ASX Announcement | 2 June 2025 Variscan Mines Limited (ASX:VAR) DRILLING AT UDÍAS MINE CONTINUES TO DELIVER HIGH-GRADE ZINC INTERVALS Highlights • • • • • Underground drilling campaign at the Udías Mine has continued to deliver high-grade zinc (Zn) and lead (Pb) intercepts targeting zones with no historical drilling. Assays from diamond drillholes confirm significant mineralisation: o o o o UDDT016: 8.00m @ 9.60% Zn, 0.02%Pb & 10.00m @ 5.58% Zn, 0.52% Pb UDDT009: 7.10m @ 3.85% Zn, 0.47%Pb & 5.00m @ 5.32% Zn, 0.59% Pb UDDT010: 5.40m @ 5.06% Zn, 0.20% Pb UDDT017: 4.00m @ 4.93% Zn, 0.04% Pb Intervals correlate well with exceptionally high-grade historical face sampling results and lie outside the current Mineral Resource Estimate (MRE) Drilling set to continue along mine development targeting new untested zones to link up with existing MRE zones and beyond to the San Jose Mine Drilling results reported from Udías confirm significant growth potential Variscan Mines Limited (ASX:VAR) (“Variscan” or “the Company”) is pleased to announce a second batch of assay results from its underground drilling campaign at the Udías Mine, part of the Novales (San Jose)- Udías Project in northern Spain. Continued drilling success confirms growth potential This maiden underground drilling campaign within the Udías Mine has been designed to test priority discovery targets in previously undrilled areas. It has successfully discovered new zones of mineralisation and corroborates well with historical face sampling data 1 to confirm that past production from Zn-oxide did not fully exploit the high-grade and zinc-rich primary sulphide mineralisation. The Udías Mine complex has a large footprint of under-explored workings which is along strike from, but currently outside of the existing MRE. Assay results returned from the latest round of diamond drilling indicate that mineralised zones extend well beyond the current geological and MRE model and remain open. 1 Refer ASX Announcement 10 September 2024 The drilling at Udías has also demonstrated strong geological similarity with mineralisation in the San Jose Mine, indicating they are part of the same mineral system. Drilling is continuing to confirm the upside of this largely under-explored yet highly mineralised area. The future drilling plan is move systematically into new target zones along the existing mine development to link up with areas within the existing MRE and the San Jose/Novales Mine. Figure 1. Plan view of southern part of the Udías Mine indicating locations of underground diamond drillholes (new results shown in yellow boxes), mine development and historical face samples 2 Insert shows location relative to the size and scale of the Udías Mine, as well the continuation into the San Jose/Novales Mine to the northeast. 2 Refer ASX Announcement 10 September 2024 2 Figure 2. Plan view of southern part of the Udías Mine indicating areas of drilling results, mine development , future drilling targets to link with zones of current Mineral Resources in north-eastern Udías and beyond to the San Jose Mine 3 Figure 3. Section view indicating Udías Mine drilling results, future drilling target zones to link with the current Mineral Resources and San Jose Mine. Drilling to continue to link to Mineral Resource Estimate and San Jose Mine Drilling at Udías is planned to continue. The Udías Mine is highly prospective and under-explored. The target areas are all located outside of the existing MRE model and are expected to add to an updated MRE, anticipated for later in 2025. Access to the underground mine has allowed mapping, sampling and drilling short (up to ~30 m), cost-effective drillholes. Next Steps & Way Forward The San Jose/Novales-Udías Project continues to progress, with the following demonstrable milestones expected: • • • Results from metallurgical test work for inclusion in the Mine Re-Start (Scoping) Study Results from geotechnical test work for inclusion in the Mine Re-Start (Scoping) Study Further assay results from underground drilling at the Udías Mine Variscan’s Managing Director & CEO, Stewart Dickson, said: “We have always thought that the Udías Mine had potential to grow the Project significantly. Following on from the first batch of outstanding thick, high grade zinc intercepts, this second batch has continued to deliver high-grade results along mine development. With the current drilling outside of the Mineral Resource Estimate, there is genuine potential to add significant tonnage and scale to this high-quality project. 