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GALENA MINING LIMITED

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GALENA ADVANCES EXCELLENT PFS FOR ABRA BASE METALS PROJECT, DECLARES MAIDEN ORE RESERVE

ASX Announcement 25 September 2018 

HIGHLIGHTS: 

  • 14-year mine life producing a high-value, high-grade lead-silver concentrate containing 91ktpa of lead and 760kozpa of silver after ramp-up 
  • Outstanding economics, with pre-tax NPV of A$528M and IRR of 50% 
  • Transformational improvements in Project scale and value vs. Scoping Study: 
    • Annual throughput increased by 20% to 1.2Mtpa 
    • Mine life extended by three years (27%) to 14-years 
    • Pre-tax NPV increased by A$134M (34%) 
    • Improvements come with no material increase in pre-development capex 
  • Average annual net free cash flow during commercial production of A$97M 
  • Attractive cash costs among global primary lead producers of US$0.48/lb lead C1 direct cash cost of production 
  • Declaration of maiden JORC Ore Reserve of 10.5Mt Probable at 8.1% lead and 20g/t silver 
  • Clear pathway for rapid completion of permitting and other pre-development works – On track for 2019 construction commencement 
  • Upcoming milestones include Resource upgrade, offtake and continuation of recently commenced project financing discussions

GALENA MINING LTD. ("Galena" or the “Company”) (ASX: G1A) announces completion of the highly anticipated pre-feasibility study (“PFS”) for its wholly-owned Abra Base Metals Project (“Abra” or the “Project”), located in Western Australia. The PFS outcomes are considered excellent and in most respects confirm or exceed the previously completed Scoping Study (see Galena ASX announcement of 28 June 2018). The completion of the PFS has also allowed the Company to declare its maiden JORC Ore Reserve for the Project.

Managing Director, Alex Molyneux commented, “This PFS confirms Abra is one of the best base metals projects in the world in terms of high investment returns, low country risk and market significance. The overall value of the Project has also just got a whole lot bigger with the NPV rising by 34% to A$528M, and a number of years additional mine life.”

Managing Director, Alex Molyneux went on to say, “The work done for the PFS also confirms we have a clear pathway to complete permitting and other pre-development works quickly. Abra is a very ‘executable’ project and it will be the absolute mission of Galena’s team to move it into construction in a timely manner.”

Click here to view the full announcement


NEW DRILLING CONFIRMS HIGH-GRADE MINERALISATION 150M OUTSIDE EXISTING RESOUCE ENVELOPE

ASX Announcement 10 September 2018

HIGHLIGHTS: 

  • New drilling results confirm high-grade mineralization 150m outside of the March 2018 Resource, and remains open 
  • Four holes being reported today (AB95-AB98) include the following significant intersections: 
    • 16.2m at 9.2% lead and 44g/t silver (including 4.5m at 15.1% lead and 44g/t silver), and 6.0m at 14.5% lead and 28g/t silver in hole AB96 
    • 6.0m at 11.8% lead and 19g/t silver in hole AB97 
    • 4.6m at 5.9% lead and 19g/t silver in hole AB98 
  • Assays have been received for four new drill-holes drilled as part of Galena’s 2018 Resource infill and development drilling program 
  • New mineralisation occurs in the shallower north western area of the Abra deposit very near the currently proposed access decline and the earliest years of mining inventory assumed for the Scoping Study 
  • Mineralisation continues to remain open along strike to the northwest and down dip

GALENA MINING LTD. ("Galena" or the “Company”) (ASX: G1A) announces further highgrade lead and silver intersections from four holes drilled as part of its 2018 Infill and Resource Development Program.

Managing Director, Alex Molyneux commented, “These results are very exciting because they confirm high-grade mineralisation extends 150m beyond the existing Resource model mineralised area. This bodes well for achieving our Resource development ambitions when we come to publish an updated Mineral Resource estimate.”

NEW DRILL-HOLE ASSAYS 

Intersections for assays for the four holes that have just been received (AB95 to AB98) are graphically represented in Figure 1 (below) and detailed in Appendix 1, together with drill collar locations in Appendix 2. 

Figure 1: 3D model of March 2018 Resource (5% lead cut-off wireframes) looking obliquely east, with new drill-holes AB95, AB96, AB97 and AB98 overlain.

Of the new holes, AB95 was drilled as an infill hole within the envelope of the current Mineral Resource (see announcement of 14 March 2018) (“March 2018 Resource”) and returned results as per expectations.

