Thor Energy Regulatory News (THR)

30 April 2020

THOR MINING PLC

("THOR" OR THE "COMPANY")

QUARTERLY REPORT JANUARY TO MARCH 2020

CORPORATE & FINANCE

The Spring Hill gold royalty sale process continues, and it is expected that the Company will be in a position to advise successful completion in June.

During the quarter the Company completed the sale of its interest in Hawkstone Mining Limited.

Mr Mick Billing, Executive Chairman, commented:

"Challenging market conditions prevail, & we have taken further steps to reduce overheads, along with taking advantage of Australian government COVID-19 initiatives aimed at meeting some employment costs. We expect also that we will be able to complete the sale of the Spring Hill royalty shortly, and we look forward to providing details of our exciting potential new asset acquisition when finalised."

"Our ISR copper investments continue to develop value with excellent outcomes from testwork at Kapunda. We hope to be able to advise final drill assays shortly. Critically however the real story at Kapunda is the ongoing buildup of evidence that the ISR process will work in practice".

"We have continued to add value to the Molyhil project with the release of resource estimates at Bonya in January, potentially adding materially to the life and economic outcomes of the project".

"In addition, recent renewed interest by the Australian government in critical minerals has resulted in increased support for projects of this nature, and we hope to be able to take advantage of this."

"Finally, the initial sampling program in our 100% owned Pilbara project produced some outstanding initial results, and we look forward to follow up work on these, once COVID-19 access restrictions are lifted." 

COPPER PROJECTS

KAPUNDA and MOONTA COPPER PROJECTS - SA

Thor holds a 25% equity interest in private Australian company, EnviroCopper Limited ("ECL"), along with rights to acquire a further 5% interest via investment of an additional A$0.4million, of which A$0.1million has been advanced. In turn ECL has entered into an agreement to earn, in two stages, up to 75% of the rights over metals which may be recovered via in-situ recovery ("ISR") contained in the Kapunda deposit from Australian listed company, Terramin Australia Limited ("Terramin" ASX: "TZN"), and rights to 75% of Moonta copper project comprising the northern portion of exploration licence EL5984 held by Andromeda Metals Limited (ASX:ADN).

Information about EnviroCopper Limited and its projects can be found on the EnviroCopper website:

https://www.envirocopper.com.au/

During 2018, the Australian Government Ministry for Science, Jobs and Innovation announced an offer to ECR for research funding of A$2,851,303, over a 30 month period, for the Kapunda In-Situ Copper and Gold Recovery Trial.

During the June 2019 quarter the Company advised of successful gold recovery from Kapunda core, in addition to copper recovery, using a CSIRO developed thiosulphate product, instead of, the more normal, cyanide. As reported (ref ASX announcement of 3 April 2019), gold has been intersected in a number of holes at Kapunda, within the existing copper resource, and results for 28 surface & drill core samples historically reported to range from 0.6 to 5.54 dwts /ton (approx 0.93 to 8.58 g/t), with best results of 95.1 metres @ 3.06g/t gold from 2.4metres depth.

Field pump tests of the flow of fluids through the deposit for successful ISR activities were conducted during the quarter. The program involved drilling three holes, in the southern portion of the deposit during the December quarter, all of which intersected copper, followed by a series of testwork which are ongoing. This testwork continues, however to date, all results consistently support the concept that ISR copper recovery at Kapunda is technically feasible.

Pumping of groundwater from the holes drilled showed a rapid response in the water levels from those nearby, indicating good connectivity associated with favourable porosity and permeability. This has been reinforced with specific inert tracer chemical tests demonstrating successful flow through the ground rock between holes.

Ongoing work includes large scale column leach testwork of drilling samples, & also some extractive work (ion exchange & electro-winning) on copper & other metals contained in the local groundwater, which have dissolved naturally over time. We expect to be able to release the results of these activities during the June quarter.

Other near-term activities at Kapunda include continued community liaison in respect of project activities, testwork on historical drill core to determine the optimum extraction agent (lixiviant) most suited to the Kapunda deposit and establishing appropriate parameters for future field recovery trial work.

Moonta

During the September 2019 quarter the Company advised that EnviroCopper Limited, on behalf of Environmental Metals Recovery, had completed a Mineral Resource Estimate (MRE) on several of the deposits at Moonta, based on substantial historical drilling. The results of this study was an Inferred Resource estimate of 66.1 million tonnes (MT) grading 0.17% copper (Cu), containing 114,000 tonnes of contained copper, at a cutoff grade of 0.05%Cu.

