Paterson Resources : High Grade Gold Results Returned From Grace

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ASX ANNOUNCEMENT

15 December 2021

High grade gold results returned at Grace Project

25km from the Telfer Gold mine in the Paterson Province

HIGHLIGHTS

• Assay results received for first EIS-funded drill hole from maiden diamond drilling program at Grace Project in the highly prospective Paterson Province which hosts the world class Telfer Gold Mine.
• Gold mineralisation within a wide silica-carbonate rich brecciated ore system over returning 20.8m @ 2.0/t Au from 203.2m including high grade intercepts of 2m @ 3.6g/t Au from 216m and 3m @ 8.38 g/t Au from 221m.
• In addition, 15.7m @ 0.39g/t Au was returned from 762m which is associated with a silica altered felsic intrusive which represents a new style of mineralisation at the Grace Project.
• Further Results from PDD0001 and from a further 4 diamond drill holes and 1 reverse circulation ("RC") hole expected over the coming weeks.
• The Intrusive related gold mineralisation highlights the prospectivity of the numerous untested magnetic targets at the Grace Project.
• Mineralised interval has been intersected over 200m from the nearest drilling and remains open to the east and west and at depth.
• A combined diamond and RC drilling programme planned to commence in first quarter 2022 to test high-priority targets at Grace Project.

Paterson Resources Executive Director, Matt Bull commented:

"The drilling campaign was designed to test high-priority geophysical targets and target mineralisation along the Grace-Bemm Shear Zone. Historically, this has only been drilled with wide spaced and generally shallow drill-holes. The drilling program successfully intersected wide sulphide- rich breccia zones in several of the diamond holes. Further, the first assay results received confirm they can host high-grade mineralisation. The results confirm a large mineral system with multiple mineralisation styles and the company will now delineate the resource which remains open in all directions and test multiple magnetic targets."

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Figure 1: Assay results of the EIS drill-hole PDD001 at the Grace Project

Paterson Resources Limited ("Paterson" or "the Company") (ASX: PSL) is pleased to announce the first results from the 2021 drilling campaign have returned encouraging results within a broad zone of brecciated silica-carbonate altered siltstone: 20.8m @ 2.0 g/t AU from 203.2m including 2m @ 3.6g/t and 3m @ 8.38 g/t Au from 221m (Figure 1). The campaign was designed to test a series of priority targets outlined from geophysics and historical drilling, which has identified gold-copper mineralisation similar in style to the ore system at the world-class Telfer gold-copper mine (25km north-west) and Havieron gold deposit (40km north-east).

On completion of the EIS hole, the core was reviewed by consultant geologists. Encouragingly, the shallow mineralisation highlighted the potential for a more significant underlying system. As a result, Paterson has focused on following up these results to better understand the structural relationships of the mineralisation with more diamond drilling. In turn, this will enable the new interpretation to be fully tested.

Figure 2 shows the highly altered quartz/carbonate/pyrite veining which returned multiple high- grade results over a 20m width. A summary of the assay results are listed in table 1. The style of mineralisation was noted in several of the holes and increases the confidence that there will be more high-grade intercepts in the outstanding assays yet to be returned.

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Figure 2: Silicic-carbonate veining and alteration in PDD0001 with pervasive sulphidation. Gold grades noted over the intervals from 216m to 224m.

	Hole ID			From			To			Width (m)			Au Grade
									(g/t)
			197		198		1			0.40
			203.2		224		20.8			2.0
	PDD0001		Inc 216	218		2			3.6
		Inc 221	224		3			8.38
			762.3		778		15.7			0.4
				Inc 762.3	762.6		0.3			3.14
	PDD0002						Awaiting assay results
	PDD0003						Awaiting assay results
	PDD0004						Awaiting assay results
	PDD0005						Awaiting assay results
	PRC0001						Awaiting assay results

Table 1 Significant results of the diamond drilling hole PDD0001

Figure 3 shows the location of PDD0001 along with historic drilling in the project area. Mineralisation intercepted in PDD0001 within the felsic intrusive at 762.3m is highly encouraging. Anomalous gold is associated with pervasive silicic alteration at the contact of the intrusive and extends further into the felsic unit. Further assaying has been undertaken to understand the full extent of the mineralisation.

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The presence of gold mineralisation is considered highly encouraging. The felsic unit has significant zones of pervasive chlorite-magnetite alteration which likely give rise to the characteristic magnetic trends seen at the Grace Project and which is underly several historic high grade gold hits.

Preliminary interpretations suggest the felsic intrusive and alteration system is potentially driving the hydrothermal fluid flow up the rock profile and depositing secondary gold mineralization in zone of silicic-carbonate rich breccia zones that have previously been intersected at the Grace Project.

This hypothesis highlights multiple other high priority, largely unexplored, magnetic highs near to the Grace Project that will be tested in the upcoming drilling program.

Figure 3: Map of EIS hole location at the Grace Project with the Historic Drilling.

Future Exploration

Paterson has commenced planning a follow up RC and diamond drilling program at the Grace Project. The program will delineate extensions to the known mineralised system and test multiple high-quality targets along strike and at depth.

The Company is in the process of finalising access surveys with the Western Desert Land Aboriginal Corporation ("WDLAC") to clear areas for drilling. It is anticipated access surveys will be finalised in the first quarter of 2022.

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Grace Project Location

The Grace Gold-Copper Project is located in the heart of the Paterson Province, where multiple major exploration groups including Rio Tinto, Newcrest and Greatland Gold, are actively exploring within the region. Significant discoveries proximal to Paterson's Grace Gold-Copper Project include Havieron to the north-east, Maroochydore to the south and world-class Telfer Mine located 25km northwest.

Figure 4: Map showing the location of the Grace Copper-Gold Project and Paterson Resources tenements (yellow outline), and nearby significant gold-copper deposits over an image of Paterson Province geology draped over a filtered magnetic anomaly image.

This announcement has been approved for release to ASX by the Board of Paterson Resources