UPDATED NI 43-101 REPORT FOR CHU CHUA UPDATED RESOURCE ESTIMATE AND DRILLING PLANNED FOR 2022

VANCOUVER, BC, Dec. 16, 2021 /CNW/ - Newport Exploration Ltd ("Newport" or "the Company") is pleased to report on the summary results of an updated NI43-101 Technical Report (the "Report") and an updated mineral resource estimate for the Chu Chua massive sulphide deposit ("Chu Chua"), located near Barriere, BC, as estimated by APEX Geoscience Ltd. ("APEX") of Vancouver, BC. Newport has a 100 percent (%) interest in Chu Chua which is subject to two separate 1% Net Smelter Return ("NSR") royalties.

An updated pit constrained mineral resource estimate for Chu Chua completed by Mr. Nicholls of APEX comprises an inferred mineral resource of 2.29 million tonnes averaging 2.11% copper, 0.3% zinc, 9.99g/t silver and 0.5g/t gold, at a copper block cut-off grade of 1.0%.

The report has been prepared for Newport for the purpose of a valuation for Chu Chua and for planning future technical work on the project in 2022. This news release summarizes the highlights of the Report titled: Technical Report on the Chu Chua Property, Kamloops Mining Division, British Columbia, which is available under Newport's Issuer Profile on SEDAR (www.sedar.com).

NI 43-101 Technical Report

During 2021, APEX was retained by Newport to complete an updated NI 43-101 report and update the mineral resource estimate for Chu Chua. The authors of the report, Mr. Kristopher Raffle, B.Sc., P. Geo., Mr. Steve Nichols, BA.Sc (Geology) MAIG, and Mr. Alfonso Rodriguez, M.Sc., P. Geo., of APEX are all independent qualified persons as defined by the Canadian Securities Administration (CSA) National Instrument43-101. Specifically, Mr. Raffle supervised the 2011 re-sampling of historic core and data verification and conducted property visits during 2008 and 2012, Mr. Rodriguez conducted the most recent property visit in July 2021, and the mineral resource estimation of the Chu Chua mineralized zone was completed by Mr. Nichols.

The Report has been written in accordance with the requirements of the NI43-101 Standards of Disclosure for Mineral Projects, and is a technical summary of the available geological, geophysical, and geochemical data relevant to the Project. Mr. Raffle P.Geo., of APEX Geoscience Ltd. is the Qualified Person who has reviewed and verified the technical information contained in this new release. 

The Chu Chua Property

Chu Chua consists of two active mineral claims totaling 282.5 hectares (ha); located 24 km northeast of Barriere, BC.  The property is host to the Chu Chua deposit; a Cyprus-type volcanogenic massive sulphide body first discovered in 1978. Chu Chua comprises several mineralized lenses oriented along a north-south trend and dipping from vertical to very steeply to the west.

A total of 99 diamond drill holes, totaling 19,707m were completed to delineate the Chu Chua deposit between 1978 and 1982 by Craigmont Mines Ltd. ("Craigmont") and between 1988 and 1991 by Minnova Inc. ("Minnova").

Within the current boundaries of Chu Chua, 89 drill holes totalling 17,782.51m have been drilled for mineral exploration. The drilling defined two areas of relatively thick, high grade sulphide mineralization occurring within 100 m of the surface.

Additional drilling to test the grade, thickness, lateral and depth extent, and continuity of the deposit was completed by Minnova Inc. (Minnova) between 1988 and 1991. Minnova drilled a total of 46 holes (8,887 m) during the period. Selected significant drilling at Chu Chua included intercepts[1] of:

• Drill hole CCF-37 which yielded 10.04% copper, 46.3 g/t silver, and 3.44g/t gold over 1 m.
• Drill hole CCF-33 which yielded 10.37% copper, 27.1g/t silver and 1.23g/t gold over 3.4 m.
• Drill hole CC-17 which yielded 14.54% copper, 9.3g/t silver and 1.03g/t gold over 4.2 m.
• Drill hole CC-31 which yielded 8.62% copper, 62.0g/t silver and 0.69g/t gold over 1.6 m.
• Drill hole CCF-19 which yielded 4.53% copper, 13.9g/t silver and 0.36g/t gold over 25.0 m.
• Drill hole CCF-22 which yielded 3.89% copper, 16.35 g/t silver and 1.2 g/t gold over 28.5 m.

