Superior Resources’ Scoping Study Shows A$71M Potential; Assay Errors Delay Results

Exploration Momentum at Steam Engine Gold Project

Superior Resources Limited (ASX:SPQ) has reported robust advancement in its flagship Steam Engine Gold Project in northeast Queensland. The company completed Phase 2 of its 2024 resource expansion drilling program, totaling 69 reverse circulation holes for over 5,200 metres. Early assay results have revealed new zones of gold mineralisation at the northern extents of both the Steam Engine and Eastern Ridge lodes, suggesting potential for resource growth beyond the current footprint.

These findings align with advanced 3D geophysical modelling of sub-audio magnetics (SAM) data, which has confirmed the presence of highly anomalous chargeability features consistent with shallow, mineralised gold lodes. Notably, a potential southern extension of the main Steam Engine Lode has been identified, a discovery that could materially enhance the project's scale and economics.

Feasibility Study and Economic Outlook

The company is progressing a Feasibility Study focused on a toll treatment operation, running in parallel with ongoing resource expansion efforts. Earlier Scoping Study results indicated strong economics for both toll treatment and stand-alone processing scenarios, with pre-tax cash flows of approximately A$46 million and A$71 million respectively, based on a gold price of A$3,250 per ounce. Sensitivity analyses highlight gold price and grade as key drivers, with haulage costs significantly impacting the toll treatment model.

Superior Resources is targeting early production within two years, with regulatory approvals, contracting, and mining studies advancing concurrently. The company is also preparing for native title negotiations and environmental compliance internally, aiming to control costs and timelines.

Assay Challenges and Quality Control Measures

During January 2025, Superior Resources identified significant assay errors in results delivered by SGS Laboratories’ Townsville facility, which coincided with the lab’s closure announcement. These errors led to consistent under-reporting of gold grades, prompting the company to withhold affected results and arrange re-assaying of over 2,200 samples at an alternative laboratory. This quality control intervention underscores the company’s commitment to data integrity but introduces delays in resource updates and market reporting.

Bottletree Porphyry Prospect and Government Grant Support

At the Bottletree Cu-Au-Mo Porphyry Prospect, Superior Resources secured a $300,000 Collaborative Exploration Initiative (CEI) grant from the Queensland Government to fund two deep diamond core drill holes targeting a modelled porphyry core. The drilling program, originally scheduled for late 2024, has been extended to May 2025 due to market conditions and is planned to commence within the next two months, subject to weather. High-resolution gravity and magnetic surveys have delineated two significant gravity anomalies, including a newly identified second anomaly interpreted as a potential porphyry intrusion, which will be priority drill targets.

Cockie Creek Copper-Gold-Molybdenum Prospect Nearing Resource Milestone

Superior Resources is also advancing the Cockie Creek Cu-Au-Mo Porphyry Prospect, where drilling in 2023 returned better-than-expected grades and thicknesses. A maiden JORC (2012) Mineral Resource Estimate is nearing completion and expected to be released in the first quarter of 2025, potentially adding a significant copper-gold asset to the company’s portfolio.

Financial Position and Capital Management

Financially, Superior Resources closed the quarter with $398,000 in cash, following a $1.18 million oversubscribed rights issue in August 2024. The company did not proceed with a planned placement due to market conditions but maintains the capacity to raise further capital if required. Operating and investing activities continue to consume cash as exploration and feasibility work intensifies, with the board confident in securing additional funding when necessary.

Overall, Superior Resources is navigating the complexities of advancing multiple exploration projects with promising technical results, while managing operational challenges such as assay laboratory disruptions. The company’s integrated approach to resource expansion, feasibility, and regulatory processes positions it well for potential near-term production and value creation.