Kuniko Ltd Uncovers Bonanza Silver-Gold Discovery at Silica Hill NSW

Bonanza Grades Strike at Silica Hill: Kuniko's New Discovery Rewrites the Scale of Its NSW Gold-Silver System

The Kuniko Ltd Silica Hill bonanza silver gold discovery in NSW has captured significant attention across the Australian exploration sector. Kuniko Limited (ASX: KNI) has announced a significant new mineral discovery at its Silica Hill prospect within the Commonwealth–Silica Hill Project in New South Wales, with drill results returning some of the highest silver grades reported from an Australian exploration project in recent memory.

The discovery hole, CMKNI004, intersected a massive sulphide vein grading 20,603 g/t silver and 27 g/t gold over 0.5 metres — grades that place this intercept firmly in "bonanza" territory. Critically, this mineralisation sits approximately 100 metres outside the boundaries of all previous drilling, opening an entirely new chapter in the geological story at Silica Hill.

What Was Found — and Why the Location Changes Everything

The significance of this discovery is not only in the grades themselves, which are extraordinary by any measure, but in where the mineralisation was found. CMKNI004 was deliberately drilled as a step-out hole, targeting ground beneath and beyond the existing block model. Its success means the known mineralised system at Silica Hill is materially larger than previously understood.

The hole returned a composite intercept of 84 metres @ 0.6 g/t Au and 123 g/t Ag from 226 metres depth, containing several high-grade subintervals:

The 0.5-metre massive sulphide vein at 230 metres depth is interpreted by the company's geologists as a feeder-style structure — a conduit through which high-grade mineralising fluids moved through the system. This interpretation carries significant exploration implications, as feeder structures often point toward thicker and higher-grade zones in the surrounding system.

Step-Out Hole CMKNI003 Confirms Lateral Expansion

While CMKNI004 generated the headline grades, hole CMKNI003 provides equally important context. Drilled as a step-out approximately 25 metres from previous mineralisation, it confirmed that high-grade zones extend into areas that had seen limited historical testing.

This hole is open up-dip, meaning further mineralisation likely extends toward the surface in untested ground. Together with CMKNI004, these two holes consequently confirm that the Silica Hill system is both laterally broader and vertically deeper than the existing resource model captures.

Understanding Bonanza Grades and Feeder Structures

What is a Bonanza Grade?

In gold and silver mining, a "bonanza" grade refers to exceptionally high metal concentrations — well above the threshold required for economic extraction. For silver, grades above several hundred grams per tonne are considered high-grade in most contexts.

A result of 20,603 g/t silver is approximately 20.6 kilograms of silver per tonne of rock, which is extraordinary even by the standards of the world's highest-grade silver mines.

What is a Feeder Vein, and Why Does It Matter?

Hydrothermal systems — the geological engines that concentrate precious metals — work by circulating hot, metal-rich fluids through fractures in the earth's crust. These fluids deposit metals as they cool. "Feeder veins" or "feeder structures" are the main conduits through which these fluids travel.

They tend to be the highest-grade portions of the system and often act as pathways connecting deeper, hotter metal sources to shallower mineralised zones. Identifying a potential feeder structure at Silica Hill, as Kuniko's geologists have interpreted from CMKNI004, implies that the system has significant depth potential.

Furthermore, drilling down-plunge to the west — the interpreted direction of the system's structural trend — could encounter even higher-grade mineralisation.

Glossary of Key Terms

• g/t (grams per tonne): Standard unit for precious metal grades. One g/t = one gram of metal in one tonne of rock.
• Downhole length: The length of a drill intercept measured along the drill hole, which may differ from the true thickness of the mineralised zone.
• Hydrothermal system: A geological system where hot fluids circulate through rock, depositing minerals including gold and silver.
• VMS (Volcanogenic Massive Sulphide): A deposit type formed on ancient seafloors where metal-rich hydrothermal fluids vent and deposit sulphide minerals.
• Epithermal: A deposit type formed at shallow depths from low-temperature hydrothermal fluids, often hosting high-grade gold and silver in veins.
• Block model: A three-dimensional digital representation of a mineralised body, used to estimate resources.
• Feeder structure: A high-permeability zone through which hydrothermal fluids were channelled, often associated with the highest grades in a system.

Managing Director Maja McGuire commented: "This is an exceptional new discovery and a significant step change for Silica Hill. Intersecting grades of 20,603 g/t silver and 27 g/t gold in a massive sulphide vein is an outstanding result and highlights the potential for high-grade zones within the system. What is particularly exciting is that this mineralisation sits outside the limits of previous drilling, with both CMKNI004 and CMKNI003 confirming that the system is larger and more continuous than previously understood. We are now moving quickly into Phase 2 drilling, targeting extensions of these zones and potential higher-grade positions at depth."

