Doray Minerals : Deflector Near-Mine Exploration Drilling Results

7 March 2019

DEFLECTOR NEAR-MINE EXPLORATION DRILLING INTERSECTS

EXCITING GOLD AND COPPER MINERALISATION

Doray Minerals Limited ("Doray" or "the Company") (ASX: DRM) is pleased to announce the results from recent surface reverse circulation (RC) drilling focussed on testing several near-mine exploration targets at the Deflector Gold Copper Mine.

HIGHLIGHTS

• o Drilling on a series of traverses across the Spanish Galleon target 500m west of Deflector intersected near-surface gold and copper mineralisation as well as narrow zones of primary mineralisation. Significant results include:

  • o DERC0299 - 1m @ 9.0g/t Au and 0.1% Cu from 52mdh

  • o DERC0303 - 1m @ 7.3g/t Au and NSA Cu from 37mdh

  • o DERC0300 - 3m @ 3.8g/t Au and 0.4% Cu from 112mdh

• o Drilling on the Deflector Southwest target, 300m from Deflector, following up on an historic drill intersection previously reported in 2014 (14DEFDD015 - 3.1m @ 9.9g/t Au and 7.5% Cu) returned several high-grade intersections correlating with the revised interpretation of the prospect. Significant intersections include:

  • o DERC0318 - 1m @ 11.3g/t Au and 4.4% Cu from 102mdh

  • o DERC0319 - 2m @ 6.1g/t Au and NSA Cu from 224mdh

  • o DERC0322 - 5m @ 3.2g/t Au and 0.1% Cu from 239mdh

• o Drilling has highlighted the broader extent of gold and copper mineralisation present within the Deflector area and the clear potential for additional discoveries.

Commenting on these high-grade intersections at prospects close to the Deflector mine, Doray Minerals Managing Director Leigh Junk said, "These latest results continue to confirm our long-held belief that there is additional untapped mineralisation across the broader Deflector project area. We have been consistent over the past year in investing in near-mine exploration with the target of extending Deflector's mine life.

"These latest results, while early stage, are extremely encouraging and highlight yet again the high-grade prospectivity of Deflector, and we look forward to continuing to unlock its significant potential."

*NSA - No Significant Assay

Deflector Near-Mine Exploration - Drilling Update

A series of RC drilling programmes were completed on the Spanish Galleon, Deflector Southwest and the Da Vinci North prospects (see Figure 1). The Spanish Galleon and Deflector Southwest prospects were targeted based on reinterpretations of existing drill data utilising the enhanced understanding of mineralisation controls and styles at the nearby Deflector Gold Copper Mine. The Da Vinci North programme was drilled to test for further strike extensions to the Da Vinci discovery made in 2017, which has recently been included in the Deflector mine plan (seeASX releasedated 31 January 2019).

The Spanish Galleon programme consisted of two traverses across the previously defined oxide zone anomalism. The Deflector Southwest programme consisted of three sections orientated obliquely across the Deflector local grid in order to optimally test the reinterpreted orientation of the mineralised structure. The Da Vinci North programme consisted of three sections of RC directly along strike from the previously defined Da Vinci Mineral Resource.

Figure 1. Location diagram of recent near-mine exploration RC drilling programmes at the Deflector Gold Copper Mine

Spanish Galleon

The Spanish Galleon prospect is located approximately 500m to the west of the southern end of the Deflector deposit. Historical aircore and limited RC drilling had previously identified a coherent zone of gold and copper mineralisation within the base of the transition zone, along an apparent parallel trend to Deflector. While part of the broader overall Deflector corridor, the host rocks to mineralisation at Spanish Galleon are lower in the stratigraphic sequence than those at Deflector. Lithologies intersected by drilling include a series of basalt flows with minor interstitial sediment units along the contact with the basal ultramafic. The prospect is cross-cut by the same dolerite dyke that transects between Deflector and Da Vinci mineralisation.

Two RC traverses were drilled across the Spanish Galleon sequence, with 16 holes drilled for 3,105m. Drilling was successful in confirming and expanding the known extent of supergene mineralisation present at Spanish Galleon. Several narrow primary zone intersections were also returned, indicating the presence of narrow vein host structures at depth. Several significant intersections were returned from the drilling, including:

• • DERC0299 - 1m @ 9.0g/t Au and 0.1% Cu from 52mdh (Supergene)

• • DERC0303 - 1m @ 7.3g/t Au and NSA Cu from 37mdh (Supergene)

• • DERC0300 - 3m @ 3.8g/t Au and 0.4% Cu from 112mdh (Primary Mineralisation)

• • DERC0305 - 1m @ 4.8g/t Au and NSA Cu from 141mdh (Primary Mineralisation)

• • DERC0302 - 5m @ 2.6g/t Au and 0.2% Cu from 60mdh (Supergene)

RC drilling was hampered by the presence of extensive groundwater, which prevented the planned "overlap" of deep RC holes to satisfactorily orientate these primary host structures. As illustrated in the cross section in Figure 2, primary mineralisation appears to be located along the steeply east dipping contacts between the basalt and thin sediment unit, as well as the basalt and ultramafic unit. As a result of the inability to adequately test the primary mineralisation by RC methods, it is planned to drill a series of diamond tails on the existing RC holes to extend coverage at depth and allow for detailed examination of the host and style of mineralisation present at Spanish Galleon as compared to Deflector.

Figure 2. Spanish Galleon prospect, cross section 4160mN, with interpreted geology and recent significant intersections in red and historic significant intersections in black. Note Cu NA - Copper not assayed in historic drilling

Deflector Southwest

The Deflector Southwest target is centred on an historic drill intersection previously reported in 2014, whereby diamond drill hole 14DEFDD015 intersected Deflector style quartz veining and massive chalcopyrite-pyrite sulphides within a basalt host rock. Assays from 14DEFDD015 returned 3.1m @ 9.9g/t Au and 7.5% Cu (see ASX: MYG release dated 27 August 2014). Recent re-logging of the intersection, coupled with the greater understanding of styles of mineralisation at Deflector, led to a revised interpretation of the possible strike and dip. This newly interpreted orientation had not been adequately tested by previous drilling.

As a result of this new work, an RC drilling programme was designed to test the interpreted structure. A total of 9 holes for 1,821m were drilled. Drilling intersected a number of mineralised structures within the host basalt sequence (see Figure 3). Importantly, visible copper sulphide mineralisation was intersected along the interpreted Deflector Southwest structure. Significant intersections returned include:

• • DERC0318 - 1m @ 11.3g/t Au and 4.4% Cu from 102mdh

• • DERC0319 - 2m @ 6.1g/t Au and NSA Cu from 224mdh

• • DERC0322 - 5m @ 3.2g/t Au and 0.1% Cu from 239mdh

The nature of these structures is consistent with those observed at the Deflector underground mine and clearly indicates a continuation of the mineralised system to the southwest. As a follow-up to this RC programme, the plan is to drill a series of surface diamond drill holes along a similarly oblique orientation to gather additional geological as well as structural data.

Figure 3 Deflector Southwest prospect cross section, illustrating previous Mutiny and Doray drilling with new significant RC intersections. Note the presence of multiple mineralised structures.

Da Vinci North

Following on from the successful estimation of the Da Vinci Mineral Resource and subsequent inclusion of this material into the Deflector production plan, a series of RC drill lines was designed to test for a northern continuation of economic mineralisation. Underground drilling and development of the western Da Vinci lode had indicated that mineralisation was stoped out by an intrusive diorite unit to the north. As such, it was interpreted that mineralisation could still be open along strike.