Phoenix Copper Limited / Ticker: PXC / Sector: Mining

12 January 2022

Phoenix Copper Limited

('Phoenix' or the 'Company')

Red Star Drilling Results

Exploratory drilling at Red Star encounters further copper, gold, silver, zinc and lead mineralisation

Phoenix Copper Ltd (AIM: PXC; OTCQX: PXCLF; OTCQX ADR: PXCLY), the AIM quoted USA focused base and precious metals emerging producer and exploration company, is pleased to announce the assay results from additional drilling at the Red Star silver - lead deposit, adjacent to the Empire Mine Open Pit Project, Custer County, Idaho, USA.

Highlights:

·    In a programme designed to test and help delineate the boundaries of the magnetite zones, seven exploratory reverse circulation ("RC") holes were drilled at Red Star, totaling 876.3 metres ("m"), all of which encountered further mineralisation.

·    Silver and lead grades encountered in the drilling are consistent with, or exceed, those reported in the Red Star maiden resource; copper, gold and zinc are also encountered in significant quantities.

Significant drill results are listed in Table 1 below, including the following:

Hole RS21-01

·    27.4 m of 0.69% copper, 0.8 grammes per tonne ("g/t") gold and 14.9 g/t silver starting at a depth of 38.1 m,

o  including 7.6 m of 1.61% copper, 2.3 g/t gold and 38.6 g/t silver from 50.3 m,

o  and including 1.5 m of 2.71% copper, 3.9 g/t gold and 50.7 g/t silver from 51.8 m

Hole RS21-02

·    36.6 m of 0.52% copper, 0.5 g/t gold, 24 g/t silver, 0.28% lead, and 0.64% zinc starting at a depth of 82.3 m,

o  Including 13.7 m of 23.9 g/t silver and 1.46% zinc from 82.3 m,

o  Including 1.5 m of 0.56 g/t gold, 92.3 g/t silver, 3.13% lead, and 2.77% zinc from 83.8 m

o  Including 7.6 m of 1.35% copper, 1.2 g/t gold and 49.0 g/t silver from 102.1 m

Hole RS21-05

·    7.6 m of 0.20% copper, 0.3 g/t gold, and 17.4 g/t silver from 35.1 m depth

o  Including 3 m of 0.29% copper, 0.7 g/t gold, and 28.9 g/t silver from 39.6 m

·    These results, and the results of the ground magnetic survey recently completed on Red Star, will be used to target a planned 3,000 m diamond core drilling programme in 2022.

Ryan McDermott, Chief Executive Officer, said, "I am delighted with the latest drill results from the Red Star program. All seven drill holes encountered mineralization consistent with, if not exceeding, the grades in the maiden Red Star resource, further demonstrating the widespread polymetallic mineralization at Empire, and the continuity of a northerly trending system.

"This drilling confirms that the surface geology and geochemistry, as well as the magnetic anomalies identified in the ground magnetics survey reported on 20 October 2021, show a continuous northerly-trend toward the Horseshoe-White Knob project as expected, and are reliable and provide prospective drill targets for a planned 3,000 m core drilling program in 2022.

"The 2021 Red Star ground magnetics survey identified three magnetic zones east-southeast of the Red Star discovery outcrop covering nearly 46 acres.  These seven exploratory drill holes, RS21-01 to RS21-07, targeted specific areas within those 46 acres for the purpose of providing subsurface exploratory information for future drilling programs.  These latest drilling results have accomplished that purpose, and the Phoenix team is excited to apply what we have learned to our next phase of Red Star drilling.   

"In addition to our ongoing exploration programs, we continue to focus our efforts on the Empire Open-Pit copper oxide feasibility study, scheduled for completion in Q2 of this year, and with the ongoing permitting of the Empire copper-oxide open pit. The evaluation of the Navarre Creek gold project, ahead of an anticipated exploratory drilling program in 2022, is also in progress, as is the planned reporting of the results of the Navarre Creek ground magnetics survey and geophysical program in the coming weeks.  I look forward to an exciting year ahead for the Company and wish all our stakeholders a happy and healthy 2022."

Background

During the 2021 field season, a ground magnetics survey was conducted in the Red Star project area.  The results of the survey identified three subsurface magnetite zones east of the Red Star discovery outcrop, which had not been apparent in the surface outcrop. In early October 2021, a RC drill rig became available for a short period of time and drilled seven exploratory holes at various locations throughout the newly identified magnetic zones as a precursor to a future and more extensive diamond core drilling programme.

