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EUROPA METALS LIMITED - Hole TOD-023D Successfully Completed at the Toral Zn, Pb & Ag Project, Spain

Release Date: 02/09/2019 08:00
Code(s): EUZ     PDF:  
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Hole TOD-023D Successfully Completed at the Toral Zn, Pb & Ag Project, Spain

Europa Metals Ltd
(Formerly Ferrum Crescent Limited)
(Incorporated and registered in Australia
and registered as an external company in
the Republic of South Africa)
(Registration number 4459850)
(External company registration number 2011/116305/10)
Share code on the ASX: EUZ
Share code on AIM: EUZ
Share code on the JSE: EUZ
ISIN: AU0000014342
("the Company")

Hole TOD-023D Successfully Completed at the Toral Zn, Pb & Ag Project, Spain

   -   Drill hole TOD-023D has now been successfully completed.
   -   The entire core sampled from the ‘daughter hole’ (TOD-023D) has been sent for independent
       metallurgical testwork and, accordingly, will not be assayed for updated JORC (2012)
       resource reporting purposes.
            - The metallurgical test results in due course are expected to advance the conceptual
                mine design at Toral and potentially provide a first determination of the concentrate
                products obtainable for potential future sale to smelter operations.
   -   The parent hole (TOD-023) has been sampled and the samples sent for independent analysis
       to potentially inform a JORC (2012) resource update for the Toral Project.
   -   Drilling campaign has now concluded.

Europa Metals, the European focused lead, zinc and silver developer, announces that, further to the
Company’s announcement of 15 August 2019, the ‘daughter hole’ (TOD-023D) has been
successfully completed at its 100% owned Toral-lead-zinc-silver project located in the Province of
Leon, northern Spain (“Toral” or the “Toral Project”). All core samples collected from TOD-023D
have been sent to Wardell Armstrong LLP to commence its independent metallurgical testwork. In
addition, all samples collected from the ‘parent hole’ (TOD-023) have now been sent to ALS
Laboratories for independent assay.
Hole TOD-023D
Drilling parameters for the parent and daughter holes, TOD-023 and TOD-023D respectively, are
presented in the table below. TOD-023D was drilled utilising a wedge from hole TOD-023 at 580m
downhole depth at a shallower and rotated angle in order to intercept the target mineralisation zone
above 12m (approximately 8-9m true thickness), consisting of significant mineralisation encountered
in hole TOD-023 (as announced on 15 August 2019).

  TOD-023       681407      4710017 ETRS89utm29 542.72    713.4                  204.1        -73.2
 TOD-023D       681407      4710017 ETRS89utm29 542.72    749.2                    200         -72

The core from TOD-023 was drilled with an HQ size drill bit, with half of the core being sent for
independent analysis by ALS Laboratories to inform an updated resource model and the Company
expects to receive the assay results over the coming weeks. TOD-023D was drilled as a wedge,
such that the core size was of a smaller diameter, NQ2 drill bit size. Over 58kg of core from TOD-
023D has now been sent to Wardell Armstrong LLP to enable it to commence independent
metallurgical testwork.
The successful completion of TOD-023D represents the end of the drilling campaign, which has
achieved its objective. Accordingly, drilling has stopped and the drill rig has now been demobilised.

Commenting today, Myles Campion, Technical Director of Europa Metals, said:
“I am pleased to report that the first metallurgical samples, from hole TOD-023D, have now been
dispatched for independent metallurgical testwork. We believe that the results from this testwork will
enable us to update flow sheets from the December 2018 scoping study and advance Toral closer
to a pre-feasibility study. In addition, with samples from the ‘parent hole’ TOD-023 having now been
sent for analysis, we look forward to preparing an updated resource model for Toral..”

Commenting today, Laurence Read, Executive Director of Europa Metals, said:
“We continue to make encouraging progress in respect of its stated work programmes and believe
that the data being retrieved from Toral will significantly deepen our understanding of the project as
a whole. We look forward to announcing the results of the analysis being undertaken on the samples
collected from both TOD-023 and TOD-023D in due course. We believe that Toral offers significant
potential for the development of a new, economically robust lead-zinc-silver project in Europe and
look forward to continuing our work with all stakeholders to progress towards this goal.”

Competent Person’s Statement
The exploration results and activity reported in this announcement have been reviewed by Mr James
Hogg MSc, BSc (Hons), MAIG who is a Member of the Australian Institute of Geoscientists. Mr Hogg
has sufficient experience that is relevant to the style of mineralisation and type of deposit under
consideration and to the activity being undertaken to be deemed a qualified person under the AIM
Note for Mining and Oil & Gas Companies dated June 2009. Mr Hogg consents to the inclusion in
this announcement of the matters based on his information in the form and context in which it

For further information on the Company, please visit or contact:

Europa Metals Ltd
Dan Smith, Non-Executive Director and Company Secretary (Australia)
T: +61 417 978 955
Laurence Read, Executive Director (UK)
T: +44 (0)20 3289 9923

Strand Hanson Limited (Nominated Adviser)
Rory Murphy/Matthew Chandler
T: +44 (0)20 7409 3494

Turner Pope Investments (TPI) Limited (Joint Broker)
Andy Thacker
T: +44 (0)20 3621 4120

Brandon Hill Capital (Joint Broker)
Jonathan Evans/Oliver Stansfield
T: +44 (0)20 3463 5000

Sasfin Capital Proprietary Limited (a member of the Sasfin group)
Sharon Owens
T (direct): +27 11 809 7762

The information contained within this announcement is deemed by the Company to constitute inside
information as stipulated under the Market Abuse Regulation (EU) No. 596/2014.

