Technical Report No. 4073

Exploration Permit for Minerals No. 17297 ‘Blue Hills West’, Annual Tenement Report For the Period Ended 20 June 2016

MOUNT ISA MINES LIMITED

TECHNICAL REPORT No. 4073

TITLE: EXPLORATION PERMIT FOR MINERALS No.17297 ‘BLUE HILLS WEST’, QUEENSLAND ANNUAL REPORT FOR THE PERIOD ENDED 20 JUNE 2016

HOLDER: MINES LIMITED

OPERATOR: MOUNT ISA MINES LIMITED

1:250,000 SHEET: SF54-5 ‘’

1:100,000 SHEET: 6855 ‘DUCHESS’

INVESTIGATIONS CONDUCTED BY: AEON WALFORD CREEK LIMITED

AUTHOR: D JOHNSON

SUBMITTED BY: MOUNT ISA MINES LIMITED

DATE: JULY 2016

COPY: 2

DISTRIBUTION

1. MIM Resource Development Pty Limited, Mount Isa Library

2. Department of Mines and Energy,

3. MIM Resource Development Pty Limited, Archived

4. Aeon Metals Ltd

Contents

SUMMARY ...... ii INTRODUCTION ...... 1 LOCATION AND ACCESS ...... 1 TENURE ...... 1 REGIONAL GEOLOGY ...... 3 PREVIOUS EXPLORATION ...... 5 PREVIOUS EXPLORATION BY AEON METALS ...... 5 EXPLORATION COMPLETED DURING THE CURRENT TERM ...... 6 CONCLUSIONS AND RECOMMENDATIONS ...... 8 REFERENCES ...... 9

Tables

Table 1 Block and Sub-Block details for EPM 17297...... 1 Table 2 Summary of Historical Exploration within EPM 17297 ...... 5 Table 3 Summary of Previous Work Completed by Aeon Metals ...... 6

Figures

Figure 1 EPM 17297 Blue Hills West Sub blocks over Urandangi 1:250,000 Topographic Map Sheet .... 2 Figure 2 Blue Hills West Regional Geology and Major Structures (Oban 1:100,000 map sheet) ...... 4

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SUMMARY

Aim of Project Exploration Permit for Minerals (EPM) 17297 is part of Aeon Metals Limited’s, Waverly Basin Project. This project aims to assess and test areas for base metal deposits, including stratabound Zn-Pb-Ag and structurally controlled, sediment hosted Cu.

Object of Report This report provides an update of exploration carried out on EPM 17297 ‘Blue Hills West’ for the twelve month period ending 20 June 2016.

Location The Blue Hills West EPM is located 82km SSW of Mount Isa and 32km NW of Dajarra Township in Northwest Queensland.

Tenure The Blue Hills West EPM 17297 was granted on 21 June 2010 for a period of three years and is operated by Mount Isa Mines Limited. A Joint Venture was agreed between Mount Isa Mines Limited and Aeon Metals Limited, formerly Aston Metals, on 20 July 2010.

Précis EPM 17297, along with EPMs 12653, 14821 and 15911, forms part of the Waverly Basin Project, considered prospective for base metal mineralisation. Aeon Metals has not undertaken any field work during the current year of tenure. Exploration work has been limited to desktop studies.

Conclusions The faulted contacts between the Mount Isa Group strata and the Haslingden Group metavolcanics within the tenement area remain prospective and have not been drill tested.

Further exploration recommended by Aeon Metals includes:  Geological mapping and rock chipping along faulted contacts with the Mount Isa Group.

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INTRODUCTION

EPM 17297 ‘Blue Hills West’ consists of 3 sub-blocks covering a total area of approximately 9km². This area lies adjacent to the more prospective EPM 15911 and was targeted because of the lower Mount Isa Group unit faulted against the metabasalt and quartzite units of the Eastern Creek Volcanics. The tenement is still considered to have some potential for sediment hosted copper breccia system (Mount Isa Copper and/or Gunpowder).

LOCATION AND ACCESS

The EPM is centred approximately 82 km south-southwest of Mount Isa and 32 km northwest of Dajarra in Northwest Queensland. Access to the site is via the Dajarra Road (Diamantina Developmental Road) with station tracks transecting most of the EPM providing good 4WD access. The land is used for cattle grazing and held within Stanbroke Station. The tenement is located on the Oban (6755) 1:100,000 and Urandangi (SF-5405) 1:250,000 map sheet.

TENURE

Blue Hills West EPM 17297 was granted on 21 June 2010 for a period of three years. The tenement is still currently held by Mount Isa Mines Limited but Aeon Metals is responsible for undertaking exploration and has now earned a 100% interest in the project following the Joint Venture (JV) Agreement which started on the 20 July 2010. The tenement is currently being transferred into the name of Aeon Walford Creek Limited. A list of the current sub-blocks is tabulated below. The location of the tenement is shown in Figure 1.

