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SEPTEMBER 2013 QUARTERLY REPORT Highlights
BRYAH BASIN PROJECT
High-grade gold returned from Seaborg ‘gold-only’ prospect
o 1-metre assays confirm grade continuity, including 51m @ 3.71g/t
gold from surface in CBRB001
o follow-up RC/diamond drilling planned
Multiple ‘gold-only’ targets identified across Bryah Basin Project
o initial surface geochemistry programs and field mapping underway
o detailed ground magnetic surveys over Seaborg and other targets
planned
First-pass shallow drilling of copper-gold targets along strike from
Sandfire’s North Robinson Range multi-element anomaly completed –
assay results imminent
Multiple geophysical and geochemical copper-gold targets remain
untested along +45km long VMS prospective corridor
Advances in understanding of key controls on copper-gold and ‘gold-only’
mineralisation
CORPORATE
$1.1 million cash on hand at 30 September 2013
Judicious use of funds focussed on cost-effective exploration of copper-
gold and ‘gold-only’ targets
BOARD OF DIRECTORS Mr Oscar Aamodt Non-Executive Chairman
Ms Sofia Bianchi Non-Executive Director
Mr Lindsay Dudfield Non-Executive Director
Mr Anthony Ho Non-Executive Director
ISSUED CAPITAL
SHARES 156,852,955
OPTIONS 975,000 (Unlisted)
PROJECTS
BRYAH BASIN (80-100%)
MURCHISON (80-100%)
Level 2/72 Kings Park Road WEST PERTH WA 6005 Phone: +61 8 9481 4400 Facsimile: +61 8 9481 4404
www.alchemyresources.com.au
Quarterly Report 1 July 2013 – 30 September 2013
2
Bryah Basin Project
Alchemy’s Bryah Basin Project comprises a 630km2 ground package, located 130km NE of Meekatharra, Western
Australia. The project is located along strike and west of Sandfire Resources’ DeGrussa copper-gold mine and
southeast of Horseshoe Metals’ Horseshoe Lights copper-gold project, and adjacent to Peak Hill where about
1Moz of gold has been mined from several deposits (Figure 1).
Alchemy holds 100% interest in the landholding with the exception of several tenements held in joint-venture
with Jackson Minerals Pty Ltd (20%), a subsidiary of Fe Ltd (ASX: FEL).
Alchemy is focussed on unlocking the copper–gold and ‘gold-only’ potential across the Bryah Basin Project
employing innovative geochemical and geophysical methods in conjunction with drill testing of priority targets.
In the September Quarter, focussed, innovative exploration continued to test copper–gold targets along the
+45km long prospective corridor within the Bryah Basin Project. Multiple bedrock conductors and geochemistry
anomalies associated with prospective volcanogenic massive sulphide (VMS) horizons within remain untested
across the Project.
The Project currently has Indicated Resources of 300,000oz gold (4.7Mt @ 2.0g/t gold) at Hermes and Wilgeena
(see ASX announcement dated 22 October 2012), and multiple ‘gold-only’ targets have been delineated across
the project through advances in understanding of the key controls on mineralisation. Systematic exploration
and targeted drilling campaigns have commenced to unlock the broader potential of the Project region for
additional ‘gold-only’ deposits.
Figure 1: Bryah Basin Project – Alchemy tenements, gold prospects and Magnus VMS target zone.
Seaborg gold prospect
High-grade gold assay results were returned from an initial two hole rotary air-blast (RAB) drilling program at
the Seaborg gold prospect completed in September 2013, with both holes confirming and extending a high-
grade gold intersection (27m @ 5.43g/t Au from 15m) in a historic hole drilled by Troy Resources (see ASX
announcement dated 15 October 2013). CBRB001 was collared to drill a scissor hole and CBRB002 was collared
Quarterly Report 1 July 2013 – 30 September 2013
3
10 metres from and drilled in a similar orientation to the historic hole, with both holes ending short of target
depth.
