Since its discovery in mid-2020, LCL has been drilling its flagship Tesorito prospect, but has yet to find all the limits of the deposit. This suggests a large gold system in place. We anticipate that LCL will continue to drill until at least 3 of the 4 edges are found, before determining the maiden resource estimate (MRE), likely sometime in mid-2022.

Here is how we will rank the JORC resource estimate result (our opinion only):

Sprott Initiation Coverage

Warwick Grigor Calculations

• LCL suspect that it may have more than just one big deposit on its hands, as there is evidence that the flagship may just be one end of a bigger, regional goldfield
• Drilling is underway to test this, starting with several deep holes into “Jabba”. We anticipate first results by 2Q22. If these results are encouraging, we’d expect further drilling into Jaba to continue throughout the year.
• If the results from Jabba are not promising, we expect LCL to send those drill rigs to fast-track exploration at other advanced prospects nearby

Following maiden JORC resource at its Tesorito prospect, and incorporating existing Definitive Feasibility Study at Miraflores and potential ‘nested porphyries’ discoveries, we anticipate LCL to commence a scoping study in 2H22. This is significant as this will provide a clearer indication of what returns could be expected should the flagship be commercialised.

Given that LCL is close to releasing a maiden JORC, we would like to see a strategic raise to bring in a couple more major gold funds, preferable at a much higher share price than the current ~11c. Bringing on more major gold funds (or increased investment from the two gold funds already on the cap table) will underpin the valuation.

LCL has an extensive drilling program planned at the standout target of the PNG assets — the Kusi copper-gold prospect that is part of the Ono Project.

The maiden 3,000m drilling program over ~18 diamond holes is due to commence on schedule in March 2023. This upcoming drilling program is part of a larger Kusi exploration program.

There are three things we want to see from this exploration program:

1. The initial drilling will further test the gold-copper oxide skarn mineralisation within an upper limestone unit that was established from previous drilling, trenching and surface sampling. This will provide confidence in what LCL has on its hands in its target drilling areas.
2. Gauge the potential regional scale. The wider Kusi exploration program will include trenching and mapping to define the extent of the mineralised skarn horizon which occurs within the upper limestone unit and over a total area of approximately 3km x 1.5km. This will help answer the question of just how big is the skarn unit?
3. Gain a better understanding of the central copper porphyry. Drilling and surface work is instrumental in locating the porphyry source.

The Veri Veri target is prospective for high grade nickel sulphide. LCL says that relatively quick and inexpensive exploration could transform Veri Veri to a target of significance in the battery metals space.

LCL intends to kick off exploration at Veri Veri early this year after the maiden drilling program at Kusi. It will focus on the source of creek float boulders of massive nickel sulphides assaying up to 45.8% nickel with some samples also reporting high gold grades such as 23.4% Ni with 10.6g/t gold.

We want to see LCL commence field work at Veri Veri in H1 2023.

LCL has an abundance of targets at its PNG projects. While its primary near term focus remains on drill testing the high-grade gold-copper Kusi oxide skarn at the Ono Project, LCL is eager to see advances across multiple targets concurrently. It has specifically acknowledged the significant copper/gold targets across the Liamu, Ubei, Imou and Tauya projects.

In order to advance multiple targets concurrently while its own capital is largely being directed to Kusi, LCL is seeking joint venture partners.

As part of LCL’s strategy to seek joint venture partners, it has a field program planned at the Imou Project for Q2 2023, aiming to enhance the project’s prospectivity and broad appeal.

• We want LCL to commence its planned field program at Imou in Q2 2023.
• We want to see LCL attract a partner to help with additional exploration at Imou, Ubei, or at another of its PNG projects.

At the 2.6Moz Quinchia Gold Project in Colombia, LCL has transitioned to focus on investigating potential development scenarios, while reducing greenfield exploration activities.

While not the primary focus for LCL over the coming 12 months, we do want to see progress on works that would feed into a Preliminary Economic Assessment (PEA), which would help provide clarity around potential investment returns that development of the Colombian project could deliver.