Australian Gold Joint Venture update

Red Rock Resources PLC

("Red Rock" or the "Company")

Australian Gold Joint Venture update

9 August 2021

Red Rock Resources Plc, the natural resource development company with interests in gold, manganese and base metals, announces a progress report in respect its Australian gold joint venture, Red Rock Australasia Pty Ltd ("RRAL") (www.rraustralasia.com.au) which holds extensive gold exploration interests near the historic mining centre of Ballarat in the Gold Fields of Victoria. Red Rock owns 50.1% of RRAL, with 49.9% being owned by Power Metal Resources plc (AIM:POW). 

Key points

·    Over half of license applications now granted with more expected.

·    A strong team of Victoria-based geologists, all with experience in the nearby Ballarat Mine, and familiar with local surface and underground geology, has been conducting soil sampling, mapping, and 3-D modelling on the southern group of licenses.

·    3 targets now drill-ready with proposals for drilling in November-December 2921.

·    Continuing research by RRAL geologists into known and overlooked historical mines on the tenements is leading to a new understanding of the potential.

·    Work now begun on the eastern license group, a large area characterised by thicker cover over strong structural folding and faulting, and has already identified a little-known high grade gold field, confirming the exploration potential of the area.

·    With the bulk of the ground covered by the NI 43-101 report now at granted status, RRAL has started the process of progressing a possible listing, previously considering North America but now focussing on London.

Red Rock Chairman Andrew Bell commented:

"A review of potential options for a listing of RRAL has now led to the choice of London as the preferred venue, with the possibility of seeking a trading facility in North America later.

Some listing work has already been done, and this can be used in the current process.

Timing, established relationships and familiarity with the processes, short lines of communications at a time of restricted travel, and the existence of suitable comparators were all factors in this decision.

Our geological team has been able to work with minimal interruption through the pandemic and their highly competent work is yielding new insights and giving us increasing confidence."   

ACTIVITY UPDATE

Since February this year over half the total number of exploration licences applied for by RRAL have been granted, predominantly in the southern Ballarat region.   

The highly prospective nature of the area coupled with the gold-rich production history has provided numerous discrete resource opportunities that are becoming more apparent.  Of key interest is the ubiquitous narrow vein high-grade underground gold mines present throughout the granted tenure. These mines have been largely inactive since early last century as a result of economic factors or through poor technology. Most still have identified vein material remaining.

Building information through field inspection, abundant geological reports and newspaper descriptions of these early mines, RRAL is already identifying a set of potential projects based on historic mines.   

First phase portable X-ray fluorescence spectrometer (pXRF) soil sampling programmes coupled with the literature searches and field mapping have added to the confidence in the generation of the prospects. 

The soil sampling techniques focuses primarily on arsenic distribution as this a previously identified reliable path finder to gold mineralization. The results of the sampling have produced broad targets immediately south and southeast of Ballarat. (Figure 1).   Additional field work and  in-fill sampling will   lead to  drilling over the anomalous areas in the near future. 

Note Red outline is RRAL tenement boundary. Lightly shaded insets are tenements or areas pending approvals. Green is forest or natural bushland.

Figure 1 arsenic soil samples results (Standardised data - see below)

http://www.rns-pdf.londonstockexchange.com/rns/9281H_1-2021-8-8.pdf

A second phase of geochemical sampling is under way with results expected before the end of the third quarter.  The second phase will focus on constraining the broad anomalies already identified and will extend regional coverage, testing lines of mineralization to the west and south of Ballarat itself. 

Recent exploration has had a dual purpose:

1)    Confirmation of the presence of potential gold bearing structures through soil sampling and mapping, and

2)    Identification of any projects with sufficient geological evidence or historical activity to fast-track to drill testing. Three such opportunities have so far been identified; Golden Reefs at Dereel, Mt Bute near Pitfield and O'Laughlins  south of Buninyong.