Drill-holes AB96, AB97 and AB98 were drilled to test for shallow north western extensions to the Apron Zone outside of the March 2018 Resource. All of these drill-holes intersected high-grade lead mineralisation: 

  • AB96 returned 16.2m at 9.2% lead and 44g/t silver (including 4.5m at 15.1% lead, 44g/t silver and 0.9% copper) and 6.0m at 14.5% lead and 28g/t silver. 
  • AB97 intersected 6.0m at 11.8% lead and 19g/t silver. 
  • AB98 returned 4.6m at 5.9% lead and 19g/t silver. 
  • This mineralisation is gently dipping so intersection widths are interpreted to be estimates of true widths.

Importantly, drill-holes AB96, AB97 and AB98 extend high-grade lead-silver mineralisation by over 150m outside the current Resource area. Furthermore, it is likely the newly identified mineralisation will provide additional inventory of high-grade mineralisation for the earliest mining years based on the Company’s current design work for the mine plan. With these results, mineralisation remains open along strike to the northwest.

Infill hole AB95 intersected Apron Zone style stratiform mineralisation returning 6.0m at 5.4% lead and 17g/t silver (note: this mineralisation is gently dipping so intersection widths are interpreted to be estimates of true widths) and then intersected Core Zone style hydrothermal vein mineralisation returning 7.0m at 5.8% lead and 10g/t silver (including 3.4m at 10.4% lead and 17g/t silver) (note: this mineralisation appears to be moderately dipping to the north so true widths have been estimated to be approximately 50% of downhole width). Mineralisation remains open down dip.

Click here to view the full announcement

High Lead Grades Continue in Development Drilling at Abra

ASX Announcement 30 August 2018

Highlights: 

  • 5.5m @ 16.0 % Pb, 22 g/t Ag and 6.1m @ 8.1 % Pb, 11 g/t Ag in AB94 
  • Resource extensions have been identified to the deposit up dip in the northwest sector. These will provide additional high grade resource tonnes in the first years of production 
  • 13.3m @ 9.0% Pb, 20 g/t Ag and 6m @ 8.1 % Pb, 15 g/t Ag and 6.7m @ 8.9% Pb, 27g/t Ag in AB89 
  • 4.3m @ 8.1 % Pb and 10g/t in AB91A 
  • 6.1 m at 13.4 % Pb and 16 g/t Ag in AB93. Mineralisation is open down dip to the south east 
  • Drilling converting Inferred to Indicated JORC, ongoing with one rig and assays pending for a further 6 holes

Galena Mining Limited (ASX: G1A) (“Galena” or the “Company”) is pleased to announce further high-grade lead (Pb) and silver (Ag) intersections from its Abra Base Metal Project. An infill programme designed to increase confidence in parts of the resource within the Pre-feasibility Study was commenced in late May. The programme was based on underground optimisation work as published in the Scoping Study (ASX release 28th June 2018) and was designed to convert Inferred Resources to Indicated Resources and support Galena’s ongoing study work (Figure 1). These results are from six holes of this resource development drilling program. Results for the first seven holes were reported in the ASX releases dated 9 July 2018 and 2 August 2018.

Galena CEO Ed Turner commented:

”We are very pleased with these results as they continue to support our geological and resource model for the Abra deposit which drives our optimisations as well as add additional tonnes in areas closest to surface which can be exploited in the first year of production.

Intersecting more economic mineralisation in the north west sector outside of the existing resource has meant additional drill holes have been added to the current program in this area. Results are pending for most of these holes. We look forward to releasing further results from this drilling program in the coming weeks and the results of the Pre-Feasibility Study in September.”

Galena’s 2018 Resource Development Drilling Program 

Galena recently announced outstanding Scoping Study results for the Abra Project (ASX release 28/6/2018 “Scoping Study Demonstrates Outstanding Economics for the Abra Base Metal Project”). The Study confirms Abra as an economically and technically robust opportunity, with potential to become a significant, long-life, high margin West Australian lead-silver producer.

Galena is on track to complete a Pre-Feasibility Study in September 2018 and then intends to commence a Feasibility Study in late 2018 for completion in mid 2019. To support these studies, Galena is currently drilling a resource development drilling program aimed to convert the bulk of the high grade portions of the March 2018 Inferred Resource into an Indicated Resource. In addition, drilling will test for extensions to lead-silver mineralisation in several key areas where there is potential to add to the resource. To date eighteen holes (AB82 – AB99) have been completed for 10,461 metres in 2018. AB100 is in progress.

