Bahia Nickel drills 231.50m at 0.21% Ni, 0.14% Cu, 0.014% Co from shallow mineralization at its Mangueiros sulphide nickel project

Bahia Nickel (the Company) is pleased to announce that it has received assays for the first four holes of its current 6,000-meter diamond drilling program at Mangueiros sulphide Ni-Cu-Co project, located in the municipality of Pilão Arcado, Bahia state in Brazil.

These four holes are part of an initial program, initiated in May 2022, that aims to drill thirty diamond holes at the Mangueiros project this year. The current drilling program contemplates infill and step out drilling considering the historical drilling grid as a base. Two drill rigs are on site and to date, eleven holes have been completed for a total of 2,763 meters.

The following table summarizes the mineralized intercepts of these initial four holes whose location can be identified in Figure 1 further down.

Hole Length (m) NiS (1) Cu Co Starting at (m)
MGDH-023 231.50 0.21% 0.14% 0.014% 28.50
MGDH-024 184.25 0.21% 0.16% 0.014% 14.75
MGDH-025 150.00 0.20% 0.13% 0.016% 23.00
MGDH-026 171.75 0.21% 0.17% 0.013% 20.00

(1) Reported nickel comes from ammonia citrate + hydrogen peroxide digestion that extracts nickel only from the sulphides

These new assays are in line with the historical drilling results, shown in the following table:

Hole Length (m) Ni Cu Co Starting at (m)
MGDH-002 139.75 0.20% 0.12% 0.021% 26.00
MGDH-003 217.40 0.20% 0.13% 0.014% 26.85
MGDH-005 195.72 0.23% 0.15% 0.018% 20.73
MGDH-006 208.54 0.15% 0.11% 0.012% 9.50
MGDH-007 83.14 0.15% 0.10% 0.010% 22.70
MGDH-008 175.03 0.22% 0.14% 0.014% 4.87
MGDH-012 139.73 0.21% 0.16% 0.017% 21.31

Mr. Elton Pereira, Bahia Nickel’s Country Manager, states: “We are really excited with these initial results that are confirming the sulphide Ni-Cu-Co mineralization previously identified by Mangueiros historical drilling. Moreover, we are confident that mineralization looks to be continuous not only down the holes but also laterally as all the eleven holes drilled to date in our campaign, along with the seven historical positive holes, have intercepted from surface to the bottom contact with the basement, the host ultramafic rock with wide zones of quite continuous sulphide mineralization. Besides that, mineralization is yet open laterally in all directions.”

The Company will continue its drilling program targeting the delineation of an exploration target by the end of 2022. As part of the agreement with CBPM, the data and results of the recently completed semi-detailed scale helicopter-borne Mag/EM survey contracted by CBPM, will be available to Bahia Nickel over the exploration licenses that are part of the agreement. The company will review this data for additional drill targets in due course.

Sampling, preparation, and assaying procedures
Drill cores are 100% completed with HQ diameter (63.5mm) which are placed into core cases made of recycled plastic and received in the Company’s shed field facility, where each drilling advance versus recovery is checked/confirmed. After the checking, density measurements are made at regular intervals and magnetic susceptibility is also measured by using a KT-20 hand scanner. Drill cores are then cut on a diamond saw in two equal size longitudinal splits. In the next step, the Company’s geologists log all geological features in the cores and mark the sampling intervals that are mostly one meter long. Samples are always collected at the right split of the drill cores. Each sample has its ID number marked at the left side of the core trays and put into plastic bags that are internally and externally identified. Each sample bag is tied/locked with plastic straps and assembled with other samples inside PVC bags that collectively, will compose the sample batches for each of the drill holes. All batches are transported, from the Company’s site facility to the lab, on a dedicated box truck freighter.

Drill core samples are sent to the ALS lab facility in Vespasiano, Minas Gerais state where sample preparation is done. Assays are done at the ALS lab facility in Lima, Peru. Core samples are dried at 110º C and 100% crushed to 70% < 2mm. A 250g crushed split is obtained to be ground at 85% < 75µ (200#). An aliquot of the ground split is leached with ammonia citrate + hydrogen peroxide for nickel-sulphide assay with ICP-AES finishing. In a 30g split, Au, Pt and Pd are assayed with fire-assay/ICP-AES finishing and in another split, multi-element analysis is done with four-acid digestion and ME-ICP finishing.

For QA/QC purposes, duplicate samples, blanks, and reference samples (obtained from nickel sulphide ores) produced and sold by AMIS from South Africa, are regularly inserted in all core batches.

About Mangueiros Project and Bahia Nickel
Located in the northern part of the mining-friendly Bahia state, Mangueiros is a greenfield exploration project for sulphide nickel, copper, and cobalt deposits. The Mangueiros prospect has 3,051m of historical drilling into the main target, confirming the existence of continuous mineralization on a near-surface, horizontal, canoe-shaped ultramafic sill that is approximately 3km long, 500-700 meters wide, 250-300 meters deep, mainly composed by an incomplete and unlayered stratigraphy consisting of pyroxenites and peridotites that are enclosed by pelitic meta-sediments.

The ultramafic intrusion is oriented NW-SE and contains continuous sulphide mineralization as inter-cumulus or locally hydrothermally remobilized Ni-Cu-Co sulphides. The ultramafic assemblage consists of massive medium to coarsely crystalline olivine and clinopyroxene cumulates with disseminated Ni-Cu-Co sulphides with magmatic textures well preserved.

Bahia Nickel is a private company formed to explore the Mangueiros project following a public auction process, which the Company won and signed in December 2021. The contract with Companhia Baiana de Pesquisa Mineral-CBPM gives the Company the right to conduct further exploration into the project area for 3 years. After this period, Bahia Nickel will be entitled to sign a Mining Lease Agreement for 20 years, with the option to extend it for an additional 10 years, allowing the mining operation of the mineral deposit.

The Mineral Exploration Contract with CBPM has similar terms as with other successful mining companies in Bahia state, such as Largo Resources (vanadium at Maracás), Atlantic Nickel (nickel at Santa Rita), Equinox (gold at Santa Luz), and Galvani (phosphate at Irecê).

Representative pictures of the different styles of Ni-Cu-Co mineralization at Mangueiros

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