Australian Silica Quartz : Hardrock High Purity Quartz and Silica Update - Revised

AUSTRALIAN SILICA QUARTZ GROUP LIMITED

EXPLORATION AND RESEARCH UPDATE - HARDROCK HIGH PURITY

QUARTZ AND SILICA

HIGHLIGHTS

only	➢ Targeting high purity hard rock quartz occurrences with scale finalised
after +2 year assessment of +100 high purity quartz targets throughout
Australia
➢ ASQ holds 4 high purity quartz (HPQ) tenements (1 in WA & 3 in QLD)
covering 286km2 all with known visual quartz occurrences demonstrating
potential to produce HPQ products
use	➢ Applications made to incorporate White Springs and Quartz Hill quartz
occurrences both with historic non-JORC quartz resources into ASQ Far
			North Queensland tenements
			➢ Recent testwork results indicate potential to produce HPQ products from
			ASQ exploration tenements
			➢ Testwork of rock chip samples from the Lake Seabrook Project returns
personal	grades of 99.98% SiO2
➢ ASQ Far North Queensland rock chip sampling by ASQ on granted
US$5,000 per tonne
			tenements with results up to 99.99% SiO2 after acid washing
			➢ Testwork completed with innovative processing flowsheet developed by
			ASQ's HPQ R&D program comparing favorably to conventional processing
			methodology
			➢ Exploration programs planned to evaluate quantity of identified quartz
			occurrences in both Western Australia and Queensland
			➢ HPQ identified in CSIRO 2021 Critical Energy Minerals Roadmap as a
			mineral essential to the advancement of many technology and energy
			sectors
			➢ ASQ receiving enquiries from potential HPQ customers as well as parties
			wishing to purchase the projects in their entirety
			➢ Market pricing for HPQ understood to range from US$300 to greater than
For
			Quartz outcrop
		Pandanus Creek Project, QLD

15 December 2021

ASX Code: ASQ

AUSTRALIAN SILICA QUARTZ

GROUP LTD

ABN: 72 119 699 982

DIRECTORS:

Robert Nash

Non Executive Chairman

Luke Atkins

Non Executive Director

Neil Lithgow

Non Executive Director

Pengfei Zhao

Non Executive Director

CHIEF EXECUTIVE OFFICER AND

COMPANY SECRETARY:

Sam Middlemas

Head Office:

Suite 10, 295 Rokeby Road

Subiaco WA 6008

Mail:

Suite 10, 295 Rokeby Road

Subiaco WA 6008

1. [phone]

1. [phone]

1. [e-mail]

1. www.asqg.com.au

Share Registry:

Automic Group

GPO Box 5193

Sydney NSW 2001

1. 1300 288 664 (within Australia)

1. [phone] (international) www.automicgroup.com.au

Suite 10, 295 Rokeby Road, SUBIACO WA 6008

Phone: [phone] Fax: [phone] www.asqg.com.au

For personal use only

Australian Silica Quartz Group Limited (ASX:ASQ, "ASQ" or "the Company") provides the following update on the Company's High Purity Quartz ("HPQ") Projects and Research and Development ("R&D") efforts. All silica and quartz projects are held 100% by ASQ's wholly owned subsidiary Australian Silica Quartz Pty Ltd.

ASQ have secured a number of hard rock quartz deposits in Western Australia and Queensland and the company is currently evaluating the potential to produce a high-grade lump silica or hard rock quartz product.

High Purity Quartz Market

HPQ (+99.95% SiO2) is considered a highly specialised commodity with a low tonnage, high value market. The commodity is used in the production of:

• semi conductors
• solar panels (cover glass and silicon metal production)
• specialist technology applications

In 2021 CSIRO identified HPQ as a 'Critical energy mineral' in an emerging theme that is explained by the convergence of two primary mining and energy sector trends. The first, 'critical minerals', represents a subset of minerals that are of growing concern due to potential supply risks and projected demand increases across a wide range of applications. Separately, the transition to renewable energy is underpinned by technologies that are more critical mineral intensive than fossil fuel incumbents and are expected to undergo accelerated growth over the coming decades.

Table 1: Typical high purity quartz (silica) specifications and pricing by market

Other

Market

Typical price

Type or Application

SiO2 (%)

Elements

Size (Mtpa)

(US$/tonne)

(%)

'Low Grade' HPQ

≥99.95

≤0.05

0.75

US$300 - 600

'Medium Grade' HPQ

≥99.99

≤0.01

0.25

US$500 - 800

'High Grade' HPQ*

≥99.997

≤0.003

<0.1

>US$5,000

Modified from a table by Richard Flook and Industrial Minerals December 2013

*High grade high purity quartz, with <30ppm, is the standard is the standard high purity material produced by Unimin Corp. and TQC at Spruce Pine

Note 1: Specific other elements may be limited by application. E.g. Fe2O3<100ppm for solar panel cover glass

Note 2: Generally, 'high purity' quartz has Fe2O3<15ppm, Al 2O3<300ppm, and alkali and alkali earth oxides <150ppm

Note 3: Limits can vary according to the composition of other raw materials in the application

Target Identification and Assessment

Over the course of +2 years ASQ has systematically identified and evaluated over 100 hardrock quartz targets throughout Western Australia and Queensland. Most have been visited on the ground by Company geologists and assessed for the potential of hosting high grade quartz deposits. The primary aim has been to identify large scale quartz occurrences that demonstrate the potential to produce HPQ products. A number of exploration tenements have been applied for and then surrendered following more detailed assessment.

Whilst the Company continues to search for additional high quality hardrock quartz occurrences, ASQ considers the current hardrock quartz tenements in both Western Australia and Queensland demonstrate excellent potential for development (Figure 1).