Click here to view the full announcement

Development drilling at Abra continues to deliver better than expected results

ASX Announcement 2 August 2018

Highlights

  • 28.3m @ 8.9% lead, 52 g/t silver (including 14.7m @ 11.2% lead, 77 g/t silver) and 8.1m @ 11.2% lead in AB85 
  • Mineralisation is thicker than anticipated and is open to the northwest. 
  • 29.6m @ 9.5% lead, 19 g/t silver and 10.9m @ 24% lead, 33 g/t silver and 8.7m @ 11.2% lead in AB88 
  • 6.4m @ 13.0% Pb in AB87 
  • 4.0m @ 13.2% lead, 34 g/t silver in AB84 
  • 3.6m @ 9.6% lead, 26 g/t Ag in AB86 
  • Drilling converting Inferred to Indicated JORC, ongoing with two rigs and assays pending for a further 6 holes

Galena Mining Limited (ASX: G1A) (“Galena” or the “Company”) is pleased to announce further high-grade lead (Pb) and silver (Ag) intersections from its Abra Base Metal Project. An infill programme designed to increase confidence in parts of the resource within the Pre-feasibility Study continues to add exceptional results and extend the boundaries of the economic deposit to the north west which remains open

The programme is based on underground optimisation work as published in the Scoping Study (ASX release 28th June 2018) and was designed to convert Inferred Resources to Indicated Resources and support Galena’s ongoing study work (Figure 1).

Results for the first two holes (AB82 and AB83) were reported in the ASX release dated 9 July 2018.

Galena CEO Ed Turner commented:

”These results add further confidence to our resource model and the thicknesses and grades are better than expected in several locations in particular the north west sector which includes mineralisation that is closest to surface and therefore likely to be mined in the first few years of production. 

Every hole completed in 2018 has, like in the 2017 drilling, intersected high grade mineralisation and will therefore greatly assist with the ore block optimisation that is part of the Pre-Feasibility Study. We look forward to releasing further results from this drilling program in the coming weeks and the results of a Pre-Feasibility Study. This study will be completed in September 2018.

Click here to view the full announcement

BOARD OF DIRECTORS

Mr Adrian Byass

BSc Geol Hons, B. Econ, MAIG & FSEG

+20 years in the mining industry both in listed and unlisted entities globally, Non-Executive and Executive Director of various listed and unlisted mining entities, which have successfully transitioned to production in bulk, precious and speciality metals around the world. Currently on the Boards of ASX phosphate, zinc, nickel and lithium companies.


Mr Jonathan Downes

BSc Geol, MAIG

+20 years’ experience in the minerals industry and has worked in various geological and corporate capacities. Experienced with nickel, gold and base metals, he has also been intimately involved with numerous private and public capital raisings.

Mr Downes is on the board of several ASX-listed companies; he was a founding director of Hibernia Gold (now Moly Mines Limited) and Siberia Mining Corporation Limited and is a non-executive director of Corazon Mining Limited.


Mr Oliver Cairns

Corporate Financier specialist with extensive experience at management and Director level; on both AIM and ASX listed companies. Mr Cairns has experience in capital markets, M&A, IPO, corporate governance, IR experience across the resources and industrial sectors.


Mr Tim Morisson

B. Econ, MBA

+20 years in the finance industry and capital markets. A partner of Empire Equity which is a Perth based boutique investment advisory company. Tim has extensive experience in ASX and resource-related companies.


SENIOR MANAGEMENT

Mr Edward Turner

B ASc (Geol), MAIG

30 years experienced geologist throughout Europe, South America, Africa and Australia in a range of roles encompassing base, precious and specialty metals for leading mining companies. Technical strengths include exploration, underground mining, resource estimation, feasibility studies and development level work.


Mr Troy Flannery

BEng(Min), MAppFin, FCMMC

Mr Flannery has been working in the mining industry for over 20 years including 5 years in corporate and 16 years in senior mining engineering / project development roles. He has a degree in Mining Engineering, Masters in Finance & First Class Mine Manager’s Certificate of Competency.

Mr Flannery has worked at numerous mining companies, mining consultancies & contractors (including BHP, Newcrest, Xstrata, St Barbara Mines & AMC Consultants). 


Mr Stephen Brockhurst,

Mr Brockhurst is the founding Director of Mining Corporate Pty Ltd and has 15 years’ experience in the finance and corporate advisory industry and has been responsible for the preparation of the due diligence process and prospectuses on a number of initial public offers. His experience includes corporate and capital structuring, corporate advisory and company secretarial services, capital raising, ASX and ASIC compliance requirements.

Mr Brockhurst has served on the board and acted as Company Secretary for numerous ASX listed and private companies. He is currently a Director of Roto-Gro International Limited and International Goldfields Limited and Company Secretary of Jacka Resources Limited, Lindian Resources Limited, Volt Resources Limited, Estrella Resources Limited and Cabral Resources Limited.


www.galenamining.com.au


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