Table 1: Block and Sub-Block Details for EPM 17297

BIM Block Sub-Blocks 1240 K, P CLON 1241 F Total 3

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Figure 1: EPM 17297 Blue Hills West Sub-blocks over Urandangi 1:250,000 Topographic Map Sheet

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REGIONAL GEOLOGY

The Blue Hills West tenement lies within the Leichhardt River Sub province of the Western Succession in the Proterozoic Mount Isa Inlier. The stratigraphy within the EPM consists of Carpentarian Cover Sequences 2 and 3 underlain by a gneissic basement. The Mount Isa Group is represented by the Moondarra Siltstone and two units of the Haslingden Group outcrop: the Jayah Creek Metabasalts, amphibolitic and interlayered quartz-rich metasediments, and the Eastern Creek Volcanics (ECV), chloritised basalt and interbedded quartz-rich metasediments (Haslingden Group). A small outcrop of Sybella Granite occurs in the far northwest of the tenement to the west of the Rufus Fault System. The granite is part of the Sybella Suite which consists predominantly of I-type granodiorite plutons. Within the Western Succession the Sybella Suite mainly intrudes the units of the Haslingden Group (Carter, 1959).

Three major structures converge within the tenement area. The NNW striking Wonomo Fault juxtaposes amphibolite-facies Eastern Creek Volcanics to the west and greenschist-facies Moondarra Siltstone to the east. This fault joins the NNE Rufus Fault and Mount Annabel Fault Systems, southern extensions of the Mount Isa Fault System. A second NNW fault strikes sub-parallel to the Wonomo Fault and also joins the Rufus Fault, separating the two correlative units of the Haslingden Group within the EPM.

Extensive Cenozoic cover occurs to the northeast of the tenement area, obscuring the extent of the prospective Mount Isa Group sediments. Recent alluvium occurs to the west of the Rufus Fault and transects the EPM due to the presence of a major creek.

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Figure 2: Blue Hills West Regional Geology and Major Structures (Oban 1:100,000 map sheet)

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PREVIOUS EXPLORATION

The tenement forms part of Aeon Metals’ Waverly Basin Project along with the other EPMs 12653, 15911 and 17300. The Waverly Basin area has been subject to extensive exploration targeting Mount Isa style copper, lead and zinc (Table 2). Traditional exploration has focused on mineralisation within shale units along the Rufus- Mount Annable Fault Systems and within the Waverly sedimentary basin largely to the east of the EPM. Previous exploration within EPM 17297 is limited, consisting of surface geochemistry with no drilling being undertaken.

A detailed description of the historical exploration can be found in previous Annual Reports (Adamson, 2011 and Warburton, 2012).

Table 2: Summary of Historical Exploration within EPM 17297

EPM No. Period Company Exploration Activities

97 1957-1958 Rio Tinto Exploration Airborne EM, mapping, soil geochemistry Pty Ltd

323 1966-1971 Longreach Minerals Mapping and surface soil geochemistry, geophysics (magnetics and Pty Ltd IP)

2344 1980-1985 Anaconda Australia Airborne magnetics/radiometrics, Sirotem traverses, Spectral IP, Inc RAB drilling

4708 1987 Menzies Gold N.L. Stream sampling (BLEG)

4827 1988-1990 Mount Isa Mines Ltd Rock chips, stream and soil samples

7650 1991-1998 Aberfoyle Resources Airborne GEOTEM, MMI soils, rock chips Ltd (JV with BHP)

12653 2003-2007 Red Metal Ltd Desk top studies

PREVIOUS EXPLORATION BY AEON METALS

Before entering into the JV with Mount Isa Mines Limited in 2010, Aeon Metals had acquired a range of geophysical imagery over much of their tenement package north and south of Mount Isa, including the ground covered by EPM 17297. ASTER imagery and 2.5m SPOT (panchromatic and colour) as well as MIM airborne magnetics and radiometrics were obtained in 2007. A large heliborne VTEM survey was carried out during the 2007-2008 period over a significant portion of Aeon Metals’ ground, including EPM 17297.

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Table 3 Summary of previous work completed by Aeon Metals

Exploration Activity Report Period  A detailed review of previous exploration 2010-2011 2011  The generation of a working geological model  Completion of a soil sampling program 2011-2012 2012

 Continued desktop study, including 3D modelling of the Waverly Basin 2012-2013 2013

 Desk top studies 2013-2015 2014 -2015

Exploration work during the 2011-2012 period included a widely spaced soil sampling program (200 x 400m). This soil grid targeted a VTEM anomaly (TZ63; Figures 4-6) in close proximity to the three-way intersection of the Rufus – Annable Fault Systems and the Wonomo Fault. Results of the soil sampling program show weakly anomalous Cu values occurring in close proximity to the major structures within the EPM. Values for Pb are consistently <10ppm, suggesting background levels. Values for Zn are slightly elevated but show no apparent relationship with structure or geology.

