Drilling Shows High-Grade Gold Mineralization

Phoenix Copper Limited / Ticker: PXC / Sector: Mining 

16 September 2020

Phoenix Copper Limited

('Phoenix' or the 'Company')

Empire Mine Open Pit Drilling Continues to Show High-Grade Gold Mineralization 

Phoenix Copper Ltd (AIM: PXC, OTCQX: PXCLF), the AIM quoted, North American-focused base and precious metals exploration and development company, is pleased to announce further analytical results from the Company's reverse circulation ('RC') and core drilling programme at the Empire Mine open pit project (the 'Empire Mine') and the Red Star core drilling programme in Idaho, USA.

Programme Highlights

Ø Hole KXD20-01:            1.5 metres ('m') of 2.84 grammes/tonne ('g/t') gold from 9.4 m   depth

Ø Hole KXD20-02:            12.8 m of 4.42 g/t gold from 4.3 m depth

   including                        1.5 m of 11.10 g/t gold from 15.5 m depth

Ø Hole KX20-25:               9.1 m of 2.90 g/t gold from 22.9 m depth

         Including                        1.5 m of 5.47 g/t gold from 22.9 m depth

Ø Hole KX20-26:               7.6 m of 4.38 g/t gold from 21.3 m depth

         Including                        1.5 m of 10.75 g/t gold from 22.9 m depth

Ø Hole KX20-23:               12.2 m of 1.37% copper from 15.2 m depth

Ryan McDermott, Chief Executive Officer, said, "We have received the analytical results from the remaining nine RC holes and two HQ-diameter core holes drilled in the Empire Mine Gold Zone and the gold and copper grades continue to impress.  The gold values that we are seeing in the trends targeted in this year's drilling are consistent and remarkably high-grade, and considering their relatively shallow depths, should be readily accessible by open pit mining. Gold assays as high as 9.78 g/t, silver assays as high as 508.00 g/t, and copper assays as high as 6.13% were previously reported in drill holes KX20-01 through KX20-21. The most recent gold, silver, and copper assays from the 2020 Empire Gold Zone drilling programme RC holes KX20-22 through KX20-30 and core holes KXD20-01 and KXD20-02, as well as the previously reported drilling assays, are shown below in Tables 1, 2 and 3.    

"The Phoenix team is encouraged by the results of the 32 drill holes of the 2020 season. These assays will be added to the database used in the calculation of the May 2020 NI 43-101 Empire Resource, which contained Measured, Indicated and Inferred Resources of 342,249 ounces of gold, 9.5 million ounces of silver, and 129,932 metric tons of copper, and used to recalculate the resource.  Hardrock Consulting (HRC) is scheduled to update the resource in early Q4 2020 based on a data set consisting of 411 drill holes plus the assays from Empire channel samples due at any time. The resource update will be followed by an updated Preliminary Economic Assessment (PEA) in mid-Q4 2020.  In addition, the metallurgical pilot testing programme at AuRIC Laboratories in Salt Lake City, Utah is well underway and expected to provide additional reporting on ammonium thiosulfate (ATS) gold recovery in the coming weeks.

 "In addition to the Empire Gold Zone drilling results, we have also received the results of Red Star core holes RS20-07 through RS20-10.  These holes were primarily drilled to give us an indication of the limits of the mineralisation, both geologically into the granite and at the limits of our patented claims to the north.  Although all four holes encountered modest mineralisation, the geological and geochemical information gathered from these holes provides us with invaluable data for targeting our next phase of drilling the Red Star vein system. To date, Phoenix has drilled 13 holes in the Red Star trend, with seven of the 13 showing silver intercepts of 3.76 oz/tonne to 35.3 oz/tonne and lead values from 1.17% to 20% for the same intervals. The previous Red Star drilling results were tabulated and reported by the Company on 25 August 2020. The drilling completed thus far at Red Star has provided significant promise and will continue to do so as we target the next round of drilling. The Company's immediate focus is on the Empire Gold Zone resource update, however, additional news regarding Red Star will be forthcoming as the team further evaluates the geological and geochemical drilling data.    

"We are also awaiting the assays for the rock chip samples from the Navarre Creek gold area".

Table 1 - Empire Drilling Results 16 September, 2020

 Table 2 - Empire Drilling Results Reported 29 July, 2020

Table 3 - Empire Drilling Results Reported 25 August, 2020

Empire Mine Drilling Update

Phoenix has completed a total of 1,658 m of drilling at Empire in 2020. To date this consists of 1,550 m of RC drilling and 108 m of diamond drilling. The assays for all drill samples have been received and will be added to the existing Empire database for use in estimating an updated resource in early Q4 2020.

Red Star Drilling Update

Phoenix has completed 10 drill holes for a total of 455 m of HQ-diameter diamond drilling at Red Star thus far in 2020. The assays for all drill samples have been received. Additional core drilling is also planned at Red Star following the evaluation of the first 10 core holes.

Other Results Pending Analysis

There are currently 30 Empire channel samples and 25 Navarre Creek rock chip samples awaiting assay results.  Results from these samples will be reported as they are received.

