Update on Elizabeth Hill Silver Tailings Project

Trading Symbols

AIM: UFO

FWB: I3A1

10 March 2021

Alien Metals Ltd

("Alien Metals" or "the Company")

Alien enters into exclusivity agreement to acquire Silver Tailings Project at Elizabeth Hill

Follow the link to view the announcement in full including all figures:

http://www.rns-pdf.londonstockexchange.com/rns/6991R_1-2021-3-9.pdf

Alien Metals Ltd (LSE AIM:UFO), a minerals exploration and development company, is pleased to provide an update regarding the Company's high-grade silver project located at Elizabeth Hill, Western Australia. 

The Company has entered into a 60 day exclusivity arrangement with the owner of the tailings on site within the Elizabeth Hill Mining Licence, using this period to carry out further assessment of the tailings in situ and potentially negotiate an acquisition by Alien of the rights and title to the Elizabeth Hill tailings project, if terms can be agreed between the parties.

Elizabeth Hill Silver tailings projects

·   Alien has signed an exclusivity agreement with Wombat Resources Pty Ltd, the owner of the historic tailings on site within the Elizabeth Hill Mining Licence

·     Recent sampling of the tailings undertaken by Alien have returned very encouraging results

o  84 samples were taken from 21 locations, with silver grades up to 1,270 g/t (38 oz/t)

o  The samples returned an average grade of 472 g/t Ag (13.3 oz/t Silver)

·    During the 60 day exclusivity period, the Parties intend to negotiate an acquisition by Alien of the rights and title to the Elizabeth Hill tailings project

Bill Brodie Good, CEO & Technical Director of Alien Metals, commented:

"We have been aware of the potential of historic silver tailings at Elizabeth Hill for some time. Knowing that the Elizabeth Hill silver mine's historic operations were somewhat inefficient and being very high-grade with abundant native silver we felt that, despite previous reprocessing activities, there is likely significant value remaining in the silver tailings. 

"Following discussions with the silver tailings owner, a first-pass sampling program was undertaken in December 2020 to test the properties of the tailings. ALS laboratories in Perth carried out an Aqua Regia ICP-AES assay on 84 auger samples from 21 locations, which returned consistently high values of silver and associated minerals. Over the coming months, the Company will undertake further sample work and analysis to better understand the most efficient and cost-effective processes to extract the silver from the tailings. We believe that the silver tailings project could generate near-term cashflow which could help underpin a range of exploration activities at Elizabeth Hill and the Munni Munni North project."

Figure 1: Location of Elizabeth Hill Project, Western Australia, Jan 2021

History of the tailings

Located within the Company's mining lease ML47/342 there remains the partly retreated tailings from the original silver mine operations at Elizabeth Hill. This is currently subleased from Alien by Wombat Resources Pty Ltd (Wombat) (see below).

Alien's preliminary assessment indicates that there remains about 16,000 tons of tailings on site, based on tonnage of ore extracted from the mine however further work will be undertaken during the exclusivity period to confirm available tailings for reprocessing.  

Historic reports refer to grades above 1,000 g/t (33oz/t) silver in the original tailings due to inefficient processing practices of the ore during historic mining, Ref Independent Technical Assessment Report on the Elizabeth Hill Project, Agricola Mining Consultants, June 2018.

Historically some reprocessing of the silver tailings was undertaken, however limited information exists on processing recoverability.

2021 Sampling Results

A brief program of hand auguring of the existing tailings was carried out at the end of December 2020 by the Alien geological team in order to get an initial understanding of the grade of the remaining material in the dump as review of historical reports does not give any clear outline of this.

A hand auger was used and at each sample site 4 samples were taken at different depths (see table 1). The holes were stopped when they reached the base of the tailings on the liner. The average sample depth from surface was 1.5m with the deepest samples going to 1.87m and the shallowest to 1.19m. The samples were not geologically logged as it was felt unnecessary as the material is essentially homogenous crushed ore material from the mine so uniform in nature. 

The samples were sent to ALS Perth and analysed for a main suite of 35 elements by  Aqua Regia ICP-AES with follow up analysis of any initial high grade silver assays by code Ag-OG46 by Aqua Regia which totalled 78 out of the 84 samples submitted.

ALS as part of their standard analysis performed their standard in-house QA/QC which appears acceptable in relation to this sample batch.

The results show that there remains significant silver in the tailings, even if they were reprocessed from the original mine processing days, as well as some acceptable credits for copper, nickel and zinc. The sample results included a high of 1,270 g/t Ag (38 Oz/t) and a low of 60.6 g/t Ag (which at just under 2 Oz/t silver is still a significant grade). Only 6 samples from the 84 analysed returned below 100 g/t Ag which is also significant.

The results show good consistency downhole as well as from hole to hole and the pattern as seen in Figure 4 of the higher grades against the few low grades could be related to historical access to the tailings being cut into the southern area. Alien is planning to follow-up in more detail from this sampling to better understand the spread and concentration of the material.

Figure 2: Sample points on Tailings, Elizabeth Hill Mine, Western Australia, December 2020

Figure 3: Sample point and sample split, Elizabeth Hill Mine Tailings, December 2020

Table 1: Elizabeth Hill Tailings sample results, December 2020

Figure 4: Summary of grade distribution on Tailings, Elizabeth Hill Mine, December 2020

Should further work be positive, Alien will undertake an initial scoping study of the project, including potential processing/treatment options and likely start-up costs.

Munni Munni North update

Alien are awaiting the results and final report from the Airborne Magnetic Survey over the project area currently being processed and analysed by Southern Geoscience. Alien expect to receive the report in by mid-March, which will allow us to prioritise next stage exploration plans.

The Board of Alien continues to assess a range of mineral projects and opportunities, with particular focus on exploration projects with near term news flow and value creation.  

PDAC

The Company is also pleased to announce it will be attending the 2021 PDAC Conference, along with other major mining companies, between March 8^th and 11th 2021. Details of the conference can be found at: https://www.pdac.ca/convention 

For further information please visit the Company's website at www.alienmetals.uk, or contact:

Notes to Editors

Alien Metals Ltd is a mining exploration and development company listed on AIM of the London Stock Exchange (LSE: UFO). The Company's focus is on precious and base metal commodities, with its operations located in proven mining jurisdictions and it has embarked upon an acquisition-led strategy headed by a high-quality geological team to build a strong portfolio of diversified assets.

In 2019 it made two acquisitions over the Brockman and Hancock Ranges high-grade (Direct Shipping Ore) iron ore projects and the Elizabeth Hill Silver projects both located in the Pilbara region, Western Australia.

The Company also holds silver projects located in the Zacatecas State, Mexico's largest silver producing state which produced over 190m oz of silver in 2018 alone accounting for 45% of the total silver production of Mexico for that year.

In addition to progressing and developing its portfolio of assets and following its strategic review of its portfolio of silver and precious metals projects in Mexico, Alien Metals has identified priority exploration targets within its nine mining concessions which it is working to advance systematically.