Falcon Metals Limited advised that it has received assay results for the first four diamond holes it has drilled at the Karri prospect in the Pyramid Hill Gold Project, north of Bendigo in Victoria, Australia. Diamond drilling commenced mid-January within a month of listing on the ASX at the Karri prospect, a 4km-long gold anomaly under Murray Basin cover defined by previous aircore drilling. Falcon has completed 7 diamond holes for 2,832m thus far, with assays finalised for 4 of these holes.

Drilling is underway to the north of hole PHKADD021 where the zones of alteration and mineralization appear to be improving along an anticline and eastern limb. Assay results for the remaining holes will be announced once received and finalised. Whilst one diamond drilling rig is continuing at Karri, the second diamond rig has now commenced drilling at the Ironbark North prospect, ~20km to the south.

Falcon also commenced aircore drilling in late March at the high priority Ironbark East prospect, and soil sampling programs have been initiated across the greater Pyramid Hill project area. The Pyramid Hill Gold Project has also expanded with the successful granting of Exploration Licence EL07200, a prospective 872km square exploration permit 80km south of Bendigo. Diamond Drilling Results at Karri: Diamond drilling has progressed at Karri with 7 holes now completed for 2,832m.

Karri is a large 4km long gold anomaly defined by previous reconnaissance aircore drilling and 17 wide-spaced diamond holes. This previous drilling intersected several zones of mineralisation along interpreted upright anticlinal fold hinges like those known to host high-grade gold mineralisation across the Bendigo zone. Falcon's drilling in 2022 is targeting possible down-plunge and along strike extensions to these intercepts based on structural models from the region.

Assays for the first 4 holes have been received with the better results as below: PHKADD018: 2m at 3.32 g/t Au from 108m, including 1m at 6.51 g/t Au from, 109m,PHKADD020:1m at 1.65 g/t Au from 190m, 0.86m at 1.26 g/t Au from 232.14m, PHKADD021: 1m at 1.19 g/t Au from 232m, 8m at 1.08 g/t Au from 287m, including 1m at 7.31 g/t Au from 294m, 0.8m at 1.15 g/t Au from 302.11m, 1m at 1.32 g/t Au from 308m, 2m at 2.01 g/t Au from 347m. Mineralisation in PHKADD018 was in the oxide zone and appears to be related to weathered sulphides in a sandstone with no quartz veining. It is in the western limb of an anticline, close to the hinge.

This is in a similar position to the anomalous zone intersected previously in PHDH015 (5.1m at 13.96 g/t Au from 100.9m, including 2.2m at 32.10 g/t Au) that was also associated with iron oxides. Mineralisation in PHKADD020 occurred in the west limb of the same anticline. It was associated with sericite alteration, disseminated pyrite and minor arsenopyrite.

The mineralised zones identified in PHKADD021 are of particular importance because they have extended the mineralisation in the eastern limb of this same anticline a further 100m to the north of mineralised structures intersected in PHDH007 (1m at 5.40g/t Au from 192.8m) and PHDH015 (8m at 1.05 g/t Au from 202m, including 1m at 5.33 g/t Au). Mineralisation is associated with quartz veining, intermittent sericite alteration, and disseminated pyrite & arsenopyrite. In addition to the higher grades including 1m at 7.31 g/t Au, broad zones of low-level Au mineralisation were also present within this zone including 16.2m at 0.27 g/t Au from 299.8m and 27m at 0.33 g/t Au from 341m.

Based on the encouraging results in PHKADD021, an additional hole, PHKADD025, has commenced. This is planned to test this mineralised target zone a further 100m north in the eastern limb of the mineralised anticline. At this preliminary stage this anticline, eastern fold limb and syncline are all considered prospective.

Aircore Drilling Commences at Ironbark East: Previous work at Ironbark has highlighted the association of gold mineralisation with the contact between Castlemaine Group Sediments and intrusive diorites, with some mineralisation hosted within the diorites. The successful reconnaissance aircore drilling program at Ironbark East during the 2021 field season significantly increased the priority of this prospect, especially given there are several analogous high-grade diorite-associated gold deposits in Eastern Victoria (Walhalla-Woods Point Goldfields) including Cohen's Reef (~1.5Moz at 32 g/t Au). The previous results at Ironbark East are considered by Falcon to be exceptional given they are on a wide-spaced reconnaissance line (Figure 3).

Hole PA953 is particularly given the intercept of 13m at 1.52 g/t from 113m and ended in mineralisation. The next hole on this line, PA918, intersected 9m at 0.91 g/t from 61m and is 200m west of PA953. The aircore drilling at Ironbark East commenced in late March.

This was later than planned due to the contracted drilling company having initial delays due to the impact from COVID-19, followed by equipment issues that are still preventing them from mobilising to site. Falcon was able to contract a second drilling company that was in the process of commissioning an AC rig. Drilling rates have been slower than normal during the commissioning phase but as this is now completed, they are expected to improve throughout the rest of April.

Drilling at Ironbark East will continue until cropping season commences in early May 2022. Aircore drilling of other targets within the Pyramid Hill Project will be deferred until the commencement of the next drilling season in late Spring. EL7200 Permit Granted: Exploration licence EL007200 is an 872km2 area within the highly prospective Bendigo Zone that has seen very limited modern-day exploration for gold.

It is in a similar structural position to the Castlemaine (~6Moz) and Daylesford (~1.3Moz) goldfields. Falcon will commence community engagement and planning with the intent of soil sampling programs later in the year. The initial focus will be on areas with outcropping Castlemaine Group sediments.

It is expected this will lead to subsequent aircore drilling in 2023.