Exploration Target: Verkhuba Cu-Zn-Pb Deposit

RNS Number : 5888T

East Star Resources PLC

21 March 2023

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF REGULATION 2014/596/EU WHICH IS PART OF DOMESTIC UK LAW PURSUANT TO THE MARKET ABUSE (AMENDMENT) (EU EXIT) REGULATIONS (SI 2019/310) ("UK MAR"). UPON THE PUBLICATION OF THIS ANNOUNCEMENT, THIS INSIDE INFORMATION (AS DEFINED IN UK MAR) IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN.

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21 March 2023

East Star Resources Plc

("East Star" or the "Company")

Independent Exploration Target for Verkhuba Copper-Zinc-Lead Deposit, Kazakhstan

East Star Resources Plc (LSE:EST), which is defining mineral resources in Kazakhstan for the energy revolution, is pleased to announce an independent JORC-compliant Exploration Target conducted by leading resource advisors AMC Consultants on the Verkhuba Copper-Zinc-Lead Deposit on the Rudny Altai VMS belt.

Highlights:

· Exploration Target of 19-23 Mt at 1.0-1.4% Cu and 1.0-1.4% Zn (1.4-1.9% CuEq)

· Exploration Target is defined by 97 drill holes comprising 42,178 m of historical diamond drilling, reviewed by East Star over the past 12 months, providing a reasonable level of confidence in the geological interpretation

· Historical drilling was over 2.89 km² of laterally extensive mineralisation in a grid pattern of circa 100x100 m in the central part of the deposit and 200x100 m on its flanks

· Further possible significant exploration upside exists in drill-ready satellite targets identified in 2022 helicopter electromagnetic ("HEM") survey

· Historical metallurgical test work reported Au and Ag grades in technological samples equal to 0.3 g/t Au and 14.2 g/t Ag indicating potential to further enhance the value per tonne of ore

· Potential for low-CAPEX development using existing processing capacity within the region

· Verification and infill drilling has been planned to upgrade Exploration Target to JORC-compliant resources with drilling expected to commence this summer

Exploration Target Summary Table

Mining method	Tonnes	Zn	Cu	Pb
Mining method	(kt)	(%)	(%)	(%)
Open pit	5,000 - 6,000	0.5 - 0.8	1.4 - 1.8	0.1 - 0.2
Underground	14,000 - 17,000	1.2 - 1.6	0.8 - 1.2	0.1 - 0.2
Total	19,000 - 23,000	1.0 - 1.4	1.0 - 1.4	0.1 - 0.2

· This is an Exploration Target and should not be considered to be a Mineral Resource

· The Exploration Target assumes an open pit mining method with marginal cut-off of 0.38% Cu equivalent and underground mining method with the marginal cut-off of 0.86% Cu equivalent

· A nominal dry density values of 3.0 t/m³ was assumed to be appropriate for the style of mineralisation

· Cu equivalent was calculated using the following metal prices: 3,050 US$/t for Zn, 9,000 US$/t for Cu, 2,250 US$/t for Pb

· Tonnage is reported on dry basis

Chart, diagram Description automatically generated

Figure 1 Micromine model of ore bodies including modelled open pit scenario.

Alex Walker, East Star CEO, commented:

"This Exploration Target validates the statement that the Verkhuba Deposit is a game changer for East Star. The Exploration Target is based on 42,178 m of historical diamond drilling which should require a limited twin drilling programme to upgrade to JORC-compliant resources. The Exploration Target of 19-23 Mt @ 1.4% - 1.9% Cu equivalent is already significant, with potential for additional tonnage in some of the orebodies.

"The Verkhuba Deposit is 2.89 km² within a 30 km² ore district which also includes multiple drill-ready HEM targets. Furthermore, with significant infrastructure already in place and excess processing capacity within the region from both Glencore (Kazzinc) and KAZ Minerals, it may be possible to fast track the Verkhuba Deposit into production with low capital expenditure.

"With high-grade copper mineralisation already identified, significant exploration upside and a potential route to low-CAPEX development, East Star is uniquely positioned for growth in 2023 within a progressive mining jurisdiction. We are eager to commence verification and infill drilling over the Verkhuba Deposit this summer."

Webcast Presentation

A short webcast presentation about the independent Exploration Target for the Verkhuba Copper-Zinc-Lead Deposit by East Star's CEO is available via the Company's website at: https://www.eaststarplc.com/presentations.

Background

East Star Resources commissioned AMC Consultants Pty Ltd ("AMC") to prepare a Mineral Resource Estimate ("MRE") and a conceptual pit optimisation and analysis for the Verkhuba Deposit located in eastern Kazakhstan. For reporting purposes, the MRE was converted to an Exploration Target range under JORC reporting standards.

Exploration of the project area was carried out in the 1950s through to the 1990s, mostly by surface core drilling. Exploration adits and drives were also developed at the Verkhuba Deposit, but the database for underground channel sampling was not available. Mineralised bodies are represented by VMS shallow dipping sheet-like bodies and lenses.

A total of 97 diamond drillholes define the Verkhuba Deposit with a total of 42,178 m of drilling. 62 drillholes were used for the grade estimate. The deposit area was sampled using diamond drillholes at variable spacings - from 200 m x 200 m to 100 m x 100 m spacing.

