South West New Georgia Bauxite Project

Initial Exploration Target Defined

Potential for DSO-Quality Bauxite Confirmed

Shortly after its acquisition of the South West New Georgia Bauxite Project (SWNG) located in the Solomon Islands, the Company identified three distinct high-grade bauxite targets -each returning peak results of between 55% and 57% Al2O3 during its reconnaissance-sampling program (ASX announcements 8th August and 7th September 2017). The sampling program included 199 hand-auger drill holes and 40 shallow test-pits, for a total of 239 samples. Hand-held XRF results have been completed for all samples, with 130 (54%) samples returning results of more than 40% Al2O3 (alumina).

During the March 2018 quarter, the Company delineated a large initial Exploration Target at SWNG. The Company’s exploration activities resulted in the definition of large areas of high-tenor bauxitic soils, grading +40% Al2O3, (alumina) (Figures 2 and 3). Distinct high-grade targets, with characteristics suitable for DSO quality bauxite, were identified throughout the SWNG area in this phase of exploration.

Two areas in the southern part of the SWNG Prospecting Licence – the Kindu and Dunde prospects – were identified as priority targets due to the high grade Al2O3 and low-silica content.

An initial Exploration Target* of 5.92Mt – 10.05Mt @ 41.0% – 48.0% Al2O3 and 9.5% – 11.8% SiO2 (Table 1) has been estimated at the Kindu and Dunde prospects. These two targets are now the priority focus for Resource definition work, scheduled to commence in the near future.

Table 1 – Initial Exploration Target for the Kindu and Dunde Prospects, South West New Georgia Project.
*This Exploration Target is not a Mineral Resource as defined by JORC 2012. The target is conceptual in nature and, to date, there has been insufficient exploration to define a Mineral Resource and it is uncertain if further exploration will result in the determination of a Mineral Resource. Additional details defining the basis for this target are presented within this document.

 The Exploration Target was defined using the results of the Company’s recently completed extensive auger drilling and sampling program at the Project. A total of 562 hand-auger holes were completed, with 1092 samples taken; of these samples, 979 were analysed at the Company’s field laboratory via hand-held XRF.

Laboratory analysis of samples taken from within the Company’s exploration target area (ASX announcement – 27th March 2018) (Figure 3) validated field XRF results and defined “available alumina” and “reactive silica” values (Table 1) similar in quality to the Company’s Nendo project and other DSO operations in the Southeast Asia – Pacific region.

Figure 2 – Satellite Imagery of the SNWG Project, including auger drilling locations, colour-coded with grade ranges for field hand-held XRF Al2O3 results.

 Figure 3 – Satellite Imagery of SWNG (southern area), including auger drilling locations, colour coded with grade ranges from field hand-held XRF Al2O3 results, samples submitted for laboratory analysis (white squares) and areas of interest pertaining to the current Exploration Target (yellow polygons).

Significant Infrastructure Requirements in Place

SWNG is adjacent to commercial port facilities offering significant infrastructure advantages for any future export mining operations. The Noro Port can accommodate Handymax and Supermax bulk cargo ships and is subject to an infrastructure upgrade program in the near term. The SWNG project is well serviced by daily domestic flights from Honiara to Munda Airport, which is currently being upgraded to accommodate international flights. Access within the project appears good with extensive logging tracks crisscrossing the SWNG Prospecting Licence.

South West New Georgia Project Summary

During the September 2017 Quarter, the Company completed its acquisition of the South West New Georgia Bauxite Project (SWNG) in the Solomon Islands (ASX announcement 4th August 2017), following the receipt of final approval from the Solomon Islands Government’s Ministry of Mines, Energy and Rural Electrification (MMERE) for Prospecting Licence PL04/17, which covers the SWNG project area (Prospecting Licence).

The Company believes SWNG is prospective for large tonnage DSO bauxite mineralisation, which appears analogous with deposits in the Nendo and Rennell Islands, both within the Solomon Islands (Figure 1). This style of mineralisation provides the opportunity for quick, cost-effective resource definition and a simple, low cost, dig-load-ship style mining operation.

The SWNG Prospecting Licence covers an area of 236km² and targets bauxitic clays on uplifted limestone reef (averaging more than 100m above sea level). Much of the tenure at SWNG appears unexplored, and represents a significant exploration opportunity for Pacific Bauxite.

The area to be explored within the new Prospecting Licence is three times the area being targeted by the Company at Nendo.

Prior exploration by Australian companies in the early 1970’s identified extensive areas of bauxite mineralisation and postulated the potential for economic deposits at SWNG. Historical work targeted the southern part of the application, north of the town of Munda, and included several hand-auger drilling programs and test pitting. The main drilling campaign focused on an area of approximately 3.5 km by 1 km and included 39 auger holes for 101 samples. This work identified substantial tonnages of material with grades of between 40% and 45% total Al2O3 and 5% to 10% total SiO2.

The Prospecting Licence has been granted to Pacific Bauxite by the MMERE for an initial period of three years and can be extended for two years upon application. A further extension of two years may be applied for.

The Company has received overwhelming widespread local support for its proposed prospecting activities at SWNG. The Prospecting Licence was granted followed an extensive Awareness Program, conducted by Pacific Bauxite and involving all stakeholders including traditional landowners, local communities, and both Provincial and National Government representatives.