4 Drilling will continue at Udías for the foreseeable future as we explore, define new zones of mineralisation and seek to link up with our existing high-grade Mineral Resource Estimate. It is pleasing to report continued drilling success and we look forward to reporting further drilling results as they become available. We are delivering on our clear strategy to unlock value via re-starting production and exploration at one of the highest-grade, development stage zinc deposits in Europe, which is continuing to produce excellent results and make substantial progress.” ENDS To ask questions directly to the Variscan management team and access media content, visit our interactive investor website at: https://variscan.com.au/s/aa7e61 This ASX announcement has been approved by the Board and authorised for issue by Mr Stewart Dickson, Managing Director and CEO, 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 Jane Morgan Management Chloe Hayes / Jane Morgan E: chloe@janemorganmanagement.com.au / jm@janemorganmanagement.com.au P: + 61 (0) 458619317/ +61 (0) 405 555 618 We encourage all investors to share questions on this announcement via our interactive investor hub: https://variscan.com.au/s/0e58e7 Or scan the QR code. Subscribe to our news alert service: https://variscan.com.au/s/8d46e7 5 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 high-impact 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 Twitter Visit our investor website: www.variscan.com.au Forward Looking Statements Forward-looking statements are only predictions and are not guaranteed. They are subject to known and unknown risks, uncertainties and assumptions, some of which are outside the control of the Company. Past performance is not necessarily a guide to future performance and no representation or warranty is made as to the likelihood of achievement or reasonableness of any forward-looking statements or other forecast. The occurrence of events in the future are subject to risks, uncertainties and other factors that may cause the Company’s actual results, performance or achievements to differ from those referred to in this announcement. Given these uncertainties, recipients are cautioned not to place reliance on forward looking statements. Any forward-looking statements in this announcement speak only at the date of issue of this announcement. Subject to any continuing obligations under applicable law and the ASX Listing Rules, the Company, its directors, officers, employees and agents do not give any assurance or guarantee that the occurrence of the events referred to in this announcement will occur as contemplated. 6 Project Summary The Novales-Udias Project is located in the Basque-Cantabrian Basin, some 30km southwest from the regional capital, Santander. The project is centred around the former producing San Jose underground mine with a large surrounding area of exploration opportunities which include a number of satellite underground and surface workings and areas of zinc anomalism identified from recent and historic geochemical surveys. Variscan has delineated a significant 9km mineralised trend and a sub-parallel 3km trend from contemporary and historical data across both the Buenahora exploration and Novales mining permits. The San Jose Mine is nearby (~9km) to the world class Reocin Mine which is the largest known strata-bound carbonate-hosted Zn-Pb deposit in Spain 3 and one of the world’s richest MVT deposits 4. Further it is within trucking distance (~80km) from the San Juan de Nieva zinc smelter operated by Asturiana de Zinc (100% owned by Glencore). Significantly, the Novales-Udias Project includes a number of granted mining tenements 5. Novales-Udias Project Highlights • • • • • • • • • • • • Near term zinc production opportunity (subject to positive exploratory & development work) Updated JORC compliant Mineral Resource Estimate of 3.4Mt @ 7.6% Zn, 0.9 %Pb released in December 2024 6 Expanded tenement holding of 111 km2 (including a number of granted mining tenements) Regional exploration potential for another discovery analogous to Reocin Mine (total past production and remaining resource 62Mt @ 8.7% Zn and 1.0% Pb 7 8) Trucking distance (~ 80km) from the San Juan de Nieva smelter (Glencore owned) Classic MVT carbonate hosted Zn-Pb district Historic production of high-grade zinc from San Jose Mine; average grade reported as ~7% Zn 9 with super high grade ‘bolsas’ (mineralised pods and lenses) commonly 10-20% Zn and in some instances +30% Zn 10 Maiden drilling at Udias Mine Simple mineralogy of sphalerite – galena – calamine Mineralisation is strata-bound, epigenetic, lenticular and sub-horizontal Access and infrastructure all in place Local community and government support due to historic mining activity Velasco, F., Herrero, J.M., Yusta, I., Alonso, J.A., Seebold, I. and Leach, D., (2003) ‘Geology and Geochemistry of the Reocin Zinc-Lead Deposit, Basque-Cantabrian Basin, Northern Spain’ Econ. Geol. v.98, pp. 1371-1396. 4 Leach, D.L., Sangster, D.F., Kelley, K.D., Large, R.R., Garven, G., Allen, C.R., Gutzner, J., Walters, S., (2005) ‘Sedimenthosted lead-zinc deposits: a global perspective’. Econ. Geol. 100th Anniversary Special Paper 561 607 5 Refer to ASX announcement of 29 July 2019 6 Refer to ASX announcement of 9 December 2024 7 Velasco, F., Herrero, J.M., Yusta, I., Alonso, J.A., Seebold, I. and Leach, D., 2003 - Geology and Geochemistry of the Reocin Zinc-Lead Deposit, Basque-Cantabrian Basin, Northern Spain: in Econ. Geol. v.98, pp. 1371-1396. 