To establish the Exploration Target, AMC completed the following phases of work:

· Database import and validation

· Classical statistical analysis

· Interpretation and wireframing of mineralised zones using metal equivalent grades available in the database

· Data selection and compositing

· Block model development

· Grade interpolation and model validation

· Preliminary pit optimisation study using a base case scenario

· Pit analysis and a preliminary scoping estimate of the deposit's economic potential

· Development of verification and an infill drilling programme

Geological modelling was completed by AMC which resulted in 59 interpreted and wireframed mineralised bodies. A block model constrained by the interpreted mineralised bodies was constructed with the parent cell size of 5 mE x 5 mN x 2 mRL with standard sub-celling five times in all directions to maintain the volume resolution of the mineralised bodies. Drillhole sample intervals have been composited to 1 m length and were used to interpolate all main modelled grades (Zn, Pb, Cu) into the block model using ordinary kriging (OK) interpolation techniques. Block grades were validated both visually and statistically and all modelling was completed using Micromine software.

Constant average bulk density values of 3.0 t/m³ were applied to each model cell, which was assumed from the historical reports.

Exploration Target

The grade estimate and subsequent Exploration Target allowed an assessment of the integrity of the input data. It was also used to confirm estimation and reporting of exploration potential ranges of tonnage and grades for the Verkhuba Deposit. The Exploration Target is to be reported in accordance with the JORC Code*.

Table 1 shows the Exploration Target for the Verkhuba Deposit for both open pit and underground mining methods. The Exploration Target is based on actual Exploration Results that were obtained during several historical exploration programmes completed between 1950 and 1990 when a total number of 97 diamond holes were drilled totaling 42,178 m. The estimated potential quantity of tonnes and grades are conceptual in nature as there has been insufficient data and evaluation to support estimation of a Mineral Resource. Tonnages and grades are expressed as ranges that are considered appropriate for the Exploration Target. There is no certainty that further exploration, verification drilling, or twinned drilling will result in the estimation of a Mineral Resource. The Exploration Target is not to be considered in any way to represent a Mineral Resource or Ore Reserve.

Table 1 Verkhuba Exploration Target estimate for open pit and underground mining methods

Mining method	Tonnes	Zn	Cu	Pb
Mining method	(kt)	(%)	(%)	(%)
Open pit	5,000 - 6,000	0.5 - 0.8	1.4 - 1.8	0.1 - 0.2
Underground	14,000 - 17,000	1.2 - 1.6	0.8 - 1.2	0.1 - 0.2
Total	19,000 - 23,000	1.0 - 1.4	1.0 - 1.4	0.1 - 0.2

Notes:

· This is an Exploration Target and should not be considered to be a Mineral Resource

· The Exploration Target assumes an open pit mining method with marginal cut-off of 0.38% Cu equivalent and underground mining method with the marginal cut-off of 0.86% Cu equivalent

· A nominal dry density values of 3.0 t/m³ was assumed to be appropriate for the style of mineralisation

· Cu equivalent was calculated using the following metal prices: 3,050 US$/t for Zn, 9,000 US$/t for Cu, 2,250 US$/t for Pb

· Tonnage is reported on dry basis

Following the Exploration Target, AMC made the following findings:

· The quality of procedures for the historical data collection used for the Exploration Target estimate is believed to be of sufficient standard

· The Exploration Target for the Verkhuba Deposit was prepared using data, geological interpretation and understanding, and estimation practices that are appropriate for the style of mineralisation

· The cut-off grades which have been calculated for reporting open pit and underground Exploration Target are considered reasonable and based on justifiable assumptions and parameters

· The Exploration Target has potential to be developed via open pit and underground mining methods, and it has been delineated and reported in accordance with the JORC Code

· Further verification and infill drilling are required to upgrade the current Exploration Target to a Mineral Resource

*Note: Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. The JORC Code, 2012 Edition. Prepared by: The Joint Ore Reserves Committee of The Australasian Institute of Mining and Metallurgy, Australian Institute of Geoscientists and Minerals Council of Australia (JORC).

Next Steps

As part of ongoing studies, AMC recommend that ten new drillholes, twined to historical drillholes, should be drilled as verification holes to support further mineral resource estimation and classification. It is the intention of the Company to drill these holes in summer 2023 to expediate the estimation of JORC- compliant resources over the Verkhuba Deposit.

Upon conversion to JORC-compliant resources, East Star will be able to undertake a Scoping Study on both the open pit and underground development scenarios to confirm the potential economics of the project. East Star hopes to complete and publish the results of this work by the end of 2023.

The Company will abide by industry standard QA/QC protocols for quality assurance and intend on conducting geotechnical logging on all core for the purpose of saving time and money on the subsequent stages of feasibility assessment.

A map of a city Description automatically generated with medium confidence

Figure 2 Arial view of mineralisation with OP outline and planned drillholes (yellow)

Rudny Altai Region

The Rudny Altai region is one of the largest VMS provinces in the world, part of the Central Asian Orogenic Belt. The Company's newest 1794-EL, 1795-EL (containing the Verkhuba Deposit) and 1799-EL licences are located adjacent to the Company's existing 847-EL and 914-EL licences (together, the "Licences"). Administratively, the Licences are within the Shemonaikha District and are extraordinarily well connected to infrastructure. The regional centre of Ust-Kamenogorsk is located 45 km, and its international airport is located 35 km, southeast of the Licences. The railway connecting Ridder (Kazzinc Mine) and Tomsk cities crosses the Licences from the south to the northwest with two railway stations located on the territory of the Licences. There is a network of dirt roads within the Licences that are suitable for driving all year round. A hard-surfaced road from Ust-Kamenogorsk to Shemonaikha crosses the western part of the Licences.

