Western New Zealand was originally part of Gondwana and lay adjacent to eastern Australia until around 80 Ma ago. The NW of the South Island of New Zealand comprises an area of predominantly early Paleozoic rocks in broad northerly trending belts, which terminate at the Alpine Fault. The Paleozoic sequence is divided into the Buller Terrane, Takaka Central and Takaka Eastern Belts.

These belts are interpreted to correspond with the Western, Central and Eastern belts of the Lachlan Fold Belt. The Buller and Western Lachlan belts contain orogenic gold deposits like Bendigo, Ballarat and Fosterville in Australia and the Reefton and Lyell Goldfields in New Zealand. Gold and stibnite are currently being mined at the Mandalay Resources Costerfield mine in Victoria.

The Costerfield lodes are typically anastomosing, en-echelon style, narrow-vein systems, which dip from 25° to 70° west to 70° to 90° east. Mineralised shoots are observed to plunge to the north, when structurally controlled, and south when bedding controlled. The mineralisation occurs as single lodes and vein stockworks.

The mineralised lodes vary from massive stibnite with microscopic gold to quartz-stibnite, with minor visible gold, pyrite, and arsenopyrite. The average production grade since 2010 has been 8.9g/t Au, 3.6% Sb for 17.4g/t AuEq. Nagambie Resources are currently exploring for gold and stibnite at the Nagambie Mine 45kms to the east of Costerfield.

Nagambie has drilled number of diamond holes down to around 230m and has intersected a number of steeply west dipping zones of Au-Sb mineralisation, with massive stibnite veins up to 200mm wide, similar to that found at Auld Creek. Drillhole intersections reported by Nagambie are shown in Table 6. These intersections have an estimated horizontal thickness (EHT) or true width of 1.9m averaging 2.9g/t Au, 6.2% Sb for 17.3g/t AuEq (33-gram metres AuEq). If the same criteria are applied to Auld Creek drillhole intersections (>1.2m EHT, > 3g/t minimum cut-off grade (MCOG) AuEq, and > 1.0% Sb), then Auld Creek weighted average true widths are 4.8m at 3.4g/t Au, 3% Sb for 10.5g/t AuEq (50-gram metre AuEq).

The Auld Creek mineralisation is considerably thicker than the Costerfield and Nagambie mineralisation, with lower but still significant grades. The greater thickness at Auld Creek would allow for more favourable mechanised mining. Field exploration will continue over the next quarter with additional mapping soil sampling and trenching followed by diamond drilling in first quarter 2023, subject to Department of Conservation (DoC) access.

Infill soil sampling will be extended to the north and south of the Fraternal ­ Bonanza area. Trenching will continue, targeting 100m spacing along the Fraternal, Fraternal North and Bonanza mineralised zones. A DoC Access agreement has been submitted, which will allow drilling of the Fraternal, Fraternal North and Bonanza Shoots, initially down to around 300m.

The Energetic mine to the north was mined to around 600m below surface and the Globe Progress mine to the south was mined to 420m, where the mineralisation was offset by the Chemist Shop Fault. The mineralisation on the other side of the fault has not been found. Subject to further trench results, the initial drilling will focus on defining the extent (height) and plunge of the Fraternal, Fraternal North and Bonanza Shoots.