Glandore Gold Project

The Glandore Project, held in joint venture with Aruma Exploration Pty Ltd, is located 40kms east of Kalgoorlie and 12kms (direct) from SAU’s Cannon Gold mine, on the western margin of Lake Yindarlgooda. The project is comprised of 11 prospecting and three mining licenses, covering 2,871ha of land. Historically the area has produced small tonnages of high grade gold from old shafts and workings.

The close proximity of the project to Southern Gold’s operating project at Cannon is seen as a significant advantage to bringing any discovered resources into production. The project area has seen extensive exploration drilling over the past thirty years on several prospects. These projects have been advanced to a stage where a JORC resource is anticipated to be determined with a minimal amount of drilling.

Local geology and tenement layout of the area covered by the Farm In and Joint Venture Agreement with Aruma Exploration Pty Ltd

Geology

Much of the Glandore Project lies within the north-west trending Moreland’s Group of Williams 1970 (GSWA) on the western limb of the Bulong Anticline. Locally, the tenements extend over a tightly folded package of mafics, ultramafics and felsic volcanics in the upper portion, with some chert and associated sediments, various mafic and ultramafic intrusives and minor felsic intrusives. Sediments from the regionally extensive lake Yindarlgooda and surficial sands overlie much of the area. The project sits within the northern end of an antiformal fold which hosts the Daisy Milano Mine and associated orebodies at its southern end. Mineralisation at Glandore is found in NW and NE trending veins within a large, differentiated, dolerite sill. The Lavaeolus fault system cuts through the hinge of the fold and acts a s a major conduit for the transport of mineralised fluids.

Mineralisation at Doughnut Jimmy and Lavaeolus is also associated with the contact between the dolerite sill and the overlying basalts which the sill intrudes. This mineralisation sits on the eastern limb of the antiform which dips shallowly (~30⁰) to the east. The western limb appears to be much more steeply dipping, particularly as it approaches the Goddard Fault, a major regional structure separating the Bulong Ultramafic Complex in the west from the Bulong Anticline in the east. Mineralisation may also be associated with a zone of mafic pegmatoids within the dolerite sill. These are rich in magnetite which may act as a suitable trigger for the precipitation of gold.

The Glandore Project area is cut by numerous felsic dykes, mainly in the southern half of the area. The majority are granitic in composition with a minor rhyolitic component. These are probably related to a small granite intruding the core of the antiformal fold.

Mineralisation

There are several well-developed targets within the Glandore Project including Doughnut Jimmy, Lavaeolus, Eastern Lode and Central Zone. Doughnut Jimmy, and Lavaeolus have had the greatest concentration of historical drilling targeting them. Intercepts from this period include 20m @ 4.6 g/t (from 12m) at Doughnut Jimmy and 10.25m @ 10.3 g/t (from 58m) at Lavaeolus. There is also exploration potential in less developed areas amongst old workings in the southern extents of the tenements.

The main mineralisation style is quartz vein hosted with disseminated carbonate alteration halos. In fresh rock, gold mineralisation is typically associated with biotite-pyrite alteration with variable sericite and ankerite. Gold intersections typically average around 5-10m at 2-5 g/t. High grade intersections of 1-5m at >10g/t are also present across the Glandore Project. The key challenge in this area is to determine the structural/lithological controls on these high-grade intersections to enable the definition of economic mineralisation in the short term.

The company believes that the Glandore Project has high potential to rapidly provide resources from several well-developed targets, as well as significant exploration potential within lesser known targets to the south.

The Lavaeolus and Doughnut Jimmy targets are highlighted on the above picture, along with significant gold intercepts from drilling and auger sampling.

Limonitic quartz veins with yellow carbonate alteration halos at Steve’s prospect on the floor of Lake Yindarlgooda

Section 6595638mN within the Doughnut Jimmy target. Future drilling (P1) is planned to target a large gap between high-grade gold intercepts. Inset shows a 3D representation of the section.