The area is characterised by moderately hilly terrain with elevations ranging between 270 m and 630 m above the mean sea level.

For further information visit the Company's website at www.eaststarplc.com, or contact:

East Star Resources Plc

Alex Walker, Chief Executive Officer

Tel: +44 (0)20 7390 0234 (via Vigo Consulting)

Peterhouse Capital Limited (Corporate Broker)

Duncan Vasey / Lucy Williams

Tel: +44 (0) 20 7469 0930

Vigo Consulting (Investor Relations)

Ben Simons / Peter Jacob

Tel: +44 (0)20 7390 0234

About East Star Resources Plc

East Star Resources is focused on the discovery and development of strategic minerals required for the energy revolution. With an initial nine licences covering 1,321.5 km² in three mineral rich districts of Kazakhstan, East Star is undertaking an intensive exploration programme, applying modern geophysics to discover minerals in levels that were not previously explored. The Company also intends to further expand its licence portfolio in Kazakhstan. East Star's management are based permanently on the ground, supported by local expertise, and joint ventures with the state mining company.

LinkedIn: https://www.linkedin.com/company/east-star-resources/

Twitter: https://twitter.com/EastStar_PLC

The person who arranged for the release of this announcement was Alex Walker, CEO of the Company.

Competent Persons Statement

The information in this Report that relates to the Exploration Target is based on and fairly represents information which has been compiled by Mr Dmitry Pertel who is a member of the Australian Institute of Geoscientists. Mr Pertel has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity that is being undertaken to qualify as a Competent Person, as defined in the 2012 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr Pertel is a full-time employee of AMC Consultants Pty Ltd..

The information in this Report that relates to QAQC (JORC Code Table 1 Sections 1 and 2) is based on and fairly represents information which has been compiled by Dr Mikhail Tsypukov who is a Fellow of the Institute of Materials, Minerals and Mining (UK). Dr Tsypukov has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity that is being undertaken to qualify as a Competent Person, as defined in the 2012 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr Tsypukov is an independent Consulting Geologist (not associated with AMC) and has consented to the inclusion of the matters in this report based on his information in the form and context in which it appears.

JORC Table 1. Verkhuba Deposit

Section 1 Sampling Techniques and Data

(Criteria in this section apply to all succeeding sections)


