Announcement PDF ASX Announcement | 7 August 2023 Variscan Mines Limited (ASX:VAR) CONTINUITY OF HIGH-GRADE MINERALISATION EXTENDING SOUTHWEST FROM SAN JOSE MINE CONFIRMED Highlights • • • • • Variscan Mines confirms south-west extension and continuity of mineralisation from the San Jose Mine, on the 9km Novales-Udias Trend The extension of mineralisation, along strike, was revealed from new data collated by Variscan Mines which comprised, 131 historical drillholes for 7,398 metres These results materially enlarge the Company’s drillhole database at San Jose Mine; it now consists of 1,114 drill-holes for 95,553 metres Selected historical diamond drilling results over largely unmined areas which connect the San Jose Mine and the Udias Mine workings: o SU3/82 10.90m @ 12.01% Zn, 0.62% Pb o S-89D 14.85m @ 8.17% Zn, 0.64% Pb o S-89D 10.70m @ 8.64% Zn, 0.57% Pb o S-89 4.80m @ 14.36% Zn, 2.17% Pb o SU10/82 6.20m @ 10.23% Zn, 3.00% Pb o S-89A 6.10m @ 5.54% Zn, 0.57% Pb Recent work has established zinc mineralisation extends both south-westerly and northeasterly, on strike, stepping out from the San Jose Mine and will be incorporated into Mineral Resource Estimation work-streams which are underway. Variscan Mines Limited (ASX:VAR) (“Variscan” or “the Company”) is pleased to announce further progress and exploration work at the San Jose Mine, near Novales, located in Cantabria, northern Spain. South-west extension and continuity of mineralisation from the San Jose Mine confirmed The drill-hole data indicates that there is excellent continuity of mineralisation extending, along strike, in a south-westerly direction (Figure 1). The style of zinc mineralisation is identical to that found at the San Jose Mine as it is predominately high-grade zinc sulphides and occurs at the same elevation (i.e., no vertical offset, Figure 2). The data from this drilling extends over an area of natural caves typical of the karstic limestone structures and which has only seen limited mining activity. The findings reported herein are significant as they indicate a linkage over 1.4km between the San Jose Mine and the far more extensive Udias workings (Figure 1). Figure 1. Plan view of drill-hole data illustrating significant exploration potential as mineralisation extends on strike to the south west of San Jose Mine 2 Figure 2. Cross-section of drill-hole data Exploration & Tonnage Upside Potential These results indicating significant exploration potential to the south west of the San Jose Mine follow on from the confirmed significant strike potential of the San Jose mineralised system to the north east, as demonstrated by the previously reported high grade drilling results from Variscan’s step-out drilling (see ASX announcement dated 2 March 2023) and additional data (see ASX announcement dated 25 May 2023). These data and the new findings will be incorporated in the ongoing work-streams and delineation of a JORCcompliant Mineral Resource Estimate, which is underway. Valuable project drill-hole dataset enlarged Variscan has collated and interpreted 131 historical underground drill-holes for approximately 7,398 metres. The enlarged project dataset has now been increased to 1,114 drill-holes for 95,553 metres providing an extremely cost-effective and time-saving approach to progressing towards mineral resource estimation for within and around the San Jose Mine. The newly incorporated data were generated from drilling conducted by Real Compañía Asturiana de Minas (“RCAM”). RCAM was acquired by Asturiana de Zinc, SA (“AZSA”) in 1983. AZSA is now owned by Glencore. 3 Variscan’s Managing Director & CEO, Stewart Dickson said, "This additional drill-hole data shines an even brighter light on the upside potential to the south west of the San Jose Mine. Together with our own drilling and supplementary drill-hole data to the north-east we are now seeing a clear and more robust picture of the scale, continuity and quality of the zinc mineralisation beyond the immediate workings of the San Jose Mine and onto the wider 9km Novales-Udias Trend. This provides significant exploration and tonnage upside potential as well as supports our near-term objectives of mine restart evaluation." ENDS 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 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 Twitter Visit our investor website: www.variscan.com.au 4 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 10 years of full-time exploration experience in MVT-style zinc-lead 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. 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. 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. 5 JORC Table 1, Sections 1 and 2 Criteria JORC Code explanation Commentary Sampling techniques • • • • • Drilling techniques • Drill sample recovery • • • Nature and quality of sampling (e.g., 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 News release. In cases where ‘industry standard’ work has been done this would be relatively simple (e.g., ‘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 (e.g., submarine nodules) may warrant disclosure of detailed information. Drill type (e.g., core, reverse circulation, open-hole hammer, rotary air blast, auger, Bangka, sonic, etc) and details (e.g., 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). 