Empire Resources : Annual Report to shareholders

EMPIRE RESOURCES LIMITED

ABN 32 092 471 513

Annual Report

30 June 2022

EMPIRE RESOURCES LIMITED

Corporate Directory

Directors

Company Secretary

Registered Office

Auditor

• Michael Ruane Sean Richardson Jeremy Atkinson
• Simon Storm
• Registered Office and Principal Place of Business 159 Stirling Highway
  Nedlands WA 6009
  Telephone: [phone]
  Email [e-mail] Website www.resourcesempire.com.au
• HLB Mann Judd (WA Partnership) Level 4
  130 Stirling Street Perth
  WA 6000

Share Registry	:	Automic Group
		Level 5
		191 St Georges Terrace
		Perth
		WA 6000
		Telephone: [phone]
Australian Securities Exchange	Home Branch: Perth

Code: ERL

ABN

:

32 092 471 513

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Empire Resources Limited

Review of Operations

Figure 1: Project Location Map

Empire Resources Limited (ASX:ERL) is a gold and copper focussed exploration and development company. Empire owns four highly prospective projects. The Yuinmery Copper-Gold Project 470km northeast of Perth in the Youanmi Greenstone Belt, the Barloweerie multi-element precious and base metal project, the Nanadie Copper-Gold Project southeast of Meekatharra in the Murchison Region and the Penny's Gold Project 45km northeast of Kalgoorlie in the prolific Eastern Goldfields Region of Western Australia. Empire's projects have numerous exploration targets with excellent potential.

Empire has an experienced team of exploration, development and financial professionals who are committed to developing a sustainable and profitable mineral business. Empire seeks to extract value from direct exploration in its existing projects as well as identifying value accretive investment opportunities that complement the Company's development objectives.

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Empire Resources Limited

Review of Operations

Penny's Gold Project (WA)

The Penny's Gold Project is located 45km east of Kalgoorlie, Western Australia within the north-northwest trending Gindalbie greenstone belt consisting of a sequence of mafic-ultramafic volcanic rocks with intercalated horizons of felsic volcanic rocks and metasediments. The sequence has been subjected to multiple deformation events resulting in significant folding, pronounced foliation, and a northerly plunging mineral lineation. To the east of the project is the GMQ shear where subsidiary structures are common and locally appear to influence spatial distribution of gold mineralisation, particularly where structures intersect or bifurcate. Outcrop within the project area is poor with the regolith dominated by a deeply dissected laterite weathering profile and the subsequently derived colluvial products.

Gold mineralisation at Penny's Gold project occurs within a lower order northwest trending shear that intersects a northerly trending structure. This structure is interpreted to continue to the north through the project area. To the east of this structure and within the project area lie multiple northerly and northwest trending structures interpreted from reprocessed aeromagnetic data.

Yuinmery Project (Cu-Au)

The Yuinmery Copper-Gold project is located in the Mid-West region of Western Australia and consists of six granted tenements, two mining and four exploration, for a total area of 106.7 km2. The project has a current JORC 2012 Resource of 2.52Mt @ 1.31% Cu, 0.49g/t Au and 1.76g/t Ag using a 0.5% Cu cut-off.

The Yuinmery project area covers the eastern portion of the Archaean Youanmi greenstone belt with rock types consisting largely of mafic and ultramafic volcanics with altered chloritic felsic and intermediate volcanic units. The volcanic units contain a number of intercalated strongly sulphidic cherty sediments, which are host to Volcanic Massive Sulphide (VMS) copper-gold mineralisation. The project area lies between the Youanmi Shear zone (western boundary) and the Yuinmery Shear zone (eastern boundary) with the southern area covering the southern closure of a northerly plunging syncline.

Empire's improved understanding of the geology, alteration characteristics and structure at Yuinmery, paired with discovery of new Cu-Au,Cu-Ni and PGM occurrences have now expanded the Company's opportunities to target previously untested areas. Of significance is the evolution of Empire's conceptual models of VMS deposits, layered PGM occurrences and orogenic gold mineralisation used to target exploration.

Barloweerie Project (Zn-Pb-Ag-Au-Cu)

The Company has one granted exploration licence and three exploration tenements in application. The total package is 533km2 and is located approximately 155km west of Cue, WA.