The full details of the resource announcement may be accessed via the following link:

https://www.asx.com.au/asxpdf/20190815/pdf/447hw9dbbkg94b.pdf

The Company is not aware of any new information or data which would materially affect the Mineral Resource, and all assumptions and key technical parameters relevant to the estimate remain unchanged. 

TUNGSTEN PROJECTS

Tungsten and Molybdenum Price Trends

During March and April, global tungsten and molybdenum prices dipped in response to weaker manufacturing and infrastructure demand, brought on by the global COVID-19 pandemic. 

At the date of this report, the price of tungsten, per mtu of APT (Ammonium Para Tungstate) sits between US$195/mtu and US$220/mtu, while the molybdenum price sits at US$8.25/lb. 

Industry discussion continues to forecast tight supply conditions for tungsten concentrates and downstream products, with dominant global supplier, China, enforcing improved environmental standards, and restricting the issue of new mine production licences . This implies a recovery in tungsten pricing when the global economy commences an upturn. In addition, industry expectations are that molybdenum will be subject to supply constraints for several years.

MOLYHIL TUNGSTEN PROJECT - NT (100% Thor)

During the quarter, Thor continued discussions with various potential partners who have expressed interest, in either off-take, joint venture or debt finance arrangements. It is hoped that, on the back of improved global markets, a favourable arrangement can be finalised in the near term.

Adjacent to Molyhil, the Bonya tenements, in which Thor holds a 40% interest, host outcropping tungsten deposits, a copper resource and a vanadium deposit.

During the quarter, following completion of a reverse circulation (RC) drilling program at the nearby Bonya JV tenement, maiden mineral resource estimates on the White Violet and Samarkand tungsten deposits were published.

A full background on the project is available on the Thor Mining website www.thormining.com/projects.

During the December quarter, on 10 October 2019, the Company reported an updated Mineral resource estimate for the Molyhil deposit comprising Indicated and Inferred Mineral Resources of 4.7 million tonnes at 0.28% WO₃ (Tungsten trioxide), 0.14% Mo (Molybdenum), 0.05% Cu (Copper), and 18.0% Fe (Iron) above a cut-off grade of 0.12% WO3 equivalent.

The revised resource estimate increased contained WO₃ by 1.5%, and contained Mo by 9.3% compared with the previous estimate, and includes copper, which had not previously been reported since 2006.

An update to the Open Cut Ore Reserve, and the Definitive feasibility Study (DFS) has not been commissioned at this stage, however the directors may elect to revisit these with any improvement in the Bonya deposits resources classification beyond Inferred status.

Table A: Molyhil Summary JORC (2012) Mineral Resource Estimate - Reported 10 October, 2019

Notes:

· Thor Mining PLC holds 100% equity interest in this project.

· The Mineral Resource is reported at 0.12% WO3 equivalent cut-off and above 200mRL only on a dry, in-situ basis

· The Company is not aware of any information or data which would materially affect the Mineral Resource, and all assumptions and key technical parameters relevant to the previous estimate remain unchanged.

Details of the resource announcement may be accessed via the following link:

https://www.asx.com.au/asxpdf/20191011/pdf/449d2szw7y7hzy.pdf 

The Company is in discussion with several Australian Commonwealth government agencies each of which are mandated to assist companies with projects to develop and produce critical minerals, which includes tungsten. These agencies include; Export Finance Australia, Defence Export Facility, Critical Minerals Facilitation Office and the North Australian Infrastructure Facility. Further announcements will be made as appropriate.

Bonya (Tungsten, Copper, Vanadium) (40% Thor)

During the quarter, after a December quarter RC drilling program the Joint Venture was able to report a maiden resource estimate for the White Violet and Samarkand deposits on 29 January 2020.

https://www.thormining.com/sites/thormining/media/pdf/asx-announcements/20200129-mineral-resource-estimates---bonya-tungsten--copper.pdf 

The updated Mineral Resource Inventory for Bonya licence to date is shown in Table B and Table C below:

Table B: Bonya Tungsten Mineral Resources (announced 29 January 2020)

Notes:

· 0.05% WO3 cut-off grade.

· Totals may differ from the addition of columns due to rounding.

· Thor Mining PLC holds 40% equity interest in this project.

· The Company is not aware of any information or data which would materially affect this previously announced resource estimate, and all assumptions and technical parameters relevant to the estimate remain unchanged.

Table C: Bonya Copper Mineral Resources (announced 26 November 2018)

Notes:

· 0.2% Cu cut-off grade.

· Totals may differ from the addition of columns due to rounding.