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 • • • The historical sample data referenced in this report relates to exploration undertaken by Real Compania Asturiana de Minas – a mining company operating the Project from the 1950’s to the early 1980’s. This historical data consists of underground core drilling, of which the paper-format core logs and detailed location maps are held at the School of Mines and Energy Engineering at Torrelavega, a faculty of the University of Cantabria. It is understood that all historic drilling was core drilling. Due to the incomplete nature of the historic drilling data and records, including procedures, a comment on the sample representativity or calibration of measurement tools or systems used by historic workers cannot be made. Further comment regarding specific components of the historic drilling is provided in subsequent sections of this table. The data cannot be considered ‘industry standard’ by modern standards. It is understood that most if not all assaying carried out by Real Compania Asturiana de Minas (who carried out the drilling program) was carried out at their own laboratory (Laboratorio Central) in Torres, and that the practice of assaying half-core was the general rule. It has been assumed that all reported assays are representative of technology available at the time, but no reliance has been put on it. This release relates to 131 historical underground drill holes realised by Real Compania Asturiana de Minas within the historical Udias mine system, which are totalling 7397.87m. The records recently obtained, and that were not previously reported by Variscan Mines, are only partially complete with detailed drill collar coordinates not available for 18 holes, hole length information not available for 8 holes, and azimuth+dip information not available for 21 holes, respectively. • The historical underground drilling is understood to be all core drilling. No details of the drilling techniques employed have been identified in the historical data. This includes reference to core diameter(s), core orientation methods, and downhole survey data. No records of the type of drill rig used have been identified. • No records of drill core recovery have been identified for most of the historical drillholes and no historical drill core has been preserved. Where recovery data is available, it typically includes recoveries >90%, however, recoveries as low as 60% have also been recorded. Given the absence of core recovery data, it is not possible to assess the potential relationship between sample recovery and grade. The absence of drill recovery data means that the referenced grades may be subject to either over- or Criteria Logging Sub-sampling techniques and sample preparation Quality of assay data and laboratory tests JORC Code explanation 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 insitu material collected, including for instance results for field duplicate/second-half sampling. • Whether sample sizes are appropriate to the grain size of the material being sampled. • The nature, quality and appropriateness of the assaying and laboratory procedures used and whether the technique is considered partial or total. • For geophysical tools, spectrometres, handheld XRF instruments, etc, the parametres 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 Commentary under-estimation. No assessment or estimation of these effects has been made due to the lack of detailed data. • Hardcopy geological logs have been digitised for the historical holes reported in this news release. No geotechnical logs have been identified. In the absence of detailed data, no comment on whether the logging, where observed, is qualitative or quantitative has be made. • The geological logs have varying degrees of detail. However, basic intervals were digitised. • The historical holes reported in this press release have hard copy logs which include detailed information including: lithological logging, stratigraphic column, downhole deviation, collar XYZ positions, hole orientation, assay results and detailed descriptions. Note that drill collar coordinates are not available for 18 holes, hole length information not available for 8 holes, and azimuth+dip information not available for 21 holes, respectively. No core photography has been identified. • The historical approach to sampling appears selective, mainly guided by visual observation and clearly neither low-grade mineralisation, trace mineralisation, nor “apparent” waste were sampled. No details of the sample preparation techniques have been identified from the historical records, and no supporting sampling procedures have been identified. In many cases, it is not known whether half or whole core was submitted for analysis, though assaying half-core was practised as a rule by Real Compania Asturiana de Minas, with sampling intervals normally ranging from 0.5 to 3.0m. In the absence of data related to the sub-sampling techniques and sample preparation, no comment on the appropriateness of the sample preparation techniques can been made. • No evidence of Quality Control procedures has been identified for the historical holes. This includes evidence of field duplicates or other current industry standard quality control procedures, such as Certified Reference Materials and blanks. In the absence of sample size data, no comment on whether the sample size is appropriate to the grain size of the sampled material can been made for these historical drillholes. • No descriptions of the assaying and laboratory procedures used have been found. It is unknown whether the techniques used were partial or total, though there is evidence that half-core was typically assayed by Real Compania Asturiana de Minas. • No descriptions of quality control procedures adopted for historical drilling by the laboratory, nor any results of any related Quality Control data, have been identified. No comment can be made on whether acceptable accuracy or precision of results has been established. 