One-metre fire and screen fire assay results have confirmed the anomalous gold results of the initial 4-metre
composite samples at Seaborg, returning intervals of high-grade gold mineralisation (applying a 1.0 g/t gold
lower cut-off) (Table 1):
CBRB001 51m @ 3.71 g/t Au from surface to end of hole incl. 5m @ 6.03 g/t Au from 1 metre and
14m @ 6.59 g/t Au from 23 metres CBRB002 23m @ 3.16 g/t Au from 16 metres, and 1m @ 1.54 g/t Au from 41 metres
Screen fire assays were undertaken on all 1-metre samples that returned fire assays with greater than 7.0 g/t
gold. The screen fire assays generally returned similar values to the fire assays (Table 2), although two samples
with initial high-grade gold fire assay results returned lower screen fire assay values, indicating patchy coarse or
nuggety gold at Seaborg.
Table 2 lists the 1-metre fire and screen fire assays for the two holes whilst Figures 2 and 3 show the drill holes
in plan and section view.
Figure 2: Seaborg gold prospect – Plan showing recent and historic drilling results.
The results indicate a significant level of continuity in gold grade down-hole and that drilling stopped within the
gold mineralised zone. The results also indicate that there are intervals with higher gold grade within the
mineralised zone, including 5m @ 6.03 g/t Au from 1 metre and 14m @ 6.59 g/t Au from 23 metres in CBRB001
(Figure 3).
In combination with the limited previous drilling at Seaborg (Figure 2), the results indicate gold mineralisation is
associated with quartz veins in sheared and fuchsite-pyrite altered psammite and amphibolite and is possibly a
high grade shoot that plunges steeply to the east (Figure 3). The drilling suggests the shoot may lie within an
east-northeast-trending gold mineralised zone.
Quarterly Report 1 July 2013 – 30 September 2013
4
Targeted reverse circulation (RC) and diamond drilling is being planned to determine the orientation and plunge
of the interpreted high-grade shoot as well as the strike and depth extent of mineralisation.
Figure 3: Seaborg gold prospect – Section 697850mE.
A detailed ground magnetic survey will be acquired over the Seaborg prospect in the December quarter. The
data will assist delineation of additional structural targets in the Seaborg area that will be drill tested in 2014.
‘Gold-only’ targets
The Bryah Basin Project represents a significant under-explored area prospective for ‘gold-only’ mineralisation.
Assessment for ‘gold-only’ mineralisation has continued with a number of target zones delineated within the
Peak Hill Schist (Figure 4), and these represent key areas for further exploration.
A large surface anomaly has been identified to the east of the Seaborg prospect in an area where the regolith
environment is likely more amenable to surface sampling. This anomaly has only been tested with very limited
shallow drilling and represents a priority target area. Field mapping and targeted surface geochemistry
programs have commenced to assist delineation of robust drilling targets in this area.
Exploration to date on the Central Bore prospect has shown that the mineralised corridor is also open to the
east and west and much of the historic drilling may not have tested below the transported and/or leached
regolith profiles. Aircore and RC drill testing of gold targets to the west of the Central Bore prospect has
delineated several areas that also require further evaluation.
Quarterly Report 1 July 2013 – 30 September 2013
5
A regional, curved structure linking the Central Bore and Hermes mineralised trends is apparent from geological
mapping and geophysical images. Historic gold exploration along this structure is limited, with best results
returned from the Jones and Henry prospects (Figure 4), including 3m @ 250 g/t Au from OPAC126, and 3m @
41 g/t Au from OPAC246.
The majority of the historic drilling did not test the structural corridor, with areas to the northwest (towards the
south-west end of the Hermes mineralised trend) increasingly affected by transported cover. Targeted multi-
element surface geochemistry programs and field mapping has commenced to assist delineation of robust drill
targets (Figure 4) and shallow drilling is being planned to test these targets in early 2014.