· Thor Mining PLC holds 40% equity interest in this project 

· The Company is not aware of any information or data which would materially affect this previously announced resource estimate, and all assumptions and technical parameters relevant to the estimate remain unchanged.

Vanadium

During the September quarter, Thor and Arafura Resources, released details of a study outlining the potential of the Jervois Vanadium Project, along with a proposed development plan. The study details can be accessed via the following link:

https://www.asx.com.au/asxpdf/20190703/pdf/446bv386tvk7fh.pdf

PILOT MOUNTAIN TUNGSTEN PROJECT - NEVADA USA (100% Thor)

Thor's Pilot Mountain Project, acquired in 2014, is located approximately 200 kilometres south of the city of Reno and 20 kilometres east of the town of Mina, located on US Highway 95.

The Pilot Mountain Project is comprised of four tungsten deposits: Desert Scheelite, Gunmetal, Garnet and Good Hope. All of these deposits are in close proximity (~three kilometres) to each other and have been subjected to small-scale mining activities at various times during the 20th century.

A full background on the project is available on the Thor Mining website www.thormining.com/projects. 

The directors believe Pilot Mountain's resource is substantial on a global scale, and has potential for significant growth, in particular from the discovery in the August 2017 drilling program of an additional parallel zone of scheelite mineralisation at the Desert Scheelite deposit (Figure 6.).

The directors believe that the Desert Scheelite resource, which outcrops at surface at the western end for more than 400 metres, has potential to develop into a long term open pit mining operation which, when supplemented by higher grade mineralisation from the other deposits at Pilot Mountain, has the potential for a longer term profitable operation.

This significant tungsten resource is strategically located in the USA and tungsten has been confirmed by the US Department of the Interior as a critical mineral in 2018.

Locked cycle testwork on material from the Desert Scheelite deposit, was completed during the June 2019 quarter, resulting in production of a high grade scheelite concentrate grading 68% WO₃ with recovery of 73.6%. 

Environmental study parameters are being established with relevant agencies, and Infrastructure studies have also commenced.

OTHER PROJECTS

During the quarter (on 16 January 2020), the Company released results from a field reconnaissance program incorporating soil and stream sediment sampling conducted during the December, on the Pilbara Gold licences, in Western Australia.

The results showed mineralisation in 17 of the 44 sites sampled. Of the mineralised samples, 15 contained gold, and two encountered nickel and chromium. The released results can be accessed via the following link:

https://www.thormining.com/sites/thormining/media/pdf/asx-announcements/20200117-asx-pilbara-gold-reconn-assays.pdf 

The principle focus of the stream sediment survey was the preliminary evaluation of the gold potential, and this appears to have been very successful. The encouraging nickel and chrome results achieved in the western part of E46/1262 were not expected. A subsequent literature search specific to the nickel potential on the tenement has highlighted the presence of a north south trending gossan with anomalous nickel (1018 ppm) previously mapped by the WA geological survey over a 1km strike length. The gossan occurs approximately 2km south east and in the same ultramafic unit as the recent positive stream sediment results. Because the gossan was not identified before the recent stream sediment survey, that gossan will not have been tested.

The Company now has a strong nickel target, as well as several very promising gold targets, for follow up field evaluation during the course of 2020, and once COVID-19 related restrictions are eased, that will be scheduled as a priority.

SPRING HILL GOLD PROJECT - NT (ROYALTY ENTITLEMENT)

In February 2017 Thor completed the A$3.5 million sale of its Spring Hill Gold project¹. The sale transaction carries an ongoing residual royalty of:

· 1BA$6 per ounce of gold produced from the Spring Hill tenements where the gold produced is sold for up to A$1,500 per ounce; and

· A$14 per ounce of gold produced from the Spring Hill tenements where the gold produced is sold for amounts over A$1,500 per ounce.

¹Refer AIM announcement of 26 February 2016 and ASX announcement of 29 February 2016

No royalties were received during the quarter, however the owners of the Spring Hill project have advised that they are progressing mine permitting, and also that the treatment plant for toll processing the ore has been refurbished. They are hopeful of commencement of operations in the near term.

The Company is engaged in the process of selling this royalty, and it is expected that this will be successfully concluded shortly.

Competent Person's Report

The information in this report that relates to exploration results, and exploration targets, is based on information compiled by Richard Bradey, who is a Member of The Australasian Institute of Mining and Metallurgy. Mr Bradey is an employee of Thor Mining PLC. He has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Richard Bradey consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

Enquiries:

The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

Updates on the Company's activities are regularly posted on Thor's website www.thormining.com, which includes a facility to register to receive these updates by email, and on the Company's twitter page @ThorMining.