Sampling Techniques	¡ 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 representivity 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.	¡ The deposit was explored by drilling producing 59 and 76 mm diameter core. Sampling was performed only on mineralised intervals identified by visual core logging and downhole geophysics (X-ray radiometric and/or electric downhole logging). ¡ Mineralised core of different mineralogy was sampled separately at intervals ranging from 0.1 to 2.0 m in length. ¡ 59 mm core was sampled in full, 76 mm core was cut in half, one half of core was sampled for laboratory studies. ¡ Host rocks in hanging wall and footwall of mineralisation were sampled by 1 m long samples, 2-3 samples were collected from each contact. ¡ Non-mineralised core was sampled by 10 m long composite core samples by collecting rock chips every 10 cm of core for rock chemical and mineralogical studies. ¡ In case of low core recovery (<50%) sampling intervals were increase to 3 m to provide enough sampling material for chemical studies. In the opinion of the Competent Person, the sampling techniques were appropriate for the geology, scale of deposit, and are of an acceptable standard for the purpose of data used in estimating an Exploration Target.
Drilling Techniques	¡ 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, face-sampling bit or other type, whether core is oriented and if so, by what method, etc).	¡ Double barrel wireline system was used in Exploration Target definition drilling. ¡ Upper 10-20 m transported deposits were drilled by 132 mm diamond drill bit, followed by 112 mm bit up to depth of 35-70 m below the surface. After casing of drill hole by 89 mm casing pipes, the drilling was continued by 76 mm bit (core diameter 57 mm), followed by 59 mm drill bit (core diameter 42 mm). ¡ Most of the mineralised intervals were drilled with 59 mm drill bits. In the opinion of the Competent Person, the drilling techniques are suitable for estimating Exploration Target: the core sizes are appropriate, but the standards of work completed in the Soviet era should be quantified and compared to the planned verification drill programme. The data obtained using the older drilling techniques is acceptable for the definition of an Exploration Target.
Drill Sample Recovery	¡ 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.	¡ On undisturbed core, the recovery was estimated by dividing of core length by the length of drilling run reduced to 100%. Most of the core was presented by broken and fragmented core and its recovery was measured using weight method. ¡ To increase core recovery on mineralised intervals the length of drilling runs was reduced to 1 m and drill bit load was also reduced. ¡ Core recovery on mineralised intervals was reported above the limit of 70% and above 60% within the bioherm sequence. ¡ There were no requirements on core recovery on non-mineralised intervals and host rocks, where core recovery varied within 23-40% (1987-1990). ¡ No relationship between sample recovery and grade was reported nor it was apparent. In the opinion of the Competent Person, the drill sample recoveries are suitable for data used in estimating an Exploration Target.
Logging	¡ 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.	¡ All drill holes were geologically logged except upper sections of drill holes with transported sediments, however only limited original information from geological archives has been obtained to date. ¡ No results of historical geotechnical logging are available. ¡ Historical logging was qualitative, in many cases rock nomenclature is not confirmed by rock chemistry and by other exploration campaigns. ¡ No core photos were taken during historical exploration. In the opinion of the Competent Person, the available geological logging is sufficient to support estimate of an Exploration Target.
Sub-sampling Techniques and Sample Preparation	¡ 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 representivity of samples. ¡ Measures taken to ensure that the sampling is representative of the in situ 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.	¡ 57 mm core was cut along the core axe, half core subsamples were taken for control purposes. 42 mm core was sampled in full, no geological duplicates were available for control purposes. ¡ Sample preparation was robust and included all necessary procedures, including multiple crushing controlled by sieving, staged size reduction, pulverizing and collection of one analytical sample and three duplicates of sufficient weight for analytical studies. ¡ Sample size was appropriate to the grain size of the sampling material. The Competent Person's opinion that the subsampling techniques and sample preparation were suitable for data used in estimating an Exploration Target.
Quality of assay data and laboratory tests	¡ 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.	¡ Atomic absorption spectral analysis was used for determination of Cu, Pb and Zn. Fire assay analysis with atomic absorption finish was use for determination of Au and Ag. ¡ Analytical test results for Cu, Pb and Zn on main and duplicate samples performed in main and umpire laboratories demonstrated discrepancy within the acceptable limits. ¡ There is no available information on internal QAQC procedures in main and umpire laboratories. The Competent Person is satisfied that the overall quality of the assay results is acceptable and fit for the purpose of estimating an Exploration Target.
Verification of Sampling and Assaying	¡ 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.	¡ No verification drilling has been performed by ESR at this stage. ¡ No twinning of historical drill holes was performed by ESR. ¡ Limited primary historical data as core lithological and structural logs, drill hole inclination etc. is available by the time of preparation of the report. ¡ Location of mineralised intervals can be corrected after obtaining of historical topographic survey results, drill hole logs and on-site inspection. No control or verification results were available at the time of reporting; thus estimated grades and tonnes were not classified.
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.	¡ Location and deviation of historical drill holes was digitised from georeferenced geological sections and maps at scale 1:10,000, which is considered as appropriate for Exploration Target mineral inventory. ¡ By the time of preparation of the report no historical drill hole logs with collar coordinates were available. ESR is in the process of obtaining this information from geological archives. ¡ Topography of the deposit area was presented as digital terrane model with sufficient resolution which is considered as appropriate for Exploration Target mineral inventory. The Competent Person is satisfied that the location of data points is fit for the purpose of estimating an Exploration Target.
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.	¡ Data spacing is appropriate for delineation of Exploration Target assessment of volume of mineralised material and metal endowment and grades. ¡ Historical data spacing and distribution is sufficient to establish mineralised bodies, continuity of lithology and grade appropriate for delineation of Exploration Target. Verification drilling and twinning of some drill holes are required for subsequent Mineral Resource Estimate in Inferred and Indicated categories. ¡ Exploration grid includes 97 diamond holes drilled with 200 m by 200 m to 100 m by 100 m spacing. ¡ Most mineralised zones do not outcrop, but some of them do outcrop. Mineralised bodies were traced to a depth exceeding 800 m from the surface, using adit levels and inclined core drillholes. Drillholes were located along the profiles, oriented across the mineralised bodies strike, the profiles strike at 100-105º. The Competent Person is satisfied that data spacing is appropriate for estimating an Exploration Target.
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.	¡ Most of the drill holes were sub-vertical, intersecting of flat lying lithology at steep angles. Thus, no correction of width of mineralised intersections was applied which is considered as appropriate to the considered deposit type. ¡ The sampling orientation was appropriate for the reliable sampling of the identified structures, considering the mineralisation type. ¡ Drilling profiles were oriented across the mineralisation. ¡ The flat lying mineralised bodies were sampled by inclined or vertical drillholes, oriented across the mineralised zone strike. ¡ Sampling bias from the orientation of the drilling was not identified. The Competent Person is satisfied that orientation of data in relation to geological structure is appropriate for estimating an Exploration Target.
Sample Security	¡ The measures taken to ensure sample security.	¡ Not appropriate. All historical core and laboratory samples were disposed of shortly after completion of exploration programmes.
Audits or Reviews	¡ The results of any audits or reviews of sampling techniques and data.	¡ As far as Competent Person aware, there were no audits or reviews of sampling techniques and data related to Verkhuba deposit performed by any third party.

Section 2 Reporting of Exploration Results

(Criteria listed in the preceding section also apply to this section)

Mineral Tenement and Land Tenure Status

¡ 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.

¡ Verkhuba deposit is located in the eastern part of exploration licence 1795-EL, owned by Discovery Ventures Kazakhstan Ltd. The licence was issued on 27 July 2022 for initial period of 6 years with a possibility of further five years extension subject to reduction of the licence area by 40%. The licence has an area of 37.1 km² and contains VHMS deposits Pokrovskoe-2 (mined out in 1960-1970^th) and Verkhuba and several VHMS occurrences. No native title interests, historical sites, wilderness or national park and environmental setting identified by ESR appointed environmental consultants.

