Announcement PDF Emu NL Vidalita silver assays outline prospective ground 21 August 2018 Vidalita silver assays HIGHLIGHTS: • Silver grades from recent drilling highlight silver-dominated zones in the Vidalita epithermal system • Substantial widths of silver mineralisation encourages Emu to explore for commercial silver resources, though gold remains a priority • Significant silver intercepts include (down hole widths, true width unknown): Interval m 8 1 1 2 4 Silver grade g/t 33 58 1,049 177 148 From M 40 166 216 253 52 Hole 4900-1 5300-2 5700-1 5700-1 6500-2 Within broader Silver grade interval m g/t 28 8 6 6 16 23 15 211 93 88 From m 36 163 215 251 44 • Large zones of low grade base metal mineralisation, particularly in zinc, outlined • Targeting underway for follow-up drilling campaign SUMMARY A substantial mineralised epithermal system, with similar attributes to those being mined elsewhere in the Maricunga Belt, has been discovered at Vidalita. Zones have been identified within this epithermal system that are silver and/or base metal dominated and are being assessed as targets in their own right. Silver grades and relevance to gold deposits in the Maricunga Belt A feature of the Maricunga Belt gold deposits is that they tend to be high tonnage, low grade gold often interspersed with supergene or bonanza grade pockets. Their economics generally rests on the very large gold resources they represent, with the typical deposit holding in excess of 5 million ounces of gold. Another feature of these deposits is the importance of silver credits in the operating mines where, in many cases, the silver dominates in volume terms (Table 1). Silver grades Vidalita Assays reported previously (ASX announcement on 18 July, 2018) are reproduced here as Tables 2 (gold) and 3 (silver). Refer to announcement on 18 July, 2018 for data aggregation method and the JORC table describing this data. These data suggest Vidalita has gold and silver in similar proportions to that seen generally in deposits of the Maricunga Belt. Page 1 of 9 Emu NL Vidalita silver assays outline prospective ground 21 August 2018 Table 1 Gold and silver grades and Resources of Maricunga belt deposits close to Vidalita. Deposit Owner Salares Norte 1 Cerro Casales3 Cerro Maricunga 2 Caspiche 3 Maricunga (Refugio) 4 La Coipa 5 Nueva Esperanza 6 Veladero3 Alturas3 Gold Fields Barrick/Goldcorp Atacama Pacific Goldcorp Kinross Kinross Kingsgate Barrick Barrick Resource (Mt) 23.3 747.1 491.7 701.8 298 19.4 39 184 211 Gold (g/t) 4.89 0.55 0.37 0.51 0.7 1.4 0.39 .69 1.00 Gold (Moz) 3.66 13.3 5.85 11.62 5.4 1 0.5 4.1 6.79 Silver (g/t) 66.0 1.52 0.25 1.4 37.6 66 13.2 - Silver (Moz) 49.5 37.6 4 31 23.5 112.7 89.5 - Interpretation of the Vidalita Gold-Silver mineralisation Vidalita exhibits all the hallmarks of a large epithermal system: a diatreme intruding a sequence of dacitic volcanics and domes, causing large scale brecciation, veining, pervasive alteration, and capped by vuggy silica. Figure 2 shows these features in the interpretation of Emu’s drilled section 5300N. While insufficient drilling has been completed at Vidalita to confidently place the prospect within the classic epithermal model, the system displays features that suggest it is a classic high sulphidation epithermal Gold-Silver (Au-Ag) system. A high silver to gold ratio, intense argillic alteration, and a magnetic low associated with the mineralised zone are all characteristics of HSE systems. These are noted features of the Vidalita prospect. Anomalous silver geochemistry, as mapped out by soil sampling surveys, have larger footprints than the gold geochemistry from the same surveys, though the two are broadly coincident (Figure 3). Of particular interest are the silver anomalies in soils around holes 6500-1 and 6500-2. Hole 6500-2 intersected 4m at 148g/t Ag from 52m in a broader intercept of 16m at 88g/t Ag from 44m, but negligible gold. Emu intends to follow up both gold and silver-gold targets at Vidalita, and surrounding prospects, to ensure so not only maximising exploration success, but aid in mapping out this highly mineralised system. 