Kambale Graphite Project

Plan showing historical and recent drill results, Exploration Target estimate outline and locations of Phase 2 diamond core holes and planned follow-on RC drill holes

2022 Highlights

More Graphite Zones at Kambale

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Table 1: Kambale 2022 Exploration Target Estimate Summary¹
Domain Min Tonnage (Mt) Max Tonnage (Mt) Min Grade (%TGC) Max Grade (%TGC)
D1 16.82 50.46 6.74 10.40

¹ Cautionary Statement: The Exploration Target has been prepared and reported in accordance with the 2012 edition of the JORC Code. The potential quantity and grade of the Exploration Target is conceptual in nature. There has been insufficient exploration to estimate a Mineral Resource. It is uncertain if further exploration will result in the estimation of a Mineral Resource.

² FastMarkets: NewGen Long Term Forecast – 27.10.2022

Castle Managing Director, Stephen Stone commented: “The independently estimated Exploration Target of 16.82 to 50.46 million tonnes at a grade range between 6.74% and 10.40%TGC indicates the Kambale Graphite project has a possible scale and grade to warrant progression to the next phase of assessment. Phase 2 test work using samples obtained from the now underway diamond core drilling will assess if a commercial grade concentrate can be produced which would then be evaluated for possible use in the manufacture of electric vehicle battery anodes. A follow-on infill RC drilling program will primarily focus on defining recently confirmed multiple higher grade graphitic zones and will also facilitate a maiden JORC 2012 Mineral Resource for delivery around end-Q1 2023. In addition to the large amount of news flow in coming months from the Kambale Graphite Project there will also be a steady stream of updates from Castle’s battery and future metals projects in Western Australia.”

Table 2: Selected intercepts from 2022 RC campaign
Hole Width Total Graphitic Carbon From
22CKRC001 15m 11.0% 51m
22CKRC006 29m 11.8% 47m
incl. 5m 15.4% 56m
incl. 1m 21.2% 56m
22CKRC007 16m 7.4% 46m
and 14m 7.5% 77m
22CKRC009 19m 8.4% 20m
and 32m 6.8% 59m
22CKRC010 11m 8.4% 28m
and 7m 12.5% 43m
incl. 3m 18.0% 43m
and 23m 6.8% 79m
22CKRC011 15m 9.2% 57m
and 11m 8.0% 83m
22CKRC012 30m 10.7% 30m
incl. 4m 14.7% 55m
22CKRC018 58m 8.2% 22m
22CKRC019 30m 5.9% 24m
22CKRC021 14m 11.5% 43m
incl. 2m 19.7% 45m
22CKRC022 24m 7.3% 115m
22CKRC026 21m 6.3% 38m
22CKRC029 26m 6.4% 61m
22CKRC031 10m 10.7% 77m
22CKRC033 11m 10.3% 61m
incl. 2m 16.4% 68m
22CKRC037 18m 10.0% 44m
incl. 2m 16.0% 54m
22CKRC039 29m 6.6% 101m
22CKRC040 20m 10.5% 36m
incl. 2m 16.2% 48m
22CKRC041 17m 11.1% 37m
and 22m 7.4% 59m
22CKRC042 19m 9.8% 0m
incl. 2m 18.8% 11m
22CKRC043 21m 7.8% 77m
22CKRC044 17m 9.2% 52m
22CKRC045 31m 10.2% 13m
22CKRC046 33m 9.7% 58m
22CKRC047 18m 9.2% 40m
22CKRC051 21m 12.0% 68m
incl. 7m 15.1% 76m
22CKRC052 14m 8.1% 47m
and 45m 11.2% 66m
incl. 2m 16.6% 77m
and 2m 18.3% 90m
5% TGC cut-off. 2m max internal dilution. Intercepts are not true widths.

Background

In 2012 Castle commenced graphite exploration on the Wa Project. A historic graphite occurrence about 5km west of Wa was first noted by Russian geologists whilst prospecting for manganese in the 1960’s.

Castle located the historic trenches and completed mapping, RAB, aircore and RC drilling during the first half on 2012. In July 2012 Castle announced a maiden resource estimate for its Kambale Graphite of 14.4mt @ 7.2% C (graphitic carbon) for 1.03mt contained graphite (Inferred Resource). Flotation testwork was conducted on samples of fresh and weathered graphitic schist from the Kambale deposit. Microscopic examination of some flotation concentrates indicated that the graphite flakes were up to 250 microns long.

Exploration has only tested a small part of the interpreted graphtic schist horizon at Kambale and excellent potential exists to substantially increase the current resource. RAB intercepts outside of the current resource area include 36m@10.68% TGC and 19m @ 7.64% TGC highlighting the prospectivity of the area.

Rougher flotation tests on the fresh and weathered ore samples gave a maximum concentrate grade of over 50% graphite but at low recoveries. In the size fractions coarser than 150 microns, a high proportion of graphite loss to the scavenger tailings was observed. The -150+75 micron size fraction, concentrates 1 and 2 combined, gave a 50% graphite grade at 40% recovery with 30% lost to the final tails. The -75 micron fraction gave the highest recovery (>90%), as expected from a greater degree of graphite liberation from the gangue but grades of less than 30% were achieved. Cleaner and recleaner flotation tests on the -180+75 micron size range failed to improve on these initial rougher tests. A small degree of regrinding of the rougher tail, from 180 to 150 micron top size, improved recovery but did not achieve any significant improvement in graphite grade from the rougher tail.

In order to achieve a high grade of product from the samples supplied, a grind size below 75 microns is recommended. The softness and smearing effect of the graphite on the gangue minerals, drives the need to take small size reduction steps followed by multistage flotation. The sample supplied for testing was RC chips and the RC drilling process itself may increase the smearing effect of graphite over the gangue minerals and any further testwork should be carried out on diamond drill core.

The testwork results from this initial study have shown that an upgrade to just over 50% graphite can be achieved in 1-2 stages of flotation. Further test work would be needed to determine if additional grind-flotation and/or gravity stages could increase the grade to produce a high grade graphite product.

Castle is currently seeking end user/industry participation to advance project development

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