Figure 2 -Fast track opportunities.

http://www.rns-pdf.londonstockexchange.com/rns/9281H_2-2021-8-8.pdf

Golden Reefs/Dereel Prospect

The Golden Reef line of mineralization was actively mined at the turn of the nineteenth century. The mining (identified primarily as the Dereel Mine) exploited a high-grade lode system. Mining followed the gold-bearing quartz veins (or "reef") down to approximately 80 metres vertical and extending along strike for some 300 metres.  Initial investigations suggest the geology is  similar to Ballarat/Bendigo. A well-defined anticline to the west and the major steeply west dipping Pinchgut fault cross-cutting the anticline has produced saddle reefs in the fold hinge with associated flat lying quartz spurs.  A similar second structure west of the main reef may be an upper bounding structure and offers an opportunity for a second line of reef not previously exploited and further mineralisation developing between the two structures. The main reef is averaging approximately 1 metre wide and hosted in predominantly a black slate.  Ambiguities over early production suggest some of the gold may be fine and associated with sulphides and may not have been recoverable in original mining efforts.  An initial drill programme is planned for late in the 4th quarter with up to 1,200m of diamond drilling looking for along strike and down plunge extension to seek to expand the known mineralisation by over four times.

Note: Model is looking north.  RHS figure -dark red lines are proposed drill fence traces with a fan of up to three holes on each fence. Digitized underground workings in dark blue digitized from the plan shown in the LHS. The southern boundary of the tenement is the thick blue line.  Mineralized zone plunges north.

Figure 3 - Dereel Mine

http://www.rns-pdf.londonstockexchange.com/rns/9281H_3-2021-8-8.pdf

Mt Bute/Pitfield Prospect

Re-evaluation of historical data at Mt Bute (EL007301) has identified a linear arsenic anomaly with associated elevated gold centred on a small cluster of historical shaft south of Linton, Victoria.  The prospect is part of a much longer zone informally referred to as the Linton trend which may extend many kilometres.

Metex in the 1990's enhanced the prospectivity of the Mt Bute prospect by conducting a limited reverse circulation drilling through the centre of the anomaly.  They were looking for suitable oxide material at or near surface with a view to high tonnage low grade open pit recovery and not focused on the structural or mineralogical elements that diamond drilling may have identified.  RRAL believes that high grade narrow quartz reef mining is more likely based upon other known deposits in the area and anticipates more coherent and elevated grade to occur below the surficial weathering.

3D modelling of the geology, drill results and other data sets currently available are providing a valuable visual support to drill planning.  The company is working towards a maiden diamond drill programme at the prospect before the end of the current year comprising initially 600 metres.  In addition, the Company is looking to extend its regional pXRF programme to the north and east of Mt Bute to cover folded and faulted Ordovician age rocks to the east and along strike from the known Mt Bute prospect.

In the centre of the tenement, another previously overlooked historical mine has presented further opportunities for advanced exploration.  The Gribbles/ Linton mine extends down to approximately 65 metres (190 ft) and produced from both quartz reefs and flat makes (shallow dipping quartz spurs).

Figure 4 - Pitfield Project

http://www.rns-pdf.londonstockexchange.com/rns/9281H_4-2021-8-8.pdf

O'Laughlins Prospect  

Preliminary results from a geochemical survey using a pXRF analytical technique has produced well-defined arsenic anomalies in areas south of the main Ballarat and Scotsburn lines of gold mineralisation. One advanced target which has been confirmed from recent geochemical sampling marks the southern end of the Scotsburn line of gold workings. The elevated arsenic coincides well with historical workings, structural trends and a potassic anomaly identified from airborne radiometric data from the late 1980's.

Originally identified by Conzinc Rio Tinto of Australia (CRA) as a primary target containing elevated gold in rock chip and geochemical sampling, no drilling has ever been conducted.

The planning and permitting process is under way for this first ever drilling campaign before the end of the year. Further mapping and sampling is also being undertaken to develop a more detailed picture on the whole of the Scotsburn line of mineralisation. 

Of immediate focus is the western side of the O'Laughlins Prospect where numerous  prospect workings are identified as the historic Enfield reef.  Little historical literature exists for these workings other than a single reference to a reef where processing of gold was associated with sulphide in quartz. It is hypothesised that regional structural trends aligned north-northeast and steeply dipping to the west contain mineralisation providing a solid target for immediate drilling.

Variations to the traditional Ballarat  model at Enfield Reef are now considered possible where east -west striking flatter-lying quartz veins and steeply dipping east-west striking dykes have been mentioned  at the turn of last century in other writings on the regional geology.

