CARNABY RESOURCES LIMITED — Capital/Financing Update 2019

Apr 23, 2019

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ASX ANNOUNCEMENT

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24 April 2019

Tick Hill sale to Berkut completed

• Sale of non‐core Tick Hill Gold Project to ASX‐listed Berkut Minerals Limited (ASX:BMT) completed a week ahead of schedule following early completion of conditions precedent in Heads of Agreement (HOA)

• Consideration comprises 7,211,539 fully paid ordinary shares in BMT, which following recent BMT share price increases are currently valued at $937,500 (@ $0.13 per share) at settlement (up $375,000 since signing of HOA)

• Issued shares are subject to 12‐month escrow period and further settlement terms include immediate replacement of Diatreme’s associated tenement bonds, totaling $336,844

• Deal gives DRX shareholders significant shareholding in BMT (7.51% post settlement) and exposure to upside in BMT’s Australian gold assets in WA and QLD.

Emerging miner a l and silica s ands miner Diatreme R e sources Li m ited (ASX:D R X) announ c ed today th e early completion of t h e sale of its T ick Hill Gol d Project ne a r Mount Is a , QLD to Be r kut Mineral s Limited (A S X:BMT), giving Diat r eme nearly $1 million of Berkut shares (at current prices) a n d exposure to Berkut’s a ttractive p o rtfolio of gold asse t s in wester n and eastern Australia.

Und e r the now c ompleted HOA with Berkut (refer A S X announc e ment 12 M a rch 2019), D iatreme ag r eed to the sale of it s three relat e d mining t e nements ( M L7094, ML7 0 96 and ML 7 097) and a s sociated mi n ing inform a tion to a Berkut nominee. Consi d eration for t he sale was the issue of 7,211,539 f u lly paid ordinary share s to Diatrem e in BMT, va l ued at t h at time at $ 5 62,500 @ $ 0.078 per s h are, with t h e shares su b ject to volu n tary escro w for a 12‐m o nth period f rom thei r expected date of issue. Diatreme h o lds immedi a tely post s e ttlement 7. 5 1% of the i s sued capital of Berkut.

Foll o wing a succ e ssful comp a ny restruct u re and vari o us asset ac q uisitions, including the T ick Hill ass e ts, the valu e of the B MT shares a s at settle m ent date (2 3 April 2019 ) has signific a ntly increa s ed, being v a lued at $93 7 ,500 (at $0.13 per s hare), amo u nting to a s i gnificant wi n dfall for D R X shareholders.

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BM T will also, as a condition of settleme n t and title t ransfer, rep l ace existing tenement e nvironmental bonds held by the r egulatory a u thority (Qu e ensland’s D epartment o f Natural R e sources Mi n es and Ene r gy) totallin g $336,844. The s e bonds are currently s u pported by cash equiva l ent security ($336,844) deposited b y Diatreme, w hich will b e refu n ded to Dia t reme on discharge.

Foll o wing settle m ent compl e tion, Diatreme’s joint v e nture with S uperior Re s ources Limi t ed ( Superior ) (ASX:SPQ ) con c erning Tick H ill has also been termi n ated.

Wel c oming the c ompletion o f the sale, D iatreme’s C E O, Neil McIntyre, said t h e win‐win d eal had alr e ady deliver e d incr e ased value f or sharehol d ers.

“We are delight e d by the ea r ly completi o n of this ag r eement a w eek ahead o f schedule. A lready, Dia t reme shareholders ha v e benefitte d from the i n crease in t h e value of Berkut share s , which hav e risen by $375,000 sinc e the HO A was signed , ” Mr McInt y re said.

“We are confide n t of furthe r benefits fr o m this deal, as our shar e holding in B erkut provi d es exposur e to a suite o f gold assets in w e stern and e a stern Australia, manag e d by an experienced an d focused team at Berkut, and in vie w of the h igh Australian dollar go l d price.”

He added: “The v alue created from this c onversion i n to BMT shares will help enormousl y as we driv e value in ou r emerging Galala r Silica Project in North Q ueensland, which toge t her with ou r Cyclone Zi r con Project offers the pot e ntial for a m arket re‐rat i ng of Diatreme in 2019. ”

Neil McIntyre Greg Starr Chief Executive O fficer Chairman

Cont a ct – Mr Neil McIntyre ‐ Ph – 0 7 33972222 Web s ite ‐ diatreme. c om.au E‐ma i l ‐ manager@ d iatreme.com. a u

Forward looking statements: Thi s document ma y contain forwa r d looking state m ents. Forwar d looking state m ents are often, but not alway s , identified by the use of words such a s “seek”, “indi c ate”, “target”, “ a nticipate”, “for e cast”, “believe ” , “plan”, “estim a te”, “expect” a n d “intend” and state m ents that an e v ent or result “ m ay”, “will”, “sh o uld”, “could” or “might” occur o r be achieved a nd other simil a r expressions. Indications of, a nd inter p retations on, future expected e xploration results or technical o utcomes, pro d uction, earning s , financial pos i tion and perfor m ance are also forward-looking stat e ments. The fo r ward-looking s t atements in thi s presentation a re based on c u rrent interpret a tions, expectat i ons, estimates, assu m ptions, foreca s ts and projecti o ns about Diatr e me, Diatreme’ s projects and a ssets and the industry in whic h it operates as well as other f a ctors that m anagement believes to be rel e vant and reas o nable in the ci r cumstances at the date that s u ch statements a re made. The forward-lookin g state m ents are subj e ct to technical, business, economic, competit i ve, political an d social uncerta i nties and conti n gencies and m ay involve kno w n and u nknown risks a n d uncertaintie s . The forward - looking statem e nts may prove to be incorrect. Many known a nd unknown f a ctors could ca u se actual events or res u lts to differ materially from the estimated or a n ticipated even t s or results expressed or impli e d by any forw a rd-looking state m ents. All forw a rd-looking statements made i n this presentat i on are qualifie d by the foregoi n g cautionary s t atements.

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Disclaimer: Diatre m e and its relat e d bodies corporate, any of the i r directors, offi c ers, employee s , agents or co n tractors do not make any repre s entation or wa r ranty (either e x press or implied) as to the ac c uracy, correctness, completeness, adequacy, reliability or lik e lihood of fulfil m ent of any f o rward-looking s tatement, or a n y events or re s ults expressed or implied in a n y forward looking statement, e xcept to the extent required b y law. Diatr e me and its rel a ted bodies cor p orate and eac h of their respe c tive directors, o fficers, employ e es, agents an d contractors di s claims, to the maxi m um extent per m itted by law, a ll liability and r e sponsibility for any direct or indirect loss or d a mage which m ay be suffered by any person (including because of fault or neglig e nce or otherwise) through us e or reliance on anything conta i ned in or omitt e d from this presentation. Oth e r than as re q uired by law a n d the ASX Listing Rules, Diat r eme disclaims a ny duty to up d ate forward looking statement s to reflect new developments.

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