8 Cautionary Statement: references in this announcement to the publicly quoted resource tonnes and grade of the Project 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 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. 9 These figures have been taken from historical production data from the School of Mines in Torrelavega historical archives. 10 Reports of the super high-grade mineralisation are supported with historical production data from the School of Mines in Torrelavega historical archives. (Refer ASX release 29 July 2019) 3 7 Figure 4. Map of Novales-Udias Project Licence Areas Figure 5. Map of Novales-Udias Project Licence Areas and local infrastructure 8 Mineral Resource Estimate for Novales-Udias Project JORC Mineral Resource Estimate for San Jose Mine and north-eastern Udías by deposit and classification reported above at 2% Zn+Pb cut-off (ASX announcement 9 December 2024) Competent Person Statement The information in this document that relates to technical information about the Novales-Udias project is based on, and fairly represents information and supporting documentation compiled and reviewed by Dr. Mike Mlynarczyk, Principal of the Redstone Exploration Services, a geological consultancy acting as an external consultant for Variscan Mines. Dr. Mlynarczyk is a Professional Geologist (PGeo) of the Institute of Geologists of Ireland, and European Geologist (EurGeol) of the European Federation of Geologists, as well as Fellow of the Society of Economic Geologists (SEG). With over 14 years of full-time exploration experience in MVT-style zinclead systems in several of the world’s leading MVT provinces, Dr. Mlynarczyk has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the December 2012 edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves” (‘JORC Code’). Dr. Mlynarczyk consents to the inclusion in the report of the matters based upon the information in the form and context in which it appears. Where reference is made to previous releases of exploration results and mineral resource estimates in this announcement, and in particular the ASX announcement dated 9 December 2024 “Three Fold Increase in the High Grade Mineral Resource Estimate for Novales – Udias Project” the Company confirms that it is not aware of any new information or data that materially affects the information included in those announcements and all material assumptions and technical parameters underpinning the exploration results and mineral resource estimates included in those announcements continue to apply and have not materially changed. The information in this document that relates to previous exploration results was prepared pre-2012 JORC code. It is the opinion of Variscan that the exploration data is reliable. Although some of the data is incomplete, nothing has come to the attention of Variscan that causes it to question the accuracy or reliability of the historic exploration. 9 JORC Table 1, Sections 1 and 2 Criteria Sampling techniques Drilling techniques JORC Code explanation • Nature and quality of sampling (eg 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 representativity 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 (eg ‘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 (eg submarine nodules) may warrant disclosure of detailed information. • Drill type (eg core, reverse circulation, open-hole hammer, rotary air blast, auger, Bangka, sonic, etc) and details (eg 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). Commentary • Drilling being reported has been sampled with industry best practice methods (for the sake of representativeness - as full core, because of its comparatively small diameter of 38 mm), and the samples were sent to the accredited ALS Seville laboratory for analysis. The samples are considered representative and include waste intervals on the periphery of mineralised intersections. It is assumed that the equipment used was calibrated correctly as per the internal SOP’s at ALS. • The new drillholes reported are located in the southern part of the Udias – San Jose complex of historic underground mines near Novales, Cantabria. Unlike the San Jose Mine, which produced zinc sulfide until the late 1990s, the much larger Udias mines closed down in 1930 and only produced calamine from the uppermost (oxidized) levels of mineralization, remaining largely undeveloped and underexplored • All the drill holes reported in this news release consist of underground diamond drillholes and were sampled as full core from 30cm to 1.45m sample length (average 1.00m) with at least a single 1m sample either side to cover the periphery of the mineralised intersection. • The analytical method used by ALS is Zn-OG62h for Zinc and Pb-OG62h for Lead, as well as Zn-AA07 for non-sulphide (‘oxide’) zinc. These are considered appropriate for the deposit type. • • The new drillholes referred to in this press release are underground diamond drillholes (core) completed using a Hilti portable drill, at a core diameter of 38mm. These new holes have not employed oriented core methods. 