Ausgold : AUC Drilling Identifies Further Near-Surface High-Grade Gold

ASX Release

4 April 2022

AUC Drilling Identifies Further Near-Surface High-Grade Gold

Highlights:

•  New drilling at the Katanning Gold Project (KGP) has identified near surface high-grade gold mineralisation in the Central Zone along the Jackson, White Dam and Jinkas Lodes, with results including:

  • - 13m @ 2.62g/t Au from 9m including 3m @ 9.64g/t Au in BSRC1441 (Jackson)

  • - 8m @ 4.19g/t Au from 53m including 4m @ 7.99g/t Au in BSRC1411 (White Dam)

  • - 9.2m @ 1.70g/t Au from 99m including 4.0m @ 3.06g/t Au in BSDD038 (Jinkas)

  • - 15.4m @ 1.55g/t Au from 125m including 5.0m @ 3.98g/t Au in BSDD038 (Jinkas)

  • - 13m @ 1.04g/t Au from 187m in BSRC1355 (Jackson)

•  Ausgold has now completed its large-scale 30,000m drilling program in the Central and Southern Zones, with additional 2,500m of follow up drilling underway

•  Resource upgrade on track for late April 2022 and Prefeasibility Study (PFS) targeted completion late Q2 CY2022

Ausgold Limited (ASX: AUC) (Ausgold or the Company) is pleased to provide an update of exploration activities at the Company's 100% owned 1.84 Moz Katanning Gold Project (KGP).

30,000m RC Drilling Campaign

Ausgold has now completed its 30,000m multi-rig reverse circulation (RC) drilling campaign designed to add near-surface Resource ounces and support open-pit mine planning as part of the Prefeasibility Study( PFS). Results have now been received for 15,000m of drilling along the Jackson and White Dam Lodes with further results pending and an additional 2,500m of drilling underway within the Olympia and Jinkas North areas.

The Company is encouraged by the extent of near-surface gold mineralisation identified within both the Jackson and White Dam Lodes, which sit along the footwall of the existing Resource in the Central Zone. The additional oxide mineralisation, combined with the greater continuity of gold mineralisation over this 4.5km of strike length will support further open-pit mine planning.

Jinkas

New drilling (11 holes 1,068 metres) within the Jinkas lode targeting the down plunge extensions of the high-grade gold mineralisation has intercepted broad zones of gold mineralisation. Further RC drilling and downhole electromagnetic (EM) surveys are planned to further extend this mineralisation (Figures 5 & 8). Significant results include:

- 9.2m @ 1.70g/t Au from 99m including 4.0m @ 3.06g/t Au in BSDD038

- 15.4m @ 1.55g/t Au from 125m including 5.0m @ 3.98g/t Au in BSDD038 (Jinkas)

ABN 67 140 164 496

Level 4, 251 St Georges Terrace, Perth WA 6000

T: 08 9220 9890 F: 08 9220 9820 E:[e-mail] W: www.ausgoldlimited.com

Southern Jackson Areas

Drilling along the Southern Jackson area has intersected near surface high-grade gold mineralisation. The significant results have identified further down-plunge potential which remains open at depth and within 150m from surface following recent high-grade results. New significant results include:

• - 13m @ 2.62g/t Au from 9m including 3m @ 9.64g/t and 2m @ 3.92 from 52m in BSRC1441 (White Dam)

• - 10.0m @ 0.61g/t Au from 94m in BSRC1437 (Jackson)

• - 13.0m @ 1.04g/t Au from 187m in BSRC1355 (Jackson)

• - 9.0m @ 0.95g/t from 99m including 5.0m @ 1.35g/t in BSRC1350 (Jackson)

This new drilling complements recent drilling which has shown high-grade gold mineralisation with the Jackson deposit.

