Blackham Resources Ltd.: Wiluna Open Pits to Stretch Over 3.5 kms

Perth - Blackham Resources Ltd. (ASX:BLK) (OTCMKTS:BKHRF) ("Blackham") is pleased to provide a revised Mineral Resource estimate for the Wiluna North open pits encompassing the Happy Jack, Bulletin, Squib, Essex, Golden Age North and Starlight orebodies at the Wiluna Gold Operation. Mineral Resource estimates are currently underway for the Adelaide - Moonlight areas and will be reported later this quarter.

Highlights

- Wiluna North open pit resources now sit at 7.3Mt @ 2.69g/t for 630koz (81% Indicated)

o Increase of 310,000oz or 103%

o High grades for open pit

o 65% of the resource falls into a A$1,400/oz pit shell

o Previous Ore Reserves of 180,000oz @ 2.7g/t Au

o Updates to pit designs and Ore Reserves underway

- Wiluna open pit resources now total 17Mt @ 2.8g/t for 1.5Moz which have been delineated at a cost of $7/resource oz

- Resource continuity confirmed with likely pit stretching over 3.5kms

- Total Resource now 65Mt @ 3.1g/t for 6.5Moz

The latest Mineral Resource estimate for the Wiluna North lodes is based on an additional ~23,000m of RC and diamond drilling completed between March and May 2017 which was very successful in proving the continuity of mineralisation. This drilling has resulted in extensions to mineralisation at the Happy Jack - Gap lodes and confirmed the presence of additional footwall lodes to the west of the main Bulletin lode. Mining studies which will allow an updated open pit Ore Reserve estimate for Wiluna North are underway.

Blackham's Managing Director, Bryan Dixon said "Since drilling commenced in September last year a total of ~$10.5M has been spent on Resource and Reserve definition drilling on the Wiluna open pits. In this time, the Mineral Resource has grown from 80,000oz to 1,505,000oz in just one year, of which 76% is classified as Indicated. This represents a very attractive resource addition cost of $7/oz. This large open pit resource and reserves underpin the growth opportunity as seen in the Expansion PFS released late in August. We also expect a significant reserve upgrade to flow from the latest resource upgrade."

Wiluna Resource Update

Pit optimisations based on drilling completed since September 2016 has confirmed that a shear zone which stretches over 3.2km from the West Lode in the South to the Bulletin Lode in the north contains economic mineralisation over the majority of its strike length. Mineralisation within a second, 1.8km long sub-parallel shear zone encompassing the East, North and Essex lodes is also economic over the majority of its strike length (see Figure 1 and Figure 2 in the link below). Drilling during 2017 has focused on extending mineralisation and improving the confidence level of the Mineral Resource Estimates to allow Ore Reserves to be estimated as part of the expansion study. A resource update for the East and West lodes comprising 8.5Mt @ 2.8g/t for 770koz was released to the ASX on the 3rd August. Following 23,000m of infill drilling, Measured, Indicated and Inferred Resource estimates have now been updated for the Wiluna North lodes encompassing the Happy Jack, Squib, Starlight, Gap, Essex, Golden Age North and Bulletin orebodies. The Wiluna North open pit Mineral Resource reported within A$1,800/oz optimised pit shells is now 7.3Mt @ 2.69g/t for 631Koz of which 81% is classified as Indicated. Total open pit resources at Wiluna are now 16.9Mt @ 2.8g/t for 1,505koz.

Cube Consulting were once again engaged to produce the gold grade estimate for the Mineral Resource based on a mineralisation interpretation completed by Blackham geologists. The Mineral Resource was peer reviewed and classified with guidance from Cube. 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 shows that except for Bulletin, the pits are relatively insensitive to gold price. As shown in Figures 3 to 5 (see link below), apart from Bulletin, the A$1,400 pit shells are only slightly smaller than the A$1,800/oz pit shells.

A breakdown of the Wiluna North Mineral Resource estimate is provided in Table 1 (see link below) and compared with the previous Mineral Resource estimate from January 2017.

Comparison to the previous Wiluna North Open Pit Mineral Resource

Drilling at Bulletin during 2017 has confirmed the presence of additional high grade shoots in lodes sub-parallel to the main Bulletin lode. Results from these new shoots include 35m @ 4.95g/t Au, 7m @ 5.54g/t Au, 14m @ 1.97g/t Au, and 19m @ 2.70g/t Au (refer to ASX release dated 3rd July for details). These sub-parallel lodes have resulted in a large increase in the Bulletin open pit resource due to the presence of very high-grade mineralisation driving the pit deeper. Deep drilling into these lodes is limited and consequently the deeper portions of these lodes have been classified as Inferred.

