TORONTO, 2016-01-19 13:00 CET (GLOBE NEWSWIRE) --
Mandalay Resources Corporation ("Mandalay" or the "Company") (TSX:MND) is
pleased to provide 2015 year-end exploration updates for all three of its
mines. Figures accompanying this release can be found in an exploration
presentation posted on the Company's website. It can be accessed here:
http://www.mandalayresources.com/investor-presentations/Technical_Presentations
Brad Mills, CEO of Mandalay, commented, "Our exploration programs across the Company once again continued on track to approximately replace reserves with our end-of-2015 resource and reserves update expected to be released in mid-February, 2016. Exploration at all sites continued to identify new quality target areas for future exploration. At Costerfield, exciting new intercepts suggest that at least three branches of the Cuffley lode occur below the King Cobra fault in the vicinity of our underground infrastructure; all three contain high gold and/or antimony grades and we are optimistic that further drilling planned for 2016 will outline a potentially significant new resource. Intercepts obtained at the Margaret and Brunswick targets have confirmed the presence of mineralized veins and improved our understanding of the structural settings for potential mineralization in these areas. Finally, an initial round of shallow reverse circulation drilling to test the large top-of-bedrock gold and antimony anomaly at West Costerfield has demonstrated the presence of an extensive system of mineralized structures, which may be followed up by core drilling in 2016."
Mr. Mills continued, "At Cerro Bayo, drilling under Laguna Verde continued to reveal the southeast and depth limits of the Coyita vein, with a gap remaining in the middle of the lake that has proved difficult to drill from currently accessible locations. New intercepts on the Yasna vein under Laguna Verde have further defined and slightly enlarged this ore shoot as well. We expect modest increases in resources on both these veins at the year-end 2015 resources and reserves update. Our first hole to test below the northeastern half of the lake intersected a new vein called Victoria. While this wide intercept did not contain economic grades, it indicates that significant structures exist to the east of the current Laguna Verde vein system that were active at the time of mineralization."
Mr. Mills concluded, "At Björkdal, drilling has pushed the limits of underground mineralization some 200 m to the north and up to 100 m to east and northeast. We expect this work will translate into a significant increase in underground resources and reserves in our year-end reserve and resource update. Furthermore, drilling results in and around the southeast part of the open pit suggests we will be able to expand the pit in this area. This year's core drilling has also confirmed the validity of the Nylunds resource model that had previously only been defined by historic RC drilling. We expect the Nylunds resource to convert to a new open pit reserve as a result. Finally, a new mineralized zone was intercepted in the Storheden area some 700 m north of the current Björkdal mine. This intercept, which is anomalously wide for the district, represents a new high quality exploration target for the coming year."
Costerfield
Drilling, Sampling, and Assaying
During the second half of 2015, Mandalay drilled 11,525 metres ("m") of diamond core in 29 holes on Cuffley, Sub-King Cobra, Margaret, Brunswick and Corridor projects (Figure 1). In addition, the Company completed 1,781 m of on-vein operating development and associated sampling of the N- and Cuffley lodes. Thirty-eight reverse circulation ("RC") drill holes totaling 2,780 m were drilled at the West Costerfield bedrock geochemical anomaly. Diamond drill core and RC cuttings were logged and sampled by Costerfield geologists, who also mapped and sampled the development advances. All samples were sent to Onsite Laboratory in Bendigo, Victoria, Australia, (with the exception of the West Costerfield and Margaret drilling samples that were sent to ALS in Orange, NSW, Australia) for sample preparation and assay. Site geological and metallurgical personnel have implemented a QA/QC process that includes the regular submission of standard reference materials and blanks with drill and face samples submitted for assay. Standard reference materials have been certified by Geostats Pty Ltd. (see March 31, 2015, Technical Report entitled "Costerfield Operation, Victoria, Australia NI 43-101 Report", available on SEDAR (www.sedar.com), which contains a complete description of drilling, sampling, and assaying procedures).
Drill Results
Assay results are summarized in Tables 1 through 6 below; they are displayed in geologic context in Figures 2 through 7.
Cuffley Main (Table 1; Figure 2)
-- Four new intercepts were obtained in the Cuffley Main zone, incidental to testing the Corridor target. The highest grade of these, COR003, intercepted 0.045 m at 14.4 grams per tonne ("g/t") gold ("Au") and 2.3% antimony ("Sb"). -- These intercepts were generated while drilling to reach the primary target in the Corridor zone below the Tiger Fault and are not expected to significantly change the estimated resources in the Cuffley Main zone as they penetrated the Main zone within the boundaries of already-Indicated Resource. -- However, they do increase the level of confidence for mine planning in the area.
Table 1: Significant new drill intercepts on Cuffley Main
Hole Hole Interce Interce Elevat True Gold Antimo AuEq Total ID Comple pt pt ion Width* Grade ny (g/t) Hole tion Easting Northin (m) (m) (g/t) Grade over Depth Date (Mine g (%) 1.8m (m) Grid, (Mine ** m) Grid, m) COR003 18/08/ 15199 4916 956 0.04 14.4 2.3 0.03 680 2015 COR003 18/08/ 15181 4920 942 0.43 1.3 0.0 0.67 680 2015 COR003 18/08/ 15179 4920 940 0.20 2.8 0.0 0.11 680 2015 COR004 11/11/ 15133 4575 898 1.11 4.5 0.0 2.85 721 A 2015
* True width is preliminary estimate only and may not reflect final true width used in resource estimate
** AuEq(g/t) = Au(g) + Sb(%) x Price per 10 Sb(kg) × Sb Recovery(%) ------------------------------------- Price per 1 Au(g) × Au Recovery (%)
Cuffley Deeps (Table 2; Figure 3)
-- Two drill holes were completed with the aim of increasing the confidence in the geometry and the extent of the high grade mineralization found at the top of the Cuffley Deeps zone. These holes were successful in delineating the southern boundary of the high grade zone and proving that the grade continues to the north.
Table 2: Significant new drill intercepts on Cuffley Deeps
Hole Hole Interce Interce Elevat True Gold Antimo AuEq Total ID Comple pt pt ion Width* Grade ny (g/t) Hole tion Easting Northin (m) (m) (g/t) Grade over Depth Date (Mine g (%) 1.8m (m) Grid, (Mine ** m) Grid, m) AD130 7/10/2 15189 5068 848 0.73 0.4 0.0 0.16 171 015 AD131 16/11/ 15181 5102 847 2.75 16.6 19.4 55.9 163 2015
* True width is preliminary estimate only and may not reflect final true width used in resource estimate
** AuEq(g/t) = Au(g) + Sb(%) x Price per 10 Sb(kg) × Sb Recovery(%) ------------------------------------- Price per 1 Au(g) × Au Recovery (%)
Sub King Cobra (Table 3, Figure 4)
-- Three high grade structural zones have been identified in drilling beneath the King Cobra fault system (Eastern, Central and Western). The vein composition within these mineralized zones vary from high stibnite concentrations (54.8 g/t Au and 37.2% Sb) in the Eastern structure to visible coarse gold in quartz (3,928 g/t Au and 0.02% Sb) within the Central and Western. -- Assaying and interpretation of the "Eastern" mineralized zone has resulted in significant intercepts in CSK009 of 0.77 m at 2.6 g/t Au and 3.8% Sb, 1.07 m at 6.4 g/t Au and 4.1% Sb. -- Hole CSK007 identified the "Central" Zone as a wide, 8 m zone consisting of quartz-stibnite veins with visible gold in two veins at ~374 m (0.071 m at 119.4 g/t Au and 7.0% Sb, 1.39 m at 136.8 g/t Au and 1.2% Sb). -- The "Western" mineralized zone is located 120 m to the west of the central zone in CSK007 (2.37 m @ 47.5 g/t Au). It consists of a 1.75 m fault zone, containing minor quartz-gold fragments. -- These three zones represent high priority drill targets for follow up in 2016.
Table 3: Significant new drill intercepts on Sub King Cobra
Hole Hole Interc Interc Elevat True Gold Antimo AuEq Total Target ID Comple ept ept ion Width* Grade ny (g/t) Hole tion Eastin Northi (m) (m) (g/t) Grade over Depth Date g ng (%) 1.8m (m) (Mine (Mine ** Grid, Grid, m) m) CSK009 5/11/2 15193 4616 621 2.36 0.95 0.8 2.48 551 Easter 015 n CSK009 5/11/2 15190 4618 617 0.77 2.60 3.8 4.43 551 Easter 015 n CSK009 5/11/2 15188 4620 615 1.07 6.45 4.1 8.83 551 Easter 015 n CSK007 12/10/ 15127 4818 546 0.08 81.0 3.8 3.89 520 Centra 2015 l CSK008 16/09/ 15128 4941 542 0.11 41.4 8.6 3.69 480 Centra 2015 l CSK008 16/09/ 15091 4964 492 0.57 9.9 0.0 3.16 480 Centra 2015 l CSK007 12/10/ 15097 4817 504 0.07 119.4 7.0 5.25 520 Centra 2015 l CSK007 12/10/ 15095 4817 502 1.39 136.76 1.2 107.57 520 Centra 2015 l CSK008 16/09/ 15116 4948 525 0.28 19.4 14.2 7.58 480 Centra 2015 l CSK007 12/10/ 15020 4813 404 2.37 47.51 0.0 47.51 520 Wester 2015 n CSK007 12/10/ 15089 4816 493 0.43 1.8 1.4 1.08 520 Unname 2015 d CSK008 16/09/ 15120 4946 531 0.08 0.5 14.3 1.23 480 Unname 2015 d CSK008 16/09/ 15112 4951 520 0.08 15.8 6.8 1.39 480 Unname 2015 d CSK008 16/09/ 15099 4959 502 0.28 1.1 2.9 1.09 480 Unname 2015 d NSK001 14/07/ 15243 4838 824 0.06 39.7 51.3 4.74 200 Unname 2015 d
* True width is preliminary estimate only and may not reflect final true width used in resource estimate
** AuEq(g/t) = Au(g) + Sb(%) x Price per 10 Sb(kg) × Sb Recovery(%) ------------------------------------- Price per 1 Au(g) × Au Recovery (%)
Margaret (Table 4, Figure 5)
-- Three holes have been drilled on the Margaret target for a total of 1,274 m. The drilling program resulted in shallow intercepts ranging from 75 to 100 m downhole on the "Margaret East" target zones. MM011 displayed visible gold in core and returned grades of 0.14 m at 46.5g/t Au and 3.5% Sb. MM010 was also successful and intercepted high grades in "Margaret East": 0.19 m at 5.8 g/t Au and 9.4% Sb; and 0.1 m at 5.6 g/t Au and 6.7% Sb. -- Follow-up drilling is anticipated in 2016.
Table 4: Significant new drill intercepts on Margaret
Hole Hole Interce Interce Elevat True Gold Antimo AuEq Total ID Comple pt pt ion Width* Grade ny (g/t) Hole tion Easting Northin (m) (m) (g/t) Grade over Depth Date (Mine g (%) 1.8m (m) Grid, (Mine ** m) Grid, m) MM009 5/11/2 15038 3299 1134 0.09 7.8 0.0 0.39 400 015 MM009 5/11/2 15139 3298 1055 0.10 1.4 0.4 0.12 400 015 MM009 5/11/2 15193 3298 1013 0.06 1.4 0.0 0.05 400 015 MM010 4/12/2 15180 3101 1121 0.85 3.9 0.9 2.73 553 015 MM010 4/12/2 15182 3101 1123 0.17 5.8 9.4 2.38 553 015 MM010 4/12/2 15183 3101 1124 0.06 1.2 1.8 0.15 553 015 MM010 4/12/2 15184 3101 1125 0.10 3.7 0.0 0.20 553 015 MM010 4/12/2 15220 3100 1156 0.07 1.3 1.2 0.15 553 015 MM010 4/12/2 15238 3100 1171 0.12 1.0 0.0 0.07 553 015 MM010 4/12/2 14933 3106 913 0.09 2.3 0.0 0.12 553 015 MM010 4/12/2 14962 3105 937 0.11 1.8 0.0 0.12 553 015 MM011 23/12/ 15248 2901 1184 0.21 0.9 0.0 0.11 320 2015 MM011 23/12/ 15248 2901 1184 0.78 1.0 0.0 0.45 320 2015 MM011 23/12/ 15197 2909 1141 0.94 13.1 1.7 8.69 320 2015
* True width is preliminary estimate only and may not reflect final true width used in resource estimate
** AuEq(g/t) = Au(g) + Sb(%) x Price per 10 Sb(kg) × Sb Recovery(%) ------------------------------------- Price per 1 Au(g) × Au Recovery (%)
Corridor (Table 5, Figure 2)
-- Five holes totaling 3,545 m have been drilled in the mineralized Corridor program. -- Four of the five holes drilled on the target confirmed a sub-vertical structure approximately 350 m to the west of the Cuffley Deposit. This newly identified structure has a confirmed strike length of 500 m and is open along strike to the north and south. Mineralization consists of brecciated quartz with pyritic matrix that bears strongly anomalous Au and Sb.
Table 5: Significant new drill intercepts on Corridor
Hole Hole Interce Interce Elevat True Gold Antimo AuEq TotalH ID Comple pt pt ion Width* Grade ny (g/t) ole tion Easting Northin (m) (m) (g/t) Grade over Depth Date (Mine g (%) 1.8m (m) Grid, (Mine ** m) Grid, m) COR001 20/07/ 15018 5284 794 0.10 3.0 0.0 0.17 851 2015 COR003 18/08/ 14750 4990 624 0.22 2.0 0.0 0.24 680 2015 COR004 11/11/ 14981 4600 785 0.11 1.1 0.1 0.08 721 A 2015 COR005 27/11/ 14786 4357 629 0.06 1.5 2.4 0.20 724 2015
* True width is preliminary estimate only and may not reflect final true width used in resource estimate
** AuEq(g/t) = Au(g) + Sb(%) x Price per 10 Sb(kg) × Sb Recovery(%) ------------------------------------- Price per 1 Au(g) × Au Recovery (%)
Brunswick (Table 6, Figure 5)
-- During November - December 2015, 3 diamond drill holes totalling 1,172 m were drilled at Brunswick, targeting the northern extension of mineralization and a continuation of the lode at depth below the Brunswick pit. -- BD238 and B240 confirmed the continuation of the Brunswick structure at depth and to the north, respectively; however, the structure intercepted in these holes only contains trace mineralization. -- BD239 has proven up the continuation of mineralization below the south end of the Brunswick pit returning assays of 0.3 m at 8.1 g/t Au and 0.6% Sb. -- While the 2015 program bounded the upside potential of Brunswick to the north, should metal prices and economic analysis warrant, a follow-up program to infill the southern area around and below BD239 plus other sparsely drilled gaps in the lode is possible.
