Gullewa Gold Copper Project Deflector

Gullewa Gold Copper Project Deflector

Gullewa Project

The Gullewa Project is associated with the historical Gullewa mining district which is located 450km north of Perth and 160km east of the Western Australian regional city of Geraldton. Geraldton is the nearest port location on the Indian Ocean. The two nearest local communities to the project are Yalgoo (51km to northeast) and Morawa (61km south, southwest). The road that runs between Yalgoo Morawa cuts through the Gullewa Project.

The Gullewa Project has a large tenement package covering 530km2. Included within the tenement package are seven historical mined our partially mined open pits and five shallow high grade underground mines. Given the size and location of the Gullewa Project, the history is complex and involves many different companies, a number of joint ventures, company name changes and different levels of exploration activity based on different objectives.

Geology

The Gullewa Greenstone Belt is contained within the Company's Gullewa tenements in the Murchison Province of the Archaean Yilgarn Block. The southern end of the belt has formed a broad east-west orientated synform comprised of a lower group of mafic and ultramafic rocks with banded iron formation units, overlain by more flesic rocks and upper group of conglomerates, arenites minor basalts. Internal intrusive bodies include trachyandesite, granodiorite gabbro.

The major north-south Salt Creek fault structure runs through the eastern section of the belt. Northeast trending faults shear zones cut the belt. Both the Salt Creek fault the northeast structures are associated with gold mineralisation gold, copper silver mineralisation.

Outcrop is limited within the project area, the basement of which is covered by thin present day sheet wash and underlying partly laterised alluvial "Murchison Hardpan".

Gold

From 1894 through to 2003 a total of 553,931 tonnes @4.48g/t was mined and processed to produce 70,675 gold ounces.

Gold was first discovered in the Gullewa district in 1894. A small gold rush followed creating the historical mining town of Gullewa by 1896. First gold production was recorded in the area in 1897 and continued in two separate time frames through to 1942. Over that period the shallow, high grade underground mines (Daisy, Gullewa Queen, Mugga King, Pheonix, Shannadoah and Victory United Mines) produced 24,000t @ 46.3g/t gold. These mines were all outcropping narrow high-grade quartz-sulphide veins.

Modern Gold exploration commenced in the district in 1982 and has continued intermittently through to today. In 1994 National Resources Exploration (NRE) constructed a 250ktps CIL gold processing plant for treatment of the Monarch, New Phoenix, Michelangelo and Golden Stream gold deposits. In 1995 NRE completed an upgrade to 300ktps CIL plant. In 1996 operations were suspended due to poor mining performance and limited reserves. NRE changed its name to Gullewa Gold NL in late 1996. The mine was sold in 2000 to King Solomon Mines. The mine was then on sold to King Solomon Mines in a Joint Venture Agreement to Menzies Gold Limited in 2002. Menzies re-furbished the plant and commenced mining the Brandy Hill deposit before moving onto the closer Rocksteady and Michelangelo mines. In late 2002, Menzies commenced processing the Deflector gold-copper pre in the CIL plant as it was the only remaining large tonnage resource. The decision to do this by Menzies was fatal as the gold-copper ore was not suitable for processing in a CIL plant. In 2003, Menzies Gold Limited and King Solomon Mines entered into voluntary administration. The Gullewa Project was consequently suspended and placed on care and maintenance.

Gold resources of 1.8Mt @ 1.5g/t for 90,000 gold ounces currently exist for the Michelangelo, King Solomon, New Phoenix and Rocksteady deposits (Refer to resources section).

Gold, Copper & Silver (Deflector)

From the mid 1960’s through to the mid 1980’s base metal exploration occurred in the Gullewa district due to the discovery of the Golden Grove copper-lead-zinc-silver deposit 50km to the east of the Gullewa mining centre. Limited information of this exploration exists but included major companies like Western Mining Corporation, CRA exploration, Australian Anglo-American and AMAX Australia Ltd.

The Deflector gold-copper discovery was made in January 1991 by Sons of Gwalia (SOG). The name Deflector comes from an observation by SOG that a deflection in the magnetics warranted investigation. Broad spaced RAB drilling identified a 1,000m by 200m gold-copper anomaly. SOG rapid follow-up RC drilling then confirmed the discovery and by July 1993 107 RC and diamond holes had been completed. At this time, the first resource was completed (315,000 tonnes @ 6.49g/t Au and 1.71% Cu). Initial metallurgical test work was carried out on the Deflector ore body in 1993. This test work focussed on gravity separation and flotation methods to recover gold, copper and silver in concentrates as a standard CIL or heap leach process wasn’t suitable for treating Deflector ore due to the presence of copper. National Resources Exploration (NRE) acquired the project in 1994.

