MGX, Belmont drill first Kibby hole to 1,798 ft

Aug 28, 2018

2018-08-27 06:50 ET – News Release

Also News Release (C-BEA) Belmont Resources Inc (3)

Mr. Jared Lazerson of MGX reports

MGX MINERALS ANNOUNCES COMPLETION OF FIRST HOLE TO 1800A AT KIBBY BASIN, NEVADA LITHIUM BRINE PROJECT

MGX Minerals Inc.’s joint venture partner Belmont Resources Inc. has provided an update. Drilling has reached a depth of 1,798 feet (548 metres) into the playa sediments in hole KB-3, the first hole of the 2018 drilling program at Kibby basin. The first section of the hole was drilled to a depth of 1,270 feet using a mud rotary method, and the remaining 528 feet were completed with a diamond core tail. A total of 126 samples of drill cuttings from the mud rotary section of the hole have been collected and shipped to ALS Global lab facility in Reno, Nev., for assaying. Lithium and multielement assay results from these samples will be compiled once testing is complete.

The borehole targeted the southern portion of a large MT (magnetotelluric) conductor, which may represent saturated sediments containing lithium brine. The hole drilled through lacustrine playa sediments — dominantly calcareous clays and silts grading to lithified claystone’s and siltstones at depth. Sand and gravel zones, which may represent brine-bearing aquifers, were encountered at depths of 150 to 170 feet, 210 to 230 feet, 260 to 300 feet and 900 to 920 feet, where a potential aquifer in a cobble gravel was intersected.

Oxidized clay zones at 400 to 640 feet and several thinner zones of clay deeper in the hole are being evaluated as potential lithium-bearing bedrock mineralization. Thin intervals of altered rhyolite ash and possible hot spring sinter were encountered at 1,411 to 1,412 feet, 1,488 to 1,490 feet and 1,589.5 to 1,590 feet. Operation of a paleo-geothermal system is evidenced by the silicified intervals and fronts of pyrite and magnetite alteration increasing below a depth of 1,500 feet.

A downhole geophysical survey including gamma-caliper-temperature-fluid resistivity and SP (spontaneous potential), SPR (single-point resistance) logging will be conducted on the hole to identify permeable aquifer zones and conductive brine zones. Water samples will be collected after the geophysical logging and will be assayed for lithium, associated elements and physical properties. Sections of drill core from 1,270 to 1,798 feet will be split and similarly assayed as above.

About the Kibby basin lithium brine partnership

MGX is partnered with Belmont Resources on the property and currently earning a 50-per-cent interest with the goal of forming a 50/50 joint venture to utilize MGX’s rapid lithium extraction technology. Kibby basin is located in the western portion of the Great basin in Nevada. The property covers 2,560 acres located in Esmeralda county, Nevada. Kibby Flat is a dry playa and no springs or water sources occur on the property. Geothermal research by the Nevada Bureau of Mines and Geology (NvBMG) identified three wells and springs in the region. All three sources indicated near-surface water. Nevada has abundant geothermal resources and NvBMG compilation has outlined areas with potential heat flow, based on surface temperatures of springs, drill hole water temperatures, geothermal-related geochemical signatures and associated geologic settings. These areas suggest zones of potential elevated heat flow.

Geologic research of the Kibby basin has indicated that proximal rhyolitic flows and tuffs surrounding the basin could be a potential source of lithium brine in the Kibby basin playa. In addition, the Kibby basin is located within a geothermal cluster at a basin low setting. Regional geophysical signatures in the area reflect similar anomalies comparative to that of Clayton Valley, approximately 50 kilometres to the south, location of Abermarle’s Silver Peak mine, the only North American lithium producer.

Rapid lithium brine extraction technology

MGX has developed a rapid lithium extraction technology eliminating or greatly reducing the physical footprint and investment in large, multiphase, lake-sized, lined evaporation ponds, as well as enhancing the quality of extraction and recovery across a complex range of brines as compared with traditional solar evaporation. This technology is applicable to petrolithium (oil and gas waste water), natural brine, and other brine sources such as lithium-rich mine and industrial plant waste water. The technology was recently chosen as winner of the base and specialty metals industry leadership award at the 2018 S&P Global Platts Global Metals awards, held in London in May (see press release dated May 18, 2018).

About the Kibby basin lithium joint venture

MGX will acquire a 25-per-cent interest in the project by spending $300,000 on exploration and 50 per cent by incurring an additional $300,000 in exploration expense at which time the project will become a 50/50 joint venture. Upon formation of a joint venture, MGX will become the project operator and can elect to conduct additional exploration drilling, well testing operations and extraction plant installation. Additionally, MGX will provide access to its rapid lithium extraction technology (see press release dated July 13, 2018).

Qualified person

Andris Kikauka, PGeo, vice-president of exploration for MGX Minerals, has prepared, reviewed and approved the scientific and technical information in this press release. Mr. Kikauka is a non-independent qualified person within the meaning of National Instrument 43-101 standards.

About MGX Minerals Inc.

MGX Minerals is a diversified Canadian resource company with interests in advanced material and energy assets throughout North America.

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