Xanadu Mines drills 0.55% CuEq over 370 metres at Kharmagtai, Mongolia

Xanadu Mines Ltd. [XAM-TSX, ASX] and its joint venture partner Zijin Mining Group Co. Ltd. have delivered further higher-grade drill results during phase 1 infill drilling at the Kharmagtai copper and gold project, Mongolia, in preparation for the prefeasibility study (PFS).

Highlights: New infill drilling conducted in preparation for the PFS has returned strong higher-grade results from the Stockwork Hill deposit. Best downhole intersects include drill hole KHDDH649 that returned 424 metres of 0.36% CuEq (0.26% Cu & 0.21 g/t Au) from 126 metres, including 72.2 metres of 0.72% CuEq (0.41c% Cu & 0.60 g/t Au) from 126 metres & 30.2 metres of 0.89% CuEq (0.50% Cu & 0.76 g/t Au) from 168 metres & 6 metres of 0.96% CuEq (0.86% Cu and 0.19 g/t Au) from 348 metres & 18 metres of 0.66% CuEq (0.54% Cu and 0.23 g/t Au) from 466 metres.

KHDDH650 returned 131m of 0.70% CuEq (0.35% Cu & 0.67g/t Au) from 6m, including 76m of 0.96% CuEq (0.45% Cu & 1.00g/t Au) from 26m, including 38.5m of 1.24% Cu (0.51% Cu & 1.44g/t Au) from 58m & 29m of 1.00% CuEq (0.92% Cu & 0.14g/t Au) from 185m & 41.7m of 0.94% CuEq (0.53% Cu & 0.81g/t Au) from 347m.

KHDDH660 returned 421.25m of 0.48% CuEq (0.33% Cu & 0.28 Au) from 152.75m, including 105m of 0.84% CuEq (0.47% Cu & 0.72g/t Au) from 168m, including 62m of 1.05% CuEq (0.56% Cu & 0.97g/t Au) from 196.75m.

KHDDH653 returned 6.2m of 2.08% CuEq (1.42% Cu & 1.31g/t Au) from 183.8m and 14m of 0.83% CuEq (0.15% Cu & 1.32g/t Au) from 202m.

KHDDH655 returned 370m of 0.55% CuEq (0.41% Cu & 0.28g/t Au ) from 236m, including 106m of 0.80% CuEq (0.56% Cu & 0.48g/t Au) from 386m & 46m of 0.85% CuEq (0.69% Cu & 0.32g/t Au) from 544m, including 12m of 1.35% CuEq (1.00% Cu & 0.69g/t Au) from 578m.

Completed Phase 1 drilling has defined and expanded the volume of higher-grade mineralization within the Stockwork pit, indicating both grade uplift and resource expansion potential.

Building on recent infill drilling success, these newly identified higher-grade zones are expected to enhance the 2021 Mineral Resource Estimate (MRE), currently an Inferred and Indicated Resource of 1.1Bt containing 3Mt Cu and 8Moz Au (1.98Mt CuEq Indicated, 2.33Mt CuEq Inferred);

Interim MRE update to be completed early 4Q CY2023, in preparation for Final PFS MRE during 4Q CY2023, which will include results from Phase 2 (now underway);

Growth-focused discovery exploration drilling at Kharmagtai also continues with 2 diamond rigs; we expect to provide further shallow results, plus first ever deep drilling results during 3Q CY2023.

Xanadu’s Executive Chairman and Managing Director, Colin Moorhead, said, “Our infill drilling program to support the PFS has progressed safely and efficiently and is continuing to demonstrate results in line with or materially better than the 2021 MRE. Results from this Phase One have continued to show upside to the existing Resource that formed the basis for the 2022 PEA and Scoping Study. Pleasingly, we’ve intersected new higher grade zones at Stockwork Hill within the existing Resource boundary, which supports the potential to expand and increase the near-surface high-grade tonnes; a significant value-driver for the open-pit project going forward. Hole KHDDH649 is extremely encouraging, intersecting a high-grade steeply dipping tourmaline breccia, adding at least 120 m vertical extension of known higher grade zones. Not only does it highlight potential for significant grade boosts relative to the existing MRE, but also has dragged high-grade mineralization closer to surface.

Phase Two drilling, currently underway, is focussed on Golden Eagle, Zephyr and West White Hill, and will also address any outstanding issues arising from Phase One. Phase 2 results will then be combined with the Interim MRE to produce a final PFS Mineral Resource update in Q4 CY2023.”

The Phase One infill drilling program for Stockwork Hill, White Hill and Copper Hill is complete. All infill drilling assay results have now been returned for Stockwork Hill. These results demonstrate that the high-grade tourmaline breccia body within the Resource is larger than previous modelling predicted. Several holes encountered materially better grade relative to Resource grade. Significant drill intersections from Stockwork Hill, include:

Four diamond drill rigs are currently focused on Kharmagtai infill drilling, with overarching objective to target areas with potential for future Mineral Resource to Ore Reserve conversion.

The Phase One infill drilling program for Stockwork Hill, White Hill and Copper Hill is complete, with 80 holes completed for a total 33,212m. All results from infill drilling have now been returned for Stockwork Hill.

Phase Two infill drilling is currently underway at Golden Eagle, Zephyr and White Hill West; it is expected to complete mid-August 2023. These results will then be combined with the Interim MRE, with a final PFS Mineral Resource update reported Q4 CY2023.

Xanadu is Operator of the 50-50 JV with Zijin Mining Group in Khuiten Metals Pte Ltd, which controls 76.5% of the Kharmagtai project.