NRE/Gullewa Gold continued the aggressive exploration and resource drilling associated with Deflector and by January 1997 a total of 402 RC and diamond holes were completed. The January 1997 resource was 664,900 tonnes @ 4.6g/t Au and 1.8% Cu.

From 1996 to 2003 drilling of Deflector greatly diminished with only 12 new holes being drilled. In 2000 ownership of the project changed to Menzies Gold/King Solomon Mines (KSM). In 2003 Menzies under control of the administrators re structured the company to re float on the Australian Stock Exchange as Batavia Mining Limited.

In 2003 Hallmark and Batavia gained access to the deposit. Over this short period an additional 133 RC and diamond holes were completed. The 2004 Feasibility study associated with this work had a resource of 1.8Mt @ 3.92g/t Au, 0.95% Cu and a reserve of 904,000 tonnes @ 3.55g/t Au and 1.14% Cu. Batavia continued drilling and completing various studies on Deflector through to 2006.

In November 2006, Snowden completed a Feasibility Study on the Deflector Gold Copper project for Batavia. This work produced a resource of 3.3Mt @ 5.31g/t Au, 0.76% Cu and 5.18g/t Ag. The associated reserve was 1.3Mt @ 3.91 g/t Au, 1.08% Cu and 7.42g/t Au.

In April 2008, ATW Gold (Now Red Hill Resources Ltd) acquired the Gullewa Gold Project from Batavia.

In 2010 Mutiny Gold Ltd acquired the Gullewa project from Canadian Miner ATW Gold (now Red Hill Resources Ltd).

In July 2012 Mutiny Gold announced the completion of a feasibility study associated with Deflector. That study was based on a resource of 3.2Mt @ 5.1g/t Au, 0.82% Cu and 6.01g/t Ag. The associated open pit and underground reserves were 2.8Mt @ 3.70g/t Au, 0.58% Cu and 6.07g/t Ag.

Following further resource estimation after 2012 drilling the feasibility study was revised based on a resource of 2.8Mt @ 6.41g/t Au, 0.95% Cu and 6.82g/t Ag. The associated reserves were 2.1Mt @ 4.5g/t Au, 0.8% Cu and 6.1g/t Ag.

In September 2013, Mutiny then further revised the feasibility study based on a revised cost and metal price inputs. This work was based on the same resources as the previous work and the new reserves became 2.3Mt @ 4.9g/t Au, 0.6% Cu and 5.9g/t Ag.

(The current listed resources and reserves are provided in the Mineral Resources and Ore Reserves Section. The summary of the recent feasibility studies are given as part of the ASX Announcements Section).

Iron Potential

The Company has identified a potential for hematite and magnetite ore production at Gullewa. Iron has been identified in the drill intersections associated with the Rocksteady and Brandy Hill areas in the form of BIF units.

Exploration

The Gullewa Greenstone Belt covered by the Gullewa Project tenement package has historically produced over 70,000 ounces of gold from several small to medium sized gold deposits. To date there has been no base metal production or resources defined at Gullewa, but a significant base metal deposit exists at Golden Grove (Scuddles and Gossan Hill) which is 50km east of Gullewa.

Previous explorers have mapped and sampled gossan and ironstone and have identified multi-element geochemical signatures at Gullewa in search of similar VMS deposits to those seen in the adjacent Golden Grove area. To date no economic grades or widths have been identified. The southern part of the Gullewa belt is considered more prospective for base metal mineralisation associated with VMS type deposits and this will be considered in ongoing exploration work.

Potential certainly exists on the Gullewa belt for narrower, high grade quartz/sulphide lodes as real underground targets similar to those previously discovered and mined. Significant copper grades may also occur similar to the Deflector deposit. Potential also exists for supergene-enriched, moderate tonnage laterite deposits. Potential mineralisation is likely to be concealed under the transported regolith which is apparent across the large majority of the tenement package (85- 90%).

Exploration is primarily focussed on the Deflector corridor as it is host to the most significant/current deposit in Deflector.

Included within the tenement package are seven historical mined or partially mined open pits and five historical shallow high grade underground mines. Ongoing evaluation of potential extensions to these mines is part of the company's ongoing exploration strategy.

Also, recent work has been completed on Mutiny's extensive geophysical data sets, developing detailed structural interpretations across the entire Gullewa tenement package. There are over 100 targets for consideration by the Company. From this work a detailed exploration strategy and priorities will be set to systematically explore those targets.

The company has had recent success with the use of SAM (Sub audio magnetics) and follow up shallow drill programs to help identify specific structures located under the transported cover. This has now been proven as a useful exploration technique for identifying covered structures at Gullewa which will potential host economic mineralisation