Updated Mineral Resource Estimate

The mineral resource modelling and estimation was carried out using a 3-dimensional block model, using commercial mine planning software Micromine. The mineral resource estimate comprises an inferred mineral resource of 2.3 million tonnes averaging 2.11 % copper, 0.30 % zinc, 9.99 g/t silver, 0.50 g/t gold at a copper block cut-off grade of 1.0% (Table 1).

Mineral resources were classified in accordance with guidelines established by the Canadian Institute of Mining, Metallurgy and Petroleum ("CIM") Council in "Estimation of Mineral Resources and Mineral Reserves Best Practice Guidelines" dated November 29, 2019, and "Definition Standards for Mineral Resources and Mineral Reserves" dated May 10th, 2014, and prescribed by the Canadian Securities Administrators' NI 43-101 and Form 43-101F1, Standards of Disclosure for Mineral Projects. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability. It is reasonably expected that the majority of the inferred mineral resources could be upgraded to indicated mineral resources with continued exploration. There is no guarantee that any part of the mineral resources discussed herein will be converted into a mineral reserve in the future.

Table 1. Mineral Resource Estimate (August 1, 2021, effective date) for the Chu Chua Deposit (reported at 1.0 % Cu lower cut off and reported within a Lerchs-Grossman (LG) optimized pit shell using USD $4/lb Copper, USD $1.2/lbs Zinc, USD $1,700/oz Gold and USD $25/oz Silver prices.)

The mineral resource modelling and estimation was carried out using a 3-dimensional block model, using commercial mine planning software Micromine (version 12.05.03 and version 21.0.5.49 for pit optimization). The Chu Chua mineralized zone block model utilized a parent block size of 2 m (X) x 25 m (Y) x 10 m (Z) with sub blocking down to 0.5 (X) m x 2.5 m (Y) x 1 m (Z).  The resource modelling utilized 55 historic core holes completed between 1978 and 1990, of which 50 were used in the resource estimation. Drill line spacing varies from 10 m to 45 m, with an average of approximately 20 m between drill lines. A total of 251 composites of 5m length, capped at 5.9% copper, 0.86% zinc, 32g/t silver and 1.4g/t gold, were used for the estimation. The mineral resource was estimated using ordinary kriging with a three-dimensional mineralization envelope, defined by similar geological characteristics in terms of alteration and mineralogy, using a 0.5% copper cut-off grade. The search ellipsoids were used for grade interpolation into 2 m (X) x 25 m (Y) x 10 m (Z) parent blocks. All blocks were classified as being in the inferred category. A total of 464 bulk density measurements were used to calculate the average for each of three modeled massive sulphide lenses. The average density of each of the three lenses varied from 4.33 to 4.73 g/cm3.

The mineral resources are sensitive to the selection of the reporting cut-off grade as demonstrated in Table 2. The reader is cautioned that the figures provided in Table 2 should not be interpreted as a statement of mineral resources. Quantities and estimated grades for different cut-off grades are presented for the sole purpose of demonstrating the sensitivity of the resource model to the choice of a specific cut-off grade.

Table 2. Reported Resource with various cut-off grades

Mining and Processing Parameters used for the LG Pit Optimization

To demonstrate that the Chu Chua deposit has reasonable prospects for future economic extraction the unconstrained resource block model was constrained using the Lerchs-Grossman ("LG") pit optimization algorithm implemented in Micromine v2021 with the following mining costs and mineral processing parameters as shown in Table 4, which are considered reasonable for a Copper, Zinc, Gold, and Silver deposit.

Table 4. Mining and Processing Parameters for LG Pit

Risks and Uncertainties

Factors that may affect the mineral resource estimates include: metal price assumptions, changes in interpretations of mineralization geometry, continuity of mineralization zones, changes to kriging assumptions, metallurgical recovery assumptions, operating cost assumptions, confidence in the modifying factors, including assumptions that surface rights to allow mining infrastructure to be constructed will be forthcoming, delays or other issues in reaching agreements with regulatory authorities and stakeholders, and changes in land tenure requirements or in permitting requirements.