Kilmore Prospect 

RRAL has also commenced work on the easternmost tenement immediately north of Melbourne.  Within this tenement strong structural folding and faulting identified in historical maps appear to correlate well with antimony anomalism identified in regional ASTER remote sensing data. In addition first pass historical research has uncovered a previously little discussed Donnybrook gold field where although production from the mine was minimal the narrow (sub 0.25m) vein was reportedly running at very high grade of around 4 ounces ( approx. 120g/t).  Further research is continuing this prospect with a view to determining if the structure develops at depth and along strike.  Drilling is likely early in the new year pending the outcomes of the ongoing geological reconnaissance investigations.

Soil sampling method - pXRF

Soil sampling within the granted licenses  was completed in anticipation that various elements associated with the gold mineralisation could function as potential pathfinders for gold, particularly arsenic. The supposition is thatXRF is limited in its penetration of the soil and thus may be more likely to represent the surficial elements on the grain rather than the composition of the grain itself.   As a broadly similar concept to MMI analytical work, the low-level detection using pXRF may highlight any anomalous metal migration laterally or vertically through the surface soils and could be indicative of mineralisation beneath or adjacent to the anomalous area.   

The sample set used in this study is derived from amalgamation of historical data found in the public domain with over 1024 additional sample points from recent field work conducted by RRAL.

The following sampling and subsequent data manipulation methodology was adopted.

•     Soil was collected immediately below the surface   and sieved producing a more homogenous sample for testing. organic fragments removed.

•     Samples were placed in plastic chip trays for storage and analyzed using pXRF in an offsite office. The office allowed for a more constant temperature and humidity than in the field - samples were given time to air dry before analysis.

•     During the analysis standard and blanks were inserted on a regular basis to identify any drift developing in the instrument over time.  The same reference materials were used to calibrate the XRF at the start and finish of operation and taken as approx. every 20^th sample.

•     Statistical standardization post-analysis allowed direct comparisons of the historical data with the recently collected soil survey data. The compilation into one homogeneous dataset comprising the recent survey with the historical sampling programmes and techniques could only be achieved through standardisation of each individual programme. 

•     It was found that a small number of ultrahigh values (outliers) resulted in skewing the final data set.  In particular, the samples close to the Yarrowee River and potentially atop the deep lead locations were extremely high value. To minimize the bias samples identified as external contamination were removed prior to final data manipulation.

•     To aid graphic representation when developing contours anything above three standard deviations was considered as highly anomalous and a top cut of three SD was applied. This process allowed a more readily interpretative contour of the data.

Historical data added a further 579 data points to the recently collected 733. 

FURTHER INFORMATION

Joint Venture Company - RRAL

RRAL is a joint venture company 50.1% owned by Red Rock and 49.9% owned by Power Metal Resources plc ("POW"). Paul Johnson, CEO of POW and Andrew Bell are directors of RRAL.

Granted Licenses

These licenses cover high priority areas where RRAL has early drill targets and in which exploration has already started.

A further two licenses were granted in March 2021, and a further two in April 2021.

Applications

RRAL has applications in process for six other new gold exploration license areas covering approximately 1,458 km² in the Victoria Goldfields of Australia as follows:

* Balmaine Gold Pty Ltd, Mercator Gold Australia Pty Ltd, and Loddon Gold Pty Ltd have put in competing applications the same day as RRAL for the ground covered by EL007540. The application considered to have greatest merit will eventually be given priority.

The following applications have been made in Western Australia, covering largely areas previously held by the Company at the time of its original listing. The two where there is another applicant will be subject to a ballot.

The technical information relating to exploration in this report is compiled by David Holden, BSc, MBA, MEM, who is a member of the Australian Institute of Geoscientists. Mr Holden has experience in the style of mineralisation and type of deposit under consideration. Mr Holden is the Exploration Director of RRAL.

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the Company's obligations under Article 17 of MAR.

For further information, please contact:

Andrew Bell 0207 747 9990                                                           Chairman Red Rock Resources Plc

Roland Cornish/ Rosalind Hill Abrahams 0207 628 3396           NOMAD Beaumont Cornish Limited

Mark Treharne 0203 700 2500                                                      Broker Pello Capital Limited