1 https://www.goldfields.com/reports/annual-report-2017/minerals/salares-norte-mineral-resources.php, indicated and Inferred 2 http://atacamapacific.com/projects/cerro/reserves.aspx, Measured, Indicated and Inferred 3 https://barrick.q4cdn.com/788666289/files/quarterly-report/2018/Barrick-2017-Reserves-Resources.pdf, Proven and Probable 4 https://miningdataonline.com/property/135/Maricunga-Mine.aspx. Measured and Indicated 5 http://fb.kinross.com/operations/operation-la-coipa-chile.aspx, Measured and Indicated 6 http://www.kingsgate.com.au/reserves_resources/, Resources inclusive of Reserves Page 2 of 9 Emu NL Vidalita silver assays outline prospective ground 21 August 2018 Figure 1: Drill hole locations, Vidalita Prospect, Maricunga Belt, Chile. Location of cross sections included in this announcement are indicated. Co-ordinate system is WGS84/UTM19S. Base metals at Vidalita Another area of interest in following up the recent drilling results is the anomalous base metals intercepted. Examples are: Hole 5100-3 5300-2az 5700-1b incl 6500-2 Interval m 8 16 21 66 37 4 1 7 32 From m 184 228 211 171 181 215 216 251 32 To m 192 244 232 237 218 218 217 257 64 Copper % 0.24 2.18 5.37 Lead % 0.99 2.24 0.18 0.13 Zinc % 0.36 0.54 0.22 0.27 1.61 3.65 1.34 0.57 Zinc is, in particular, widespread with copper being restricted to the area of Hole 5700-1b suggesting distinct mineral zonation. While base metal intercepts tend to be low grade, they are essential pointers Page 3 of 9 Emu NL Vidalita silver assays outline prospective ground 21 August 2018 to epithermal architecture. High copper grades tend to suggest a high sulphidation epithermal system, while lead-zinc mineralisation points to a more intermediate sulphidation system. These preliminary observations support the interpretation that there were multiple mineralising events on the Vidalita Prospect. Table 2 Summary of significant gold intercepts, Vidalita prospect. Assay intervals of more than 0.1g/t gold were averaged. Single assays within the interval falling below 0.1g/t were included in the average. Assay interval for AC was 4m, for DDH it was 1m. High grade zones used a bottom cutoff of 0.5g/t gold. Drilling method From M To m Interval m Gold g/t 5100-3 5100-4 AC 5300-2 DDH 164 28 12 92 88 50 32 166 157 214 50 50 128 120 68 44 120 108 108 108 40 32 192 216 174 164 168 36 52 96 96 58 70 173 178 221 58 102 132 144 76 92 124 124 112 116 44 52 204 218 244 168 4 8 40 4 8 8 38 7 21 7 8 52 4 24 8 48 4 16 4 8 4 20 12 2 70 4 0.51 0.70 0.39 1.06 0.59 0.86 0.44 1.12 0.54 0.4 1.02 0.46 0.92 0.33 1.10 0.64 0.51 0.30 0.52 0.32 0.51 0.29 0.38 0.68 0.23 0.51 Hole No AC in and in in 5300-2b AC 5300-3 AC 5300-4 AC 5300-5 AC 5500-1 AC 5500-3 AC 5700-1b DDH 5100-3 AC and in and in in in in in in and in Next Step Emu is assessing all drilling and assay data generated by the recently completed drilling campaign. Included in this assessment is: • Analysis of mineralogy by Scanning Electron Microscopy • Assistance from world renown epithermal consultants to model where in the epithermal architecture Vidalita sits, and • Identification of drillable targets off the gold, silver, and base metal results received. Page 4 of 9 Emu NL Vidalita silver assays outline prospective ground 21 August 2018 Emu continues to plan the next drilling campaign including negotiating for drilling, camp services, and logistics. Table 3 Summary of significant silver intercepts, Vidalita prospect. Assay intervals of more than 5g/t silver were averaged. Single assays within an interval falling below 5g/t were included in the average. High grade zones used a bottom cutoff of 25g/t. Assay interval for AC was 4m, for DDH it was 1m. Note corrected intervals from previous announcement. Hole No Drilling method 4900-1 AC 5100-4 5300-2 AC AC 5300-4 5500-1 AC AC 5700-1 DDH 5900-5 AC 6500-2 AC in in in and in in in From m To m Interval m Silver g/t 40 36 32 166 163 44 108 108 216 215 253 251 20 16 48 64 52 167 171 84 112 116 217 221 255 257 24 24 8 28 20 1 8 40 4 8 1 6 2 6 4 8 33 23 8 58 15 8 28 17 1,049 211 177 93 35 24 52 44 56 60 4 16 148 88 Page 5 of 9 Emu NL Vidalita silver assays outline prospective ground 21 August 2018 Figure 2 Section 5300N. Gold grade histogram in gold (ppm = g/t, scaled 1:10) and silver in green (ppm = g/t, scaled 1:1). Note grade scales at bottom of some holes (same scale is applicable to all holes). This is a preliminary, simplified geological interpretation. Co-ordinate