Table 6: Significant new drill intercepts on Brunswick
Hole Hole Interce Interce Elevat True Gold Antimo AuEq Total ID Comple pt pt ion Width* Grade ny (g/t) Hole tion Easting Northin (m) (m) (g/t) Grade over Depth Date (Mine g (%) 1.8m (m) Grid, (Mine ** m) Grid, m) BD238 13/11/ 14812 5890 972 0.30 0.1 0.0 0.00 372 2015 BD239 23/11/ 14774 5760 962 0.76 4.2 0.3 1.33 295 2015 BD240 2/12/2 14830 6063 1054 0.11 0.7 0.0 0.04 270 015
* True width is preliminary estimate only and may not reflect final true width used in resource estimate
** AuEq(g/t) = Au(g) + Sb(%) x Price per 10 Sb(kg) × Sb Recovery(%) ------------------------------------- Price per 1 Au(g) × Au Recovery (%)
West Costerfield (Table 7, Figure 6)
-- A total of 38 holes totaling 2,780 m of RC drilling was undertaken during the second half of 2015 in order to confirm the bedrock geochemical anomaly found in the 2014 auger drilling program. -- Results from the RC drilling confirmed bedrock mineralization in the anomaly. The identification of the geochemical anomaly represented an almost entirely untested, near surface mineralized system. -- The program generated five low grade intercepts, one of 4 m width and the others of 1 m each. -- Correlations in the district suggest that RC results tend to underestimate grades found in the same vein by neighbouring core holes, suggesting that follow-up of the mineralized RC intercepts by core holes may be warranted in the future.
Table 7: Significant new drill intercepts on West Costerfield
Hole Hole Intercep Intercep Elevat Down Gold Antimony Total ID Complet t t ion Hole Grade Grade Hole ion Easting Northing (m) Length (g/t) (%) Depth Date (Mine (Mine (m) (m) Grid, m) Grid, m) WCRC00 4/09/20 13878 7227 1230 2.0 0.61 0.004 72 4 15 WCRC00 8/09/20 13950 7205 1203 1.0 0.87 0.026 72 6 15 WCRC00 8/09/20 13934 7207 1180 2.0 0.66 0.005 72 6 15 WCRC00 10/09/2 14023 7191 1184 1.0 0.80 0.005 72 8 015 WCRC01 11/09/2 13878 7226 1208 1.0 1.33 0.006 72 1 015 WCRC01 21/09/2 13671 6975 1185 3.0 0.82 0.005 72 4 015 WCRC01 21/09/2 13665 6976 1176 1.0 0.83 0.004 72 4 015 WCRC01 21/09/2 13660 6978 1167 4.0 1.16 0.006 72 4 015 WCRC02 28/09/2 13694 6951 1175 1.0 0.87 0.005 72 2 015 WCRC02 28/09/2 13701 6946 1165 1.0 0.63 0.000 72 2 015 WCRC02 30/09/2 13662 6763 1204 1.0 0.99 0.006 72 4 015 WCRC02 29/09/2 13687 6753 1163 1.0 0.83 0.005 72 8 015 WCRC03 1/10/20 13475 6827 1210 1.0 0.62 0.000 72 0 15 WCRC03 9/10/20 13523 6569 1204 1.0 0.97 0.000 72 2 15 WCRC03 5/10/20 13611 6568 1197 4.0 0.93 0.005 72 4 15 WCRC03 5/10/20 13610 6569 1196 1.0 1.51 0.006 72 4 15 WCRC03 5/10/20 13590 6576 1170 1.0 0.26 0.288 72 4 15 WCRC03 5/10/20 13657 6551 1204 1.0 0.57 0.005 72 5 15 WCRC03 7/10/20 13611 6570 1197 2.0 0.59 0.005 72 7 15 WCRC03 8/10/20 13562 6553 1192 3.0 0.53 0.005 72 8 15 WCRC03 8/10/20 13588 6540 1153 1.0 0.50 0.004 72 8 15
* True width is preliminary estimate only and may not reflect final true width used in resource estimate
** AuEq(g/t) = Au(g) + Sb(%) x Price per 10 Sb(kg) × Sb Recovery(%) ------------------------------------- Price per 1 Au(g) × Au Recovery (%)
Cerro Bayo
Drilling, Sampling and Assaying
A total of 14,007 m of NX and BX diamond drill core were produced from 34 holes at Cerro Bayo during the second half of 2015. The bulk of this meterage was drilled from surface platforms on the margins of Laguna Verde, while the rest was completed from underground stations in the Dagny and Yasna mines. All drill holes were directionally surveyed by standard techniques with a downhole instrument.
Drill core was logged and sampled by staff geologists and all core samples (including blanks, standards and duplicates) were submitted to the on-site assay laboratory of Compañia Minera Cerro Bayo. The Cerro Bayo assay laboratory was audited in 2011 by SGS Lakefield Research Ltd. and routinely sends check samples to the ALS laboratory (ISO 9001:2008 and ISO/IEC 176025:2005 certified) in La Serena, Chile, following QA/QC practices established by the parent company, Mandalay Resources. (Please see the Company's previously filed document, 'Technical report on the Cerro Bayo project, Region XI (Aysèn) Chile', dated March 28, 2014, and available on SEDAR (www.sedar.com), for a full description of the drilling, logging, assaying and estimation processes, including data verification procedures).
Drill Results
The following tables and figures display mineralized intercepts obtained through December 31, 2015, correlated by vein according to the latest structural interpretation. Such structural interpretation may be subject to revision as more drilling data are acquired.
Coyita vein (Table 8, Figures 9,10,11)
27 new drill holes completed during the second six months of 2015 indicate that the Coyita vein is a strongly mineralized fissure essentially all the way across Laguna Verde to the district-scale fault structure of the Falla Cañadón Verde (Figure 9). The mineralization in the vein largely has been closed off in both its SE and NW extents, with a few gaps remaining on the extreme southern end and the central section under the lake to be drilled (Table 8, Figures 10 and 11). Localized, significant grade has been recognized in subordinate branch veins lying to the west of the Coyita vein. A new vein was intersected far to the east of the Coyita, dubbed the 'Victoria' vein (Figure 9). This latter feature was not well-mineralized in this initial intercept, but the characteristics of hydrothermal alteration and gangue mineralogy encourage further drill testing at higher structural levels and along strike.
Table 8: Summary of mineralized intercepts correlated to the Coyita vein
Hole Hole Total Interc Interc Interc From To Length True Gold Silver ID Comple Hole ept ept ept (m) (m) (m) Width Grade Grade tion Depth UTM_E UTM_N Elev. (m) (g/t) (g/t) Date (m) (m) DLV15- 6/22/2 368.60 272334 484064 -33.65 319.18 323.5 4.32 2.51 1.04 45 026 015 .81 8.75 DLV15- 8/2/20 379.35 271990 484112 126.18 360.3 360.88 0.58 0.4 0.96 467 027 15 .07 9.09 DLV15- 7/12/2 179.95 271733 484145 125.35 162.7 167.35 4.65 2.02 0.68 222 028 015 .41 9.28 DLV15- 7/14/2 368.15 272348 484060 -45.98 346.7 349.9 3.2 2.1 3.78 896 029 015 .741 0.51 9 DLV15- 7/19/2 293.80 271778 484145 36.02 260.01 262.77 2.76 1.1 0.45 23 031 015 .69 9.28 DLV15- 8/19/2 390.80 272343 484062 -78.12 369.7 371.05 1.35 0.78 4.17 514 032 015 .63 3.07 DLV15- 7/29/2 403.90 272307 484069 -60.36 357.91 358.95 1.04 0.67 6.28 115 033 015 .84 0.62 DLV15- 8/25/2 437.60 272016 484109 92.83 387.6 388.2 0.6 0.33 0.33 133 035 015 .06 2.76 DLV15- 8/15/2 402.00 272284 484073 -71.47 387.03 388.55 1.52 1.11 1.08 102 036 015 .99 0.61 DLV15- 8/30/2 499.60 272135 484099 15.94 407.16 409.07 1.91 1.16 0.66 21 037 015 .17 0.9 DLV15- 9/2/20 158.80 271718 484146 160.32 131.3 131.6 0.3 0.19 0.49 10 038 15 .92 6.31 DLV15- 9/16/2 351.05 271954 484118 96.7 330.04 332.72 2.68 2.11 1.03 287 039 015 .89 7.97 DLV15- 10/12/ 364.50 272257 484078 -65.22 345.52 348.15 2.63 1.48 2.29 149 041 2015 .12 0.9 DLV15- 9/20/2 395.00 272364 484058 -62.88 370.68 373.11 2.43 1.37 3.69 194 042 015 .28 1.84 DLV15- 9/30/2 304.60 271912 484118 148.18 290.4 291.12 0.81 0.66 5.58 1324 043 015 .2 2.3 1 DLV15- 9/30/2 470.00 272365 484060 -103.8 396.48 397.07 0.59 0.3 15.22 347 044 015 .31 9.56 9 DLV15- 10/16/ 477.85 272131 484099 -10.77 425.86 428.35 2.49 1.5 1.44 219 045 2015 .77 0.88 DLV15- 10/23/ 531.00 272095 484097 96.29 490.31 490.75 0.44 0.27 3.41 410 047 2015 .08 0.38 DLV15- 10/17/ 431.00 272411 484055 -89.7 403.54 406.7 3.16 1.34 10.18 1308 048 2015 .27 5.99 DLV15- 11/5/2 523.60 272113 484099 75.15 502.27 504.25 1.98 1.26 3.67 1040 049 015 .68 0.02 DLV15- 11/6/2 502.25 NO VEIN 050 015 DLV15- 11/19/ 405.70 NO VEIN 051 2015 DLV15- 11/26/ 350.50 272321 484059 -19.78 328.85 329.35 0.5 0.35 1.84 598 053 2015 .09 7 DLV15- 11/26/ 378.05 271969 484114 133.95 340.81 341.15 0.34 0.25 0.05 1 055 2015 .7 9.64 DLV15- 12/13/ 373.80 272288 484065 66.94 224.89 227.02 2.13 1.35 0.31 49 057 2015 .69 4 DLV15- 12/13/ 560.60 272109 484096 62.17 505.58 509.6 4.02 2.32 6.8 811 058 2015 .56 1.98 DLV15- 12/9/2 452.00 272374 484060 -90.15 384.48 386.2 1.72 0.81 3.11 164 059 015 .66 4.07
Yasna vein (Table 9, Figure 12)
Three new infill drill holes on the Yasna vein largely confirm that the mineralized zone has been closed off and remains approximately 200 m long by 70 m high, down-dip. Minor increases in the size of the shoot could be generated by more infill drilling, but Mandalay has decided to wait to complete this work until excavation of a nearby drill station makes the project cheaper and more cost effective.
Table 9: Summary of Mineralized Intercepts Correlated with the Yasna Vein System
Hole Hole Total Interc Interc Interc From To Length True Gold Silver ID Comple Hole ept ept ept (m) (m) (m) Width Grade Grade tion Depth UTM_E UTM_N Elev. (m) (g/t) (g/t) Date (m) (m) DLV15- 9/30/2 515.20 271863 484081 54.54 424.66 425.23 0.57 0.53 0.73 208 040 015 .2 7.5 DLV15- 11/4/2 440.65 271804 484088 99.55 425.12 426.78 1.66 1.51 0.3 50 046 015 .19 5.35 DLV15- 8/28/2 507.15 271815 484082 43.36 391.76 395.3 3.54 3.44 1.04 109 034 015 .26 7.97
Kasia vein (Table 10, Figure 13)
Five new drill intercepts were obtained on the Kasia vein, in the southern sector where the Kasia and Yasna systems appear to converge. Some remarkable grades were obtained from veins lying between the Kasia fissure and the Coyita vein, which may represent a step-over or linking system between the two named veins, similar in orientation to the Yasna inflection (drill hole DLV15-054; Figure 9).
Table 10: Summary of Mineralized Intercepts Correlated to the Kasia Vein System
Hole Hole Total Interc Interc Interc From To Length True Gold Silver ID Comple Hole ept ept ept (m) (m) (m) Width Grade Grade tion Depth UTM_E UTM_N Elev. (m) (g/t) (g/t) Date (m) (m) DLV15- 8/28/2 507.15 271896 484088 38.3 494.09 494.95 0.86 0.86 1.84 320 034 015 .19 8.15 DLV15- 9/30/2 515.20 271920 484085 56.43 492.53 493.23 0.7 0.7 0.17 34 040 015 .77 3.59 DLV15- 11/23/ 413.00 272060 484068 -7.96 367.2 367.6 0.4 0.23 0.2 0.22 054 2015 .85 9.9 DLV15- 12/1/2 389.00 272070 484063 -16.84 373.7 374.6 0.9 0.56 0.63 165 056 015 .12 2.04 DLV15- 11/16/ 391.60 272085 484067 48.64 312.52 312.91 0.39 0.25 0.33 381 052 2015 .17 1.12
Björkdal
Drilling, Sampling and Assaying
All the surface, and the majority of the underground exploration diamond drilling were conducted by third party contractors, producing WL66-, NQ2- and WL76-sized core (50.7 mm, 50.6 and 57.5 mm diameter core, respectively). During the period from July 1, 2015, to December 31, 2015, 21 diamond core drill holes totalling 3,098 m were drilled to infill and extend open pit resources; 26 core holes for 6,768 m were drilled to infill and extend underground resources; 17 core holes totalling 2,875 m were drilled to confirm and extend the historic resource at the near-mine Nylunds Deposit; and 12 core holes for 2,111 m were drilled to test targets within the near-mine exploration tenements. All diamond drill hole collars are surveyed. Downhole surveys are also carried out to record hole azimuth and dip.
Diamond core samples were logged by Mandalay geologists on-site. Assaying of Björkdal samples was completed at CRS Minlab Oy (CRS) in Kempele, Finland. Whole core samples were sent directly to the independent laboratory for sample preparation and assaying. Assaying was conducted utilizing the LeachWELL process. Our rigorous QA/QC program included the use of standard reference samples, blanks, duplicates, repeats, and internal laboratory quality assurance procedures. More details on the drilling, logging, sampling, and assaying procedures are contained in the Technical Report "Mandalay Resources Corporation Technical Report on the Björkdal Gold Mine, Sweden" filed March 31, 2015 and available on SEDAR (www.sedar.com).