Empire Mine - Gold and Silver Resource and Drilling Programme

In May 2020, an updated NI 43-101 compliant resource was completed by Hard Rock Consulting and reported for the polymetallic Empire Mine open-pit oxide deposit.  The updated resource contained Measured, Indicated and Inferred metal content of 130,000 tonnes of copper, 342,000 ounces of gold, 9.5 million ounces of silver and 50,550 tonnes of zinc.  The May resource showed an increase in all metals, but particularly gold and silver, which increased 56% and 13%, respectively, from the previous May 2019 resource.  Resource report details can be found on the Company's website at www.phoenixcopperlimited.com/news and www.phoenixcopperlimited.com/research

As a result of the May 2020 resource update, and the favourable ammonium thiosulfate gold and silver recovery tests reported in June 2020, the Company initiated a RC drilling programme targeting potential extensions to the gold and silver mineralisation identified in the report, as well as targeting areas of Inferred mineralisation in an attempt to upgrade Inferred to Measured and Indicated resources.

Red Star - Silver and Lead Resource and Drilling Programme

Red Star is located approximately 330 m north-northwest of the Empire open pit resource area within the Empire patented claim boundary.  This boundary is contiguous with the Horseshoe Block to the north and west. A map showing the area can be found on the Company website at www.phoenixcopperlimited.com in the "News" section.  The Red Star Zone was discovered during field mapping and reconnaissance of the northern patented claim boundary and adjacent Horseshoe Block.  Channel samples were collected from the Red Star outcrop itself and results were reported by the Company in October 2018.  Three RC drill holes targeting the area at depth were completed and assay results were published in December 2018.  In May 2019, Hard Rock Consulting estimated a maiden Inferred resource at Red Star of 103,000 tonnes grading 173.4 g/t silver, 0.85 g/t gold, and 3.85% lead, with minor copper and zinc. 

Qualified Person

The information in this announcement has been reviewed by Roger Turner A.C.S.M., M.Sc., M.I.M.M.M., C.Eng., Chief Technical Officer and Director of the Company. Mr Turner is a graduate mining engineer from the Camborne School of Mines with an MSc in Economic Geology from Leicester University with more than 40 years' experience in mine development, construction and operation and is a qualified person under the AIM Rules. Mr Turner consents to the inclusion of the information in the form and context in which they appear.

Environmental, Social, and Corporate Governance

Phoenix is committed to meeting and exceeding the environmental standards required by law as a core value of the Company.  The baseline environmental data collected to date will be used for furthering the permitting process, but as importantly, will be used as the building blocks for the Company's future Environmental, Social, and Corporate Governance (ESG) platform.

 Market Abuse Regulation (MAR) Disclosure

Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement.

Contacts

For further information please visit www.phoenixcopperlimited.com or contact:

Notes

Phoenix Copper Limited is a North American focused, base and precious metal explorer and developer, which has carried out a drilling programme and generated a copper, gold, silver and zinc resource on which it is carrying out a feasibility study to bring the historically producing Empire Mine in Idaho, USA, back into production. It is also evaluating the silver and gold resources around three other past producing mines within the 23 km² Empire claims block as well as cobalt in two claims blocks north of Empire in Idaho.

Phoenix's primary operations are focused near Mackay, Idaho in the Alder Creek mining district. This district includes the historical Empire, Horseshoe, White Knob and Blue Bird Mines, past producers of copper, gold, silver, zinc, lead and tungsten from underground mines in the first half of the twentieth century. Additionally, the district includes Navarre Creek a Carlin-trend gold discovery which hosts a 6.1 km gold strike length within a 9.8 km² area.

Phoenix acquired an 80% interest in the historical Empire Mine property in 2017 and, based on a total of 320 drill holes, an oxide resource was completed in late 2017. A NI 43-101 compliant PEA (preliminary economic assessment) for an open pit heap leach solvent extraction and electrowinning ("SX-EW") mine was completed in April 2018. In 2018 a further 8,600 metres in 93 holes was completed to upgrade the oxide resources, provide samples for ongoing metallurgical test work, geotechnical and hydrological studies and condemnation drilling for the heap leach pad site, waste dump and plant site. An updated NI 43-101 compliant resource was completed in early May 2019, which was generated for a heap leach copper SX/EW operation where only copper was recovered. A further updated NI 43-101 compliant resource was generated in May 2020 for all metals, which resulted in an increase of measured and indicated resources of +56% gold, +11% copper, +13% silver and +26% zinc. Present contained metal in all NI 43-101 compliant categories of resources, measured, indicated and inferred, stand at 342,249 ounces of gold, 129,923 tonnes of copper, 9,502,494 ounces of silver and 50,550 tonnes of zinc. There are now 411 drill holes into the Empire oxide zone.

Since acquiring the Empire project, Phoenix has increased the claim area from 818 acres to 5,717 acres, mainly to the northwest and west, and in so doing has increased the potential for additional oxide and sulphide copper resources, as well as the potential for stand-alone gold and silver resources, along a strike length of approximately 5.4 km towards the other brownfield mines of the Horseshoe, White Knob and Blue Bird Mines now within the property boundary. In particular, a new discovery at Red Star, 330 metres north west of the Empire Mine proposed open pit, has revealed sulphide ore and from three shallow exploration drill holes a NI 43-101 compliant maiden resource of 1.6 million silver equivalent ounces was reported.

At Empire, it is estimated that less than 1% of the potential ore system has been explored to date and, accordingly, there is significant opportunity to increase the resource through phased exploration.

More details on the Company, its assets and its objectives can be found on PXC's website at www.phoenixcopperlimited.com.