10 Criteria Drill sample recovery Logging Sub-sampling techniques and sample preparation JORC Code explanation • 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. • • • • • If core, whether cut or sawn and whether quarter, half or all core taken. If non-core, whether riffled, tube sampled, 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 sub-sampling stages to maximise representativity of samples. Measures taken to ensure that the sampling is representative of the in-situ material collected, Commentary • Drill core recovery for this batch of underground drillholes was good, in the 82.3% – 100.0% range (average 97.2%). Drill core recovery information has been formally recorded for all drillholes at this time, as it forms part of the detailed core logging. • No special methods have been used to maximise sample recovery; as its occasionally low values are not caused by core loss, but are related to presence of natural voids. • The relationship between sample recovery and grade has not been assessed thus far. • • • • Detailed geological and geotechnical logging has been carried out for all reported drillholes. Currently there is sufficient geotechnical and geological logging data to support a Mineral Resource estimate for the San Jose – Udias complex of historical underground mines, which was recently significantly upgraded, however, the reported drill holes are located outside of the resource area and additional drilling is required to be able to include this drilling area into the mineral resource. Total percentage of holes that have been logged for lithology, veins, alteration, and mineralisation is 100% and the total percentage of new drillholes that has detailed recovery and geotechnical logging is 100% at this stage (based on all logs available). All of the drill core from the reported batch was photographed before sampling, which was especially important, as unlike some of the previous underground drilling campaigns of Variscan Mines, full core was assayed this time. New drillholes have been sampled using reasonable industry procedures for logging (of mineralisation), sampling, and QAQC for this project. The samples were selected by geologists for these new drillholes based on logging of mineralised intervals, and full core was sampled. Samples were preferred at 1m lengths, although they were permitted flexibility from 30cm to 1.45m sample lengths where geological boundaries existed. A minimum of three samples were taken for any mineralised intersection, the first sample encompassing the mineralised zone and the other two samples selected either side to ensure waste intervals were sampled to define the boundaries of mineralisation. Additionally, when a separate geological zone of rubble or broken core began, a new sample was taken and when solid core resumed the next samples were selected. In zones of poor recovery <80% the default sample intervals were the drillers depth markers. The nature and quality of 11 Criteria JORC Code explanation including for instance results for field duplicate/second-half sampling. • Whether sample sizes are appropriate to the grain size of the material being sampled. Quality of assay data and laboratory tests • • • Verification of sampling and assaying • • • • Commentary sampling techniques are considered appropriate for this deposit and drilling type. • All full core samples were sent directly to ALS Seville laboratory for preparation and subsequent analysis, according to industry standards with crushing, pulverizing and splitting prior to sample analysis. • Sample sizes taken for the drilling reported (i.e., full core) are considered suitable for the deposit type and style of mineralisation at this stage of exploration. 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 (eg standards, blanks, duplicates, external laboratory checks) and whether acceptable levels of accuracy (ie lack of bias) and precision have been established. • 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. • • • • • • For the new drilling reported the sampling is considered total as no drill core remains. The laboratory is accredited (ALS Seville) and the techniques for Zn/Pb (Zn-OG62h, Pb-OG62h, and Zn-AA07) are considered suitable for the elements in question. No handheld or downhole geophysics data were collected during this campaign. QAQC Procedures adopted for this batch of drilling results included a total of twenty-five QAQC samples inserted into the sample stream (total of 148 drill core samples, not including QAQC). These included three high-grade CRMs (OREAS 134B) inserted into the mineralised zone, five medium grade CRMs (OREAS 133A) and five low grade CRMs (OREAS 130) inserted in between waste rock or barren samples, as well as six blanks. Also, internal duplicates were requested to ALS for six mineralised samples and these sample ID’s were indicated to the laboratory. In total, for the batch of samples reported within this press release the QAQC samples comprised 16.9% of the sample population submitted for analysis. This