Drill Results
Underground (Table 11, Figures 14 and 15)
Underground diamond drilling at Björkdal intercepted many new economic gold-bearing veins (Table 11). These new intercepts come from the Lake zone, Lake zone north, Central zone and Main zone (Figure 15). They serve to push the limits of continuous mineralization 200 m to the north and up to 100 m to the northeast and east of previously interpreted limits; mineralization remains open in those directions.
Table 11: Significant Björkdal Underground Drill Results
Hole Hole Total Interce Interce Interc Drille Interc True Au ID Comple Hole pt pt ept RL d ept Width Grade tion Depth Easting Northin (MG) Width Angle (m) (g/t) Date (m) (MG) g (MG) (m) (°) DDU201 12/05/ 281 1319.87 1799.43 -375.3 1.8 42 1.16 4.85 5-020 2015 2 99 DDU201 1245.07 1861.74 -392.6 0.35 40 0.18 18.40 5-020 5 4 08 DDU201 24/05/ 317 1361.42 1776.26 -387.6 2.05 47 1.46 4.32 5-021 2015 6 5 08 DDU201 1349.39 1790.65 -395.4 0.35 15 0.03 10.70 5-021 2 4 98 DDU201 1311.71 1833.70 -420.4 0.25 60 0.18 36.70 5-021 4 1 14 DDU201 1233.99 1915.04 -471.8 0.35 72 0.31 33.40 5-021 6 1 12 DDU201 1230.19 1918.81 -474.3 2.7 55 2.18 2.52 5-021 9 31 DDU201 1222.47 1926.42 -479.4 2.55 73 2.42 5.09 5-021 4 1 36 DDU201 27/06/ 312 1472.81 1701.94 -397.4 1.9 18 0.53 8.66 5-022 2015 6 9 25 DDU201 1535.81 1692.90 -436.3 1.75 21 0.57 7.89 5-022 7 92 DDU201 1570.25 1688.21 -457.4 0.35 30 0.12 31.50 5-022 3 64 DDU201 01/06/ 306 1494.87 1680.03 -416.7 2.9 43 1.93 23.92 5-023 2015 2 01 DDU201 1520.25 1671.03 -435.2 0.55 22 0.15 8.63 5-023 3 8 97 DDU201 1539.86 1664.11 -450.0 2 45 1.37 5.80 5-023 3 1 09 DDU201 1589.13 1647.04 -487.8 1.95 47 1.38 4.54 5-023 4 3 45 DDU201 1643.00 1629.42 -529.1 0.3 73 0.27 38.20 5-023 3 3 36 DDU201 29/08/ 252 1557.30 1188.72 -387.2 0.3 31 0.10 21.30 5-024 2015 7 2 1 DDU201 1643.08 1154.16 -431.5 1.05 50 0.76 16.95 5-024 2 8 73 DDU201 1650.09 1151.54 -435.0 0.4 49 0.26 8.83 5-024 7 4 91 DDU201 1555.74 1179.74 -383.3 0.4 29 0.14 62.50 5-025 9 6 9 DDU201 1640.11 1120.65 -419.7 1.25 48 0.89 3.00 5-025 2 7 33 DDU201 10/09/ 250 1522.98 1130.48 -379.2 1.45 40 0.88 14.55 5-026 2015 4 4 96 DDU201 1579.72 1119.96 -410.9 0.3 64 0.24 14.00 5-026 6 4 59 DDU201 1608.05 1115.03 -427.0 0.3 50 0.19 11.10 5-026 3 3 51 DDU201 1613.64 1114.09 -430.2 1.4 30 0.65 4.72 5-026 1 5 36 DDU201 1675.62 1104.43 -465.8 2.25 88 2.25 2.41 5-026 3 3 26 DDU201 1580.92 1097.95 -406.9 0.3 77 0.28 34.60 5-027 6 79 DDU201 1664.21 1063.13 -448.7 4.15 49 3.09 31.95 5-027 5 7 3 DDU201 02/07/ 240 723.941 2037.81 -245.6 0.35 35 0.15 22.80 5-031 2015 4 06 DDU201 693.97 2053.03 -243.6 0.4 61 0.32 9.08 5-031 8 37 DDU201 09/07/ 321 565.586 2112.47 -246.6 0.85 85 0.84 96.21 5-032 2015 8 3 DDU201 22/07/ 311 725.93 2049.37 -254.6 0.4 89 0.40 135.00 5-033 2015 4 7 DDU201 627.524 2119.85 -266.5 0.6 74 0.56 7.64 5-033 2 64 DDU201 31/07/ 207 1565.70 1349.25 -391.1 0.35 29 0.11 10.60 5-034 2015 5 8 78 DDU201 1600.94 1338.10 -407.5 0.3 31 0.10 23.90 5-034 7 2 39 DDU201 1614.08 1334.10 -413.6 0.7 52 0.51 23.00 5-034 4 3 97 DDU201 1662.47 1320.19 -436.5 1.35 36 0.74 2.69 5-034 4 4 05 DDU201 1724.95 1303.42 -465.0 1 50 0.73 3.16 5-034 2 7 92 DDU201 04/08/ 213 1642.37 1303.27 -435.6 1.45 33 0.74 3.14 5-035 2015 4 8 36 DDU201 1683.63 1281.88 -458.1 3.1 35 1.73 4.09 5-035 9 8 03 DDU201 1707.81 1269.70 -471.0 0.95 40 0.56 3.46 5-035 8 6 82 DDU201 04/08/ 213 1716.36 1265.54 -475.5 0.5 38 0.26 37.80 5-035 2015 5 1 97 DDU201 10/08/ 213 1604.52 1276.61 -410.4 0.3 54 0.21 15.10 5-036 2015 6 4 18 DDU201 1611.97 1274.45 -413.1 0.25 68 0.21 130.00 5-036 6 6 55 DDU201 1651.91 1263.49 -427.5 0.45 59 0.35 15.70 5-036 6 4 57 DDU201 1702.53 1250.25 -444.6 1.05 53 0.80 6.01 5-036 7 5 61 DDU201 1723.13 1245.16 -451.2 0.9 40 0.53 13.20 5-036 6 2 69 DDU201 19/08/ 228 1635.51 1199.33 -437.5 0.3 73 0.27 13.30 5-037 2015 17 DDU201 1711.01 1186.40 -475.7 2.1 35 1.15 17.12 5-037 6 6 05 DDU201 24/08/ 232 1558.67 1208.62 -396.0 1.35 67 1.22 13.02 5-038 2015 3 2 87 DDU201 1573.86 1201.37 -403.3 0.3 48 0.18 32.00 5-038 7 8 33 DDU201 1609.55 1184.79 -420.3 3.15 66 2.85 4.83 5-038 3 2 51 DDU201 1621.03 1179.58 -425.8 0.25 41 0.12 18.40 5-038 8 9 35 DDU201 1671.62 1157.11 -450.3 0.6 29 0.24 6.18 5-038 3 7 19 DDU201 18/09/ 252 1579.16 1090.03 -411.7 0.3 53 0.20 11.83 5-039 2015 6 38 DDU201 1592.41 1082.65 -419.5 0.3 49 0.18 11.80 5-039 7 6 15 DDU201 06/10/ 276 1450.55 1680.71 -386.3 1.7 49 1.24 13.60 5-041 2015 2 3 15 DDU201 1470.71 1666.36 -401.0 1.45 42 0.92 45.54 5-041 6 89 DDU201 1475.73 1662.82 -404.8 0.7 23 0.22 9.50 5-041 7 9 05 DDU201 20/10/ 305 1491.31 1674.09 -408.7 4.05 40 2.55 29.12 5-042 2015 2 7 1 DDU201 1496.24 1671.93 -411.8 1.55 22 0.52 2.04 5-042 7 3 76 DDU201 1549.72 1649.70 -446.5 1.5 71 1.40 2.22 5-042 1 3 DDU201 1637.21 1617.27 -503.3 0.75 49 0.52 19.87 5-042 3 8 62 DDU201 07/11/ 353 1419.22 1700.52 -364.0 1 50 0.73 6.40 5-043 2015 6 2 78 DDU201 1438.82 1680.40 -377.7 0.3 59 0.22 21.20 5-043 7 2 7 DDU201 28/10/ 327 1448.44 1686.04 -385.6 0.75 38 0.41 8.34 5-044 2015 3 1 DDU201 1593.19 1601.31 -493.8 0.55 65 0.47 6.29 5-044 5 7 14 DDU201 1628.01 1584.24 -520.1 1.15 54 0.89 3.60 5-044 4 7 01 DDU201 06/09/ 291 1481.29 1598.57 -387.1 2 44 1.34 8.33 5-045 2015 9 2 18 DDU201 1491.64 1587.96 -390.8 0.55 48 0.37 29.07 5-045 7 6 27 DDU201 1524.37 1554.71 -402.4 0.6 44 0.37 28.40 5-045 3 3 21 DDU201 1535.68 1543.41 -406.3 0.45 65 0.38 206.00 5-045 5 4 97 DDU201 1558.39 1520.81 -414.5 0.45 54 0.33 11.11 5-045 4 6 16 DDU201 20/09/ 276 1527.35 1564.96 -415.8 4.4 27 1.94 2.60 5-046 2015 4 6 13 DDU201 03/10/ 282 1504.99 1604.41 -403.0 0.4 51 0.27 61.20 5-047 2015 5 4 33 DDU201 1532.74 1587.86 -414.4 3.75 14 0.85 1.33 5-047 5 5 71 DDU201 1550.07 1577.74 -421.3 2.3 58 1.92 30.25 5-047 9 4 69 DDU201 1650.68 1519.72 -461.1 0.25 52 0.16 25.60 5-047 3 85 DDU201 21/10/ 262 1561.42 1601.51 -426.8 0.3 56 0.21 12.10 5-048 2015 5 8 25 DDU201 1574.06 1596.88 -432.2 1 44 0.65 4.39 5-048 7 25 DDU201 1606.05 1585.42 -445.8 2 18 0.56 1.52 5-048 8 3 DDU201 1612.55 1583.15 -448.5 2.4 N/A 4.81 5-048 3 5 25 DDU201 1632.06 1576.43 -456.7 3 45 2.08 3.64 5-048 7 22 DDU201 1640.52 1573.57 -460.2 3.95 32 2.04 7.18 5-048 8 2 9 DDU201 1647.10 1571.35 -463.0 1 N/A 6.03 5-048 7 5 6 DDU201 18/11/ 239 1571.42 1625.33 -425.4 5.65 36 3.27 2.62 5-050 2015 8 1 31 DDU201 1593.87 1621.40 -434.1 3.95 21 1.36 1.34 5-050 9 6 43 DDU201 30/09/ 241 1275.91 1587.71 -338 0.55 64 0.47 273.00 5-051 2015 9 2 DDU201 13/10/ 312 1490.30 1653.61 -400.8 0.25 46 0.14 21.90 5-052 2015 7 7 92 DDU201 1512.04 1639.49 -412.6 0.5 38 0.26 6.44 5-052 7 8 76 DDU201 1566.06 1606.51 -441.4 2.65 32 1.35 3.46 5-052 4 44 DDU201 1622.41 1575.31 -470.4 0.45 59 0.35 7.02 5-052 2 9 63 DDU201 26/11/ 176 1052.71 1970.99 -334.6 1.35 69 1.24 2.58 5-053 2015 4 3 95 DDU201 1022.79 2000.74 -347.5 0.35 81 0.34 58.90 5-053 15 DDU201 999.522 2023.11 -357.6 0.3 85 0.29 12.40 5-053 8 12 DDU201 991.985 2030.26 -360.9 0.3 82 0.29 295.00 5-053 29 DDU201 979.603 2041.83 -366.4 7.55 68 6.98 9.75 5-053 8 38 DDU201 23/11/ 177 1051.57 1981.34 -344.1 0.7 47 0.47 4.90 5-054 2015 6 5 47 DDU201 1032.46 2008.47 -360.1 0.35 68 0.30 47.90 5-054 7 3 17 DDU201 1019.56 2026.36 -370.7 0.25 62 0.19 14.50 5-054 2 2 79 DDU201 1014.19 2033.72 -375.1 1.3 83 1.28 2.35 5-054 3 8 87 DDU201 1010.91 2038.19 -377.8 0.3 62 0.24 169.00 5-054 9 5 6
The completion of the test drilling program within the eastern limit (mine-grid) of the Main zone (DDT diamond drilling program, Figure 15) has also seen extremely positive results in that many new significant intercepts have been reported (Table 12). The test drilling program was drilled with oriented core to successfully identify mineralized veins of several different orientations within the Main zone of the mine. These veins strike at an oblique angle to the dominant vein direction and commonly contain higher than average gold grades. The use of oriented, closely-spaced drilling has allowed for a detailed understanding of a geologically complex area within the mine. This new geological knowledge is now being successfully transferred to other areas of the operation where it has confirmed the similar behaviour of the orebody throughout the known limits of the deposit.