7 Criteria Verification of sampling and assaying JORC Code explanation • • • • 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. Location of data points • 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 and distribution • 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. Commentary • Due to the historic nature of the results reported, it has not been possible to verify significant intersections. It is not known whether verification of intersections was undertaken by previous operators at the time of drilling. No remaining core from these programmes has been identified to date. • The historic data does not include any twinned holes. It is understood that Variscan may consider twinning historic drill holes as part of the company’s upcoming exploration plans. • No documentation or records of data entry procedures, data verification, data storage (physical and electronic) protocols have been identified. • Historic records consist largely of hardcopy handwritten drill hole summaries. This data was identified and transcribed to Microsoft Excel © and then imported into Leapfrog Geo and Datamine Studio RM for drill hole database validation, significant intersections, and 3D viewing. • Given the absence of detailed historical information relating to the assay data, no adjustment to the assay data has been made. The data has been reported as it was recorded in the original documentation. Variscan have no reason to disbelieve the data as presented in the historical logs, however, understand the limitations of the data for use in reliable and classified mineral resource estimations going forward until assay verification has been achieved to a satisfactory standard. • The method of recording collar coordinates by the historic operating companies has not been identified, but is inferred to have consisted of the use of high-resolution optical geodetic surveying instruments. It is noted that much of the drilling was undertaken prior to the ubiquitous use of modern GPS by industry. The reported underground drillhole collar coordinates have not yet been independently resurveyed, yet a physical check by Variscan geologists confirms their locations are reasonably accurate. • Collar coordinates relating to the historic drill holes reported were identified in a local grid and transformed to the European Terrestrial Reference System 1989 (ETRS89), an earth-centre, earth-fixed geodetic Cartesian reference frame for GIS work. Thus, 2D maps (Figures) used in this report have been made with ETRS89. • Collation and cross-reference of detailed historical maps, level plans and log/tabular hardcopy datasets show a very reasonable degree of relative geospatial correlation. • The historical underground drillholes reported in this news release are not located on a grid pattern, as they were sighted based on accessibility underground, i.e., making use of a laterally extensive network of voluminous natural karstic caves. • Underground collars are generally within 20-60 m of each other with numerous holes from each collar in a radial pattern (fanned out from UG drilling bays). The data is closely spaced due to accessibility underground and the majority of the holes point downwards. • An assessment of the data spacing with regards to its use in the estimation of a Mineral Resource or Ore Reserve has not yet been 8 Criteria JORC Code explanation Orientation of data in relation to geological structure • 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. Sample security • The measures taken to ensure sample security. • The results of any audits or reviews of sampling techniques and data. Audits or reviews Commentary made. • It is not known whether sample compositing was applied. • Mineralisation at the project occurs as stratabound, sub-horizontal 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) composed of ‘stacked’ sub-horizontal lenses. 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-Udias 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. UG drilling is often radial in nature, and no comment can be confidently made on the orientation of drilling in respect of mineralisation orientation, though, as a general rule vertical downward holes are more likely to represent the true thickness of the intersected sub-horizontal mineralised strata. • No records relating to the sample security of historical drilling programs have been identified. • No audits or reviews of the sampling techniques and data have been undertaken for the historical records presented herein. Section 2 Reporting of Exploration Results Criteria JORC Code explanation Commentary Mineral tenement and land tenure status • Exploration done by other parties • Acknowledgment and appraisal of exploration by other parties. Geology • Deposit type, geological setting and style of mineralisation. • The exploitation permit for the Novales-Udias historical mine area that encompasses the San Jose and Udias mines is owned by Variscan Mines and is in good standing. • The author is not aware, at the time of writing, of any environmental issues that could affect ongoing works within these licences. • The author is not aware, at the time of writing, of any environmental or social license issues that could affect ongoing works within these licences, nor any issues with tenure or permission to operate in this region. On the contrary, the socially and environmentally responsible mineral development undertaken by Variscan Mines has resulted to date in an outstanding social license to