Blackham Resources Ltd.: Large Pit Growing in Size and Grade

Perth - Blackham Resources Ltd. (ASX:BLK) (OTCMKTS:BKHRF) ("Blackham") is pleased to provide a revised Mineral Resource estimate for the East and West lodes at the Matilda/Wiluna Gold Operation. Mineral Resource estimates are currently underway for the Happy Jack - Bulletin and Adelaide - Moonlight areas and will be reported later this quarter.

Highlights

- Open pit resources within an A$1,800/oz pit shell for East and West lodes now sit at 8.5Mt @ 2.83g/t for 770Koz (76% Indicated)

o high grade for an open pit

o 23% increase in diluted grade from previous model

o 80% of the resource falls into a A$1,400/oz pit shell

o Pit designs and Ore Reserves are nearing completion

- Open pit resources for all the Wiluna lodes now 12.9Mt @ 2.8g/t for 1.2Moz

The latest Mineral Resource estimate for the East and West Lodes is reported within an A$1,800/oz optimised pit shell and is based on an additional ~30,000m of RC and diamond drilling completed between January and May 2017. This drilling has resulted in a significant improvement in the confidence level of the Mineral Resource with 76% now classified as Indicated. Mining studies which will allow an initial open pit Ore Reserve estimate for the East and West Lode are nearing completion.

Managing Director Bryan Dixon said "Since drilling commenced in September last year a total of ~$4M has been spent on Resource and Reserve definition drilling on the East and West lodes. In this time the Mineral Resource has grown 860% in less than a year from 80,000oz to 770,000oz of which 76% is classified as Indicated. This represents a very attractive resource addition cost of $5.80/oz. This large resource base provides a very solid basis for the expansion plans with the Expansion PFS to be released this month."

Wiluna Resource Update

Following successful drilling campaigns, Measured, Indicated and Inferred Resource estimates have been updated for the East and West Lodes at the Wiluna Gold Project. Drilling during 2017 has focused on improving the confidence level of the Mineral Resource Estimates to allow Ore Reserves to be estimated as part of the expansion study. Resource estimates for the Bulletin - Happy Jack, Squib, Essex and Golden Age lodes are underway and will be reported later this quarter.

Cube Consulting were engaged to produce the gold grade estimate for the Mineral Resource based on a mineralisation interpretation completed by Blackham geologists. The Mineral Resource was classified with guidance from Cube. The East-West open pit Mineral Resources reported within an A$1,800/oz optimised pit shell are now 8.5Mt @ 2.83g/t for 770Koz of which 76% is classified as Indicated. As drilling targeted mineralisation which is likely to fall within a pit, the underground Mineral Resource which contains all mineralisation beneath the A$1,800/oz optimised pit shell is essentially unchanged.

A review of a range of optimised pit shells show that the East-West pits are relatively insensitive to gold price. As shown in Figures 1-4 (see link below), the A$1,400 pit shell is only slightly smaller than the A$1,800/oz pit shell, and contains 80% of the ounces, indicating that Resource to Reserve conversion is likely to be high.

A breakdown of the East - West Mineral Resource estimate is provided in Table 1 (see the link below) and compared with the previous Mineral Resource estimate from December 2016.

Previous Mineral Resources for the Wiluna deposits have been estimated using Ordinary Kriging (OK). However, a review of the December resource model by Cube Consulting suggested that although OK is an industry standard estimation method it may not be the most suitable method for the East and West Lodes due to the relatively high gold grade variability evident within the lodes. Under these circumstances, OK does not reflect the inherent variability of the orebody and tends to produce over-smoothed block grade estimates. Cube recommended that Localised Uniform Conditioning (LUC) would be a more appropriate estimation method to better predict the grade-tonnage distribution which could be expected during mining. The LUC process, as implemented in this case, has resulted in a Mineral Resource estimate that accounts for the majority of the anticipated dilution.

Both the East and West lodes have been mined historically from underground which will potentially result in open voids within the planned pit. In this estimate, mineralisation immediately adjacent to historical stopes has been classified as Inferred due to uncertainty associated with the application of mining factors allowing economic extraction around the voids. This mineralisation had been classified as Indicated in the previous estimate. The significantly higher grade of Inferred compared with Indicated mineralisation in this estimate is primarily due to the occurrence of high grade mineralisation immediately adjacent to these historical stopes. Of the 180,000oz Inferred material within the A$1,800/oz pit shell, 108,000oz (943Kt @ 3.56g/t) lies adjacent to previously mined stopes.

Many of the historical stopes intersected during mining of both the East and West pits by Newmont in the late 1990s were discovered to have been back-filled with material grading between 4g/t and 8g/t gold. Close spaced probe drilling by both Newmont and Apex found that most of the historical stopes beneath the current floor of the East pit have also been back-filled. Assays from this drilling indicate that the backfill contains significant mineralisation with gold grades similar to that of the previously mined backfill. However, for the purposes of this estimate the backfill has been treated as waste and assigned a grade of 0.0g/t for the pit optimisations and resource block models. Blackham is progressing work to confirm evidence of backfill within stope voids with potentially higher grades than the existing resource. This work will continue to strengthen and de-risk the already significant resource.