Table 12: Significant New Detailed Test Drilling (DDT) Intercepts
Hole Hole Total Interce Interce Interc Drille Interc True Au ID Comple Hole pt pt ept d ept Width Grade tion Length Easting Northin RL Width Angle (m) (g/t) Date (m) (MG) g (MG) (MG) (m) (°) DDT201 12/03/ 122 967.336 2016.24 -336.1 9.33 50 7.11 4.59 5-016 2015 5 65 DDT201 15/03/ 131 990.34 1994.91 -334.5 0.25 56 0.17 107.00 5-017 2015 8 55 DDT201 973.248 2009.90 -342.5 0.95 61 0.80 7.91 5-017 1 65 DDT201 965.195 2016.97 -346.3 1 50 0.73 4.27 5-017 8 68 DDT201 18/03/ 95 976.346 2007.02 -350.5 0.2 60 0.14 18.70 5-018 2015 4 79 DDT201 23/03/ 122 944.803 1983.14 -331.8 3.45 48 2.52 3.14 5-019 2015 66 DDT201 1002.99 1949.26 -345.1 0.51 59 0.40 69.50 5-019 9 7 27 DDT201 27/03/ 129 940.957 1985.4 -337.6 3.81 58 3.20 11.55 5-020 2015 68 DDT201 955.5 1976.93 -344.1 2.18 53 1.70 1.55 5-020 7 32 DDT201 1012.75 1943.24 -369.3 0.47 60 0.38 14.70 5-020 1 2 18 DDT201 30/03/ 92 944.037 1983.19 -351.3 1.04 42 0.65 20.22 5-021 2015 4 6 DDT201 961.913 1972.42 -365.9 1.37 50 1.01 12.53 5-021 5 7 DDT201 07/04/ 126 951.649 1955.28 -343.3 0.3 35 0.12 20.90 5-023 2015 7 33 DDT201 11/04/ 55 950.707 2002.91 -331.5 0.41 64 0.34 8.53 5-025 2015 9 39 DDT201 954.944 2000.5 -332.4 0.26 61 0.20 42.40 5-025 56 DDT201 14/04/ 125 947.719 2004.19 -337.5 1.36 56 1.09 2.59 5-026 2015 6 78 DDT201 983.25 1982.50 -353.2 12.21 61 10.65 1.38 5-026 8 65 DDT201 1016.36 1962.15 -367.6 0.44 60 0.35 79.90 5-026 4 8 25 DDT201 17/04/ 93 960.724 1996.87 -358.9 1.05 55 0.82 5.31 5-027 2015 8 31 DDT201 968.064 1992.67 -364.8 0.3 40 0.14 38.90 5-027 5 53 DDT201 20/04/ 120 955 2000.61 -332.4 0.36 68 0.31 16.49 5-028 2015 9 94 DDT201 960.921 1997.29 -333.7 0.41 69 0.36 12.70 5-028 3 44 DDT201 979.92 1986.72 -337.7 10.89 57 9.10 7.16 5-028 7 19 DDT201 991.997 1980.08 -340.2 0.33 21 0.06 193.00 5-028 7 35 DDT201 1011.91 1969.14 -344.4 0.61 42 0.36 28.00 5-028 1 7 03 DDT201 27/04/ 126 936.049 1938.54 -338.2 0.62 5.11 5-030 2015 8 74 DDT201 949.341 1929.73 -344.0 0.18 56 0.11 165.70 5-030 9 78 DDT201 01/05/ 120 970.502 2014.39 -334.5 1.65 71 1.54 25.88 5-032 2015 5 81 DDT201 1019.50 1988.67 -344.7 1.45 67 1.31 52.12 5-032 8 1 84 DDT201 05/05/ 126 1025.98 1984.95 -366.0 0.45 47 0.29 81.60 5-033 2015 1 6 62 DDT201 07/05/ 100 964.796 2017.08 -356.8 1.79 62 1.55 2.12 5-034 2015 3 04
Open Pit
Surface drilling has extended the southeast limits of shallow Au mineralization adjacent to the currently mined Björkdal open pit. (Table 13 and Figure 16 for intercept locations). Future drilling will test the possibility that the East pit resource may be continuous with the shallow Nylunds resource further to the southeast.
Table 13: Significant New Near-Surface Core Drill Intercepts from the South-Eastern Portion of the Björkdal Open Pit
Hole ID Hole Total Interce Interc Interc Drille Interc True Au Comple Hole pt ept ept d ept Width Grade tion Depth Easting Northi RL Width Angle (m) (g/t) Date (m) (MG) ng (MG) (m) (°) (MG) DDP2015 05/06/ 202 301.004 2000.9 -103.6 1.2 39 0.71 1.01 -007 2015 44 05 DDP2015 302.142 1998.3 -105.9 1.15 28.5 0.49 1.28 -007 98 22 DDP2015 13/11/ 166 403.784 1886.0 -128.8 0.4 42 0.22 1.74 -011 2015 41 3 DDP2015 408.069 1880.7 -133.3 0.4 41 0.21 62.50 -011 04 47 DDP2015 29/10/ 212 463.683 1847.5 -114.9 0.35 37 0.16 218.00 -015 2015 25 89 DDP2015 483.799 1836.9 -132.7 0.45 10 0.02 1.40 -015 85 02 DDP2015 536.44 1811.2 -178.5 0.35 65 0.29 6.84 -015 35 35 DDP2015 576.222 1793.3 -212.7 3 20 0.97 3.12 -015 41 27 DDP2015 03/10/ 156 460.711 1835.5 -124.6 0.3 34 0.12 8.42 -016 2015 14 9 DDP2015 07/10/ 94 708.141 1706.7 -122.2 2.25 16 0.56 1.22 -017 2015 14 86 DDP2015 21/10/ 210 582.693 1534.5 -156.5 0.95 30 0.42 1.09 -018 2015 49 22 DDP2015 585.34 1533.0 -158.8 0.2 56 0.13 6.61 -018 83 63 DDP2015 31/10/ 174 504.943 1610.1 -84.85 1.2 70 1.11 0.52 -020 2015 26 2 DDP2015 554.318 1611.9 -123.0 1 85 0.99 1.02 -020 13 46 DDP2015 593.369 1614.1 -153.7 4.1 32 2.12 0.40 -020 93 02 DDP2015 13/10/ 134 667.878 1617.9 -144.4 0.3 64 0.24 2.51 -021 2015 38 84 DDP2015 20/10/ 145 505.051 1736.3 -103.8 0.2 40 0.08 5.72 -023 2015 84 74 DDP2015 524.048 1714.1 -124.0 0.3 50 0.19 21.80 -023 35 7 DDP2015 15/10/ 110 504.88 1745.5 -100.2 0.4 26 0.12 7.66 -024 2015 13 35 DDP2015 517.346 1738.6 -110.5 1.45 60 1.22 0.49 -024 18 27 DDP2015 12/11/ 235 555.359 1470.5 -118.7 1 33 0.49 7.35 -025 2015 78 48 DDP2015 17/09/ 110 559.623 1710.4 -127.0 0.4 46 0.24 1.65 -026 2015 58 13 DDP2015 11/09/ 152 689.567 1626.0 -92.01 1.75 54 1.38 14.82 -027 2015 25 5 DDP2015 663.129 1626.2 -112.7 0.6 26 0.21 1.14 -027 96 9 DDP2015 658.433 1626.2 -116.5 0.4 47 0.25 3.05 -027 82 24 DDP2015 06/09/ 135 623.544 1628.7 -117.1 0.2 75 0.18 6.44 -028 2015 48 34 DDP2015 595.271 1637.5 -137.3 0.4 38 0.20 4.79 -028 24 53 DDP2015 18/09/ 120 691.202 1628.2 -91.62 3.3 56 2.70 1.38 -029 2015 95 6 DDP2015 08/09/ 136 604.566 1679.8 -146.4 0.95 5 0.02 1.12 -030 2015 77 45 DDP2015 25/09/ 166 691.785 1631.0 -92.10 1.7 57 1.39 22.69 -031 2015 34 8 DDP2015 672.697 1651.0 -110.0 0.2 65 0.15 5.34 -031 58 07 DDP2015 664.629 1659.2 -117.4 0.2 36 0.07 15.90 -031 64 4 DDP2015 26/09/ 81 692.8 1633.8 -94.91 0.65 60 0.53 1.86 -032 2015 31 8 DDP2015 685.48 1647.8 -109.2 0.7 38 0.38 1.98 -032 53 2 DDP2015 680.22 1657.5 -119.2 2.8 45 1.93 1.05 -032 91 7
Nylunds
The Nylunds deposit is located 200 m southeast of the current Björkdal open pit (Figure 17). Infill and extension diamond drilling was performed in order to confirm and convert a previous historical resource based only on RC drilling. Many significantly mineralized Au-bearing vein intercepts were intercepted (Table 14). The Nylunds deposit remains open to the north, south and west (mine-grid) suggesting potential for more mineralized exploration from future exploration efforts. Immediate exploration of this deposit will likely focus on the areas immediately north located between Nylunds and the Björkdal open pit.
Table 14: Significant New Core Intercepts at Nylunds
Hole Hole Total Interce Interce Interc Drille Interc True Au ID Comple Hole pt pt ept d ept Width Grade tion Length Easting Northin RL Width Angle (m) (g/t) Date (m) (MG) g (MG) (MG) (m) (°) DDP201 13/10/ 180 -224.00 2560.17 -117.7 4.55 44 3.12 0.68 5-038 2015 6 1 51 DDP201 -164.94 2524.6 -173.8 1.9 40 1.17 2.77 5-038 2 19 DDP201 -158.96 2521.20 -179.1 0.45 47 0.29 2.58 5-038 3 6 1 DDP201 10/10/ 190 -156.43 2565.01 -174.9 3 55 2.42 0.48 5-039 2015 4 9 47 DDP201 -139.86 2553.60 -189.5 0.3 55 0.21 2.71 5-039 4 6 32 DDP201 23/10/ 188 -259.30 2682.28 -106.1 1 55 0.78 0.65 5-040 2015 6 9 96 DDP201 -210.83 2689.75 -145.6 5.75 57 4.79 0.93 5-040 7 4 99 DDP201 -196.95 2692.18 -156.6 0.5 36 0.24 1.43 5-040 4 95 DDP201 20/10/ 175 -242.65 2719.42 -105.8 0.55 36 0.27 17.73 5-041b 2015 3 6 DDP201 -200.78 2720.47 -138.3 0.7 40 0.40 2.07 5-041b 7 4 17 DDP201 -172.93 2721.69 -158.8 3.75 47 2.70 0.44 5-041b 3 5 49 DDP201 -169.40 2721.88 -161.4 0.8 43 0.50 1.77 5-041b 6 3 DDP201 -143.69 2723.54 -180.1 0.45 28 0.16 32.86 5-041b 6 13 DDP201 24/09/ 170 -75.442 2425.82 -136.2 5.75 44 3.95 0.70 5-042 2015 9 43 DDP201 -54.803 2415.54 -153.6 0.7 14 0.11 1.86 5-042 8 24 DDP201 -24.679 2401.31 -178.0 1.4 68 1.27 1.10 5-042 6 28 DDP201 15/10/ 173 -118.46 2551.03 -95.62 0.5 6 0.01 1.73 5-043 2015 9 3 4 DDP201 -96.367 2540.67 -120.9 0.8 62 0.68 3.23 5-043 2 83 DDP201 09/10/ 184 -10.473 2606.30 -172.8 0.85 52 0.63 1.09 5-044 2015 1 37 DDP201 02/10/ 191 19.58 2452.39 -111.2 1.15 59 0.95 0.55 5-045 2015 9 31 DDP201 44.546 2446.06 -131.4 0.4 66 0.34 2.04 5-045 6 99 DDP201 05/10/ 170 7.622 2508.80 -88.44 0.4 42 0.22 13.40 5-046 2015 4 1 DDP201 21.444 2504.64 -101.5 0.55 63 0.46 2.50 5-046 3 14 DDP201 13/09/ 177 39.821 2620.72 -175.2 2.3 35 1.26 0.40 5-047 2015 8 35 DDP201 10/09/ 180 171.768 2410.85 -136.9 1 55 0.78 0.70 5-048 2015 3 89 DDP201 05/09/ 178 167.017 2481.32 -102.6 1.4 48 1.00 1.11 5-049 2015 9 66 DDP201 174.775 2475.38 -110.7 2.35 55 1.89 0.55 5-049 7 38 DDP201 188.149 2465.38 -124.3 1.1 48 0.77 7.52 5-049 2 95 DDP201 208.628 2450.35 -144.7 1.9 42 1.22 1.29 5-049 7 51 DDP201 211.069 2448.56 -147.1 1.05 54 0.81 0.65 5-049 6 69 DDP201 16/09/ 145 59.71 2229.69 -149.9 1.9 46 1.32 7.54 5-050 2015 9 89
Storheden Deposit
The Storheden deposit is located approximately 750 m northeast of the Björkdal mine (Figure 14). Two significantly mineralized, closely-spaced, sub-parallel vein systems were intercepted returning an assay of 2.49 g/t Au from an interval measuring 7 m in true thickness (Table 15). Historical drilling by previous owners has intersected mineralization in this area as well.
Table 15: Significant New Drill Intercept at the Storheden Deposit
Hole Hole Total Interce Interce Interc Drille Interc True Au ID Comple Hole pt pt ept d ept Width Grade tion Length Easting Northin RL Width Angle (m) (g/t) Date (m) (MG) g (MG) (MG) (m) (°) DDE201 18/08/ 150 972.325 2876.26 -110.7 9.2 46 7 2.49 5-001 2015 7 86
Challacollo
No significant work was planned or completed at Challacollo in the second half of 2015.
Qualified Persons:
Costerfield: Chris Gregory, Vice President of Operational Geology and Chief Shield Geologist at Mandalay Resources, is a Member of the Australian Institute of Geoscientists (AIG), and a Qualified Person as defined by NI 43-101. He has reviewed and approved the technical and scientific information about Costerfield contained in this release.
Cerro Bayo: Scott Manske, Chief Cordilleran Geologist of Mandalay Resources, is an Oregon registered Professional Geologist. A "Qualified Person" as defined by NI 43-101, he has reviewed and approved the technical and scientific information on Cerro Bayo contained in this release.
Björkdal: Chris Gregory, Vice President of Operational Geology and Chief Shield Geologist, is a Member of the Australian Institute of Geoscientists (AIG), and a Qualified Person as defined by NI 43-101. He has reviewed and approved the technical and scientific information about Björkdal contained in this release.
For further information: Bradford Mills Chief Executive Officer
Greg DiTomaso Investor Relations
Contact: 647.260.1566
About Mandalay Resources Corporation: Mandalay is a Canadian-based natural resource company with producing assets in Australia and producing and development projects in Chile. The Company is focused on executing a roll-up strategy, creating critical mass by aggregating advanced or in-production gold, copper, silver and antimony projects in Australia and the Americas to generate near-term cash flow and shareholder value.
Forward-Looking Statements: This news release contains "forward-looking statements" within the meaning of applicable securities laws, including statements regarding the Company's Mineral Resources, Mineral Reserves (including anticipated increases of each), ongoing exploration plans and goals. Readers are cautioned not to place undue reliance on forward-looking statements. Actual results and developments may differ materially from those contemplated by these statements depending on, among other things, changes in commodity prices and general market and economic conditions. The factors identified above are not intended to represent a complete list of the factors that could affect Mandalay. A description of additional risks that could result in actual results and developments differing from those contemplated by forward-looking statements in this news release can be found under the heading "Risk Factors" in Mandalay's annual information form dated March 31, 2015, a copy of which is available under Mandalay's profile at www.sedar.com. In addition, there can be no assurance that any current or future Inferred Resources that are discovered as a result of additional drilling will ever be upgraded to Proven or Probable Reserves. Although Mandalay has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.