system is WGS84/UTM19S. Page 6 of 9 Emu NL Vidalita silver assays outline prospective ground 21 August 2018 Figure 3 Image of gold in soils (left) with values above 5ppb shown in red to a maximum of 1ppm (=1g/t) gold. Image of silver in soils (right) with values above 100ppb shown in red to a maximum of 4.5ppm silver. Hole collars shown. Co-ordinate system is WGS84/UTM19S. Page 7 of 9 Emu NL Vidalita silver assays outline prospective ground 21 August 2018 About the Vidalita and Jotahues Gold Projects, Maricunga Belt, Chile The Vidalita and Jotahues gold projects are located in the Maricunga gold belt in the Atacama Region in northern Chile hosting numerous world class gold and silver projects. Emu’s projects cover an area of approximately 135.7 km2 secured by mineral exploration concessions and host alteration and mineralisation that appear geologically similar to other high sulphidation gold deposits of the Maricunga gold belt. The projects are accessed using a network of roads that link Copiapó with the Refugio project (Kinross), Cerro Casale project (Barrick/Goldcorp) and the Caspiche project (Goldcorp). Refugio is located 30 km to the northwest of Vidalita. The Company holds an option (Option) to acquire a 100% interest in certain of the Vidalita and Jotahues concession packages from two Chilean companies. The concessions are the subject of the Option comprise 2 packages: one package, (the Prospex SpA concessions) covers six concessions at Vidalita, is subject to a 2% NSR on any production, and the second package, (the BLC SpA concessions) comprised of three concessions at Jotahues and two concessions at Vidalita (Vidalota A&B), is subject to a 1% NSR. Since entering into the Option, additional concessions have been included in the second package in accordance with the area of influence. An Option payment of US$100,000 is due in November 2018 if Emu elects to continue with the project. The Option may be exercised in November 2019 on payment of US$2M following expenditure of US$1M, the issue of 2.5M Emu shares and then if Emu defines: (i) 0.5Moz of gold in measured resources, a further 5M ordinary shares will be issued; and (ii) 1Moz of gold in measured resources, a further 5M ordinary shares will be issued. Emu continues to look for new mineral exploration, development and mining opportunities within Australia and at various overseas jurisdictions. Page 8 of 9 Emu NL Vidalita silver assays outline prospective ground 21 August 2018 COMPETENT PERSON’S STATEMENT Emu NL ABN 50 127 291 927 ASX Code: EMU 10 Walker Ave West Perth, WA 6005 T +61 8 9226 4266 E info@emunl.com.au PO Box 1112 West Perth, WA 6872 Fully paid shares (listed) 82,856,560 (inc. 4m which Emu can buy back for nil consideration) Contributing Shares (listed) 33,668,824 paid to $0.03, $0.03 to pay, no call before 31/12/2018 Options (unlisted) 4,750,000, exercise price $0.10, expiring 20/12/18 300,000, exercise price $0.25, expiring 20/12/18 Directors: Peter Thomas Non-executive Chairman Greg Steemson Non-Executive Gavin Rutherford Non-Executive Any details contained herein that pertain to exploration results, mineral resources or mineral reserves are based upon information compiled by Mr Marcus Flis, General Manager of Emu NL. Mr Flis is a Fellow of the Australasian Institute of Mining and Metallurgy (FAusIMM) and has sufficient experience in the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves” (JORC Code). Mr Flis consents to the inclusion herein of the matters based upon his information in the form and context in which it appears. FORWARD LOOKING STATEMENTS As a result of a variety of risks, uncertainties and other factors, actual events and results may differ materially from any forward looking and other statements herein not purporting to be of historical fact. Any statements concerning mining reserves, resources and exploration results are forward looking in that they involve estimates based on assumptions. Forward looking statements are based on management’s beliefs, opinions and estimates as of the respective dates they are made. The Company does not assume any obligation to update forward looking statements even where beliefs, opinions and estimates change or should do so given changed circumstances and developments. Page 9 of 9