Pegasus Metals Limited

Lionel Project

Introduction

The Lionel Project is located 25km north of Nullagine and covers 28km2 in Exploration Licence E46/495.

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Lionel Project – Local Geology & Copper Workings

The Lionel Project essentially lies on the southwestern edge of the McPhee Dome in the McPhee-Elsie greenstone belt.  The McPhee Dome is separated from the Kelly greenstone belt by a major NNW and NNE trending fault.  Predominant rocks in the project area are metamorphosed ultramafic, mafic and felsic rocks of the Warrawoona Group with local mafic and ultramafic intrusives. In the southeast of the prospect area felsic agglomerate, felsic tuff and andesitic basalt of the Panorama Formation have been mapped, and in the northeast pyroxenite and gabbro of the Pilbara Supergroup occurs (Figure 1).

Previous Mining and Exploration
Ferruginized ultramafic and gabbroic rocks of the Warrawoona Group to the southwest of the McPhee-Elsie greenstone belt host the Lionel and Hendersons copper deposits. Some 370t of ore averaging 15.5% Cu was produced in the area during the 1950s and 60s.

From 1986 to 1988 exploration examined the gold, PGM and diamond potential of tenements including what is now the southern part of Lionel Project.  Stream sediment sampling was followed-up with rock chip sampling in three areas where anomalous gold, silver and base metals are associated with various mineral horizons, including a copper gossan zone with gold values up to 2.26g/t Au.

18 RC drill holes for 628m were drilled in three locations to test for gold and PGMs and results showed an area of high copper-gold-silver anomalism in the Hendersons South area, with anomalous PGM values in one drill hole.  Copper values of 3m @7.0 % Cu, 3m @ 1.2% Cu, 2m @5.65% Cu, 22g/t Ag, and 5m @ 3.34% Cu were reported from four of the five drill holes drilled in the Hendersons South area. The highest intersection was 12.6% Cu, 17g/t Ag over 1m from drill hole LN 16.

PGM values were intersected at low levels in several drill holes, with drill hole LN12 recording 4m @ 0.175g/t Pt and 0.043 g/t Pd from 5m, and 22m @ 0.07 g/t Pd from 9m.  The intersections were in gabbro within a shear zone. Further work was recommended but does not appear to have been done.

In 1968 an unusual style of nickel mineralisation was discovered at the Otways prospect which is at the western boundary of E46/495.  Nickel mineralisation occurs in shears within a fault-bounded Archaean serpentinised peridotite.  Surface nickel values up to 30% Ni were followed up by four diamond drill holes which failed to intersect nickel sulphides or any other significant nickel mineralisation at depth.  The mineralisation was thought to have been deposited from hydrothermal solutions.

Prospects and Mineralisation

The mineralisation in the vicinity of the Lionel Mining Centre is within country rocks of weathered metagabbros and are mapped as Euro Basalt of the Warrawoona Group on the Nullagine 1:100,00 sheet. These rocks strike north-northwest and dip steeply west. A total of 370t of ore averaging 15.5%

The drilling at Hendersons South showed significant Cu and Ag mineralisation within ultramafics and gabbroic rocks.  Drill logs indicate shearing and pyrite development, with some quartz veining. Siliceous ironstone hosts the mineralisation in one of the drill holes.  The intersection of PGMs in hole LN12 is also significant and demonstrates the potential for mineralised deposits of this group associated with shear zones within the Euro Basalt sequence in general.  The extension of this particular shear zone needs to be further defined and evaluated.

In general terms, potential exists throughout the tenement for base metals and PGM mineralisation in the Euro Basalt sequence associated with shear zones. The Panorama Formation has potential for VMS style deposits.

The Lionel Project Area warrants further exploration to fully evaluate its potential for economic base metals and PGM deposits.

 

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