frequency and variety of QAQC samples inserted into the sample stream is considered reasonable; with industry best practice typically requiring 10-20% of the sample population to be QAQC samples in the sample stream. The QAQC sample results were interpreted and showed good repeatability. Analytical processes are being supervised by senior ALS staff experienced in mineral assaying. The new diamond drillholes are located in the southern part of the historic Udias underground mine. Primary data for this underground drilling campaign is currently stored in excel and all assay certifications and final assay results provided by ALS Seville have been reviewed. Assay data are reported in two ways within this press release, the first are raw assay values unchanged or altered, and the second are calculated significant intercepts or aggregated consecutive sample intervals using sample length weighted mean grades for Zn and Pb, assuming an ore grade of zero for the intervals with missing drill core (natural voids). 12 Criteria Location of data points Data spacing and distribution Orientation of data in relation to geological structure JORC Code explanation • 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. • • 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 mineralised structures is considered to have introduced a sampling bias, this should be assessed and reported if material. Commentary • The underground drillhole collars reported here were surveyed using a high-resolution SatLab Cygnus Lite handheld SLAM scanner, with the survey tied to reference points located along the main gallery of the Udias mine and surveyed using a total station Leica TS16 P 1´R500 by an external contractor. • All the maps and 3D models referenced in this report were made with ETRS89. • • • • • The reported drillholes have been drilled in various orientations (both downward and upward) from drilling pads underground, and their spacing is variable (see table in Appendix 1). At this stage there is no sufficient distribution of drillholes to support geological and grade continuity for the southern part of the Udias mine, however, underground geological mapping and visuals on zinc mineralization confirm it. Further drilling is required to improve geological confidence in this interpretation. Assay data for the new drillholes are reported in two ways within this press release, the first are raw assay values unchanged or altered and the second are calculated significant intersections or aggregated consecutive sample intervals using sample length weighted mean grades for Zn and Pb. There were occasional sample intervals where drill core could not be obtained due to the presence of natural cavities, these intervals were manually set to 0% Zn and 0% Pb prior to calculating mean grades for intersections. Mineralisation at the project occurs as stratabound, subhorizontal and lenticular, following sub-vertical trends, and with lateral and vertical extensions with a significant control by steeply-dipping feeder fault zones. Mineralisation in this setting presents as ‘bags’ (pods) with sub-horizontal lenticular form. Due to the irregular and/or variable nature of the mineralisation, an estimate of potential bias through orientation of sampling has not been made. While the location of mineralisation centres on the Novales trend follows a broad NNE strike, the orientation of distinct orebodies on this trend is understood to be variable both in terms of strike and dip. Underground drilling is often radial in nature, and no comment can be made on the orientation of drilling in respect of mineralisation orientation. New drillholes have been oriented at a variety of orientations both drilling above and below (positive and negative dips) from the historical mine stopes, to intersect mineralised lenses located above and below. These orientations are considered appropriate for the geometry of this mostly lenticular MVT mineralisation at Udias. 13 Criteria Sample security JORC Code explanation • The measures taken to ensure sample security. Audits or reviews • The results of any audits or reviews of sampling techniques and data. Section 2 Reporting of Exploration Results Criteria JORC Code explanation Mineral • Type, reference name/number, tenement and location and ownership including land tenure agreements or material issues with status 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 licence to operate in the area. Exploration • Acknowledgment and appraisal of done by other exploration by other parties. parties Geology • Deposit type, geological setting and style of mineralisation. Commentary • Samples were securely stored at the locked on-site core shed and were handed directly to a courier for transport to ALS Seville. Samples were logged and collected on site under supervision of the responsible Variscan geologists. No detailed 3rd party audits have taken place regarding the sampling techniques for new drillholes. • Commentary • The drilling reported in this release falls within the San Jose mining