Brad Mills, CEO of Mandalay, commented, "Our exploration programs across the Company once again continued on track to approximately replace reserves with our end-of-2015 resource and reserves update expected to be released in mid-February, 2016. Exploration at all sites continued to identify new quality target areas for future exploration. At Costerfield, exciting new intercepts suggest that at least three branches of the Cuffley lode occur below the King Cobra fault in the vicinity of our underground infrastructure; all three contain high gold and/or antimony grades and we are optimistic that further drilling planned for 2016 will outline a potentially significant new resource. Intercepts obtained at the Margaret and Brunswick targets have confirmed the presence of mineralized veins and improved our understanding of the structural settings for potential mineralization in these areas. Finally, an initial round of shallow reverse circulation drilling to test the large top-of-bedrock gold and antimony anomaly at West Costerfield has demonstrated the presence of an extensive system of mineralized structures, which may be followed up by core drilling in 2016."
Mr. Mills continued, "At Cerro Bayo, drilling under Laguna Verde continued to reveal the southeast and depth limits of the Coyita vein, with a gap remaining in the middle of the lake that has proved difficult to drill from currently accessible locations. New intercepts on the Yasna vein under Laguna Verde have further defined and slightly enlarged this ore shoot as well. We expect modest increases in resources on both these veins at the year-end 2015 resources and reserves update. Our first hole to test below the northeastern half of the lake intersected a new vein called Victoria. While this wide intercept did not contain economic grades, it indicates that significant structures exist to the east of the current Laguna Verde vein system that were active at the time of mineralization."
Mr. Mills concluded, "At Björkdal, drilling has pushed the limits of underground mineralization some 200 m to the north and up to 100 m to east and northeast. We expect this work will translate into a significant increase in underground resources and reserves in our year-end reserve and resource update. Furthermore, drilling results in and around the southeast part of the open pit suggests we will be able to expand the pit in this area. This year's core drilling has also confirmed the validity of the Nylunds resource model that had previously only been defined by historic RC drilling. We expect the Nylunds resource to convert to a new open pit reserve as a result. Finally, a new mineralized zone was intercepted in the Storheden area some 700 m north of the current Björkdal mine. This intercept, which is anomalously wide for the district, represents a new high quality exploration target for the coming year."
Costerfield
Drilling, Sampling, and Assaying
During the second half of 2015, Mandalay drilled 11,525 metres ("m") of diamond core in 29 holes on Cuffley, Sub-King Cobra, Margaret, Brunswick and Corridor projects (Figure 1). In addition, the Company completed 1,781 m of on-vein operating development and associated sampling of the N- and Cuffley lodes. Thirty-eight reverse circulation ("RC") drill holes totaling 2,780 m were drilled at the West Costerfield bedrock geochemical anomaly. Diamond drill core and RC cuttings were logged and sampled by Costerfield geologists, who also mapped and sampled the development advances. All samples were sent to Onsite Laboratory in Bendigo, Victoria, Australia, (with the exception of the West Costerfield and Margaret drilling samples that were sent to ALS in Orange, NSW, Australia) for sample preparation and assay. Site geological and metallurgical personnel have implemented a QA/QC process that includes the regular submission of standard reference materials and blanks with drill and face samples submitted for assay. Standard reference materials have been certified by Geostats Pty Ltd. (see March 31, 2015, Technical Report entitled "Costerfield Operation, Victoria, Australia NI 43-101 Report", available on SEDAR (www.sedar.com), which contains a complete description of drilling, sampling, and assaying procedures).
Drill Results
Assay results are summarized in Tables 1 through 6 below; they are displayed in geologic context in Figures 2 through 7.
Cuffley Main (Table 1; Figure 2)
-- Four new intercepts were obtained in the Cuffley Main zone, incidental to testing the Corridor target. The highest grade of these, COR003, intercepted 0.045 m at 14.4 grams per tonne ("g/t") gold ("Au") and 2.3% antimony ("Sb"). -- These intercepts were generated while drilling to reach the primary target in the Corridor zone below the Tiger Fault and are not expected to significantly change the estimated resources in the Cuffley Main zone as they penetrated the Main zone within the boundaries of already-Indicated Resource. -- However, they do increase the level of confidence for mine planning in the area.
Table 1: Significant new drill intercepts on Cuffley Main
Hole Hole Interce Interce Elevat True Gold Antimo AuEq Total ID Comple pt pt ion Width* Grade ny (g/t) Hole tion Easting Northin (m) (m) (g/t) Grade over Depth Date (Mine g (%) 1.8m (m) Grid, (Mine ** m) Grid, m) COR003 18/08/ 15199 4916 956 0.04 14.4 2.3 0.03 680 2015 COR003 18/08/ 15181 4920 942 0.43 1.3 0.0 0.67 680 2015 COR003 18/08/ 15179 4920 940 0.20 2.8 0.0 0.11 680 2015 COR004 11/11/ 15133 4575 898 1.11 4.5 0.0 2.85 721 A 2015
* True width is preliminary estimate only and may not reflect final true width used in resource estimate
** AuEq(g/t) = Au(g) + Sb(%) x Price per 10 Sb(kg) × Sb Recovery(%) ------------------------------------- Price per 1 Au(g) × Au Recovery (%)
Cuffley Deeps (Table 2; Figure 3)
-- Two drill holes were completed with the aim of increasing the confidence in the geometry and the extent of the high grade mineralization found at the top of the Cuffley Deeps zone. These holes were successful in delineating the southern boundary of the high grade zone and proving that the grade continues to the north.
Table 2: Significant new drill intercepts on Cuffley Deeps
Hole Hole Interce Interce Elevat True Gold Antimo AuEq Total ID Comple pt pt ion Width* Grade ny (g/t) Hole tion Easting Northin (m) (m) (g/t) Grade over Depth Date (Mine g (%) 1.8m (m) Grid, (Mine ** m) Grid, m) AD130 7/10/2 15189 5068 848 0.73 0.4 0.0 0.16 171 015 AD131 16/11/ 15181 5102 847 2.75 16.6 19.4 55.9 163 2015
* True width is preliminary estimate only and may not reflect final true width used in resource estimate
** AuEq(g/t) = Au(g) + Sb(%) x Price per 10 Sb(kg) × Sb Recovery(%) ------------------------------------- Price per 1 Au(g) × Au Recovery (%)
Sub King Cobra (Table 3, Figure 4)
-- Three high grade structural zones have been identified in drilling beneath the King Cobra fault system (Eastern, Central and Western). The vein composition within these mineralized zones vary from high stibnite concentrations (54.8 g/t Au and 37.2% Sb) in the Eastern structure to visible coarse gold in quartz (3,928 g/t Au and 0.02% Sb) within the Central and Western. -- Assaying and interpretation of the "Eastern" mineralized zone has resulted in significant intercepts in CSK009 of 0.77 m at 2.6 g/t Au and 3.8% Sb, 1.07 m at 6.4 g/t Au and 4.1% Sb. -- Hole CSK007 identified the "Central" Zone as a wide, 8 m zone consisting of quartz-stibnite veins with visible gold in two veins at ~374 m (0.071 m at 119.4 g/t Au and 7.0% Sb, 1.39 m at 136.8 g/t Au and 1.2% Sb). -- The "Western" mineralized zone is located 120 m to the west of the central zone in CSK007 (2.37 m @ 47.5 g/t Au). It consists of a 1.75 m fault zone, containing minor quartz-gold fragments. -- These three zones represent high priority drill targets for follow up in 2016.
Table 3: Significant new drill intercepts on Sub King Cobra
Hole Hole Interc Interc Elevat True Gold Antimo AuEq Total Target ID Comple ept ept ion Width* Grade ny (g/t) Hole tion Eastin Northi (m) (m) (g/t) Grade over Depth Date g ng (%) 1.8m (m) (Mine (Mine ** Grid, Grid, m) m) CSK009 5/11/2 15193 4616 621 2.36 0.95 0.8 2.48 551 Easter 015 n CSK009 5/11/2 15190 4618 617 0.77 2.60 3.8 4.43 551 Easter 015 n CSK009 5/11/2 15188 4620 615 1.07 6.45 4.1 8.83 551 Easter 015 n CSK007 12/10/ 15127 4818 546 0.08 81.0 3.8 3.89 520 Centra 2015 l CSK008 16/09/ 15128 4941 542 0.11 41.4 8.6 3.69 480 Centra 2015 l CSK008 16/09/ 15091 4964 492 0.57 9.9 0.0 3.16 480 Centra 2015 l CSK007 12/10/ 15097 4817 504 0.07 119.4 7.0 5.25 520 Centra 2015 l CSK007 12/10/ 15095 4817 502 1.39 136.76 1.2 107.57 520 Centra 2015 l CSK008 16/09/ 15116 4948 525 0.28 19.4 14.2 7.58 480 Centra 2015 l CSK007 12/10/ 15020 4813 404 2.37 47.51 0.0 47.51 520 Wester 2015 n CSK007 12/10/ 15089 4816 493 0.43 1.8 1.4 1.08 520 Unname 2015 d CSK008 16/09/ 15120 4946 531 0.08 0.5 14.3 1.23 480 Unname 2015 d CSK008 16/09/ 15112 4951 520 0.08 15.8 6.8 1.39 480 Unname 2015 d CSK008 16/09/ 15099 4959 502 0.28 1.1 2.9 1.09 480 Unname 2015 d NSK001 14/07/ 15243 4838 824 0.06 39.7 51.3 4.74 200 Unname 2015 d
* True width is preliminary estimate only and may not reflect final true width used in resource estimate
** AuEq(g/t) = Au(g) + Sb(%) x Price per 10 Sb(kg) × Sb Recovery(%) ------------------------------------- Price per 1 Au(g) × Au Recovery (%)
Margaret (Table 4, Figure 5)
-- Three holes have been drilled on the Margaret target for a total of 1,274 m. The drilling program resulted in shallow intercepts ranging from 75 to 100 m downhole on the "Margaret East" target zones. MM011 displayed visible gold in core and returned grades of 0.14 m at 46.5g/t Au and 3.5% Sb. MM010 was also successful and intercepted high grades in "Margaret East": 0.19 m at 5.8 g/t Au and 9.4% Sb; and 0.1 m at 5.6 g/t Au and 6.7% Sb. -- Follow-up drilling is anticipated in 2016.
Table 4: Significant new drill intercepts on Margaret
Hole Hole Interce Interce Elevat True Gold Antimo AuEq Total ID Comple pt pt ion Width* Grade ny (g/t) Hole tion Easting Northin (m) (m) (g/t) Grade over Depth Date (Mine g (%) 1.8m (m) Grid, (Mine ** m) Grid, m) MM009 5/11/2 15038 3299 1134 0.09 7.8 0.0 0.39 400 015 MM009 5/11/2 15139 3298 1055 0.10 1.4 0.4 0.12 400 015 MM009 5/11/2 15193 3298 1013 0.06 1.4 0.0 0.05 400 015 MM010 4/12/2 15180 3101 1121 0.85 3.9 0.9 2.73 553 015 MM010 4/12/2 15182 3101 1123 0.17 5.8 9.4 2.38 553 015 MM010 4/12/2 15183 3101 1124 0.06 1.2 1.8 0.15 553 015 MM010 4/12/2 15184 3101 1125 0.10 3.7 0.0 0.20 553 015 MM010 4/12/2 15220 3100 1156 0.07 1.3 1.2 0.15 553 015 MM010 4/12/2 15238 3100 1171 0.12 1.0 0.0 0.07 553 015 MM010 4/12/2 14933 3106 913 0.09 2.3 0.0 0.12 553 015 MM010 4/12/2 14962 3105 937 0.11 1.8 0.0 0.12 553 015 MM011 23/12/ 15248 2901 1184 0.21 0.9 0.0 0.11 320 2015 MM011 23/12/ 15248 2901 1184 0.78 1.0 0.0 0.45 320 2015 MM011 23/12/ 15197 2909 1141 0.94 13.1 1.7 8.69 320 2015
* True width is preliminary estimate only and may not reflect final true width used in resource estimate
** AuEq(g/t) = Au(g) + Sb(%) x Price per 10 Sb(kg) × Sb Recovery(%) ------------------------------------- Price per 1 Au(g) × Au Recovery (%)
Corridor (Table 5, Figure 2)
-- Five holes totaling 3,545 m have been drilled in the mineralized Corridor program. -- Four of the five holes drilled on the target confirmed a sub-vertical structure approximately 350 m to the west of the Cuffley Deposit. This newly identified structure has a confirmed strike length of 500 m and is open along strike to the north and south. Mineralization consists of brecciated quartz with pyritic matrix that bears strongly anomalous Au and Sb.
Table 5: Significant new drill intercepts on Corridor
Hole Hole Interce Interce Elevat True Gold Antimo AuEq TotalH ID Comple pt pt ion Width* Grade ny (g/t) ole tion Easting Northin (m) (m) (g/t) Grade over Depth Date (Mine g (%) 1.8m (m) Grid, (Mine ** m) Grid, m) COR001 20/07/ 15018 5284 794 0.10 3.0 0.0 0.17 851 2015 COR003 18/08/ 14750 4990 624 0.22 2.0 0.0 0.24 680 2015 COR004 11/11/ 14981 4600 785 0.11 1.1 0.1 0.08 721 A 2015 COR005 27/11/ 14786 4357 629 0.06 1.5 2.4 0.20 724 2015
* True width is preliminary estimate only and may not reflect final true width used in resource estimate
** AuEq(g/t) = Au(g) + Sb(%) x Price per 10 Sb(kg) × Sb Recovery(%) ------------------------------------- Price per 1 Au(g) × Au Recovery (%)
Brunswick (Table 6, Figure 5)
-- During November - December 2015, 3 diamond drill holes totalling 1,172 m were drilled at Brunswick, targeting the northern extension of mineralization and a continuation of the lode at depth below the Brunswick pit. -- BD238 and B240 confirmed the continuation of the Brunswick structure at depth and to the north, respectively; however, the structure intercepted in these holes only contains trace mineralization. -- BD239 has proven up the continuation of mineralization below the south end of the Brunswick pit returning assays of 0.3 m at 8.1 g/t Au and 0.6% Sb. -- While the 2015 program bounded the upside potential of Brunswick to the north, should metal prices and economic analysis warrant, a follow-up program to infill the southern area around and below BD239 plus other sparsely drilled gaps in the lode is possible.
