, maiden underground drilling at the Udias Mine, which is due to start in H1 FY25. VARISCAN MINES ANNUAL REPORT 2024 21 Operational Review Figure 18. Plan view of underground f