The core objectives of the drilling campaign (initiated in May 2019) were as follows:

1. Drill into the higher-grade core of the Project, as defined within the existing Inferred JORC (2012) resource
2. Target high grade areas within the defined resource to further the Company’s understanding of the project,
   with the aim of increasing confidence in the resource estimate to delineate a portion of the deposit into
   the Indicated resource category; and
3. Obtain a significant sample for metallurgical testwork by independent consultants to determine the
   potential Zn, Pb and Ag concentrate composition from Toral. This sample will provide additional data to
   assist process plant design and discussions with potential offtake parties.
Rig mobilisation
The rig and associated operating crew was supplied by Sondeos y Perforaciones Industriales de Bierzo SA
and was overseen by the Company’s on-site exploration team. The campaign was conducted using a single
drilling rig with assays sent for independent analysis on a rolling basis.

Addison Mining Services Limited (“AMS”) has been retained to carry out a revised independent resource
update in accordance with JORC (2012) following completion of the campaign has been concluded.

Wardell Armstrong LLP has been engaged to conduct the metallurgical testwork from a representative sample
taken from the drilling.
Economic highlights from selected conceptual development scenario
Estimated economic forecasts for Toral based on the current level of work (+/-30%) from the December 2018
Scoping Study comprise:
 • US$110 million net present value (NPV) using a discount rate of 8%;
 • 24.4% internal rate of return (IRR);
 • Estimated US$33 million CAPEX for a proposed 450ktpa design capacity plant, including associated
   auxiliary costs, with infrastructure being situated near portal entrance on the north side of the deposit;
 • Estimated total CAPEX of US$110 million;
 • US$25 per tonne indicative OPEX processing cost at steady state conditions;
 • US$36 per tonne indicative OPEX mining cost utilising mechanised cut and fill; and
 • 15-year production plan, with significant potential for extension.
Basis for announcing economics
The factors that lead the Company to believe that it has a reasonable basis for announcing a production target
and forecast financial information are detailed in the Scoping Study and can be summarised as follows:

Three conceptual underground mining development and production scenarios were considered and developed
throughout the Scoping Study, resulting in the identification of a preferred scenario, highlights from which are
set out below:
 • decline ramp access to the north of the deposit, targeting mine production within the higher-grade core
   towards the centre of the planned mining blocks;
 •    entry to mine via a principal decline reaching various levels;
 •    series of internal mining inclined ramps constructed to access levels;
 •    mechanised cut and fill (MCAF) mining method proposed;
 •    4x4 metre mine standard development size;
 •    a ventilation raise would be drilled (raise-bored) to provide both adequate ambient conditions;
      underground and a second, emergency means of access/egress into the mine;
     • ore transported to a flotation process plant by conveyor or haul truck from the mine and crushed to a
         suitable product for milling;
     • milled ore floated by standard flotation technology to provide lead and zinc concentrate, with silver
         probably reporting to the lead concentrate for sale as a combined product; and
     • 4% Zn Eq cut-off used with potential for mine life extension.
JORC (2012) resource estimate
The Scoping Study was based on a previously announced JORC (2012) resource estimate comprising 16
million tonnes in the Inferred category @ 7.5% Zn equivalent (Pb, Ag), 3.9% zinc, 3.1% lead and 24g/t silver
equating to 640,000 tonnes of zinc, 510,000 tonnes of lead and 13 million ounces of silver*.

     Cut-off                                                                Contained Contained
                                                                                                 Ag Troy
           Tonnes                  Zn Eq   Zn Eq Zn Pb Ag                       Zn        Pb
                     Density g/cm3                                                                 Oz
 4% Zn Eq (Millions)               (Pb)% (PbAg)% % % g/t                     Tonnes    Tonnes
 (PbAg)%                                                                      (000s)    (000s)

   2018      16         2.8          7     7.5  3.9 3.1 24        640          510           13

*Zn Eq (PbAg)% is the calculated Zn equivalent incorporating silver credits as well as lead; (Zn Eq (PbAg)%
= Zn + Pb*0.96 + Ag*0.022). Zn equivalent calculations were based on 3-year trailing average price statistics
obtained from the London Metal Exchange and London Bullion Market Association giving an average Zn price
of US$2,500/t, Pb price of US$2,100/t and Ag price of US$17/oz. Announced on 10 December 2018.

United Kingdom
2 September 2019

Date: 02/09/2019 08:00:00
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