Kavango Resources Regulatory News (KAV)

PRESS RELEASE

6 August 2020

KAVANGO RESOURCES PLC

("Kavango" or "the Company")

New Petrology Report for KSZ, Botswana

Kavango Resources plc (LSE:KAV), the exploration company targeting the discovery of world-class mineral deposits in Botswana, is pleased to announce the release of a new report by independent consultant, Dr Martin Prendergast, on the petrology and mineral composition of core samples, taken from the Kalahari Suture Zone ("KSZ") during the 2019 drill campaign (the "Report").

Significantly, Dr Prendergast's Report confirms two further shared characteristics of the geology of the KSZ and that of the Norilsk deposits in Russia. The Norilsk deposits host some of the world's richest mineralised zones of copper-nickel-platinum group metals ("PGMs").

Highlights

v The Report confirms:

- The presence of cumulate rocks

- Sulphide liquid fractionation

v Despite the continuing lockdown in Botswana, Kavango has been able to courier core samples from the 2019 KSZ drill campaign to a laboratory in Johannesburg for whole rock analysis and the preparation of polished thin sections. The thin sections and analytical data were then couriered to Dr Prendergast in Scotland for interpretation and reporting.

v Dr Prendergast's Report and the thin sections will now be sent to Dr David Holwell and his team at the University of Leicester for further interpretation and an update of his KSZ Mineral Systems Review ("MSR").

Michael Foster, Chief Executive Officer of Kavango Resources, commented:

"The publication by our consultant, Dr Prendergast, of his report is an important step forward for the Company, as it seeks to validate its exploration hypothesis that one or more 'Norilsk style' deposits exist in association with magmatic rocks along the KSZ structure in SW Botswana.

There now seems little doubt that there was enough sulphur in the magma to form a metal sulphide liquid phase. Dr Prendergast's report suggests that as much as 50% of the nickel and perhaps all of the copper in the magma may have precipitated as metal sulphides. The quantity of metal sulphide precipitated is a function of how much magma passed through the system on its way to the surface. All the indications suggest that it was in the order of several thousand cubic kilometres. Where the metal sulphide was precipitated and eventually crystallised is now the main focus of the company's exploration. Geological modelling of the gabbroic intrusives in the Hukuntsi area identify areas of gabbro sill thickening similar to those associated with major orebodies at Norilsk. These zones of sill thickening are now being mapped and evaluated. Targets for ground based low frequency EM surveying are being selected and the surveys will be carried out once the Covid-19 restrictions have been lifted."

The new petrology report by Dr Prendergast

Dr Prendergast's Report on the analysis of core samples from Kavango's drilling at Hukuntsi (the northern section of the KSZ) confirms the conclusions made in his earlier report (2015) on the analysis of core samples taken from the Canadian funded Kalahari Drilling Project in the early 1980's.

However, Dr Prendergast also makes a number of additional observations that further support the similarities between the KSZ and the Norilsk deposits in Russia.

In the KSZ Mineral Systems Review ("MSR"), prepared by Dr David Holwell on behalf of Kavango and released on 29 April 2020, he confirmed the presence of ten geological characteristics found in the KSZ and usually associated with economically viable magmatic sulphide deposits.

From his study of the latest core samples, Dr Prendergast confirms the presence of a further two characteristics to add to the list. These are:

- Presence of Cumulate rocks

- Sulphide liquid fractionation

The observation of sedimentary grains of silica in the gabbro again confirms that Karoo sediments (including sulphur rich coal measures) were incorporated into the magma. This is supported by the sulphur content of the samples which are generally well above average values for magmatic gabbro. For example, one sample recorded a sulphur value of 18,700ppm.

Dr Prendergast noted that all of the copper and some of the nickel resides in the sulphides, which suggests that free sulphur was available for the development of a dense copper-nickel rich sulphide (immiscible) liquid phase.

Kavango will incorporate Dr Prendergast's findings and comments into future work plans in the KSZ.

