Dragon Mountain Gold : Avalon Exploration Update and Drill Results

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ASX: DMG

only Contacts:

Robert Gardner

useChairman

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com.au personalFor

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Dragon Mountain Gold

Limited, ACN: 111 005 282

182 Claisebrook Road, Perth WA 6000

1 February 2022

AVALON PROJECT EXPLORATION UPDATE

Dragon Mountain Gold Ltd (Dragon Mountain; the Company) (ASX: DMG), a gold exploration company with projects in the Eastern Goldfields of Western Australia, provides the following exploration update and drill results from its inaugural exploration program at its Avalon Project.

The Avalon Project is located in Bulong, WA, approximately 35kms east of Kalgoorlie and comprises five granted Mining Leases of approximately 43.4km2.

The tenement group is host to the Bulong Nickel laterite deposits which were previously mined. The Avalon Project is contained within the Bulong Nickel Operation area and as a result, there has been virtually no exploration at depth for gold since the 1990's. Almost all drilling in the area in the ensuing years, when the focus was on nickel, was vertical and gridded, providing limited useable information for gold.

Dragon Mountain's exploration program commenced on 26 October 2021 and the Company completed 29 Reverse Circulation (RC) holes for 3,055m testing the first Bulk Leach Extractable Gold (BLEG) anomaly.

Figure 1: Drill Program Design

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Mineralisation is thought to be associated with a structurally enhanced, distinct lithogeochemical package and the holes were targeted to intercept mapped or interpreted secondary and splinter faults associated with the major Bulong Fault in fresh rock (80m+). Alteration was intersected in several holes well below the laterite profile and interpreted as structures which could be secondary or splinter faults.

Figure 2: Avalon Project BLEG N Prospect Section 2

Upper

Laterite

Profile

Paleo Surface/Channel

Lower Laterite Profile

Fresh Komatiite Contact

Fresh Komatiite

Elevated Au

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Figure 3: Avalon Project BLEG N Prospect Section 14

Porphyry

Elevated Au

Geochemical results to date show the area has a gold endowment similar to the BLEG anomaly data. The Company is waiting on some 1m assays from 4m composites and will use data from this first exploration program to build a 3D picture of structure and mineralisation in this area, and combine it with lithology and geochemistry associations for further target generation.

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Table 1: Significant Intercepts from Drill Programme (Greater than 0.08 ppm)

	Tenemen									Downhole
Project	t	Easting	Northing	Elevation	Dip	Azi	Hole ID	From	To	Width (m)	Au (ppm)
Avalon	M25/78	386645	6610625	431	-60	40	DMGA2106	20	24	4	0.365
Avalon	M25/78	386581	6610630	431	-60	40	DMGA2105	48	52	4	0.164
Avalon	M25/78	386525	6610943	431	-60	30	DMGA2131	0	4	4	0.122
Avalon	M25/78	386535	6610960	431	-60	35	DMGA2123	44	48	4	0.104
Avalon	M25/78	386585	6610675	431	-60	40	DMGA2108	16	20	4	0.099
Avalon	M25/78	386710	6610895	431	-60	35	DMGA2117	0	4	4	0.099
Avalon	M25/78	386571	6610960	431	-60	35	DMGA2119	0	4	4	0.098
Avalon	M25/78	386641	6611020	431	-60	40	DMGA2101	0	4	4	0.093
Avalon	M25/78	386653	6610876	431	-60	30	DMGA2122	0	4	4	0.089
Avalon	M25/78	386581	6610630	431	-60	40	DMGA2105	28	32	4	0.082

Commenting on results from the program, Dragon Mountain's Chairman Robert Gardner said: "Results from the Company's first drill program at Avalon are disappointing, however we still believe the BLEG results reflect an area with high potential for significant gold mineralisation and the next stage of exploration will test this area immediately west of the Bulong Fault.

"The Company will now rework the modelling and revise targets and then continue the RC program at depth," he said.

The next stage of exploration is expected to commence Q1, 2022.

ENDS

This announcement is approved for release by the Board.

Robert Gardner

Chairman

Competent Person Statement

The information in this report that relates to Exploration Results is based on, and fairly represents, information and supporting documentation reviewed by Mr Timothy Bevis, Consultant, Galt Mining Solutions. Mr Bevis is a member of the Australian Institute of Mining and Metallurgy and he has sufficient experience which is relevant to the style of mineralisation and type of deposits under consideration and to the activity which has been undertaken 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". Mr Bevis consents to the inclusion in this release of the matters based on the information in the form and context in which they appear.