There is no guarantee that diamond drilling will result in the discovery of additional mineralization, or an economic mineral deposit. However, there are no significant risks or uncertainties that could reasonably be expected to affect the reliability or confidence in the currently available exploration information with respect to the Chu Chua Property.

Metallurgy

Past metallurgical flotation tests achieved copper recoveries to a maximum of 92.2%; with gold and silver recoveries of 35.5% and 61.3% respectively. A single preliminary cleaner flotation test produced a 22.4% copper concentrate.

Further Exploration Drilling

To date, mineralization has been modeled over a 450M strike length and to a depth of 180M from surface. Additional drilling is warranted to define the extent of near surface mineralization at the north end of the deposit at depth within and beneath the currently modelled Main Lens, and to the south of the property where limited deep drilling encountered sulphide intercepts. Drilling will be aimed at converting some of the resource into an indicated category and to test the lateral and depth extent of known sulphide mineralization.

At this time a total of twelve holes are recommended for a total of 3,000m, with an estimated cost of approximately Cdn$1,050,000.

Other Considerations

The Chu Chua project has a favorable location for access, power, water, a labor force, and other assumptions derived from deposits of similar type and scale, as well as projects currently being operated in the area.  Accordingly, APEX considers Chu Chua to be prospective for development.

"Some of the drill intercepts at Chu Chua have yielded spectacular copper and silver grades, and with current metal prices, as well as its location and infrastructure, it is worth exploring Chu Chua's enormous potential, and we could do this ourselves or by way of joint venture opportunities", stated Ian Rozier, President and CEO of Newport.

Qualified Person

The scientific and technical information contained in this news release as it relates to the Chu Chua Property has been reviewed and approved by Kristopher J. Raffle, P.Geo. (BC) Principal and Consultant of APEX Geoscience Ltd. of Edmonton, AB, and a "Qualified Person" as defined in National Instrument 43-101 – Standards of Disclosure for Mineral Projects. Mr. Raffle verified the data disclosed which includes a review of the analytical and test data underlying the information and opinions contained therein.

About Newport

As well as its 100% ownership of Chu Chua, Newport owns a 2.5% Gross Overriding Royalty ("GOR")  over oil and gas producing permits in the Cooper Basin, Australia, operated by Beach Energy Ltd. There is no time limit or expiry date on the GOR assets, and no cost to the Company to retain them. The Company pays quarterly dividends commensurate with the royalty payments received.

The Company currently has 105,579,874 common shares issued and outstanding and $3.9 million in the treasury (comprised of cash, cash equivalents and short term investments), and no debt.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the accuracy or adequacy of this news release.

Cautionary Statement on Forward-Looking Information

This news release is intended to provide readers with a reasonable basis for assessing the future performance of the Company. The words "believe", "should", "could", "expect", "anticipate", "contemplate", "target", "plan", "intends", "continue", "budget", "estimate", "may", "will", "schedule" and similar expressions identify forward-looking statements. Forward-looking statements may pertain to assumptions regarding Beach's drilling plans, future dividends, the price of oil and fluctuations in currency markets (specifically the Australian dollar). Forward-looking statements are based upon a number of estimates and assumptions that, which are considered reasonable by the Company, are inherently subject to business, economic and competitive uncertainties and contingencies. Factors include, but are not limited to, the risk of fluctuations in the assumed prices of oil, the risk of changes in government legislation including the risk of obtaining necessary licences and permits, taxation, controls, regulations and political or economic developments in Canada, Australia or other countries in which the Company carries or may carry on business in the future, risks associated with developmental activities, the speculative nature of exploration and development, and assumed quantities or grades of reserves. Readers are cautioned that forward-looking statements are not guarantees of future performance. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those acknowledged in such statements.

The Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except to the extent required by applicable laws.

© 2021 Newport Exploration Ltd.

SOURCE Newport Exploration Ltd.

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