¡ Discovery Ventures Kazakhstan Ltd is a 100% owned entity of East Star Resources.

¡ Ministry of Industry and Infrastructural Development of the Republic of Kazakhstan does not carry any negotiations with any other party in respect of the property. All required documents including Exploration programme, Environmental impact assessment (EIA) and enhanced technical and economic calculations studies are completed by ESR and approved by the Kazakhstan mining authorities allowing ESR to perform exploration on the property.

¡ According to Kazakh mining legislation, exploration licence can be converted to mining licence after completion of exploration in case the applicants is compliance with qualification requirements of Subsoil Use Code of the Republic of Kazakhstan.

The Competent Person is satisfied that mineral tenement and land tenure status are appropriate for Exploration Target estimation.

Exploration done by other parties

¡ Acknowledgment and appraisal of exploration by other parties.

¡ The deposit was discovered in 1948-1949 during geological survey at scale 1:50,000 of topographic sheets M-44-57-D and M-44-69-B (Yakovlev et al., 1950)

¡ Several exploration campaigns through 1950-1990s were carried out within the deposit area by East Kazakhstan Geological Enterprise mostly by surface core drilling:

o 1956-1957 (Yusupov et al., 1957);

o 1970-1972 (Anoshin et al., 1973);

o 1974-1976 (Rodionov et al., 1976);

o 1985-1987 (Radchenko et al., 1987);

o 1987-1990 (Grigorovich et al., 1990);

¡ Exploration adit and drives totalling 3001 m were also developed at the deposit, but the database for underground channel sampling and metallurgical sampling was not available.

¡ Historical exploration was completed in 1990 by Technical Economic Consideration supported by Mineral Resource Estimate (Yermolaev et al., 1990).

Geology

¡ Deposit type, geological setting and style of mineralisation.

¡ Verkhuba polymetallic deposit belongs to volcanogenic hosted massive sulphide deposit type (VHMS), formed in Devonian time within Rudny Altai VHMS province as a result of hydrothermal activity in the vicinity of spreading centre or subduction zone.

¡ Mineralised bodies are represented by shallow dipping thin sheet-like bodies and lenses hosted mainly by volcanogenic sedimentary rocks including, tuffaceous siltstone and sandstone, marl, carbonate rock, felsic tuff and lava.

¡ Mineralisation is considered as a distal to a volcanic centre due to significant amount of sedimentary rocks. Mineralised bodies are controlled by a contact of Berezovskaya and Losishinskaya suites (Eifelian-Frasnian stages) and are represented by disseminated, string and massive Cu-Zn mineralisation.

The Competent Person is satisfied that geological understanding of this deposit is appropriate to support Exploration Target estimation.

Drill hole Information

¡ 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:

- easting and northing of the drill hole collar

- elevation or RL (Reduced Level - elevation above sea level in metres) of the drill hole collar

- dip and azimuth of the hole

- down hole length and interception depth

- 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 report, the Competent Person should clearly explain why this is the case.

¡ Verkhuba VHMS deposit had been explored by sub-vertical or steeply dipping drill holes that provided a grid of ca. 100x100 m in the central part of the deposit and 200x100 m on its flanks.

¡ The area studied by drilling is approximately 1.7 x 1.7 km and contains 97 drill holes, totalling 42,178 m. The drill holes varied in length from 120 to 893 m (average length of 434 m).

¡ Polymetallic mineralisation was intersected on several stratigraphic levels at depth from to 13.5 to 849 m below the surface.

¡ Information on historical drilling, including collar coordinates, drill hole inclination and length was extracted by ESR from georeferenced geology maps and geological sections at scale 1:10 000. Depth of mineralised intervals and grades were taken from historical mineral resource estimate reports (Ermolaev et al., 1990, Grigorovich et al., 1990) and require verification and correction during the follow-up exploration and delineation of JORC Code-compliant Mineral Resources.

¡ A table of drill hole collars and relevant mineralised intersections is presented in the report.

¡ All the available geological information has been included into the report.

Data Aggregation Methods

¡ 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 high grade 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.

¡ Exploration results are not the subject of this report.

¡ The following metal equivalent calculations were used:

No metallurgical metal recoveries were not applied in the metal equivalent formula dues to the conceptual nature of the estimate of Exploration Target.

Copper equivalent was calculated using conversion factor of 0.3389 for zinc and 0.2500 for lead. Metal prices used were 9,000 US$/t for copper, 3,050 US$/t for zinc and 2,250 US$/t for lead.

The resultant formula was: CuEq = Cu(%) + Zn(%) x 0.33889 + Pb(%) x 0.250000

Where: CuEq - copper equivalent (%), Zn - in situ zinc grade (%), Cu - in situ copper grade (%), Pb - in situ lead grade (%).

The Competent Person is satisfied that appropriate data aggregation methods have been applied to support Exploration Target estimation.

Relationship between Mineralisation widths and intercept lengths

¡ 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 known').

¡ Exploration results are not the subject of this report.

¡ No true thickness of mineralisation has been calculated in the current study.