Drilling completed for the December 2016 Mineral Resource estimate identified significant zones of mineralisation between the East and West Lodes. Understanding of the orientation of this mineralisation was limited at that time due to data constraints and consequently it was not included in the previous Mineral Resource estimate. Drilling completed between January and May 2017 targeting this mineralisation has since confirmed that it has a north-westerly strike and dips at ~70deg to the south-west. This mineralisation is included in the updated Mineral Resource estimate. Most of the remaining Inferred mineralisation (i.e. not adjacent to historical stopes) is contained within these structures. The inclusion of the cross structures has resulted in a larger pit compared with the December 2016 Mineral Resource (see Figure 5 in the link below). Further drilling is required to improve the confidence level of the mineralisation in these structures.

Total resources for the Wiluna/Matilda Gold Project including depletions to the end of June 2017 now stand at 61Mt @ 3.1g/t for 6.2Moz (see Table 2 in the link below).

Over the last 120 years the Wiluna/Matilda Operation has produced 4.3Moz of production from predominately refractory ores. A refractory processing facility is located less than 1km from the East West Pit which has operated for 19 of the last 24 years. Studies are underway on the potential mining and processing options which will provide the optimal outcome for developing the large Wiluna sulphide resources. This large open pit resource base will underpin the base load feed for the expansion plans. The Expansion PFS to be released this month.

Wiluna Gold Deposit Summary

The Wiluna and Matilda gold deposits are located within the Wiluna Goldfield, close to the town of Wiluna at latitude 26DEG 38'S, longitude 120DEG 15'E on the Wiluna (SG 51-9)1:250 000 scale map. Perth, the nearest capital city, lies 750km to the southeast. The closest regional centres are Kalgoorlie, 540km to the south and Meekatharra, 183km to the west.

The gold deposits are categorised as orogenic gold deposits, with similarities to many other gold deposits in the Yilgarn region. The deposits are hosted within the Wiluna Domain of the Wiluna Greenstone Belt. Rocks in the Wiluna Domain have experienced greenschist-facies regional metamorphism and brittle deformation. The Wiluna Domain is comprised of a sequence of foliated basalts and high-magnesium basalts, with intercalated felsic intrusions, lamprophyre dykes, metasediments, and dolerites.

Wiluna ores are typically oxide, refractory or free milling quartz mineralisation. The refractory ore has most gold occurring in either solid solution or as sub-microscopic particles within fine-grained sulphides. Mineralisation at Wiluna is principally controlled by the shear zones which have variable strike and dip orientations and typically flex along strike and down dip. These flexures in conjunction with favourable host rock composition act to form the best ore zones.

Gold mineralisation in the East and West lode is predominantly hosted within a series of theoletic and high magnesium basalts and generally strikes north-west. In East Lode there is one dominant shear with numerous hangwall splays which are north to north-northeast striking and easterly dipping (80deg). These mineralised shear zones range in thickness from approximately 5m to 40m. Mineralisation at West Lode is hosted within a wide (up to 70m), steeply dipping, north-south striking anastomosing shear zone. This is characterised by two main shears linked by cross cutting shears of varying orientations.

The interpretation of the mineralisation was carried out using a methodical approach to ensure continuity of the geology and estimated mineral resource using Surpac software. For the East and West Lode open pit resource a lower cut-off grade of 0.3g/t was used.

All available geological data was used in the interpretation including mapping, drilling, oxidation surfaces and interpretations of high grade ore shoots. Only diamond and reverse circulation drilling samples were used in the final estimate however all available grade control data was used in the geological assessment.

A range of criteria were considered when addressing the suitability of the classification boundaries to the resource estimate:

o Geological continuity and volume models;

o Drill spacing and available mining information;

o Modelling technique

o Estimation properties including search strategy, number of informing composites, average distance of composites from blocks, number of drillholes used and kriging quality parameters.

The classification of the blocks was also visually checked and adjusted to remove any "spotted dog" effects. No measured resources were calculated. Estimated blocks that have been informed by predominantly historical drilling where QA/QC data has not been reviewed were assigned as inferred.

To view tables and figures, please visit:
http://abnnewswire.net/lnk/9A8ZO310

About Blackham Resources Ltd:

Blackham Resources Ltd. (ASX:BLK), is an emerging gold producer focused on its Matilda Gold Project in Western Australia where mining and production is imminent. The Matilda/Wiluna Gold Operation incorporates over 1,000 square kilometres of tenements containing total JORC 2012 resources of 63Mt @ 3.2 g/t for 6.4Moz of gold. These tenements cover around 55 kilometres of strike along the Wiluna Mine Sequence and 10 kilometres of strike along the Coles Find Sequence. The Wiluna Mine and Coles Find Sequence has historically produced 4 million ounces of gold.

All the deposits are within 26 kilometres by existing haul roads of Blackhams recently acquired Gold Plant. With exploration prospects at Mt Poole, Monarch, Carroll Prior, Red Lady, Zenith, Island and Albion in the Lakeway area provides the company with excellent exploration areas for potential future projects.



Contact:

Bryan Dixon Managing Director
Blackham Resources Ltd.
Office: +61-8-9322-6418

Bruce Kendall Chief Geological Officer
Blackham Resources Ltd.
Office: +61-8-9322-6418

Jim Malone Investor Relations Manager
Blackham Resources Ltd.
Office: +61-8-9322-6418