Additional gold targets have been identified to the north-east and south-west of the Hermes resource area. The
Hermes deposits are effectively exposed at surface, with a strong soil anomaly over the deposits, which guided
most of the subsequent exploration. Geological mapping indicates that the host structural corridor to the north-
east and south-west is overlain by transported cover which may have inhibited the surface geochemistry
response. Additional multi-element geochemistry on spoil from historic shallow drilling along this structural
corridor is planned to delineate targets for follow up.
Additional linear ‘gold-only’ target zones (Figure 4) have been delineated between some of the other known
prospects and mines, such as Wilgeena, Mt Pleasant and St Crispin, where they are generally associated with
regional lithological boundaries and/or interpreted structural features. Interpretation of historic surface
geochemistry is continuing taking into account the nature of regolith. Further field mapping, surface
geochemistry programs and ground magnetic surveys to delineate additional drill targets in these zones are
planned for the December Quarter.
Figure 4. Bryah Basin Project – ‘gold-only’ target areas.
Quarterly Report 1 July 2013 – 30 September 2013
6
Shallow drill testing of copper-gold targets
Shallow drill testing of two strike-extensive targets in the eastern and central Magnus VMS target zone directly
along strike to Sandfire Resources’ +7 kilometre long, multi-element North Robinson Range Anomaly (Figure 1)
has recently been completed. The approximately 10,000 metre broad-space drilling program (see ASX
announcement dated 2 August 2013) tested priority areas within the prospective Narracoota sequence and
contact zone with the overlying Ravelstone sequence (Figure 5). The information obtained from the program
will assist refining the interpreted geology of the Project area and defining target areas for further drill testing.
Acquisition of 4 metre-composite gold and bottom-of-hole multi-element assays, as well as recording of base
metal readings using a portable XRF and ASD spectra on each metre drilled, continued during drilling and is
nearing completion. Receipt of the final assay data is imminent and form part of the data sets being currently
integrated across the Magnus target zone.
The drilling aimed to identify secondary/oxide copper-gold anomalism within the lower weathered profile that
will allow better delineation of primary sulphide targets to be tested by deeper RC drilling. Compilation of the
assay data, base metal readings and mineral species data obtained on the drill spoil with geological logging will
assist vectoring towards the VMS prospective horizons and identification of primary sulphide targets throughout
the strike-extensive target zones.
The drill testing of the targets forms part of Alchemy’s R&D plan to apply innovative technology in order to
develop effective exploration methods for copper-gold mineralisation not detected or resolved by previous
geophysical surveys.
Figure 5. Bryah Basin Project – broad-spaced, shallow drilling completed over Magnus VMS target zone.
Quarterly Report 1 July 2013 – 30 September 2013
7
Geophysical and geochemical copper – gold targets
A number of widespread multi-element geochemical anomalies and geophysical bedrock conductors associated
with VMS prospective horizons within the +45km long Narracoota sequence corridor remain untested across the
Bryah Basin Project (Figure 6).
Eight distinct conductors, including the MT-36 conductor, defined from the EM surveys remain untested (Figure
6). Two strong conductors identified in the Neptune area may be related to sulphide-bearing black shale
horizons adjacent to the basal contact of the overlying Narracoota sequence. The stratigraphic position of the
surface rocks and the associated bedrock conductors place the remaining six targets at or close to the contact of
sulphide-bearing black shale horizons with the lower-most Narracoota sequence, interpreted to be a
prospective VMS mineralised horizon.
Widespread, anomalous base metal, gold and pathfinder assay results from shallow drilling and drill spoil from
historic drilling returned from the Neptune, Churchill and Fiddler areas (Figure 6) define multiple coherent
broadly anomalous horizons that may be related to VMS-style base metal mineralising processes. Surface
geochemistry delineated a significant copper anomaly in the central Magnus area that has not been drill tested.