¡ Relationships between thickness of mineralisation and length of intercepts were interpreted during historical exploration by core observations and correlation of lithology and mineralisation between adjacent drill holes confirming flat lying stratigraphy and polymetallic mineralisation concordant to layering.

¡ According to historical reports most of drill holes were steeply dipping or sub-vertical and intersected mineralisation at steep angle so it is assumed that the width of mineralised intervals in most drill holes is close to true thickness of mineralisation.

Diagrams

¡ Appropriate maps and sections (with scales) and tabulations of intercepts should be included for any significant discovery being reported These should include, but not be limited to a plan view of drill hole collar locations and appropriate sectional views.

¡ Historical geology maps and sections at scale 1:10,000 are included into the report as well as and most significant historical mineral intersections.

Balanced Reporting

¡ Where comprehensive reporting of all Exploration Results is not practicable, representative reporting of both low and high grades and/or widths should be practiced to avoid misleading reporting of Exploration Results.

¡ Mineral inventory presented in the report is based on historical drilling results including both barren and mineralised drill holes.

¡ All material historical exploration results and conclusions in which the authors are confident in are reported, as well as main concerns related to continuation of mineralisation.

Other Substantive Exploration Data

¡ Other exploration data, if meaningful and material, should be reported including (but not limited to): geological observations; geophysical survey results; geochemical survey results; bulk samples - size and method of treatment; metallurgical test results; bulk density, groundwater, geotechnical and rock characteristics; potential deleterious or contaminating substances.

¡ Based on historical drilling results, a Technical-Economic Consideration supported by a historical mineral resource estimate was produced by Ermolaev et al.(1990). The historical resource estimate considered three cut-off grades 3.0, 2.0 and 0.8% sum of metals (Zn equivalent), minimal thickness of mineralised bodies as 1.6 m and maximal thickness of barren rocks included into the mineralised interval - 3 m. Results of the estimate are presented in table below.

Cut-off grade	Ore	Cu	Pb	Zn	Cu	Pb	Zn	Au	Ag
%	Kt	%	%	%	Kt	Kt	Kt	t	t
3.0	2,714	1.84	0.27	4.65	49.90	7.41	126.25	0.81	38.50
2.0	5,445	1.34	0.22	3.19	74.62	4.73	173.94	1.66	77.30
0.8	10,897	1.14	0.14	1.91	124.22	15.68	208.54	3.27	154.70

¡ Au and Ag resources were calculated based on Au and Ag grade in technological sample №4 equal to 0.4 g/t Au, 14.2 g/t Ag.

¡ Au and Ag recovery to concentrates was below 50%:

Cut-off grade	Cu concentrate		Zn concentrate		Pyrite concentrate		Tailings
%	Au	Ag	Au	Ag	Au	Ag	Au	Ag
3.0	11.15	51.93	15.5	31.26	15.37	4.7	57.98	12.17
2.0	8.29	38.5	12.8	21.45	15.81	27.24	63.82	12.81
0.8	6.89	31.96	6.28	11.2	23.78	43.5	63.05	13.34

¡ Bulk density for mineralised material was estimated as 3.0 t/m³ based on 500 samples collected from drill core and underground channels.

¡ It was concluded by Ermolaev et al. (1990) that the mining could be profitable with 3 % of sum of metals as a cut-off grade in accordance with economic conditions and costs of 1990.

¡ According to Yermolaev et al. (1990), total of 9 metallurgical tests were performed on Verkhuba mineralised material by Central Laboratory of East Kazakhstan Geological Expedition (Vostkazgeologia) and All Union Scientific Institute (VNIIzvetmet, Ust-Kamenogorsk, 1989) . The 9 individual and composite samples differed in ore mineralogy and varied in weight from 14 to 1500 kg. Several treatment schemes were applied producing Cu, Pb, Zn and pyrite concentrate with the recovery varying within 86-96% (Cu), 75-85% (Pb), 75-94% (Zn), 48-60 (pyrite). Based on test results it was recommended to use bulk-differential flotation which provide 83-84% Cu and Zn recovery to concentrates.

Further Work

¡ The nature and scale of planned further work (eg tests for lateral extensions or depth extensions or large-scale step-out drilling).

¡ Diagrams clearly highlighting the areas of possible extensions, including the main geological interpretations and future drilling areas, provided this information is not commercially sensitive.

¡ ESR intends to verify continuity and grades of mineralisation and perform metallurgical test work, hydrogeological and geotechnical and other appropriate studies.

¡ Model geology of the deposit using results of verification and infill drilling and whole rock geochemistry.

¡ Produce JORC compliant Mineral Resource Estimate at Indicated and Inferred categories by completion of field and laboratory programme.

The Competent Person is satisfied that the proposed work is appropriate to support subsequent objectives.

Section 3 Estimation and Reporting of Mineral Resources

(Criteria listed in Section 1, and where relevant in Section 2, also apply to this section)

AMC comments that this section is provided to support some aspects of the determination of the Exploration Target. It is not strictly required for public reporting of an Exploration Target nor are all items applicable to an Exploration Target. AMC provides this information for the purposes of transparency and materiality.