Table 6: Significant new drill intercepts on Brunswick
Hole Hole Interce Interce Elevat True Gold Antimo AuEq Total ID Comple pt pt ion Width* Grade ny (g/t) Hole tion Easting Northin (m) (m) (g/t) Grade over Depth Date (Mine g (%) 1.8m (m) Grid, (Mine ** m) Grid, m) BD238 13/11/ 14812 5890 972 0.30 0.1 0.0 0.00 372 2015 BD239 23/11/ 14774 5760 962 0.76 4.2 0.3 1.33 295 2015 BD240 2/12/2 14830 6063 1054 0.11 0.7 0.0 0.04 270 015
* True width is preliminary estimate only and may not reflect final true width used in resource estimate
** AuEq(g/t) = Au(g) + Sb(%) x Price per 10 Sb(kg) × Sb Recovery(%) ------------------------------------- Price per 1 Au(g) × Au Recovery (%)
West Costerfield (Table 7, Figure 6)
-- A total of 38 holes totaling 2,780 m of RC drilling was undertaken during the second half of 2015 in order to confirm the bedrock geochemical anomaly found in the 2014 auger drilling program. -- Results from the RC drilling confirmed bedrock mineralization in the anomaly. The identification of the geochemical anomaly represented an almost entirely untested, near surface mineralized system. -- The program generated five low grade intercepts, one of 4 m width and the others of 1 m each. -- Correlations in the district suggest that RC results tend to underestimate grades found in the same vein by neighbouring core holes, suggesting that follow-up of the mineralized RC intercepts by core holes may be warranted in the future.
Table 7: Significant new drill intercepts on West Costerfield
Hole Hole Intercep Intercep Elevat Down Gold Antimony Total ID Complet t t ion Hole Grade Grade Hole ion Easting Northing (m) Length (g/t) (%) Depth Date (Mine (Mine (m) (m) Grid, m) Grid, m) WCRC00 4/09/20 13878 7227 1230 2.0 0.61 0.004 72 4 15 WCRC00 8/09/20 13950 7205 1203 1.0 0.87 0.026 72 6 15 WCRC00 8/09/20 13934 7207 1180 2.0 0.66 0.005 72 6 15 WCRC00 10/09/2 14023 7191 1184 1.0 0.80 0.005 72 8 015 WCRC01 11/09/2 13878 7226 1208 1.0 1.33 0.006 72 1 015 WCRC01 21/09/2 13671 6975 1185 3.0 0.82 0.005 72 4 015 WCRC01 21/09/2 13665 6976 1176 1.0 0.83 0.004 72 4 015 WCRC01 21/09/2 13660 6978 1167 4.0 1.16 0.006 72 4 015 WCRC02 28/09/2 13694 6951 1175 1.0 0.87 0.005 72 2 015 WCRC02 28/09/2 13701 6946 1165 1.0 0.63 0.000 72 2 015 WCRC02 30/09/2 13662 6763 1204 1.0 0.99 0.006 72 4 015 WCRC02 29/09/2 13687 6753 1163 1.0 0.83 0.005 72 8 015 WCRC03 1/10/20 13475 6827 1210 1.0 0.62 0.000 72 0 15 WCRC03 9/10/20 13523 6569 1204 1.0 0.97 0.000 72 2 15 WCRC03 5/10/20 13611 6568 1197 4.0 0.93 0.005 72 4 15 WCRC03 5/10/20 13610 6569 1196 1.0 1.51 0.006 72 4 15 WCRC03 5/10/20 13590 6576 1170 1.0 0.26 0.288 72 4 15 WCRC03 5/10/20 13657 6551 1204 1.0 0.57 0.005 72 5 15 WCRC03 7/10/20 13611 6570 1197 2.0 0.59 0.005 72 7 15 WCRC03 8/10/20 13562 6553 1192 3.0 0.53 0.005 72 8 15 WCRC03 8/10/20 13588 6540 1153 1.0 0.50 0.004 72 8 15
* True width is preliminary estimate only and may not reflect final true width used in resource estimate
** AuEq(g/t) = Au(g) + Sb(%) x Price per 10 Sb(kg) × Sb Recovery(%) ------------------------------------- Price per 1 Au(g) × Au Recovery (%)
Cerro Bayo
Drilling, Sampling and Assaying
A total of 14,007 m of NX and BX diamond drill core were produced from 34 holes at Cerro Bayo during the second half of 2015. The bulk of this meterage was drilled from surface platforms on the margins of Laguna Verde, while the rest was completed from underground stations in the Dagny and Yasna mines. All drill holes were directionally surveyed by standard techniques with a downhole instrument.
Drill core was logged and sampled by staff geologists and all core samples (including blanks, standards and duplicates) were submitted to the on-site assay laboratory of Compañia Minera Cerro Bayo. The Cerro Bayo assay laboratory was audited in 2011 by SGS Lakefield Research Ltd. and routinely sends check samples to the ALS laboratory (ISO 9001:2008 and ISO/IEC 176025:2005 certified) in La Serena, Chile, following QA/QC practices established by the parent company, Mandalay Resources. (Please see the Company's previously filed document, 'Technical report on the Cerro Bayo project, Region XI (Aysèn) Chile', dated March 28, 2014, and available on SEDAR (www.sedar.com), for a full description of the drilling, logging, assaying and estimation processes, including data verification procedures).
Drill Results
The following tables and figures display mineralized intercepts obtained through December 31, 2015, correlated by vein according to the latest structural interpretation. Such structural interpretation may be subject to revision as more drilling data are acquired.
Coyita vein (Table 8, Figures 9,10,11)
27 new drill holes completed during the second six months of 2015 indicate that the Coyita vein is a strongly mineralized fissure essentially all the way across Laguna Verde to the district-scale fault structure of the Falla Cañadón Verde (Figure 9). The mineralization in the vein largely has been closed off in both its SE and NW extents, with a few gaps remaining on the extreme southern end and the central section under the lake to be drilled (Table 8, Figures 10 and 11). Localized, significant grade has been recognized in subordinate branch veins lying to the west of the Coyita vein. A new vein was intersected far to the east of the Coyita, dubbed the 'Victoria' vein (Figure 9). This latter feature was not well-mineralized in this initial intercept, but the characteristics of hydrothermal alteration and gangue mineralogy encourage further drill testing at higher structural levels and along strike.
Table 8: Summary of mineralized intercepts correlated to the Coyita vein
Hole Hole Total Interc Interc Interc From To Length True Gold Silver ID Comple Hole ept ept ept (m) (m) (m) Width Grade Grade tion Depth UTM_E UTM_N Elev. (m) (g/t) (g/t) Date (m) (m) DLV15- 6/22/2 368.60 272334 484064 -33.65 319.18 323.5 4.32 2.51 1.04 45 026 015 .81 8.75 DLV15- 8/2/20 379.35 271990 484112 126.18 360.3 360.88 0.58 0.4 0.96 467 027 15 .07 9.09 DLV15- 7/12/2 179.95 271733 484145 125.35 162.7 167.35 4.65 2.02 0.68 222 028 015 .41 9.28 DLV15- 7/14/2 368.15 272348 484060 -45.98 346.7 349.9 3.2 2.1 3.78 896 029 015 .741 0.51 9 DLV15- 7/19/2 293.80 271778 484145 36.02 260.01 262.77 2.76 1.1 0.45 23 031 015 .69 9.28 DLV15- 8/19/2 390.80 272343 484062 -78.12 369.7 371.05 1.35 0.78 4.17 514 032 015 .63 3.07 DLV15- 7/29/2 403.90 272307 484069 -60.36 357.91 358.95 1.04 0.67 6.28 115 033 015 .84 0.62 DLV15- 8/25/2 437.60 272016 484109 92.83 387.6 388.2 0.6 0.33 0.33 133 035 015 .06 2.76 DLV15- 8/15/2 402.00 272284 484073 -71.47 387.03 388.55 1.52 1.11 1.08 102 036 015 .99 0.61 DLV15- 8/30/2 499.60 272135 484099 15.94 407.16 409.07 1.91 1.16 0.66 21 037 015 .17 0.9 DLV15- 9/2/20 158.80 271718 484146 160.32 131.3 131.6 0.3 0.19 0.49 10 038 15 .92 6.31 DLV15- 9/16/2 351.05 271954 484118 96.7 330.04 332.72 2.68 2.11 1.03 287 039 015 .89 7.97 DLV15- 10/12/ 364.50 272257 484078 -65.22 345.52 348.15 2.63 1.48 2.29 149 041 2015 .12 0.9 DLV15- 9/20/2 395.00 272364 484058 -62.88 370.68 373.11 2.43 1.37 3.69 194 042 015 .28 1.84 DLV15- 9/30/2 304.60 271912 484118 148.18 290.4 291.12 0.81 0.66 5.58 1324 043 015 .2 2.3 1 DLV15- 9/30/2 470.00 272365 484060 -103.8 396.48 397.07 0.59 0.3 15.22 347 044 015 .31 9.56 9 DLV15- 10/16/ 477.85 272131 484099 -10.77 425.86 428.35 2.49 1.5 1.44 219 045 2015 .77 0.88 DLV15- 10/23/ 531.00 272095 484097 96.29 490.31 490.75 0.44 0.27 3.41 410 047 2015 .08 0.38 DLV15- 10/17/ 431.00 272411 484055 -89.7 403.54 406.7 3.16 1.34 10.18 1308 048 2015 .27 5.99 DLV15- 11/5/2 523.60 272113 484099 75.15 502.27 504.25 1.98 1.26 3.67 1040 049 015 .68 0.02 DLV15- 11/6/2 502.25 NO VEIN 050 015 DLV15- 11/19/ 405.70 NO VEIN 051 2015 DLV15- 11/26/ 350.50 272321 484059 -19.78 328.85 329.35 0.5 0.35 1.84 598 053 2015 .09 7 DLV15- 11/26/ 378.05 271969 484114 133.95 340.81 341.15 0.34 0.25 0.05 1 055 2015 .7 9.64 DLV15- 12/13/ 373.80 272288 484065 66.94 224.89 227.02 2.13 1.35 0.31 49 057 2015 .69 4 DLV15- 12/13/ 560.60 272109 484096 62.17 505.58 509.6 4.02 2.32 6.8 811 058 2015 .56 1.98 DLV15- 12/9/2 452.00 272374 484060 -90.15 384.48 386.2 1.72 0.81 3.11 164 059 015 .66 4.07
Yasna vein (Table 9, Figure 12)
Three new infill drill holes on the Yasna vein largely confirm that the mineralized zone has been closed off and remains approximately 200 m long by 70 m high, down-dip. Minor increases in the size of the shoot could be generated by more infill drilling, but Mandalay has decided to wait to complete this work until excavation of a nearby drill station makes the project cheaper and more cost effective.
Table 9: Summary of Mineralized Intercepts Correlated with the Yasna Vein System
Hole Hole Total Interc Interc Interc From To Length True Gold Silver ID Comple Hole ept ept ept (m) (m) (m) Width Grade Grade tion Depth UTM_E UTM_N Elev. (m) (g/t) (g/t) Date (m) (m) DLV15- 9/30/2 515.20 271863 484081 54.54 424.66 425.23 0.57 0.53 0.73 208 040 015 .2 7.5 DLV15- 11/4/2 440.65 271804 484088 99.55 425.12 426.78 1.66 1.51 0.3 50 046 015 .19 5.35 DLV15- 8/28/2 507.15 271815 484082 43.36 391.76 395.3 3.54 3.44 1.04 109 034 015 .26 7.97
Kasia vein (Table 10, Figure 13)
Five new drill intercepts were obtained on the Kasia vein, in the southern sector where the Kasia and Yasna systems appear to converge. Some remarkable grades were obtained from veins lying between the Kasia fissure and the Coyita vein, which may represent a step-over or linking system between the two named veins, similar in orientation to the Yasna inflection (drill hole DLV15-054; Figure 9).
Table 10: Summary of Mineralized Intercepts Correlated to the Kasia Vein System
Hole Hole Total Interc Interc Interc From To Length True Gold Silver ID Comple Hole ept ept ept (m) (m) (m) Width Grade Grade tion Depth UTM_E UTM_N Elev. (m) (g/t) (g/t) Date (m) (m) DLV15- 8/28/2 507.15 271896 484088 38.3 494.09 494.95 0.86 0.86 1.84 320 034 015 .19 8.15 DLV15- 9/30/2 515.20 271920 484085 56.43 492.53 493.23 0.7 0.7 0.17 34 040 015 .77 3.59 DLV15- 11/23/ 413.00 272060 484068 -7.96 367.2 367.6 0.4 0.23 0.2 0.22 054 2015 .85 9.9 DLV15- 12/1/2 389.00 272070 484063 -16.84 373.7 374.6 0.9 0.56 0.63 165 056 015 .12 2.04 DLV15- 11/16/ 391.60 272085 484067 48.64 312.52 312.91 0.39 0.25 0.33 381 052 2015 .17 1.12
Björkdal
Drilling, Sampling and Assaying
All the surface, and the majority of the underground exploration diamond drilling were conducted by third party contractors, producing WL66-, NQ2- and WL76-sized core (50.7 mm, 50.6 and 57.5 mm diameter core, respectively). During the period from July 1, 2015, to December 31, 2015, 21 diamond core drill holes totalling 3,098 m were drilled to infill and extend open pit resources; 26 core holes for 6,768 m were drilled to infill and extend underground resources; 17 core holes totalling 2,875 m were drilled to confirm and extend the historic resource at the near-mine Nylunds Deposit; and 12 core holes for 2,111 m were drilled to test targets within the near-mine exploration tenements. All diamond drill hole collars are surveyed. Downhole surveys are also carried out to record hole azimuth and dip.
Diamond core samples were logged by Mandalay geologists on-site. Assaying of Björkdal samples was completed at CRS Minlab Oy (CRS) in Kempele, Finland. Whole core samples were sent directly to the independent laboratory for sample preparation and assaying. Assaying was conducted utilizing the LeachWELL process. Our rigorous QA/QC program included the use of standard reference samples, blanks, duplicates, repeats, and internal laboratory quality assurance procedures. More details on the drilling, logging, sampling, and assaying procedures are contained in the Technical Report "Mandalay Resources Corporation Technical Report on the Björkdal Gold Mine, Sweden" filed March 31, 2015 and available on SEDAR (www.sedar.com).