The exploration licences cover part of the Barloweerie greenstone belt where historical exploration discovered highly anomalous zinc, lead, silver, gold and copper mineralisation in a volcanogenic massive sulphide (VMS) setting. The Barloweerie Project has had limited modern exploration since 1987 when strong mineralisation was encountered in RC and diamond drilling, including:

• 5m @ 4.8% Zn from 38m (SDH34)
• 1m @ 3.9% Pb from 15m (SDH19)
• 5m @ 100.0g/t Ag from 28m (SDH31)
• 2m @ 0.58% Cu from 19m (SDP8)

Nanadie Project (Cu-Au)

The Company has three granted exploration licence totalling 127.3km2 located approximately 65km east of Meekatharra, WA.

The Nanadie Copper-Gold Project partially overlies the Barrambie Greenstone Belt which consists of a 1-4km wide sequence of strongly sheared chlorite-quartz-muscovite schists, amphibolites, BIF's and ultramafics. Much of the tenement is covered by aeolian sand, sheetwash and calcrete.

Empire's Nanadie Copper-Gold Project lies immediately along strike from Cyprium Metals Limited (ASX:CYM) Nanadie Well Copper Project. Cyprium's Nanadie Well Copper Project has a JORC 2004 Inferred Resource of 40.4Mt @ 0.40% Cu & 0.10g/t Au containing 162,000 tonnes of copper and 130,000 oz of gold (refer to ASX:CYM "Nanadie Well Mineral Resource Estimate" 19 July 2022).

The sequence hosting the Nanadie Well deposit is interpreted to continue north into Empire's tenure. A regional shear, informally known as the Nanadie Well Regional Shear traverses the project from north to south. Several geochemical and geophysical anomalies have been identified along the Nanadie Well Regional Shear that warrant further investigation.

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Empire Resources Limited

Review of Operations

INVESTMENTS

Dacian Gold Ltd

The Company has sold 13,035,000 shares in Dacian Gold Limited (ASX:DCN), realising proceeds of $2,906,112. Empire's holding in DCN at 30 June 2022 was nil.

Penny's Find Royalty

The Company previously part owned and mined the Penny's Find Gold Mine. The mine was subsequently sold and as part of the settlement, Empire is entitled to a 5% ad valorem royalty payment on gold and silver produced from the Penny's Find Gold Mine up to the first 50,000 oz of gold recovered, and 2.5% on gold and silver produced above that amount.

The Penny's Find Gold Mine is now 100% owned by Horizon Minerals Ltd (ASX:HRZ). Empire looks forward to further development of the Penny's Find Gold Mine throughout 2022.

CORPORATE ACTIVITIES

Share Issue

In December 2021, 73,668,414 shares were issued at 1.2 cents raising $884,022 before share issue costs.

In February 2022, 56,153,658 shares were issued at 1.2 cents raising $673,844 before share issue costs.

Loan Facility

The original investment in DCN was funded from cash reserves and an unsecured loan of $1.5M provided by Empire's Non-Executive Chairman and major shareholder, Dr Michael Ruane.

The key terms and conditions of the loan facility were as follows:

Commencement Date:	11 July 2019.
Lender:	Kesli Chemicals Pty Ltd
Term:	12 months
Interest Rate:	7.5% per annum. Interest accrues daily on outstanding money and will be paid quarterly in
	arrears.
Security:	The loan money and interest are unsecured.
Purpose:	Board approved payments for working capital, direct exploration and investments.

The term was extended indefinitely in July 2020. The loan plus interest was repaid in September 2021.

Project Assessment

Empire continued to assess opportunities in the Eastern Goldfields of Western Australia complimentary to its existing portfolio. The Company assessed several prospective projects during the quarter.

COMPETENT PERSON STATEMENTS

The information in this report that relates to Exploration Results is based on information compiled and/or reviewed by Mr Mark Shelverton, who is a Member of the Australian Institute of Geoscientists. Mr Shelverton is a full-time employee of Empire Resources and has sufficient experience that is relevant to the style of mineralisation and type of deposits under consideration and to the activity 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". Mr Shelverton consents to the inclusion in this presentation of the matters based on this information in the form and context in which they appear.

The information is this release concerning the Mineral Resources for the Just Desserts deposit has been estimated by Mr Peter Ball B.Sc who is a director of DataGeo Geological Consultants and is a member of the Australasian Institute of Mining and Metallurgy (AusIMM). Mr Ball has sufficient experience which is relevant to the style of mineralization and type of deposit under consideration and qualifies 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 Ball consents to the inclusion in this public release of the matters based on his information in the form and context in which it appears.

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