EXPLORATION COMPLETED DURING THE CURRENT TERM

There has been no on ground exploration undertaken during the report period. Aeon continues to review its overall tenement portfolio regarding its prospectivity.

STATEMENTS

Statements of resources/reserves

In accordance with the Mineral Resources Regulation 2003, we confirm that no significant new resource has been identified.

Statement describing significant mineralisation

In accordance with the Mineral Resources Regulation 2003, no significant new mineralisation or related geological or structural features were identified.

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Statement of compliance

During the reporting period, there were no field activities undertaken within EPM 17297. The programme of works proposed for EPM 17297 for the period ending 20th June 2016 included the following activities outlined in Table 4.

Table 4 Programme of proposed works for Year ending 2016 within EPM 17297

YEAR 6 ACTIVITIES

Period ending June  RC and DD drilling to test priority targets 2016  Prospectivity analysis, review and reporting

No programme of works was undertaken for the current one-year period with no field work undertaken. As such, proposed activities for the year were not therefore met. During the forthcoming reporting period, the following activities were originally proposed within EPM 17297. Table 5 outlines the previously proposed activities.

Table 5 Programme of proposed works for Year ending 2017 within EPM 17297

YEAR 7 ACTIVITIES

Period ending August  Ground recon and further prospect mapping 2017  Prospectivity analysis, review and reporting

Copyright Statement - ACKNOWLEDGEMENT AND WARRANTY 1. Subject to 2, the tenure holder acknowledges that this Report, including the material, information and data incorporated in it, has been made under the direction or control of the State of Queensland (the State) within the meaning of section 176 of the Copyright Act 1968 (Cwth).

2. To the extent that copyright in any material included in this Report is not owned by the State, the tenure holder warrants that it has the full legal right and authority to grant, and does hereby grant, to the State following the final relinquishment of the tenement and subject to any confidentiality obligation undertaken by the State, the right to do (including to authorise any other person to do) any act in the copyright, including to:  Use;  Reproduce;  Publish;

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 Communicate in electronic form to the public, such material, including any data and information included in the material.

3. Without limiting the scope of 1 and 2 above, the tenure holder warrants that all relevant authorisations and consents have been obtained for all acts referred to in 1 and 2 above, to ensure that the doing of any of the acts is not unauthorised within the meaning of section 29(6) of the Copyright Act (Cwth).

CONCLUSIONS AND RECOMMENDATIONS

Exploration potential within the Blue Hills West EPM is primarily associated with the major structures transecting the tenement. The principal exploration focus is on the tectonic juxtaposition of Mount Isa Group strata against the Eastern Creek Volcanics by the Rufus-Annable and Wonomo Faults. The Mount Isa Group units, which outcrop towards the east of the tenement, are still relatively under-explored however surface geochemistry has not defined any significant geochemical anomalism which would encourage further exploration activity.

Aeon Metals plans the following work for the next twelve month period ending 20th June 2017:  Further reconnaissance, geological mapping and rock chipping along the faulted contacts with the Mount Isa Group sediments.

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REFERENCES

Adamson, T. 2011. Technical Report 17297, Exploration Permit for Minerals No. 17297 ‘Blue Hills West’, Queensland. Annual Tenement Report for the Period Ended 20 June 2011.

Blake, DH, Bultitude, RJ, Donchak, PJT, Wyborn Queensland. Dept. Resources and Energy, Bulletin 219, L.A.I., Hone, I.G. 1984. Geology of the Duchess-Urandangi Region, Mount Isa Inlier.

Carter, E.K. 1959. New stratigraphic units in the Pre-Cambrian of north-, Mining Journal, 60, 92.

Johnson, D. 2015. Exploration Permit for Minerals No. 17297, ‘Blue Hills West’, Queensland Annual Tenement Report for the period ended 20 June 2016

Murphy, F. C. et al. 2011. Mineral system analysis of the Mount Isa-McArthur River region, Northern Australia. Australian Journal of Earth Sciences, 58, 849-873.

Warburton, P. 2012. Technical Report 17297, Exploration Permit for Minerals No. 17297 ‘Blue Hills West’, Queensland. Annual Tenement Report for the Period Ended 20 June 2012.

Warburton, P. 2013. Technical Report 17297, Exploration Permit for Minerals No. 17297 ‘Blue Hills West’, Queensland. Annual Tenement Report for the Period Ended 20 June 2013.

Warburton, P. 2014. Technical Report 17297, Exploration Permit for Minerals No. 17297 ‘Blue Hills West’, Queensland. Annual Tenement Report for the Period Ended 20 June 2014.

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