About Thor Mining PLC

Thor Mining PLC (AIM, ASX: THR) is a resources company quoted on the AIM Market of the London Stock Exchange and on ASX in Australia.

Thor holds 100% of the advanced Molyhil tungsten project in the Northern Territory of Australia, for which an updated feasibility study in August 2018¹ suggested attractive returns.

Adjacent Molyhil, at Bonya, Thor holds a 40% interest in deposits of tungsten, copper, and vanadium, including an Inferred resource for the Bonya copper deposit².

Thor also holds 100% of the Pilot Mountain tungsten project in Nevada USA which has a JORC 2012 Indicated and Inferred Resources Estimate³ on 2 of the 4 known deposits. The US Department of the Interior has confirmed that tungsten, the primary resource mineral at Pilot Mountain, has been included in the final list of Critical Minerals 2018.

Thor is also acquiring up to a 30% interest Australian copper development company EnviroCopper Limited, which in turn holds rights to earn up to a 75% interest in the mineral rights and claims over the resource on the portion of the historic Kapunda copper mine in South Australia recoverable by way of in situ recovery⁴, and also holds rights to earn a 75% interest in portion of the Moonta Copper project also in South Australia, and is considered amenable to recovery by way of in situ recovery⁵.

Finally, Thor also holds a production royalty entitlement from the Spring Hill Gold project⁵ of:

•  A$6 per ounce of gold produced from the Spring Hill tenements where the gold produced is sold for up to A$1,500 per ounce; and

•  A$14 per ounce of gold produced from the Spring Hill tenements where the gold produced is sold for amounts over A$1,500 per ounce.

Notes

¹ Refer ASX and AIM announcement of 23 August 2018

² Refer ASX and AIM announcement of 26 November 2018

³ Refer AIM announcement of 13 December 2018 and ASX announcement of 14 December 2018

⁴ Refer AIM announcement of 10 February 2016 and ASX announcement of 12 February 2018

⁵ Refer AIM announcement of 26 February 2016 and ASX announcement of 29 February 2016

TENEMENT SCHEDULE

At 31 March 2020, the consolidated entity holds an interest in the following Australian tenements:

At 31 March 2020, the consolidated entity holds an interest in the following tenements in the US State of Nevada:

Appendix 5B

1.1 Mining exploration entity or oil and gas exploration entityquarterly cash flow report

1.7.1

The amount at Item 6.1 above represents payments to Directors for Directors fees, the salary paid to the Executive Director, Richard Bradey, and other consulting services provided, including services provided by Mick Billing as CEO.

1.12 Compliance statement

1 This statement has been prepared in accordance with accounting standards and policies which comply with Listing Rule 19.11A.

2 This statement gives a true and fair view of the matters disclosed.

Date: 30 April 2020….....................................................

Authorised by: ...By the Board...........................................................

(Name of body or officer authorising release - see note 4)

1.13 Notes

1. This quarterly cash flow report and the accompanying activity report provide a basis for informing the market about the entity's activities for the past quarter, how they have been financed and the effect this has had on its cash position. An entity that wishes to disclose additional information over and above the minimum required under the Listing Rules is encouraged to do so.

2. If this quarterly cash flow report has been prepared in accordance with Australian Accounting Standards, the definitions in, and provisions of, AASB 6: Exploration for and Evaluation of Mineral Resources and AASB 107: Statement of Cash Flows apply to this report. If this quarterly cash flow report has been prepared in accordance with other accounting standards agreed by ASX pursuant to Listing Rule 19.11A, the corresponding equivalent standards apply to this report.

3. Dividends received may be classified either as cash flows from operating activities or cash flows from investing activities, depending on the accounting policy of the entity.

4. If this report has been authorised for release to the market by your board of directors, you can insert here: "By the board". If it has been authorised for release to the market by a committee of your board of directors, you can insert here: "By the [name of board committee - eg Audit and Risk Committee]". If it has been authorised for release to the market by a disclosure committee, you can insert here: "By the Disclosure Committee".

5. If this report has been authorised for release to the market by your board of directors and you wish to hold yourself out as complying with recommendation 4.2 of the ASX Corporate Governance Council's Corporate Governance Principles and Recommendations, the board should have received a declaration from its CEO and CFO that, in their opinion, the financial records of the entity have been properly maintained, that this report complies with the appropriate accounting standards and gives a true and fair view of the cash flows of the entity, and that their opinion has been formed on the basis of a sound system of risk management and internal control which is operating effectively.