Half-year Report

Chesterfield Resources PLC / EPIC: CHF / Market: LSE / Sector: Mining

30 September 2019

CHESTERFIELD RESOURCES PLC

("Chesterfield" or the "Company")

Interim Results

Chesterfield Resources PLC, the LSE listed exploration company with mineral exploration projects in Cyprus, is pleased to announce its interim results for the six months ended 30 June 2019.

Highlights

·      Hired a senior technical team led by Mike Parker to accelerate exploration and data analysis.

·      Built-up by far the largest license package in Cyprus totalling 236 km².

·      Chesterfield is undertaking the first modern large scale and systematic exploration programme in Cyprus, using modern techniques unavailable to historic explorers.

·      Two new targets announced; the Evlim target located between two abandoned historic mine areas and  KinValley, at the northern end of the 15km long Kinousa fault structure.

·      Further targets have now been identified meaning the drill programme will be pushed back slightly and expanded.

·      New website and presentation recently launched.

Chairman Statement

2019 has been a very active year for your company as we look forward to a new drill campaign to search for copper and gold. At the end of 2018, we had just completed our preliminary drill campaign in our Troodos West licence area in Cyprus. As good assay results continued arriving at the start of this year, we took the decision to significantly expand our exploration activities in Cyprus.

We hired a new senior operations and country manager, Mike Parker. Mike joined us after a 20-year career at First Quantum Mining ("First Quantum") where he was a key exploration geologist in making two major discoveries. He was later Country Manager for First Quantum in the DRC and then Peru. We also took the decision to greatly expand our licence area in Cyprus by filing applications for a further 183 km of mineral exploration permits in the foothills of the Troodos mountains. This more than tripled the company's potential field of exploration coverage and made us by far the dominant exploration player in Cyprus.

We then set about a systematic programme to explore this expanded licence package with the aim of reducing our search areas to a series of specific targets, which we would then rank and allocate resources accordingly. Drilling is costly and it is the company's strategy to explore each target using a "toolbox" of different techniques to determine if they justify the cost of drilling. This may take more time but is much more cost-efficient for shareholders and more likely to lead to discoveries.

To roll-out this programme, the company hired three bright and enthusiastic graduates from the Camborne School of Mines to build up its field team in country. We have developed a good relationship with Camborne , who this year paid us a visit on-site with its third-year students, and we now have two of its masters students working with us in Cyprus as interns. In addition, we have hired three talented Cypriot geologists who have joined the team on a consultancy basis to complete a strong presence in the field.

At this point, I would like to draw your attention to our new company website, which was launched recently. It contains a number of short video clips in which Mike and his team present various aspects of the project and targets for our next drill campaign. The site is entirely up to date with a new presentation, media interviews, details of our enlarged land package, as well as plenty of information on our exploration programme and the techniques we are employing. For those interested to learn more about Cyprus, there are sections on its mining history and geology.

In March 2019 we commissioned a remote sensing satellite survey using data from the Sentinel 2 satellite platform owned the European Space Agency. The survey not only provides us with high-resolution photography but also uses specially calibrated sensors in the non-visible spectrum to analyse alterations in rock structures from space. This allowed the team to analyse a first sweep of all our exploration territory for fault structures far more quickly than walking the ground. Chesterfield engaged Fathom Geophysics of Ohio, U.S.A, a company specialising in this field, to interpret the data. The results were then collated with the Company's existing geological databases. As a result, numerous new targets are now under investigation.

For the new drill campaign, we are focussing our efforts in the Troodos West area of our licence package, where we have built up our most complete data sets of archival data, geochemistry and geophysics. We have conducted extensive soil sampling and mapping of our target areas and also sifted through a wealth of historical mining and exploration data stored in the Government archives. In July, we successfully completed an Induced Polarisation (IP) survey, a geophysics technique which involves transmitting a current into the subsurface using electrodes. In Cyprus, the survey responses may typically be up to around 200m underground. The survey focussed on one of our prime targets, Evlim, and consisted of a series of test lines approximately 1km in length and 125 meters apart, and covered an area of approximately 1km sq.

The results of the IP survey were encouraging at Evlim and indicated a potential extension of mineralisation in a downfaulted block. Combined with archival data (including a drill hole from 1983 that returned 0.84% Cu over 11m, from 45m) this has enabled the identification of a drill target likely to host both copper and gold mineralisation in lavas, which will be drill tested in the next campaign.

In July we announced another target named KinValley, located at the northern end of the 15km long Kinousa Fault structure where multiple historical mines occur along two parallel trends. Chesterfield has carried out mapping, sampling, geophysics and drilling to build a high-quality database over the course of the past year.

This previously untested target is interpreted to be a shallowly buried VMS deposit formed in the hanging wall of the fault and is preserved in favourable stratigraphy. KinValley is within the same trend as a cluster of historically mined VMS deposits. An extensive geochemical survey (100m line space, 50m sample interval) was carried out, and a total of 128 soil samples were taken resulting in a coincident copper anomaly. We are excited about the Kinousa Fault, and believe further targets are to be found in its hanging wall.

Our original plan for this campaign was to focus on drilling these two good quality targets and probably a third as a back-up. However, in the process of analysing various adjacent areas in Troodos West, four new target areas have been identified and are now undergoing more detailed scrutiny. It is highly encouraging that our viable target list has built up in this way. This has given us pause for thought. We have decided to push back the drilling by a couple of months to assess these new targets, some of which have now presented themselves priority targets. As a consequence, we may well increase the size of our next drill programme.

The management of our land position in Cyprus is a dynamic one. As such land areas, either permitted or in application, will become surplus to requirement and will be released. Conversely, our exploration analysis is pointing to other areas of interest that are not currently part of our land package, and so new permits will be applied for. On balance, we will expect to gradually reduce our land package to focus on those areas we are most interested in. This is a common-sense approach which saves on unnecessary costs.

Chesterfield is an ambitious company. The technical team are excited about the upcoming drill programme, while we are analysing a number of other opportunities in Cyprus including the processing of waste dumps. There are potential deals that have been presented to us in Cyprus by third parties. We also have a stated broader ambition to use Cyprus as a jumping-off point to grow through joint ventures, or mergers, with other ventures elsewhere.

The team is working hard and I look forward to bringing you very good news flow over the coming months.

Financials

As is to be expected with an exploration company, for the six-month period ended 30 June 2019 the Group is reporting a pre-tax loss of £303,704 (six months ended 30 June 2018: £349,668). The Group's net cash balance as at 30 June 2018 was £1,282,523 (six months ended 30 June 2018: £920,776).

Responsibility Statement

We confirm that to the best of our knowledge: 

·      the interim financial statements have been prepared in accordance with International Accounting Standards 34, Interim Financial Reporting, as adopted by the EU;

·      give a true and fair view of the assets, liabilities, financial position and loss of the Company;

·      the Interim report includes a fair review of the information required by DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication of important events that have occurred during the first six months of the financial year and their impact on the set of interim financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and

·      The Interim report includes a fair review of the information required by DTR 4.2.8R of the Disclosure and Transparency Rules, being the information required on related party transactions.

The interim report was approved by the Board of Directors and the above responsibility statement was signed on its behalf by:

Martin French

Executive Chairman

30 September 2019

Market Abuse Regulation (MAR) Disclosure

Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement.

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