Eldorado prospective for copper mineralisation

6 October 2020

CASTILLO COPPER LIMITED("Castillo", "CCZ", or the "Company")

Geochemical review interprets Eldorado to be prospective for structurally controlled copper

Eldorado prospect becomes tenth viable target across Mt Oxide Project

Castillo Copper Limited (LSE and ASX: CCZ), a base metal explorer primarily focused on copper across Australia and Zambia, is pleased to announce that, following a review of historic soil samples, it has interpreted the Eldorado prospect at its Mt Oxide Project to be prospective for structurally controlled copper and gold mineralisation.

The Company has now completed its geological review of its 100% owned Mt Oxide Project, identifying a significant pipeline of exploratory work with a total of ten viable targets.

Highlights

· To conclude the Mt Oxide Project geological review, the geology team have interpreted the Eldorado prospect, which is circa 4km south-east from the Arya prospect, to be prospective for non-coincident structurally controlled copper and gold mineralisation

· Analysing historic assayed soil samples, the geology team verified there are several anomalous geochemical zones within two well defined soil grids - Grid A and Eldorado - that have elevated non-coincident copper-gold readings requiring follow up:

Grid A (SE quadrant):

o Soil sampling identified anomalous copper values over a 200m by 500m area up to 310ppm Cu;

o Rock chip samples returned anomalous copper up to 5,400ppm Cu over a 320m by 600m area which is circa 650m south-east of the historic Eldorado copper workings; and

o Notably, the anomalous copper values may be linked with a major NNE trending fault

Eldorado (NW quadrant):

o A 200m by 500m area, with anomalous gold up to 20ppb Au, was identified from soil samples; and

o Rock chip sampling returned anomalous gold up to 35ppm Au slightly to the west of the grid boundary

· Mt Oxide Project geological review now complete, identifying ten viable targets, although a field trip is key to determine if structurally controlled copper-gold mineralisation is apparent

· Castillo, Depco Drilling and third-party service providers are on track to mobilise to site mid-month to commence work on the inaugural Mt Oxide drilling campaign

Next steps for the Company

· Commence the drilling programme at Mt Oxide Project

· Broken Hill update

· Update on Mkushi Project in Zambia

· Cangai update

Simon Paull, Managing Director of Castillo Copper, commented: "The geological review has provided Castillo Copper with invaluable insights into ten viable targets across the Mt Oxide Project. Furthermore, this clearly delivers a significant pipeline of exploratory work ahead, on top of the targeted drilling campaign which is slated to get underway at the Big One Deposit and Arya Prospect shortly."

Ged Hall, UK Director of Castillo Copper, said: "Without question, the geological review has provided us with an encyclopedia on various types of copper mineralisation prevalent across the Mt Oxide Project. Encouragingly, as the macro environment for copper remains buoyant, this provides a positive backdrop on the eve of development work ramping up."

Further information following geological review of the Eldorado Prospect

Castillo's geology team have completed a review of the Eldorado prospect, within the Mt Oxide Project, interpreting it to be primarily prospective for non-coincident structurally controlled copper and gold mineralisation. To determine the veracity of this interpretation, the next key step is for the geology team to undertake a site visit.

Within two well defined soil grids, Eldorado and Grid A, there are several anomalous geochemical zones with elevated copper-gold readings:

Grid A

With reference to Grid A, soil sampling identified a 200m by 500m area with anomalous copper values up to 310ppm Cu, while rock chips returned up to 5,400ppm Cu within a 320m by 600m area. Interestingly, the anomalous copper values could potentially be associated with a significant NNE trending fault.

Eldorado

With reference to the Eldorado grid in, there is a 200m by 500m area with anomalous gold up to 20ppb Au that was identified from soil samples. In addition, rock chip sampling returned anomalous gold up to 35ppm Au which is slightly to the west of the Eldorado soil grid boundary.

Overview of Mt Oxide Project

Castillo is targeting the development of a viable copper mining operation at the Mt Oxide Project, which is located in the copper-belt district approximately 150km north of Mt Isa in north-west Queensland. The project is within the proximity of several historic and currently operating copper mines including Lady Annie and Capricorn Copper.

