Sampling returns grades up to 39g/t Gold and 6.9% Cobalt

HIGHLIGHTS:

• Azure has acquired 100% ownership of the high-grade Sara Alicia gold-cobalt project
• Limited underground mining of gold and cobalt previously undertaken in 1930s
• Sampling returns very high grades of gold and cobalt in outcrop and in old mine workings
• Separate zones of copper-zinc-silver mineralisation also identified
• Follow-up exploration activities have commenced to define drill targets

Commenting on this acquisition, Azure Managing Director, Mr Tony Rovira said, “I am very excited by this new project. The high grades of gold and the exceptionally high cobalt assays have encouraged us to start drilling at Sara Alicia as soon as possible.”

Sampling by Azure returned spectacular high-grade gold and cobalt results, including:

Azure Minerals Limited (ASX: AZS) (“Azure” or “the Company”) is pleased to announce that it has further broadened and strengthened its Mexican exploration portfolio with the purchase of the Sara Alicia goldcobalt project, located in the northern state of Sonora.

Azure Managing Director Mr Tony Rovira also commented, “During Azure’s recent search for an advanced stage precious metal / base metal project, which culminated in the recently announced acquisition of the Oposura Project, the Company identified many early stage properties with good potential. One of the absolute stand-outs was the Sara Alicia gold-cobalt project.

“Cobalt deposits are virtually unknown in Mexico, which makes the identification by our exploration team of a property containing high-grade gold and cobalt mineralisation very commendable. This was an opportunity too good to pass up and its acquisition has added an extra dimension to our Company’s project portfolio.

“Spectacular grades returned from our first sampling program indicate that this under-explored property holds potential for the definition of a body of high grade gold-cobalt mineralisation, as well as for copper-zinc-silver mineralisation. We look forward to drilling Sara Alicia this year, along with progressing our flagship project Oposura.”

Key Terms and Background to the Acquisition

Early on in Azure’s search for new projects, the Company’s geologists identified the Sara Alicia district as an area of interest for precious and base metal mineralisation, including cobalt. The mineral concession that covered the historical Sara Alicia mine workings had recently been cancelled by the Mining Registry and was potentially unavailable for staking for several years. However, Azure’s legal team identified a course of action that, with the cooperation and assistance of the previous owners, enabled the cancellation to be revoked, and the ownership to be transferred to Azure’s wholly-owned Mexican subsidiary company Minera Piedra Azul SA de CV.

In recognition of their assistance, Azure made a payment of US$125,000 to the previous owners, a local Mexican family who had held title to the Sara Alicia mineral concession since the 1930s. A further and final payment of US$125,000 will be made to the family upon the project achieving commercial production. No royalties are payable over future mineral production and there are no back-in, earn-back or other rights.

Project Summary

Sara Alicia is located on the western flank of the Sierra Madre Occidental mining province which hosts major operating gold, silver and copper mines (see Figure 1). Access to site is good with a sealed road to the town of Alamos and the nearby Piedras Verdes Copper Mine, and then via gravel roads to site.

Historically, Sara Alicia was a small-scale producer of gold and cobalt in the 1930s from an underground mining operation. No production records are available, however historical plans and reports indicate that the mine was operated on six levels to a depth of approximately 60m below surface.

The Sara Alicia mineral concession covers nine hectares and contains all historical mine workings and all observed exposures of outcropping gold-cobalt mineralisation. A surrounding tenement that covered more than 22,000 hectares recently expired. The Mexican Mining Registry has yet to declare this vacant area available for claim and Azure will work to acquire these mineral rights when they become available.

Azure has carried out reconnaissance mapping and sampling within the Sara Alicia concession and in the surrounding district. Sampling of outcrops, mine dumps and old mine workings returned many significant assay results, which are shown in Figures 2 & 3 and detailed in Appendix 1.

Geologically, the Sara Alicia prospect hosts a thick sequence of carbonate rocks which have been intruded by a granodiorite porphyry. This intrusive event caused alteration and mineralising reactions in the limestones forming skarns, with precious and base metal mineralisation introduced into several separate horizons (or mantos) within the limestone sequence. One manto hosts the gold-cobalt mineralisation, while two and possibly more mantos contain copper-zinc-silver mineralisation.

All observed outcrops of the gold-cobalt manto are located within the Sara Alicia mineral concession. Additionally, mantos containing copper-zinc-silver mineralisation were observed and sampled within both the Sara Alicia concession and in the surrounding area.

Historical reports contain descriptions of similar occurrences elsewhere in the surrounding district, and these references will be checked by Azure’s geologists during their follow-up exploration.

Azure’s forthcoming exploration program will start with surveying of the old mine workings, geophysical surveys and detailed geological mapping and sampling. This will be followed up by drilling to test identified targets. First field activities have already commenced.

-ENDS-

For enquiries, please contact:

Competent Person Statements:

Information in this report that relates to Exploration Results for the Sara Alicia Project is based on information compiled by Mr Tony Rovira, who is a Member of The Australasian Institute of Mining and Metallurgy and fairly represents this information. Mr Rovira has sufficient experience relevant to the style of mineralisation and type of deposit under consideration, and to the activities undertaken, to qualify as a Competent Person as defined in the 2012 Edition of the Joint Ore Reserves Committee (JORC) Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Rovira is a full-time employee and Managing Director of Azure Minerals Limited and consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

APPENDIX I

Original Article: http://azureminerals.com.au/wp-content/uploads/2017/08/1704455.pdf