operate. • The historical data referenced in this news release refer to exploration undertaken by Real Compania Asturiana de Minas – a mining company operating the Project from the 1950’s to the early 1980’s. • The historical data referenced in this news release and undertaken by the historic workers is held at the School of Mines and Energy Engineering at Torrelavega, a faculty of the University of Cantabria. • The mineralisation at the project is considered to be of the Mississippi Valley Type Lead-Zinc with associated structuraland stratigraphy-controlled carbonate dissolution and replacement Zinc-Lead type sulphide mineralisation, where Zinc strongly predominates over Lead. • Mineralisation at the project occurs as stratiform, sub-horizontal Type, reference name/number, location and ownership including agreements or material issues with 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. 9 Criteria Drill hole Information JORC Code explanation • A summary of all information material to the understanding of the exploration results including a tabulation of the following information for all Material drill holes: o easting and northing of the drill hole collar o elevation or RL (Reduced Level – elevation above sea level in metres) of the drill hole collar o dip and azimuth of the hole o down hole length and interception depth o hole length. • If the exclusion of this information is justified on the basis that the information is not Material and this exclusion does not detract from the understanding of the news release, the Competent Person should clearly explain why this is the case. Data aggregation methods • • Relationship between mineralisation widths and intercept lengths • • • In reporting Exploration Results, weighting averaging techniques, maximum and/or minimum grade truncations (eg cutting of high grades) and cut-off grades are usually Material and should be stated Where aggregate intercepts incorporate short lengths of highgrade results and longer lengths of low grade results, the procedure used for such aggregation should be stated and some typical examples of such aggregations should be shown in detail. The assumptions used for any reporting of metal equivalent values should be clearly stated. These relationships are particularly important in the reporting of Exploration Results. If the geometry of the mineralisation with respect to the drill hole angle is known, its nature should be reported. If it is not known and only the down hole lengths are reported, there should be a clear statement to this effect (eg ‘down hole length, true width not Commentary • • • • • • • • • and lenticular, following sub-vertical trends, and with lateral and vertical extensions, with a significant control by steeplydipping feeder faults. Mineralisation in this setting presents as ‘bags’ (pods) composed of ‘stacked’ sub-horizontal lenses. The historical underground data relates to 131 historical drill holes drilled prior to 1983. However, there may be more data that has not been located yet. Collar information (easting, northing, elevation, dip, azimuth, hole length) for the 131 underground drill holes reported is detailed in Appendix 1. Note that collar coordinates are not available for 18 holes, hole length information not available for 8 holes, and azimuth+dip information not available for 21 holes, respectively. Collar information is detailed as it has been identified in historic records. Collar information has not been verified beyond cross-checking with georeferenced detailed plans of the Udias mine and a physical inspection underground to visually confirm their locations. No records of specific gravity or density measurements have been identified. It is noted that some of the drilling was undertaken prior to the cessation of mining activities on the project, and as such some of the mineralisation referenced in this announcement may have been mined out. It is understood that this area will be assessed under the proposed exploration activities which include further assessment of historic mining records and the completion of an underground survey in order to understand the extent of mining activity and the scale of in-situ mineralisation remaining in those zones. No information has been excluded. Historical drill hole data in this announcement has been reported as it was presented in historical records. No records relating to the use of weighted averaging techniques, maximum and / or minimum grade truncations (e.g. cutting of high grades) have been identified. Aggregated intersections stated in the main text of this news release have been calculated as a weighted average based on the sample lengths. They were generally undertaken for consecutive intervals with reported assay data, however, in some cases short intervening intersections were missing assay data, and it was assumed that their zinc and lead grades were zero (which is why, it is inferred, these intervals were not assayed). No metal equivalent grades have been stated. • Due to the irregular form of the mineralisation style which can range from horizontal and gently dipping stratiform mineralisation to vertical, structurally-controlled mineralisation, and the absence (or records) of orientated core, true widths cannot be accurately reported for the historic underground drilling. • For vertical underground drillholes the thickness of mineralisation is likely close to true thickness in the case of sub-horizontal lenticular morphology of sulphide accumulations. • Therefore, interval widths reported refer to downhole length not 10 Criteria Diagrams Balanced reporting Other substantive