Database Integrity	¡ Measures taken to ensure that data has not been corrupted by, for example, transcription or keying errors, between its initial collection and its use for Mineral Resource estimation purposes. ¡ Data validation procedures used.	This relates only to the estimation of an Exploration Target which is conceptual in nature. A database with 97 diamond holes was used for estimation of Exploration Target of the deposit. The historical database was created based on previous studies, in accordance with the mining industry regulations of the USSR and Russia. All historical drilling results were entered into electronic database in Excel format. The following error checks were carried out during the final database creation: ¡ Missing collar coordinates ¡ Missing values in fields FROM and TO ¡ Cases when FROM values equal or exceed TO ones (FROM≥TO) ¡ Data availability. The data availability was checked for each drillhole in the tables: ¡ Collar coordinates ¡ Sampling data ¡ Downhole survey data ¡ Lithological characteristics ¡ Duplicate drillhole numbers in the table of the drillhole collar coordinates. ¡ Duplicate sampling intervals ¡ Duplicate downhole measurement data ¡ Duplicate intervals of the lithological column ¡ Sample "overlapping" (when the sample TO value exceeds FROM value of the next sample). ¡ Negative-grade samples. The Competent Person is satisfied that database integrity is appropriate to support Exploration Target estimation.
Site Visits	¡ Comment on any site visits undertaken by the Competent Person and the outcome of those visits. ¡ If no site visits have been undertaken indicate why this is the case.	¡ No site visit was deemed necessary for determination of an Exploration Target.
Geological Interpretation	¡ Confidence in (or conversely, the uncertainty of ) the geological interpretation of the mineral deposit. ¡ Nature of the data used and of any assumptions made. ¡ The effect, if any, of alternative interpretations on Mineral Resource estimation. ¡ The use of geology in guiding and controlling Mineral Resource estimation. ¡ The factors affecting continuity both of grade and geology.	This relates only to the estimation of an Exploration Target which is conceptual in nature. The interpretation of the mineralised structures was based on geological logging and metal equivalent grades, and also used scanned and georeferenced historical geological cross sections. Different metals were not interpreted separately. ESR supplied AMC with the validated database, topography surface and scanned cross sections with interpreted geology of the deposit and mineralised bodies. There is a reasonable level of confidence in the geological interpretation of the main mineralised bodies is traceable over a number of drillholes and drill sections. Drillhole intercepts with geological logging, assay results and structural interpretations have formed the basis for the geological interpretation. Interpretation of the main polymetallic mineralised envelopes forms the basis for modelling. 0.5% Zn equivalent was used to interpret polymetallic mineralisation. The Competent Person is satisfied that the geological interpretation is appropriate to support determination of an Exploration Target.
Dimensions	¡ The extent and variability of the Mineral Resource expressed as length (along strike or otherwise), plan width, and depth below surface to the upper and lower limits of the Mineral Resource.	This relates only to the estimation of an Exploration Target which is conceptual in nature. 59 sheet-like flat-lying mineralised bodies were interpreted and modelled at the deposit. All modelled bodies vary in size. The largest one is over 1,100 m along strike and over 1,000 m across strike with an average thickness of about 2 m. All other bodies are smaller with the length along and across strike of about 100 to 200 m. The depth below surface varies from 0 m to 800 m. The Competent Person is satisfied that the dimensions interpreted are appropriate to support determination of an Exploration Target.
Estimation and Modelling Techniques	¡ The nature and appropriateness of the estimation technique(s) applied and key assumptions, including treatment of extreme grade values, domaining, interpolation parameters and maximum distance of extrapolation from data points. If a computer assisted estimation method was chosen include a description of computer software and parameters used. ¡ The availability of check estimates, previous estimates and/or mine production records and whether the Mineral Resource estimate takes appropriate account of such data. ¡ The assumptions made regarding recovery of by-products. ¡ Estimation of deleterious elements or other non-grade variables of economic significance (eg sulphur for acid mine drainage characterisation). ¡ In the case of block model interpolation, the block size in relation to the average sample spacing and the search employed. ¡ Any assumptions behind modelling of selective mining units. ¡ Any assumptions about correlation between variables. ¡ Description of how the geological interpretation was used to control the resource estimates. ¡ Discussion of basis for using or not using grade cutting or capping. ¡ The process of validation, the checking process used, the comparison of model data to drill hole data, and use of reconciliation data if available.	This relates only to the estimation of an Exploration Target which is conceptual in nature. A preliminary block model was based on surface diamond drill core using ordinary kriging (OK) to form 5 x 5 x 5 m blocks. The block model was constrained by wireframes modelled using sectional interpretation at a nominal 0.5% ZnEq wireframing cut-off grade for mineralisation. All parameters and estimates supporting the Exploration Target are preliminary. The Competent Person is satisfied that estimation and modelling techniques are appropriate to support Exploration Target estimation.
Moisture	¡ Whether the tonnages are estimated on a dry basis or with natural moisture, and the method of determination of the moisture content.	This relates only to the estimation of an Exploration Target which is conceptual in nature. Moisture was not considered in the bulk density assignment and all tonnage estimates were based on dry tonnes. The Competent Person accepts that moisture was not considered due to the conceptual nature of an Exploration Target.