• - 6m @ 4.79g/t Au from 48m including 3m @ 9.08g/t Au in BSRC1285

• - 4m @ 5.47g/t Au from 42m in BSRC1349

• - 5m @ 3.43g/t Au from 23m in BSRC1334

• - 9m @ 1.30g/t Au from 27m in BSRC1304

• - 7m @1.03g/t Au from 29m in BSRC1259

• - 6m @ 1.17g/t Au from 53m and 5m @ 1.37g/t Au from 102m in BSRC1345

Tails Dam

New drilling has for the first time, targeted gold mineralisation beneath the historical tails dam which covers a 400m strike length of primary gold mineralisation in the southern portion of the White Dam Lodes. New results demonstrate good continuity and high-grade gold mineralisation within the Jackson and White Dam Lodes near to surface beneath the historical mine infrastructure. Significant intercepts in primary White Dam mineralisation include:

- 8m @ 4.19g/t Au from 53m in 4.0m @ 7.99g/t Au in BSRC1411 (White Dam)

- 4m @ 2.21g/t from 19m in BSRC1356 (Jackson)

The upper portions of these same drill holes have shown the historic tails material contained significant gold grades from surface (Figures 2, 4, 6 & 7). This material will be included within the upcoming mineral Resource upgrade. Significant results within the tails material include:

• - 10m @ 0.96g/t including 1.0m @ 3.40g/t and 3.0m @ 1.31g/t from 0m in BSRC1379

• - 15m @ 0.52g/t from 0m in BSRC1378

• - 10m @ 0.57g/t from 0m in BSRC1377

• - 15m @ 0.52g/t from 0m in BSRC1378

Management Comment

Ausgold Managing Director, Matthew Greentree, commented:

"Our completed 30,000m drill campaign has identified near-surface high-gold mineralisation and has clearly demonstrated further growth potential with identified extensions to the KGP Resource remaining open at depth.

New drilling along strike has also demonstrated continuous mineralisation beneath the old tailings dam and the Southern Jackson area which will be included in the Resource upgrade planned for Q2 CY2022.

Importantly, we continue to see outstanding results that continues to validate a pathway on our ambition to establish a multi-million-ounce Resource at Katanning."

Work Programs

At present one RC rig is operating at the KGP drilling in both the Central and Southern Zones, with the results of this drilling to support a Resource upgrade early in Q2 CY2022.

•  Resource Drilling - Ausgold has now completed 30,000m of its RC drilling campaign focusing on high-priority targets in the Central and Southern Zones of the KGP, with a further Resource upgrade planned for April 2022. Further 2,500m drilling is underway to test additional near-surface mineralisation on the Jackson and Jinkas Lodes, and to test down-hole EM targets which show further underground potential down plunge of the Jinkas Lode.

•  Rifle Range Drilling - RC drilling has been completed along the eastern edge of the Rifle Range Area targeting the down-dip portions of the Dingo deposit. Further drilling is planned for a low-impact small track-mounted diamond drill rig for the Rifle Range area, further expanding the Resource potential over 2.5km strike length for the Southern Zone.

Prefeasibility Studies (PFS) are rapidly advancing:

•  Mine Development Studies - Work is underway to support the PFS for the KGP, which will assess potential mine development scenarios. GR Engineering Services Limited has been engaged to lead the engineering studies and the Company anticipates that the PFS for the initial stage of development will be completed in Q2 2022.

•  Geotechnical, hydrogeology and metallurgical drilling is planned in the Central Zone and Dingo Resource areas to support future open pit and underground mining studies. This follows recent diamond drilling to collect geotechnical data, supported by down-hole televiewer programs in RC and diamond holes. Additional diamond drill holes will follow to collect samples for metallurgical optimisation testwork. Furthermore, additional groundwater monitoring wells will be installed to complement existing groundwater monitoring data.

•  Metallurgical test work - Excellent results from first phase metallurgical test work (ASX Announcement 31 March 2022). Ongoing test work is now focused on optimisation of the comminution process flow sheets and leach test work on fresh composites. Initial waste rock and tailings characterisation test work continues.

•  Community and environmental studies - Stakeholder engagement is underway along with development of the approvals pathway. Ground water and Waste rock characterisation studies have also begun.

Figure 1 - KGP Resource with new drilling showing December 2021 Resource block model

Figure 2 - New drilling in Central Zone shown with grade as gram-metres (intercept width in metres x grade)