Currently, the main highlight within the Mt Oxide Project is the exploration targets known as the Big One Deposit, which comprises shallow high-grade supergene ore up to 28.4% Cu, and the Arya Prospect, which was identified through an airborne electromagnetic survey conducted by Geoscience Australia in March 2019. Geochemical sampling and geophysical surveys have been conducted on known exploration targets over several site visits. This has helped to develop a clear exploration strategy for the inaugural test drilling campaign, which has been contracted to Depco Drilling and will commence in October 2020.

In addition to this release, a PDF version of this report with supplementary JORC-compliant information can be found on the Company's website: https://www.castillocopper.com/asx-announcements/ 

Geological review complete

The completion of the Mt Oxide Project geological review has provided significant insights into ten prospects and highlighted an array of differing copper mineralisation styles (Table 1). The next phase of the exploration plan, outside drilling Big One Deposit and Arya prospect, will be site visits to reconcile desk top findings, undertake sampling and determine geophysics programs.

For further information, please contact:

Notes to Editors:

About Castillo Copper

Castillo Copper Limited is an Australian-based explorer primarily focused on copper across Australia and Zambia. Castillo Copper is listed on the LSE and ASX under the ticker "CCZ".

The three main projects across Australia and Zambia include:

Australia

Mt Oxide Project

Castillo is targeting the development of a viable copper mining operation at the Mt Oxide Project, which has significant exploration upside with several high-grade targets including an interpreted 130m thick by 1,500m by 450m massive sulphide bedrock conductor that is about to be drilled. The project is located approximately 150km north of Mt Isa in northwest Queensland. The project is within the proximity of several historic and currently operating copper mines including Lady Annie and Capricorn Copper.

Cangai Project

The Cangai Project is in northern New South Wales, where the Cangai Copper Mine is located, one of Australia's highest grading historic copper mines. The Company's core focus is the development and expansion of the Cangai Copper Mine, which comprises a volcanogenic massive sulphide deposit, with a JORC Code compliant Inferred Resource of 3.2Mt at 3.35 per cent. Cu. and up to 14.45 per cent. Cu in assayed diamond core intersections.

Zambia

Zed Projects

The Company is the sole shareholder of Zed, an Australian company which holds four high-quality prospective assets across Zambia's copper-belt, the second largest copper producer in Africa. Castillo Copper intends to initially focus on the Luanshya Project, which sits on the Zambian copper belt's Lufilian Arc geological structure. The second priority for the Company is the Mkushi Project, which contiguously surrounds an operating open-pit copper mine, in a region proven to be highly prospective for Cu-Au mineralisation. The Company is currently working towards establishing a Zambian in-country presence, utilising local geologists and joint venture partner teams.

Visit Castillo Copper's website: https://www.castillocopper.com/

Competent Person Statement

The information in this report that relates to Exploration Results for the Mt Oxide pillar for the 'Eldorado prospect' contained in this announcement is based on a fair and accurate representation of the publicly available information at the time of compiling the RNS Release, and is based on information and supporting documentation compiled by Matthew Stephens, a Competent Person who is a Fellow of The Australian Institute of Geoscientists. Matthew Stephens is a Senior Consultant Geologist consulting to Xplore Resources Pty Ltd. Mr Stephens has been a Fellow of the Australian Institute Geoscientists for 11 years and has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Mr Stephens consents to the inclusion in the report of the matters based on his information and the form and context in which it appears.

APPENDIX A: ELDORADO PROSPECT - SURFACE OCCURENCES DATA & MAPS

FIGURE A1 - ELDORADO ROCK CHIP ASSAY VALUES

* = Source: Xplore Resources (for data sources and further information refer References 1-6, Appendices B & C)

Note: (1) BDL = Below Detectable Limit

Note: (2) NT = Not Tested

Detection Limits were as follows: [A] Cu: BDL

[B] Pb: BDL

[C] Zn: BDL

[D] Au: BDL