Cut-off Parameters	¡ The basis of the adopted cut-off grade(s) or quality parameters applied.	This relates only to the estimation of an Exploration Target which is conceptual in nature. Nominal cut-off grades of 0.38% CuEq and 0.86% CuEq (copper equivalent) were used to report the Exploration target for open pit and underground mining methods respectively. Cut-off grades were based on open pit and underground mining methods, according to an ESR's in-house estimates of unit costs and using metal's spot prices at the day of reporting. Copper equivalent was calculated using the following metal prices: 3,050 US$/t for Zn, 9,000 US$/t for Cu, 2,250 US$/t for Pb. The Competent Person is satisfied that cut-off parameters were appropriately considered, to support an Exploration Target.
Mining Factors or Assumptions	¡ Assumptions made regarding possible mining methods, minimum mining dimensions and internal (or, if applicable, external) mining dilution. It is always necessary as part of the process of determining reasonable prospects for eventual economic extraction to consider potential mining methods, but the assumptions made regarding mining methods and parameters when estimating Mineral Resources may not always be rigorous. Where this is the case, this should be reported with an explanation of the basis of the mining assumptions made.	This relates only to the estimation of an Exploration Target which is conceptual in nature. Mining is assumed to be by open pit and underground methods. Mining losses were assumed to be 5% and mining dilution was assumed 5% for open pit mining, and 10% dilution was assumed for underground mining method.
Metallurgical Factors or Assumptions	¡ The basis for assumptions or predictions regarding metallurgical amenability. It is always necessary as part of the process of determining reasonable prospects for eventual economic extraction to consider potential metallurgical methods, but the assumptions regarding metallurgical treatment processes and parameters made when reporting Mineral Resources may not always be rigorous. Where this is the case, this should be reported with an explanation of the basis of the metallurgical assumptions made.	This relates only to the estimation of an Exploration Target which is conceptual in nature. No material assumptions are considered at this stage. The Competent Person is satisfied that conceptual metallurgical factors and assumptions were appropriately considered to support Exploration Target estimation.
Environmental Factors or Assumptions	¡ Assumptions made regarding possible waste and process residue disposal options. It is always necessary as part of the process of determining reasonable prospects for eventual economic extraction to consider the potential environmental impacts of the mining and processing operation. While at this stage the determination of potential environmental impacts, particularly for a greenfields project, may not always be well advanced, the status of early consideration of these potential environmental impacts should be reported. Where these aspects have not been considered this should be reported with an explanation of the environmental assumptions made.	This relates only to the estimation of an Exploration Target which is conceptual in nature. No environmental factors or assumptions were made.
Bulk Density	¡ Whether assumed or determined. If assumed, the basis for the assumptions. If determined, the method used, whether wet or dry, the frequency of the measurements, the nature, size and representativeness of the samples. ¡ The bulk density for bulk material must have been measured by methods that adequately account for void spaces (vugs, porosity, etc), moisture and differences between rock and alteration zones within the deposit. ¡ Discuss assumptions for bulk density estimates used in the evaluation process of the different materials.	This relates only to the estimation of an Exploration Target which is conceptual in nature. A nominal bulk density of 3.0 t/m³ was used for the Exploration Target based on historical data. The Competent Person is not aware of the nature and quality of the historical bulk measurement methods and quality. However, the applied value is considered reasonable for the purposes of Exploration target reporting.
Classification	¡ The basis for the classification of the Mineral Resources into varying confidence categories. ¡ Whether appropriate account has been taken of all relevant factors (ie relative confidence in tonnage/grade estimations, reliability of input data, confidence in continuity of geology and metal values, quality, quantity and distribution of the data). ¡ Whether the result appropriately reflects the Competent Person's view of the deposit.	This relates only to the estimation of an Exploration Target which is conceptual in nature. No classification was applied to Exploration Target estimate.
Audits or Reviews	¡ The results of any audits or reviews of Mineral Resource estimates	This relates only to the estimation of an Exploration Target which is conceptual in nature. The Exploration Target estimate was reviewed internally by Ingvar Kirchner, who is employed by AMC as a Geology Manager / Principal Geologist, who concluded that the procedures used to estimate the Exploration Target are appropriate.
Discussion of Relative Accuracy / Confidence	¡ Where appropriate a statement of the relative accuracy and confidence level in the Mineral Resource estimate using an approach or procedure deemed appropriate by the Competent Person. For example, the application of statistical or geostatistical procedures to quantify the relative accuracy of the resource within stated confidence limits, or, if such an approach is not deemed appropriate, a qualitative discussion of the factors that could affect the relative accuracy and confidence of the estimate. ¡ The statement should specify whether it relates to global or local estimates, and, if local, state the relevant tonnages, which should be relevant to technical and economic evaluation. Documentation should include assumptions made and the procedures used. ¡ These statements of relative accuracy and confidence of the estimate should be compared with production data, where available.	This relates only to the estimation of an Exploration Target which is conceptual in nature. This is not relevant to reporting of an Exploration Target.

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UPDVBLFLXXLZBBB

TIDM	EST
Share Price	4.40p-3.53%
Market Cap	£24.20m

Date	21 Mar 2023
Time	07:00:03
Category	Corporate updates
ID	5888T

TIDM	EST
Share Price	4.40p-3.53%
Market Cap	£24.20m

Date	21 Mar 2023
Time	07:00:03
Category	Corporate updates
ID	5888T

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Company Information

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Company Information

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RNS Metadata

Exploration Target: Verkhuba Cu-Zn-Pb Deposit