In the Neptune and Fiddler areas, base and precious metal anomalism (copper, lead, zinc, gold, silver, cadmium,
molybdenum, arsenic and antimony) is delineated over strike lengths of <2,000 metres at the basal and upper
contacts of the Narracoota sequence in several areas. These horizons are interpreted to be in analogous
positions to the DeGrussa and Horseshoe Lights copper-gold deposits, respectively.
On-going interpretation and additional field verification studies are being undertaken to rank these targets prior
to further exploration and drill testing.
Figure 6. Bryah Basin Project – geophysical and geochemical copper–gold targets.
Quarterly Report 1 July 2013 – 30 September 2013
8
Murchison Projects
Assessment of the Company’s Murchison tenements continued with evaluation of the Big Bell North and Jeffery
Well projects. Aircore drilling programs at Jeffery Well and Big Bell North (Alchemy 80%, Jindalee 20%) and
Gidgee South (Alchemy 100%) in 2010 and 2011 delineated zones of gold anomalism localised in a structural
corridor at the regional lithological contact between basaltic and felsic-intermediate volcaniclastic rocks. The
Jeffery Well and Gidgee South prospect areas were initially targeted based on regional fault flexures identified
from Alchemy’s 3D Murchison GOCAD model, which may represent the northern continuation of the highly-
mineralised Big Bell – Meekatharra shear zone, host to the Big Bell gold deposit (3.9 Moz). The Murchison District
is prospective for not only large lode gold systems but also for narrow high grade gold systems, similar to the gold
mineralisation identified north of Meekatharra at Andy Well by Doray Minerals Limited.
The Big Bell North (Alchemy 80-100%; Jindalee 20-0%) areas host volcanic sequences with significant base metal
potential. Historic exploration north and south of the eastern side of the Big Bell North project indicates base
metal anomalism associated with felsic and mafic volcanic sequences in the Wattagee Hill area. Further
interpretation is being undertaken prior to further exploration.
Several lower priority tenements in the Gidgee, Wydgee and Polelle areas were relinquished during the period
following a review of the Company’s Murchison Projects.
Corporate
At 30 September 2013, the Company retains a cash balance of $1.1 million and is continuing to carry out the
Company’s exploration program for copper–gold and ‘gold-only’ deposits on its Bryah Basin landholding.
Alchemy remains focussed on reducing its costs wherever possible so that it can maximise expenditure on cost-
effective exploration of the Bryah Basin Project.
Please direct enquiries to: Mr Oscar Aamodt – Chairman
Dr Kevin Cassidy – Chief Executive Officer
Telephone: +61 8 9481 4400
The information in this report that relates to Exploration Results is based on information compiled by Dr Kevin Cassidy, who is a Fellow of the Australian Institute of Geoscientists and is a fulltime employee of Alchemy Resources Limited. Dr Cassidy has sufficient experience that is relevant to the style of mineralisation, type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 edition of the ‘Australasian Code for Reporting of Exploration, Results, Mineral Resource and Ore Reserves’. Dr Cassidy consents to the inclusion in this report of the matters based on his information in the form and context in which it appears.
The information in this report that relates to Mineral Resources at the Hermes Gold Deposit and Wilgeena Gold Deposit is based on information compiled by Mr Simon Coxhell of CoxsRocks Pty Ltd, who is a Member of the Australian Institute of Geoscientists and a Member of the Australasian Institute of Mining and Metallurgy and is a consultant to Alchemy Resources Limited. Mr Coxhell has sufficient experience that is relevant to the style of mineralisation, type of deposit under consideration and to the activity that he is undertaking to qualify as a Competent Person as defined in the 2004 edition of the ‘Australasian Code for Reporting of Exploration, Results, Mineral Resource and Ore Reserves’. Mr Coxhell consents to the inclusion in this report of the matters based on his information in the form and context in which it appears.