Drill Results
Underground (Table 11, Figures 14 and 15)
Underground diamond drilling at Björkdal intercepted many new economic gold-bearing veins (Table 11). These new intercepts come from the Lake zone, Lake zone north, Central zone and Main zone (Figure 15). They serve to push the limits of continuous mineralization 200 m to the north and up to 100 m to the northeast and east of previously interpreted limits; mineralization remains open in those directions.
Table 11: Significant Björkdal Underground Drill Results
Hole Hole Total Interce Interce Interc Drille Interc True Au ID Comple Hole pt pt ept RL d ept Width Grade tion Depth Easting Northin (MG) Width Angle (m) (g/t) Date (m) (MG) g (MG) (m) (°) DDU201 12/05/ 281 1319.87 1799.43 -375.3 1.8 42 1.16 4.85 5-020 2015 2 99 DDU201 1245.07 1861.74 -392.6 0.35 40 0.18 18.40 5-020 5 4 08 DDU201 24/05/ 317 1361.42 1776.26 -387.6 2.05 47 1.46 4.32 5-021 2015 6 5 08 DDU201 1349.39 1790.65 -395.4 0.35 15 0.03 10.70 5-021 2 4 98 DDU201 1311.71 1833.70 -420.4 0.25 60 0.18 36.70 5-021 4 1 14 DDU201 1233.99 1915.04 -471.8 0.35 72 0.31 33.40 5-021 6 1 12 DDU201 1230.19 1918.81 -474.3 2.7 55 2.18 2.52 5-021 9 31 DDU201 1222.47 1926.42 -479.4 2.55 73 2.42 5.09 5-021 4 1 36 DDU201 27/06/ 312 1472.81 1701.94 -397.4 1.9 18 0.53 8.66 5-022 2015 6 9 25 DDU201 1535.81 1692.90 -436.3 1.75 21 0.57 7.89 5-022 7 92 DDU201 1570.25 1688.21 -457.4 0.35 30 0.12 31.50 5-022 3 64 DDU201 01/06/ 306 1494.87 1680.03 -416.7 2.9 43 1.93 23.92 5-023 2015 2 01 DDU201 1520.25 1671.03 -435.2 0.55 22 0.15 8.63 5-023 3 8 97 DDU201 1539.86 1664.11 -450.0 2 45 1.37 5.80 5-023 3 1 09 DDU201 1589.13 1647.04 -487.8 1.95 47 1.38 4.54 5-023 4 3 45 DDU201 1643.00 1629.42 -529.1 0.3 73 0.27 38.20 5-023 3 3 36 DDU201 29/08/ 252 1557.30 1188.72 -387.2 0.3 31 0.10 21.30 5-024 2015 7 2 1 DDU201 1643.08 1154.16 -431.5 1.05 50 0.76 16.95 5-024 2 8 73 DDU201 1650.09 1151.54 -435.0 0.4 49 0.26 8.83 5-024 7 4 91 DDU201 1555.74 1179.74 -383.3 0.4 29 0.14 62.50 5-025 9 6 9 DDU201 1640.11 1120.65 -419.7 1.25 48 0.89 3.00 5-025 2 7 33 DDU201 10/09/ 250 1522.98 1130.48 -379.2 1.45 40 0.88 14.55 5-026 2015 4 4 96 DDU201 1579.72 1119.96 -410.9 0.3 64 0.24 14.00 5-026 6 4 59 DDU201 1608.05 1115.03 -427.0 0.3 50 0.19 11.10 5-026 3 3 51 DDU201 1613.64 1114.09 -430.2 1.4 30 0.65 4.72 5-026 1 5 36 DDU201 1675.62 1104.43 -465.8 2.25 88 2.25 2.41 5-026 3 3 26 DDU201 1580.92 1097.95 -406.9 0.3 77 0.28 34.60 5-027 6 79 DDU201 1664.21 1063.13 -448.7 4.15 49 3.09 31.95 5-027 5 7 3 DDU201 02/07/ 240 723.941 2037.81 -245.6 0.35 35 0.15 22.80 5-031 2015 4 06 DDU201 693.97 2053.03 -243.6 0.4 61 0.32 9.08 5-031 8 37 DDU201 09/07/ 321 565.586 2112.47 -246.6 0.85 85 0.84 96.21 5-032 2015 8 3 DDU201 22/07/ 311 725.93 2049.37 -254.6 0.4 89 0.40 135.00 5-033 2015 4 7 DDU201 627.524 2119.85 -266.5 0.6 74 0.56 7.64 5-033 2 64 DDU201 31/07/ 207 1565.70 1349.25 -391.1 0.35 29 0.11 10.60 5-034 2015 5 8 78 DDU201 1600.94 1338.10 -407.5 0.3 31 0.10 23.90 5-034 7 2 39 DDU201 1614.08 1334.10 -413.6 0.7 52 0.51 23.00 5-034 4 3 97 DDU201 1662.47 1320.19 -436.5 1.35 36 0.74 2.69 5-034 4 4 05 DDU201 1724.95 1303.42 -465.0 1 50 0.73 3.16 5-034 2 7 92 DDU201 04/08/ 213 1642.37 1303.27 -435.6 1.45 33 0.74 3.14 5-035 2015 4 8 36 DDU201 1683.63 1281.88 -458.1 3.1 35 1.73 4.09 5-035 9 8 03 DDU201 1707.81 1269.70 -471.0 0.95 40 0.56 3.46 5-035 8 6 82 DDU201 04/08/ 213 1716.36 1265.54 -475.5 0.5 38 0.26 37.80 5-035 2015 5 1 97 DDU201 10/08/ 213 1604.52 1276.61 -410.4 0.3 54 0.21 15.10 5-036 2015 6 4 18 DDU201 1611.97 1274.45 -413.1 0.25 68 0.21 130.00 5-036 6 6 55 DDU201 1651.91 1263.49 -427.5 0.45 59 0.35 15.70 5-036 6 4 57 DDU201 1702.53 1250.25 -444.6 1.05 53 0.80 6.01 5-036 7 5 61 DDU201 1723.13 1245.16 -451.2 0.9 40 0.53 13.20 5-036 6 2 69 DDU201 19/08/ 228 1635.51 1199.33 -437.5 0.3 73 0.27 13.30 5-037 2015 17 DDU201 1711.01 1186.40 -475.7 2.1 35 1.15 17.12 5-037 6 6 05 DDU201 24/08/ 232 1558.67 1208.62 -396.0 1.35 67 1.22 13.02 5-038 2015 3 2 87 DDU201 1573.86 1201.37 -403.3 0.3 48 0.18 32.00 5-038 7 8 33 DDU201 1609.55 1184.79 -420.3 3.15 66 2.85 4.83 5-038 3 2 51 DDU201 1621.03 1179.58 -425.8 0.25 41 0.12 18.40 5-038 8 9 35 DDU201 1671.62 1157.11 -450.3 0.6 29 0.24 6.18 5-038 3 7 19 DDU201 18/09/ 252 1579.16 1090.03 -411.7 0.3 53 0.20 11.83 5-039 2015 6 38 DDU201 1592.41 1082.65 -419.5 0.3 49 0.18 11.80 5-039 7 6 15 DDU201 06/10/ 276 1450.55 1680.71 -386.3 1.7 49 1.24 13.60 5-041 2015 2 3 15 DDU201 1470.71 1666.36 -401.0 1.45 42 0.92 45.54 5-041 6 89 DDU201 1475.73 1662.82 -404.8 0.7 23 0.22 9.50 5-041 7 9 05 DDU201 20/10/ 305 1491.31 1674.09 -408.7 4.05 40 2.55 29.12 5-042 2015 2 7 1 DDU201 1496.24 1671.93 -411.8 1.55 22 0.52 2.04 5-042 7 3 76 DDU201 1549.72 1649.70 -446.5 1.5 71 1.40 2.22 5-042 1 3 DDU201 1637.21 1617.27 -503.3 0.75 49 0.52 19.87 5-042 3 8 62 DDU201 07/11/ 353 1419.22 1700.52 -364.0 1 50 0.73 6.40 5-043 2015 6 2 78 DDU201 1438.82 1680.40 -377.7 0.3 59 0.22 21.20 5-043 7 2 7 DDU201 28/10/ 327 1448.44 1686.04 -385.6 0.75 38 0.41 8.34 5-044 2015 3 1 DDU201 1593.19 1601.31 -493.8 0.55 65 0.47 6.29 5-044 5 7 14 DDU201 1628.01 1584.24 -520.1 1.15 54 0.89 3.60 5-044 4 7 01 DDU201 06/09/ 291 1481.29 1598.57 -387.1 2 44 1.34 8.33 5-045 2015 9 2 18 DDU201 1491.64 1587.96 -390.8 0.55 48 0.37 29.07 5-045 7 6 27 DDU201 1524.37 1554.71 -402.4 0.6 44 0.37 28.40 5-045 3 3 21 DDU201 1535.68 1543.41 -406.3 0.45 65 0.38 206.00 5-045 5 4 97 DDU201 1558.39 1520.81 -414.5 0.45 54 0.33 11.11 5-045 4 6 16 DDU201 20/09/ 276 1527.35 1564.96 -415.8 4.4 27 1.94 2.60 5-046 2015 4 6 13 DDU201 03/10/ 282 1504.99 1604.41 -403.0 0.4 51 0.27 61.20 5-047 2015 5 4 33 DDU201 1532.74 1587.86 -414.4 3.75 14 0.85 1.33 5-047 5 5 71 DDU201 1550.07 1577.74 -421.3 2.3 58 1.92 30.25 5-047 9 4 69 DDU201 1650.68 1519.72 -461.1 0.25 52 0.16 25.60 5-047 3 85 DDU201 21/10/ 262 1561.42 1601.51 -426.8 0.3 56 0.21 12.10 5-048 2015 5 8 25 DDU201 1574.06 1596.88 -432.2 1 44 0.65 4.39 5-048 7 25 DDU201 1606.05 1585.42 -445.8 2 18 0.56 1.52 5-048 8 3 DDU201 1612.55 1583.15 -448.5 2.4 N/A 4.81 5-048 3 5 25 DDU201 1632.06 1576.43 -456.7 3 45 2.08 3.64 5-048 7 22 DDU201 1640.52 1573.57 -460.2 3.95 32 2.04 7.18 5-048 8 2 9 DDU201 1647.10 1571.35 -463.0 1 N/A 6.03 5-048 7 5 6 DDU201 18/11/ 239 1571.42 1625.33 -425.4 5.65 36 3.27 2.62 5-050 2015 8 1 31 DDU201 1593.87 1621.40 -434.1 3.95 21 1.36 1.34 5-050 9 6 43 DDU201 30/09/ 241 1275.91 1587.71 -338 0.55 64 0.47 273.00 5-051 2015 9 2 DDU201 13/10/ 312 1490.30 1653.61 -400.8 0.25 46 0.14 21.90 5-052 2015 7 7 92 DDU201 1512.04 1639.49 -412.6 0.5 38 0.26 6.44 5-052 7 8 76 DDU201 1566.06 1606.51 -441.4 2.65 32 1.35 3.46 5-052 4 44 DDU201 1622.41 1575.31 -470.4 0.45 59 0.35 7.02 5-052 2 9 63 DDU201 26/11/ 176 1052.71 1970.99 -334.6 1.35 69 1.24 2.58 5-053 2015 4 3 95 DDU201 1022.79 2000.74 -347.5 0.35 81 0.34 58.90 5-053 15 DDU201 999.522 2023.11 -357.6 0.3 85 0.29 12.40 5-053 8 12 DDU201 991.985 2030.26 -360.9 0.3 82 0.29 295.00 5-053 29 DDU201 979.603 2041.83 -366.4 7.55 68 6.98 9.75 5-053 8 38 DDU201 23/11/ 177 1051.57 1981.34 -344.1 0.7 47 0.47 4.90 5-054 2015 6 5 47 DDU201 1032.46 2008.47 -360.1 0.35 68 0.30 47.90 5-054 7 3 17 DDU201 1019.56 2026.36 -370.7 0.25 62 0.19 14.50 5-054 2 2 79 DDU201 1014.19 2033.72 -375.1 1.3 83 1.28 2.35 5-054 3 8 87 DDU201 1010.91 2038.19 -377.8 0.3 62 0.24 169.00 5-054 9 5 6
The completion of the test drilling program within the eastern limit (mine-grid) of the Main zone (DDT diamond drilling program, Figure 15) has also seen extremely positive results in that many new significant intercepts have been reported (Table 12). The test drilling program was drilled with oriented core to successfully identify mineralized veins of several different orientations within the Main zone of the mine. These veins strike at an oblique angle to the dominant vein direction and commonly contain higher than average gold grades. The use of oriented, closely-spaced drilling has allowed for a detailed understanding of a geologically complex area within the mine. This new geological knowledge is now being successfully transferred to other areas of the operation where it has confirmed the similar behaviour of the orebody throughout the known limits of the deposit.