The Red Star exploration programme was designed to test and help delineate the boundaries of the magnetite zones and to provide geochemical data and targeting for the next phase of drilling.  The results confirmed the continuity of magnetite related mineralisation along northerly trending structures. The Red Star mineralisation appears as discrete zones plunging steeply to the east along the structures mapped in the geophysical survey, similar to the well understood magnetite zones encountered in the Empire Open-Pit deposit.

Table 1 - Red Star Reverse Circulation Drilling Results January 12, 2022

* Length along hole (not equivalent to true width).

Assay Quality Control

HQ drill core is logged by Konnex personnel at Phoenix's drill core facility located in Mackay, Idaho, USA. The drill core is then sawed in half. One half is sent to a commercial laboratory for assaying, and the other half is kept for future reference. A strict QA/QC programme is in place by integrating duplicates, blanks and certified reference standards into the core sample sequence.

RC drill samples are collected in bags. One sample is collected per each five-foot interval (1.52m) down the hole. A representative sample is also collected and kept for future reference at the Phoenix facility. Phoenix's geologists carry out the sample preparation and insertion of the duplicates, blanks, and certified reference material at the site before sending the sample batches to the ALS Global laboratory for the same processing and analysis as the diamond drill core.

Qualified Person

The foregoing technical information in this news release has been reviewed and verified by Zachary J. Black, SME-RM, General Manager. Mr. Black is a resource geologist with more than 17 years of domestic and international experience in the mining and construction industries. Mr. Black has a degree in Geological Engineering from the University of Nevada, Reno and is a registered member of the Society for Mining, Metallurgy, and Exploration, Inc. He is a Qualified Person under the AIM Rules. Mr. Black consents to the inclusion of the information in the form and context in which they appear.

Environmental, Social, and Corporate Governance

Phoenix is committed to meeting and exceeding the environmental standards required by law as a core value of the Company.  The baseline environmental data collected to date will be used for furthering the permitting process, but as importantly, will be used as the building blocks for the Company's ongoing Environmental, Social, and Corporate Governance (ESG) platform, overseen by the Company's ESG & Sustainability Committee.

Market Abuse Regulation (MAR) Disclosure

The Company deems the information contained within this announcement to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014, which has been incorporated into UK law by the European Union (Withdrawal) Act 2018. Upon the publication of this announcement via the Regulatory Information Service, this inside information is now considered to be in the public domain.

Contacts

For further information please visit https://phoenixcopperlimited.com or contact:

Notes

Phoenix Copper Limited is a USA focused, base and precious metals emerging producer and exploration company, initially targeting copper and zinc production from an open pit mine from late 2022.

Phoenix's primary operations are focused near Mackay, Idaho in the Alder Creek mining district, at the 80% owned Empire Mine property, which historically produced copper at grades of up to 8%, as well as gold, silver, zinc and tungsten, from an underground mine. 

Since 2017, Phoenix has carried out extensive drill programmes which resulted in the publication of a NI 43-101 PEA in October 2020 for an open pit heap leach solvent extraction and electrowinning ("SX-EW") mine, which was updated in October 2020. The contained metal in all NI 43-101 compliant categories of resources, measured, indicated, and inferred, stand at 129,641 tonnes of copper, 355,523 ounces of gold, 10,133,772 ounces of silver and 58,440 tonnes of zinc. Phoenix updated its economic model in February 2021 to include the processing of all contained metals through a two phased approach.

In addition to Empire, the district includes the historic Horseshoe, White Knob and Blue Bird Mines, past producers of copper, gold, silver, zinc, lead and tungsten from underground mines. A new discovery at Red Star, 330 metres northwest of the Empire Mine proposed open pit, has revealed high grade silver / lead sulphide ore and from three shallow exploration drill holes. A maiden resource of 103,000 tonnes containing 173.4 g/tonne silver, 0.85 g/tonne gold and 3.85% lead (1.6 million ounces silver equivalent) was reported in an NI 43-101 technical report published in May 2019. Additionally, the district includes the Navarre Creek Project, a volcanic hosted, precious metals target in a 14.48 sq km area. The Company's total land package at Empire comprises 8,034 acres (32.51 sq kms).

At Empire, it is estimated that less than 1% of the potential ore system has been explored to date and, accordingly, there is significant opportunity to increase the resource through phased exploration. The stated aim of the Company is to fund this phased exploration through free cashflow generated by its initial mine. A Plan of Operations in respect of the initial open pit mine was filed with the relevant regulatory authorities in June 2021.

Phoenix also has two wholly owned cobalt properties on the Idaho Cobalt Belt to the north of Empire. An Earn-In Agreement has been signed with Electra Battery Materials Corporation (formerly First Cobalt  Corporation), Toronto, in respect of one of those properties.

More details on the Company, its assets and its objectives can be found on PXC's website at https://phoenixcopperlimited.com.