Quarterly Report 1 July 2013 – 30 September 2013
9
Table 1: Bryah Basin Project – Seaborg prospect, RAB drilling – High-grade gold intervals (cut-off >1.0g/t gold)
Hole ID Easting
(m) Northing
(m) RL
(m)* Hole
Depth (m) Dip Azi
From (m)
To (m)
Intercept (m)
Comment
CBRB001 697844 7159670 585 51 -60 150 0 51 EOH 51m @ 3.71 g/t ends in mineralisation
incl. 1 6 5m @ 6.03 g/t
and 23 37 14m @ 6.59 g/t
CBRB002 697852 7159635 585 45 -60 330 16 39 23m @ 3.16 g/t
41 42 1m @ 1.54 g/t
* nominal RL
Calculation of Assay Results:
Quoted drill intersections are based on a lower cut-off of 1.0g/t gold with a maximum of 1 metre of internal dilution (i.e., samples with less than 1.0g/t gold). Intercepts are ‘down-hole’ metres and no estimate regarding true thickness is made or implied.
Collar positions of drill holes determined by handheld GPS achieving less than 10m accuracy and using MGA datum (Zone 50).
Drilling (hole prefix CBRB) by rotary air blast hammer. One metre samples collected by spear sampling of 1 metre drill spoil.
Assay results were obtained from geochemical analysis of 1 metre samples.
All samples were analysed at ALS Global Laboratories in Perth. Samples are prepared using single stage pulverization of the entire sample. Gold assays on 1 metre samples use 30g fire assay technique and atomic absorption spectrometry (AAS) analysis finish. Screen fire assays performed on all 1 metre samples that returned fire assay results >7.0g/t gold. Screen fire assays determine gold by fire assay after dry screening to 75 microns. AAS determinations made on undersize, and fusion and AAS determinations on entire oversize fraction. Total gold content calculated from individual AAS determinations and weight fractions.
Analytical quality assurance - quality control is achieved using a suite of certified standards, laboratory standards, field duplicates, laboratory duplicates, repeats, blanks and grind size analysis.
Quarterly Report 1 July 2013 – 30 September 2013
10
Table 2: Bryah Basin Project – Seaborg prospect, RAB drilling – 1-metre fire assay & screen fire assay results
Hole ID From (m)
To (m)
Fire Assay Au (g/t)
SFA* Au (g/t)
Preferred Au (g/t)
Intercept (m) 1
(0.5g/t, 2m id) Intercept (m)
2
(1.0g/t, 1m id)
CBRB001 0 1 2.20 2.20
│--
----
----
----
----
----
----
----
----
----
----
----
----
----
----
----
----
----
----
----
-
5
1m
@ 3
.71
g/t
Au
(0
m)
----
----
----
----
----
----
----
----
----
----
----
----
----
----
----
----
----
----
----
---│
│--
----
----
----
----
----
----
----
----
----
----
----
----
----
----
----
----
----
----
----
51
m @
3.7
1g
/t A
u (
0m
)
----
----
----
----
----
----
----
----
----
----
----
----
----
----
----
----
----
----
----
--│ 1 2 6.47 6.47
2 3 1.40 1.40
3 4 7.85 8.27 8.27
4 5 8.48 7.59 7.59
5 6 6.43 6.43
6 7 2.77 2.77
7 8 17.80 3.54 3.54
8 9 5.15 5.15
9 10 0.95 0.95
10 11 4.79 4.79
11 12 4.23 4.23
12 13 1.24 1.24
13 14 0.78 0.78
14 15 1.01 1.01
15 16 0.17 0.17
16 17 1.11 1.11
17 18 0.83 0.83