2

Suite 10, 295 Rokeby Road, SUBIACO WA 6008 Phone: [phone] Fax: [phone] www.asqg.com.au

For personal use only

Quartz outcrop at Lake Seabrook (WA)

Figure 1: ASQ High Purity Quartz Project Locations

Lake Seabrook High Purity Quartz Project

The Lake Seabrook project is located on E77/2684, 42km northeast of Southern Cross in Western Australia's Yilgarn region. ASQ have identified an epithermal quartz vein system that can be traced over 5km with up to 30m true width (Figure 2). Rock chip sampling has been carried out at various locations along the occurrence and multiple rounds of lab testing completed. Conventional crushing/scrubbing/screening processing has been compared with the flow sheet ASQ has been developing though in house R&D testwork. Samples collected in a manner considered representative of real-life mining conditions have returned grades of up to 99.97% SiO2, while a similar sample returned grades of 99.98% SiO2 using the R&D flowsheet (Tables 1 & 2). The details of this flowsheet are currently considered commercial in confidence.

The company believes the quartz vein has potential to produce HPQ products.

The next step in evaluating the Lake Seabrook Hardrock Quartz project will be a drilling program to inform preliminary assessment of the quantity of quartz present and provide additional material for quality testing.

3

Suite 10, 295 Rokeby Road, SUBIACO WA 6008 Phone: [phone] Fax: [phone] www.asqg.com.au

Environmental approval has been received from DMIRS for a reverse circulation drilling program. Before this drilling can take place, heritage surveys will need to be completed.

ASQ is also assessing the Lake Seabrook tenement for other mineralisation potential. The lease straddles a +10km section of the Youanmi Greenstone Belt at the Koolyanobbing Shear Zone. Historic exploration has been carried out for tungsten, lithium, gold and iron ore. The Company is in the process of reviewing all available historic exploration data.

		Table 1: Results from conventional processing of rock chip samples from the Lake Seabrook Project
									Conventional Crushing, Washing and Acid
					Conventional Crushing and Washing			Leach
only		East	North
	mGDA94	mGDA94
	Sample	Z50	Z50	SiO2 (%)	Al2O3 (%)	Fe2O3 (%)	TiO2 (%)	SiO2 (%)	Al2O3 (%)	Fe2O3 (%)	TiO2 (%)
	ASQ-LS-001	746348	6580084	99.90	0.053	0.011	0.001	99.94	0.034		0.003	0.001
use		746704	6579612
	ASQ-LS-002	99.94	0.035	0.008	0.001
	ASQ-LS-003	747225	6579310	99.94	0.022	0.012	0.001
	ASQ-LS-004	748049	6578469	99.94	0.026	0.006	0.001	99.97	0.017		<0.001	0.001
	ASQ-LS-005	749038	6577387	99.93	0.031	0.007	0.001
	ASQ-LS-006	745757	6580550	99.38	0.121	0.469	0.009
	ASQ-LS-007	745794	6580566	99.93	0.023	0.019	0.001	99.97	0.018		0.001	0.001

For personal

Table 2: Results from R&D Flowsheet testing of rock chip samples from the Lake Seabrook Project

Sample	SiO2 (%)	Al2O3 (%)	Fe2O3 (%)	TiO2 (%)
ASQ0012	99.980	0.0117	<0.001	<0.001

Note: ASQ0012 collected at the same location as ASQ-LS-007

Figure 2: Lake Seabrook High Purity Quartz Project - E77/2684, ASQ rock chip sampling locations and interpreted quartz vein extent

4

Suite 10, 295 Rokeby Road, SUBIACO WA 6008

Phone: [phone] Fax: [phone] www.asqg.com.au

For personal use only

Queensland High Purity Quartz Projects

ASQ holds three granted Exploration Permits in Far North Queensland totalling over 240km2. Whilst travel restrictions relating to Covid-19 have recently limited the amount of fieldwork completed on these tenements, a number of rock chip samples have been collected and analysed. The Company has identified multiple quartz occurrences with potential for HPQ products. The area is prospective for other types of mineralisation as highlighted by the recent extensive area applied for by Rio Tinto Exploration Pty Ltd (Figure 3). The surrounding areas have previously been explored for gold, silver, lithium, uranium and base metals. It is not known what Rio Tinto plan to explore the area for.

Table 3: ASQ Queensland high purity quartz rock chip sampling results

		East mGDA94	North mGDA94	SiO2 (%)	Al2O3 (%)	Fe2O3 (%)	TiO2 (%)
Sample	Project	Zone 55	Zone 55
ASQ0016	Mt Eliza	208073	7997356	99.84	0.100	0.009	0.009
ASQ0017	Mt Eliza	208962	7994888	99.63	0.257	0.012	0.013
ASQ0019	Douglas Range	204018	7980466	99.95	0.020	0.016	0.001
ASQ0020	Douglas Range	203894	7979978	99.99	0.007	0.001	0.001
ASQ0021	Douglas Range	204784	7979746	99.17	0.565	0.048	0.037
ASQ0022	Pandanus Creek	166173	7978179	99.98	0.015	<0.001	0.002
ASQ0023	Mt Eliza	212680	7992521	99.98	0.013	<0.001	0.001
ASQ0024	Mt Eliza	213848	7992644	99.97	0.016	0.001	0.001
ASQ0025	Mt Eliza	219361	7994476	99.18	0.591	0.026	0.010
ASQ0026	Douglas Range	207995	7977070	99.98	0.010	0.001	0.001
ASQ0027	Douglas Range	209198	7977166	99.89	0.064	0.005	0.012
ASQ0028	Douglas Range	206679	7984756	99.98	0.008	0.001	0.001

High purity silica in lump quartz

5

Suite 10, 295 Rokeby Road, SUBIACO WA 6008 Phone: [phone] Fax: [phone] www.asqg.com.au