Table 12: Significant New Detailed Test Drilling (DDT) Intercepts
Hole Hole Total Interce Interce Interc Drille Interc True Au ID Comple Hole pt pt ept d ept Width Grade tion Length Easting Northin RL Width Angle (m) (g/t) Date (m) (MG) g (MG) (MG) (m) (°) DDT201 12/03/ 122 967.336 2016.24 -336.1 9.33 50 7.11 4.59 5-016 2015 5 65 DDT201 15/03/ 131 990.34 1994.91 -334.5 0.25 56 0.17 107.00 5-017 2015 8 55 DDT201 973.248 2009.90 -342.5 0.95 61 0.80 7.91 5-017 1 65 DDT201 965.195 2016.97 -346.3 1 50 0.73 4.27 5-017 8 68 DDT201 18/03/ 95 976.346 2007.02 -350.5 0.2 60 0.14 18.70 5-018 2015 4 79 DDT201 23/03/ 122 944.803 1983.14 -331.8 3.45 48 2.52 3.14 5-019 2015 66 DDT201 1002.99 1949.26 -345.1 0.51 59 0.40 69.50 5-019 9 7 27 DDT201 27/03/ 129 940.957 1985.4 -337.6 3.81 58 3.20 11.55 5-020 2015 68 DDT201 955.5 1976.93 -344.1 2.18 53 1.70 1.55 5-020 7 32 DDT201 1012.75 1943.24 -369.3 0.47 60 0.38 14.70 5-020 1 2 18 DDT201 30/03/ 92 944.037 1983.19 -351.3 1.04 42 0.65 20.22 5-021 2015 4 6 DDT201 961.913 1972.42 -365.9 1.37 50 1.01 12.53 5-021 5 7 DDT201 07/04/ 126 951.649 1955.28 -343.3 0.3 35 0.12 20.90 5-023 2015 7 33 DDT201 11/04/ 55 950.707 2002.91 -331.5 0.41 64 0.34 8.53 5-025 2015 9 39 DDT201 954.944 2000.5 -332.4 0.26 61 0.20 42.40 5-025 56 DDT201 14/04/ 125 947.719 2004.19 -337.5 1.36 56 1.09 2.59 5-026 2015 6 78 DDT201 983.25 1982.50 -353.2 12.21 61 10.65 1.38 5-026 8 65 DDT201 1016.36 1962.15 -367.6 0.44 60 0.35 79.90 5-026 4 8 25 DDT201 17/04/ 93 960.724 1996.87 -358.9 1.05 55 0.82 5.31 5-027 2015 8 31 DDT201 968.064 1992.67 -364.8 0.3 40 0.14 38.90 5-027 5 53 DDT201 20/04/ 120 955 2000.61 -332.4 0.36 68 0.31 16.49 5-028 2015 9 94 DDT201 960.921 1997.29 -333.7 0.41 69 0.36 12.70 5-028 3 44 DDT201 979.92 1986.72 -337.7 10.89 57 9.10 7.16 5-028 7 19 DDT201 991.997 1980.08 -340.2 0.33 21 0.06 193.00 5-028 7 35 DDT201 1011.91 1969.14 -344.4 0.61 42 0.36 28.00 5-028 1 7 03 DDT201 27/04/ 126 936.049 1938.54 -338.2 0.62 5.11 5-030 2015 8 74 DDT201 949.341 1929.73 -344.0 0.18 56 0.11 165.70 5-030 9 78 DDT201 01/05/ 120 970.502 2014.39 -334.5 1.65 71 1.54 25.88 5-032 2015 5 81 DDT201 1019.50 1988.67 -344.7 1.45 67 1.31 52.12 5-032 8 1 84 DDT201 05/05/ 126 1025.98 1984.95 -366.0 0.45 47 0.29 81.60 5-033 2015 1 6 62 DDT201 07/05/ 100 964.796 2017.08 -356.8 1.79 62 1.55 2.12 5-034 2015 3 04
Open Pit
Surface drilling has extended the southeast limits of shallow Au mineralization adjacent to the currently mined Björkdal open pit. (Table 13 and Figure 16 for intercept locations). Future drilling will test the possibility that the East pit resource may be continuous with the shallow Nylunds resource further to the southeast.
Table 13: Significant New Near-Surface Core Drill Intercepts from the South-Eastern Portion of the Björkdal Open Pit
Hole ID Hole Total Interce Interc Interc Drille Interc True Au Comple Hole pt ept ept d ept Width Grade tion Depth Easting Northi RL Width Angle (m) (g/t) Date (m) (MG) ng (MG) (m) (°) (MG) DDP2015 05/06/ 202 301.004 2000.9 -103.6 1.2 39 0.71 1.01 -007 2015 44 05 DDP2015 302.142 1998.3 -105.9 1.15 28.5 0.49 1.28 -007 98 22 DDP2015 13/11/ 166 403.784 1886.0 -128.8 0.4 42 0.22 1.74 -011 2015 41 3 DDP2015 408.069 1880.7 -133.3 0.4 41 0.21 62.50 -011 04 47 DDP2015 29/10/ 212 463.683 1847.5 -114.9 0.35 37 0.16 218.00 -015 2015 25 89 DDP2015 483.799 1836.9 -132.7 0.45 10 0.02 1.40 -015 85 02 DDP2015 536.44 1811.2 -178.5 0.35 65 0.29 6.84 -015 35 35 DDP2015 576.222 1793.3 -212.7 3 20 0.97 3.12 -015 41 27 DDP2015 03/10/ 156 460.711 1835.5 -124.6 0.3 34 0.12 8.42 -016 2015 14 9 DDP2015 07/10/ 94 708.141 1706.7 -122.2 2.25 16 0.56 1.22 -017 2015 14 86 DDP2015 21/10/ 210 582.693 1534.5 -156.5 0.95 30 0.42 1.09 -018 2015 49 22 DDP2015 585.34 1533.0 -158.8 0.2 56 0.13 6.61 -018 83 63 DDP2015 31/10/ 174 504.943 1610.1 -84.85 1.2 70 1.11 0.52 -020 2015 26 2 DDP2015 554.318 1611.9 -123.0 1 85 0.99 1.02 -020 13 46 DDP2015 593.369 1614.1 -153.7 4.1 32 2.12 0.40 -020 93 02 DDP2015 13/10/ 134 667.878 1617.9 -144.4 0.3 64 0.24 2.51 -021 2015 38 84 DDP2015 20/10/ 145 505.051 1736.3 -103.8 0.2 40 0.08 5.72 -023 2015 84 74 DDP2015 524.048 1714.1 -124.0 0.3 50 0.19 21.80 -023 35 7 DDP2015 15/10/ 110 504.88 1745.5 -100.2 0.4 26 0.12 7.66 -024 2015 13 35 DDP2015 517.346 1738.6 -110.5 1.45 60 1.22 0.49 -024 18 27 DDP2015 12/11/ 235 555.359 1470.5 -118.7 1 33 0.49 7.35 -025 2015 78 48 DDP2015 17/09/ 110 559.623 1710.4 -127.0 0.4 46 0.24 1.65 -026 2015 58 13 DDP2015 11/09/ 152 689.567 1626.0 -92.01 1.75 54 1.38 14.82 -027 2015 25 5 DDP2015 663.129 1626.2 -112.7 0.6 26 0.21 1.14 -027 96 9 DDP2015 658.433 1626.2 -116.5 0.4 47 0.25 3.05 -027 82 24 DDP2015 06/09/ 135 623.544 1628.7 -117.1 0.2 75 0.18 6.44 -028 2015 48 34 DDP2015 595.271 1637.5 -137.3 0.4 38 0.20 4.79 -028 24 53 DDP2015 18/09/ 120 691.202 1628.2 -91.62 3.3 56 2.70 1.38 -029 2015 95 6 DDP2015 08/09/ 136 604.566 1679.8 -146.4 0.95 5 0.02 1.12 -030 2015 77 45 DDP2015 25/09/ 166 691.785 1631.0 -92.10 1.7 57 1.39 22.69 -031 2015 34 8 DDP2015 672.697 1651.0 -110.0 0.2 65 0.15 5.34 -031 58 07 DDP2015 664.629 1659.2 -117.4 0.2 36 0.07 15.90 -031 64 4 DDP2015 26/09/ 81 692.8 1633.8 -94.91 0.65 60 0.53 1.86 -032 2015 31 8 DDP2015 685.48 1647.8 -109.2 0.7 38 0.38 1.98 -032 53 2 DDP2015 680.22 1657.5 -119.2 2.8 45 1.93 1.05 -032 91 7
Nylunds
The Nylunds deposit is located 200 m southeast of the current Björkdal open pit (Figure 17). Infill and extension diamond drilling was performed in order to confirm and convert a previous historical resource based only on RC drilling. Many significantly mineralized Au-bearing vein intercepts were intercepted (Table 14). The Nylunds deposit remains open to the north, south and west (mine-grid) suggesting potential for more mineralized exploration from future exploration efforts. Immediate exploration of this deposit will likely focus on the areas immediately north located between Nylunds and the Björkdal open pit.
Table 14: Significant New Core Intercepts at Nylunds
Hole Hole Total Interce Interce Interc Drille Interc True Au ID Comple Hole pt pt ept d ept Width Grade tion Length Easting Northin RL Width Angle (m) (g/t) Date (m) (MG) g (MG) (MG) (m) (°) DDP201 13/10/ 180 -224.00 2560.17 -117.7 4.55 44 3.12 0.68 5-038 2015 6 1 51 DDP201 -164.94 2524.6 -173.8 1.9 40 1.17 2.77 5-038 2 19 DDP201 -158.96 2521.20 -179.1 0.45 47 0.29 2.58 5-038 3 6 1 DDP201 10/10/ 190 -156.43 2565.01 -174.9 3 55 2.42 0.48 5-039 2015 4 9 47 DDP201 -139.86 2553.60 -189.5 0.3 55 0.21 2.71 5-039 4 6 32 DDP201 23/10/ 188 -259.30 2682.28 -106.1 1 55 0.78 0.65 5-040 2015 6 9 96 DDP201 -210.83 2689.75 -145.6 5.75 57 4.79 0.93 5-040 7 4 99 DDP201 -196.95 2692.18 -156.6 0.5 36 0.24 1.43 5-040 4 95 DDP201 20/10/ 175 -242.65 2719.42 -105.8 0.55 36 0.27 17.73 5-041b 2015 3 6 DDP201 -200.78 2720.47 -138.3 0.7 40 0.40 2.07 5-041b 7 4 17 DDP201 -172.93 2721.69 -158.8 3.75 47 2.70 0.44 5-041b 3 5 49 DDP201 -169.40 2721.88 -161.4 0.8 43 0.50 1.77 5-041b 6 3 DDP201 -143.69 2723.54 -180.1 0.45 28 0.16 32.86 5-041b 6 13 DDP201 24/09/ 170 -75.442 2425.82 -136.2 5.75 44 3.95 0.70 5-042 2015 9 43 DDP201 -54.803 2415.54 -153.6 0.7 14 0.11 1.86 5-042 8 24 DDP201 -24.679 2401.31 -178.0 1.4 68 1.27 1.10 5-042 6 28 DDP201 15/10/ 173 -118.46 2551.03 -95.62 0.5 6 0.01 1.73 5-043 2015 9 3 4 DDP201 -96.367 2540.67 -120.9 0.8 62 0.68 3.23 5-043 2 83 DDP201 09/10/ 184 -10.473 2606.30 -172.8 0.85 52 0.63 1.09 5-044 2015 1 37 DDP201 02/10/ 191 19.58 2452.39 -111.2 1.15 59 0.95 0.55 5-045 2015 9 31 DDP201 44.546 2446.06 -131.4 0.4 66 0.34 2.04 5-045 6 99 DDP201 05/10/ 170 7.622 2508.80 -88.44 0.4 42 0.22 13.40 5-046 2015 4 1 DDP201 21.444 2504.64 -101.5 0.55 63 0.46 2.50 5-046 3 14 DDP201 13/09/ 177 39.821 2620.72 -175.2 2.3 35 1.26 0.40 5-047 2015 8 35 DDP201 10/09/ 180 171.768 2410.85 -136.9 1 55 0.78 0.70 5-048 2015 3 89 DDP201 05/09/ 178 167.017 2481.32 -102.6 1.4 48 1.00 1.11 5-049 2015 9 66 DDP201 174.775 2475.38 -110.7 2.35 55 1.89 0.55 5-049 7 38 DDP201 188.149 2465.38 -124.3 1.1 48 0.77 7.52 5-049 2 95 DDP201 208.628 2450.35 -144.7 1.9 42 1.22 1.29 5-049 7 51 DDP201 211.069 2448.56 -147.1 1.05 54 0.81 0.65 5-049 6 69 DDP201 16/09/ 145 59.71 2229.69 -149.9 1.9 46 1.32 7.54 5-050 2015 9 89
Storheden Deposit
The Storheden deposit is located approximately 750 m northeast of the Björkdal mine (Figure 14). Two significantly mineralized, closely-spaced, sub-parallel vein systems were intercepted returning an assay of 2.49 g/t Au from an interval measuring 7 m in true thickness (Table 15). Historical drilling by previous owners has intersected mineralization in this area as well.
Table 15: Significant New Drill Intercept at the Storheden Deposit
Hole Hole Total Interce Interce Interc Drille Interc True Au ID Comple Hole pt pt ept d ept Width Grade tion Length Easting Northin RL Width Angle (m) (g/t) Date (m) (MG) g (MG) (MG) (m) (°) DDE201 18/08/ 150 972.325 2876.26 -110.7 9.2 46 7 2.49 5-001 2015 7 86
Challacollo
No significant work was planned or completed at Challacollo in the second half of 2015.
Qualified Persons:
Costerfield: Chris Gregory, Vice President of Operational Geology and Chief Shield Geologist at Mandalay Resources, is a Member of the Australian Institute of Geoscientists (AIG), and a Qualified Person as defined by NI 43-101. He has reviewed and approved the technical and scientific information about Costerfield contained in this release.
Cerro Bayo: Scott Manske, Chief Cordilleran Geologist of Mandalay Resources, is an Oregon registered Professional Geologist. A "Qualified Person" as defined by NI 43-101, he has reviewed and approved the technical and scientific information on Cerro Bayo contained in this release.
Björkdal: Chris Gregory, Vice President of Operational Geology and Chief Shield Geologist, is a Member of the Australian Institute of Geoscientists (AIG), and a Qualified Person as defined by NI 43-101. He has reviewed and approved the technical and scientific information about Björkdal contained in this release.
For further information: Bradford Mills Chief Executive Officer
Greg DiTomaso Investor Relations
Contact: 647.260.1566
About Mandalay Resources Corporation: Mandalay is a Canadian-based natural resource company with producing assets in Australia and producing and development projects in Chile. The Company is focused on executing a roll-up strategy, creating critical mass by aggregating advanced or in-production gold, copper, silver and antimony projects in Australia and the Americas to generate near-term cash flow and shareholder value.
Forward-Looking Statements: This news release contains "forward-looking statements" within the meaning of applicable securities laws, including statements regarding the Company's Mineral Resources, Mineral Reserves (including anticipated increases of each), ongoing exploration plans and goals. Readers are cautioned not to place undue reliance on forward-looking statements. Actual results and developments may differ materially from those contemplated by these statements depending on, among other things, changes in commodity prices and general market and economic conditions. The factors identified above are not intended to represent a complete list of the factors that could affect Mandalay. A description of additional risks that could result in actual results and developments differing from those contemplated by forward-looking statements in this news release can be found under the heading "Risk Factors" in Mandalay's annual information form dated March 31, 2015, a copy of which is available under Mandalay's profile at www.sedar.com. In addition, there can be no assurance that any current or future Inferred Resources that are discovered as a result of additional drilling will ever be upgraded to Proven or Probable Reserves. Although Mandalay has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.