McArthur River Project Annual Report period 1 August 2019 to 31 July 2020

Abstract

The McArthur River project is comprised of a single exploration licence, EL 31686 covering 92.2km2 in the McArthur River Zinc district of the Northern Territory. The region is known to host the McArthur River Mine situated about 70 km southwest of Borroloola, in the McArthur Basin. It is operated by McArthur River Mining Pty Ltd (MRM), a subsidiary of Glencore PLC. It opened as an underground mine in 1995 and has since converted to open cut. In 2014, production from McArthur River totalled 224,000t of zinc, 46,200t of lead and 1.46 million ounces of silver. The McArthur River mine has a total resource of 202.3 Mt @ 10% Zn, 4.06% Pb, 46 g/t Ag. Zinc mineralisation in the region is regarded as a sedimentary exhalative (SEDEX) deposit, comprising fine-grained thinly bedded sulphide ore hosted in the HYC Pyritic Shale Member of the Barney Creek Formation. Another large SEDEX style zinc deposit was discovered in 2013 at Teena, 10 km west of McArthur River, by a Teck Australia-Rox Resources joint venture. Teena is a very similar style of highgrade mineralisation to McArthur River, with drill intersections including 38.8m @ 16.9% Zn+Pb. (https://core.nt.gov.au/resources/commodities-in-the-nt/zinc-lead-silver). Little historic work has been conducted over EL 31686 with a modest 71 historic surface samples on record, 70 being stream sediments and 1 whole rock samples. This limited surface sampling is deemed ineffective for the implied stratigraphy of EL 31686 with the prospective Barney creek formation believed to be present at depth. Similarly historic drilling is limited to 1 diamond hole in the south of EL 31686 at the historic Leila prospect supported by 5 shallow percussion holes which are recorded as failed waterbores. There are also 2 shallow percussion holes recorded in the north of EL 31686 which collared and ended in Caranbirini member of the McArthur River formation which is notably younger and sits above the prospective Barney Creek formation. Historic Geophysics have been conducted across the region with no known modern processing having been conducted to refine and differentiate known conductors and identify deeper seated pospectivity in the region below the young alluvial cover dominating the tenements topography and hampering previous exploration. The work program within this reporting period has been severely restricted due to the COVID-19 Pandemic, along with the depressed zinc market sentiment. Work completed has included data compilation, re-assessment of historic geophysical surveys and initial field work preparations. This report details work conducted by BMEx during its second year of tenure.