As Figure 5 (see link below) shows, this deep zone of high grade mineralisation means that Bulletin open pit mining is more sensitive to the gold price than the other pits. However, the average grade of the mineralisation should support underground mining, especially since underground infrastructure is largely in place. Trade off studies comparing the cross-over point between open pit versus underground mining for Bulletin will be undertaken as part of the DFS.

Additional drilling at Happy Jack has also confirmed the continuity of high grade shoots which result in a larger high grade pit which is largely insensitive to the gold price (see Figures 4, 5 and 7 in the link below).

Of the 120,000oz Inferred material within the A$1,800/oz pit shells, 115,000oz are within the Bulletin pit where additional drilling is required to improve the confidence level of the western lodes; 66,000oz lies adjacent to previously mined stopes and 45,000oz are within the newly defined Bulletin footwall lodes. 58% of the Mineral Resource within the Bulletin A$1,800/oz pit shell is classified as Indicated. For the remaining pits >95% of the Mineral Resource is classified as Indicated.

The Happy Jack North, Happy Jack South and Bulletin pits all have existing portals and declines in them allowing a low cost transition into underground mining.

Some of the Bulletin and Happy Jack lodes have been mined historically from underground which may 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. Blackham is progressing work to identify areas of backfill within stope voids as this will increase the confidence level of the resource and allow mineralisation around backfilled stopes to be included in the Ore Reserve estimation.

Previous Mineral Resources for the Wiluna North 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 Wiluna open pits 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 open pit 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.

Total resources for the Wiluna/Matilda Gold Project (including depletions to the end of June 2017) now stand at 65Mt @ 3.1g/t for 6.5Moz (see Table 2 in the link below).

1) Wiluna Open Pit Resources include the East, West, Happy Jack, Creek Shear, Golden Age North, Gap, Bulletin, Essex, Adelaide and Moonlight orebodies reported from inside an A$1,800/oz optimised resource shell.

2) Mineral Resources are reported inclusive of Ore Reserves and include all exploration and resource definition drilling information, where practicable, up to 30th June 2017.

3) The Measured component of the Matilda and Galaxy open pit Mineral Resources is based on grade control drilling and the grade is reported on a diluted basis

4) Underground Mineral resources for Matilda are reported below an RL of 950m and above a 2.0g/t lower cut

5) Indicated and Inferred Mineral Resources at Galaxy are below the design pit and reported above a 2.0g/t lower cut

6) Mineral Resource estimates are not precise calculations. The figures in the above table are rounded to two significant figures

7) Cut off grades used in the estimations vary between deposits and are given in Appendix 1 Table 1 (see link below)

8) Resource depleted to 30 June 2017

Over the last 120 years the Wiluna Operation has produced 4.3Moz of gold from predominately refractory ores. All of the pits are located within a 4km radius of the refractory processing facility which has operated for 19 of the last 24 years. This large open pit resource base will underpin the base load feed for the expansion of the Wiluna processing plant. The Expansion PFS released on the 30 August 2017 confirmed the robust economics and economies of scale supporting the Operations expansion.

Wiluna Gold Deposit Summary

The Wiluna and Matilda gold deposits are located within the Wiluna Goldfield, close to the town of Wiluna at latitude 26DEG38'S, longitude 120DEG15'E on the Wiluna (SG 51-9) 1:250 000 scale map. Perth, the nearest capital city, lies 750km to the southeast.

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 Northern lodes is predominantly hosted within a series of theoletic and high magnesium basalts and generally strikes north-west. In Bulletin - Happy Jack lode there is one dominant shear with numerous hangwall splays which are north to north-northeast striking. These mineralised shear zones range in thickness from approximately 5m to 30m.

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 Wiluna 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:

- Geological continuity and volume models;

- Drill spacing and available mining information;

- Modelling technique

- 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/CH384MF3

About Blackham Resources Ltd:

Blackham Resources Ltd. (ASX:BLK) (OTCMKTS:BKHRF), 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.

Source:

Blackham Resources Ltd.

Contact:

Bryan Dixon Managing Director Blackham Resources Ltd. Office: +61-8-9322-6418 Bruce Kendall Chief Geological Officer Office: +61-8-9322-6418 Jim Malone Investor Relations Blackham Resources Ltd. Office: +61-419-537-714 John Gardner Media Enquiries Citadel Magnus Office: +61-8-6160-4901