A System That Keeps Growing — Structural Interpretation Points Deeper

The geological picture emerging from Phase 1 drilling is one of a vertically extensive and structurally complex hydrothermal system. Several observations from the drilling campaign strengthen this view:

• Structural analysis across Commonwealth and Silica Hill suggests a consistent plunge of approximately 50° towards 278° (west), indicating a coherent system with a common source
• Mineralisation in CMKNI004, found at greater depth than historical drilling, shows an increase in gold tenor relative to the silver-rich shallower zones — a pattern consistent with vertical metal zonation in hydrothermal systems, where gold typically becomes more prominent at depth
• The metal assemblage in CMKNI004 (elevated Ag, Au, Pb and Zn) is characteristic of feeder-style environments observed at the nearby Commonwealth Main Shaft prospect, where Impact Minerals previously identified thick, closely-spaced high-grade veins
• The mineralised system remains open in all directions: down-plunge to the west, along strike to the north and south, and up-dip

All six holes drilled in Phase 1 intersected sulphide mineralisation, confirming strong continuity of the system across the full 1,239 metres of Phase 1 drilling.

The Commonwealth–Silica Hill Project in Context

The Commonwealth–Silica Hill Project is located approximately 100 kilometres north of Orange, NSW, within the Lachlan Fold Belt — one of Australia's premier gold and copper provinces. The region hosts world-class operations including Newmont's Cadia–Ridgeway mine and Evolution Mining's Northparkes and Cowal operations.

The project sits immediately along trend from Alkane Resources' Boda-Kaiser porphyry copper-gold deposit, which hosts more than 10 million ounces of gold equivalent. The project comprises two genetically related deposits:

Kuniko holds its interest in the project through a binding earn-in and joint venture agreement with Impact Minerals (ASX: IPT), under which it can earn up to 70% of the project by meeting staged exploration expenditure commitments and cash/share payments. All current exploration programmes are funded and managed by Kuniko.

Historical JORC (2012) Inferred Mineral Resource Estimates have previously been reported by Impact Minerals at both Commonwealth and Silica Hill. Kuniko notes it has not independently verified or adopted these estimates, and intends to undertake technical work to validate and update them through its own Competent Person as appropriate.

In addition, the project includes multiple unexplored targets — Silica Hill East, Geenobbys and Gladstone — where geophysical and geochemical anomalies remain untested by drilling, providing a substantial exploration pipeline beyond the current focus areas.

What Comes Next — Phase 2 and Remaining Assays

Kuniko is wasting no time translating these results into action. The immediate forward programme is clearly defined:

1. Assay results from Holes 5 and 6 (CMKNI005 and CMKNI006) are expected within the next two weeks. These holes were drilled to test additional parts of the system and will provide further data to guide Phase 2 targeting.

2. Phase 2 drilling commences in June 2025, with a focus on:

   • Larger step-out holes to expand the known mineralised footprint
   • Testing newly defined targets generated from the integration of drilling data, structural interpretation and geophysical datasets
   • Targeting extensions at depth, particularly down-plunge to the west where the interpreted feeder system may yield thicker and higher-grade intervals
   • Reviewing MobileMT geophysics data, with a targeting exercise underway by consultants Resource Potentials

3. Scout drilling at Gladstone West and Geenobby prospects is planned as part of the broader exploration programme, where geochemical and geophysical anomalies remain undrilled.

Why This Discovery Deserves Investor Attention

Several elements of this announcement combine to create a genuinely compelling exploration story:

1. Grade quality at the extreme end of the scale
A 20,603 g/t silver intercept is not a routine exploration result. Grades of this magnitude in a massive sulphide vein are rare globally and indicate the presence of an exceptionally metal-rich hydrothermal environment.

2. Discovery outside the known envelope
The fact that CMKNI004 found bonanza-grade mineralisation 100 metres beyond all previous drilling means the existing block model significantly underrepresents the size of the system. Every step-out hole that succeeds in new ground adds exploration optionality that was not previously in the market's consideration.

3. Feeder structure interpretation adds depth potential
If the massive sulphide vein in CMKNI004 represents a feeder structure, as interpreted, then the higher-grade core of the system has yet to be drilled. This is a meaningful exploration upside scenario that Phase 2 is specifically designed to test.

4. Polymetallic credit
The system carries meaningful grades of lead and zinc alongside gold and silver, providing multi-metal optionality in a market where base metal by-product credits can materially improve project economics.

5. Tier 1 address in a proven mining belt
Operating in the Lachlan Fold Belt, next to some of Australia's largest gold and copper mines, provides both geological credibility and infrastructure context.

6. Near-term catalysts are clearly defined
With assays from two additional holes due within weeks, followed by Phase 2 drilling starting in June, the news flow timeline is well defined — giving investors a clear set of milestones to track.

Kuniko Limited has delivered one of the more striking Australian exploration results of 2025, with bonanza-grade silver-gold mineralisation discovered in ground that had never before been drilled at Silica Hill. With the system now confirmed open in all directions, a feeder structure potentially identified at depth, and Phase 2 drilling commencing in June, the next several months represent a genuine value-inflection period for the company. Investors tracking high-grade precious metals exploration in Tier 1 jurisdictions should have Kuniko firmly on their radar.

Ready to Track Kuniko's Next Chapter at Silica Hill?

With bonanza-grade silver-gold mineralisation confirmed outside the known drilling envelope, a potential feeder structure identified at depth, and Phase 2 drilling set to commence in June 2025, Kuniko Limited (ASX: KNI) is entering a defining period for the Commonwealth–Silica Hill Project. Assays from two additional holes are due within weeks, with a clear pipeline of catalysts to follow. Investors seeking exposure to high-grade precious metals discovery in one of Australia's premier mining belts can learn more about Kuniko and its projects at kuniko.eu.