Dr Holwell's MSR of the KSV can be read here -

https://www.kavangoresources.com/media/attachments/2020/04/29/mineral-systems-review-of-the-ksz-botswana.pdf

To view a short presentation by Kavango's director, founder and chief geologist, Mike Moles, about the KSZ's potential to host one or more 'Norilsk style' deposits please visit

https://twitter.com/KavangoRes/status/1286236091972976641?s=20 

Further information in respect of the Company and its business interests is provided on the Company's website at www.kavangoresources.com and on Twitter at #KAV.

For further information please contact:

 Kavango Resources plc

Michael Foster, CEO mfoster@kavangoresources.com

SI Capital Limited (Broker)

Nick Emerson +44 1483 413500

Note to Editors:

Dr Prendergast is an independent geologist and consultant. He is recognized as a leading authority on magmatic sulphides worldwide with particular expertise on copper-nickel-PGE deposits in Southern Africa. He is the author of numerous academic papers on the subject. He has been a consultant of Kavango Minerals since 2014.

Kalahari Suture Zone

Kavango's 100% subsidiary in Botswana, Kavango Minerals (Pty) Ltd, is the holder of 12 prospecting licences covering 8,324.7km2 of ground, including 10 licences over a significant portion of the 450km long KSZ magnetic anomaly in the southwest of the country along which Kavango is exploring for copper-nickel-PGM rich sulphide ore bodies. This large area, which is entirely covered by Cretaceous and post-Cretaceous Kalahari sediments, has not previously been explored using modern techniques.

The area covered by Kavango's KSZ licences displays a geological setting with distinct similarities to that hosting world class magmatic sulphide deposits such as those at Norilsk (Siberia) and Voisey's Bay (Canada). 

The Norilsk mining centre is about 2,800km northeast of Moscow and accounts for 90% of Russia's nickel reserves, 55% of its copper and virtually all of its PGMs. Kavango's licenses in the KSZ display a geological setting with distinct geological similarities to the magmatic sulphide deposits at Norilsk. Magma plumbing systems are a key feature of these deposits.

 KSZ Definitions

When a deposit consists almost entirely of sulphides it is termed "massive". When it consists of grains or crystals of sulphide in a matrix of silicate minerals, it is termed "disseminated".

Gabbro/gabbroic: A coarse grained, medium to dark coloured rock, formed from the intrusion of mantle derived molten magma into the earth's crust. Gabbroic rocks (or "gabbros") formed as the molten magma cooled.

Gabbroic sills: Relatively thin, planar bodies of solidified gabbroic magma that intruded into layers of sedimentary rock whilst still molten.

High-level sills: Are sills that are emplaced in the upper levels of the earth's crust, close to the surface.

Karoo: The Karoo System covers 1.5 million km2 of the semi-desert region region of Southern Africa. Rocks in this system formed 180-310 million years ago.

Magma Plumbing System: Magma plumbing systems are composed of stacked horizontal sills connected to each other via vertical dykes. A continuous flow of magma (containing "free" sulphur) through a magma plumbing system may have allowed the accumulation of metal sulphides in certain trap sites within the sills. This is because metal sulphides are heavy and tend to sink to the bottom of magma. Over time, accumulations of metal sulphide could have led to the formation of economic deposits of Copper-Nickel-PGMs. 

Primary sulphides: Are sulphide complexes (or crystals) that form as the magma cools and are composed of elements that are present at the time of initial crystallization. Secondary sulphides may form after the magma has solidified either by the introduction of new elements into the rock or by re-mobilising elements already present through changes in pressure, heat etc.

Sulphide mineralisation: If there is sufficient sulphur in the molten magma, it will tend to combine with metals (Cu, Zn, Ni, Co, Pb, PGEs etc.) to form metal sulphide complexes, which may coalesce to form massive sulphide deposits. If the melt is sulphide poor, the metals will be taken up into the silicate minerals that form as the magma cools and will not usually form economic deposits.