18 19 1.37 1.37
19 20 2.51 2.51
20 21 1.21 1.21
21 22 0.82 0.82
22 23 2.89 2.89
23 24 5.06 5.06
24 25 12.25 6.58 6.58
25 26 5.06 5.06
26 27 3.02 3.02
27 28 7.32 7.70 7.70
28 29 6.23 6.23
29 30 7.87 8.41 8.41
30 31 7.54 6.91 6.91
31 32 8.78 10.40 10.40
32 33 9.06 7.06 7.06
33 34 6.21 6.21
34 35 7.51 7.51 7.51
35 36 7.41 6.75 6.75
36 37 5.35 5.35
37 38 2.25 2.25
38 39 3.22 3.22
39 40 1.06 1.06
40 41 5.18 5.18
41 42 1.35 1.35
42 43 1.87 1.87
43 44 1.69 1.69
44 45 1.06 1.06
45 46 2.05 2.05
46 47 2.12 2.12
47 48 2.70 2.70
48 49 2.66 2.66
49 50 0.85 0.85
50 51 1.09 1.09
CBRB002 0 1 0.14 0.14
1 2 0.06 0.06
2 3 0.01 0.01
3 4 0.02 0.02
4 5 <0.01 <0.01
Quarterly Report 1 July 2013 – 30 September 2013
11
CBRB002 5 6 0.01 0.01
cont’d 6 7 0.01 0.01
7 8 0.03 0.03
8 9 0.64 0.64 1m @ 0.64g/t
9 10 0.07 0.07
10 11 0.04 0.04
11 12 0.16 0.16
12 13 0.24 0.24
13 14 0.10 0.10
14 15 0.12 0.12
15 16 0.57 0.57
│--
----
----
----
----
----
----
----
----
----
-
3
0m
@ 2
.57
g/t
(1
5m
)
-
----
----
----
----
----
----
----
----
----
-│
16 17 3.55 3.55
│--
----
----
----
----
----
--
2
3m
@ 3
.16
g/t
(1
6m
)
-
----
----
----
----
----
---│
17 18 3.03 3.03
18 19 3.12 3.12
19 20 5.50 5.50
20 21 4.14 4.14
21 22 2.77 2.77
22 23 3.26 3.26
23 24 5.14 5.14
24 25 3.48 3.48
25 26 2.98 2.98
26 27 2.38 2.38
27 28 2.45 2.45
28 29 2.76 2.76
29 30 3.76 3.76
30 31 2.15 2.15
31 32 0.98 0.98
32 33 1.11 1.11
33 34 0.87 0.87
34 35 2.30 2.30
35 36 1.92 1.92
36 37 9.03 8.99 8.99
37 38 3.22 3.22
38 39 2.75 2.75
39 40 0.61 0.61
40 41 0.78 0.78
41 42 1.54 1.54 1m @ 1.54g/t
42 43 0.24 0.24
43 44 0.19 0.19
44 45 0.66 0.66
* SFA – Screen Fire Assay
Calculation of Assay Results:
Quoted drill intersections are based on lower cut-offs of (1) 0.5g/t gold with a maximum of 2 metres of internal dilution (i.e., samples with less than 0.58g/t gold) and (2) 1.0g/t gold with a maximum of 1 metre of internal dilution (i.e., samples with less than 1.0g/t gold). Intercepts are ‘down-hole’ metres and no estimate regarding true thickness is made or implied.
One metre samples collected by spear sampling of 1 metre drill spoil.
Assay results were obtained from geochemical analysis of 1 metre samples.
All samples were analysed at ALS Global Laboratories in Perth. Samples are prepared using single stage pulverization of the entire sample. Gold assays on 1 metre samples use 30g fire assay technique and atomic absorption spectrometry (AAS) analysis finish. Screen fire assays performed on all 1 metre samples that returned fire assay results >7.0g/t gold. Screen fire assays determine gold by fire assay after dry screening to 75 microns. AAS determinations made on undersize, and fusion and AAS determinations on entire oversize fraction. Total gold content calculated from individual AAS determinations and weight fractions.
Analytical quality assurance - quality control is achieved using a suite of certified standards, laboratory standards, field duplicates, laboratory duplicates, repeats, blanks and grind size analysis.
