CARNAVALE RESOURCES LIMITED — Capital/Financing Update 2018

Aug 29, 2018

CARNAVALE RESOURCES LIMITED ASX Release 30 August 2018

==> picture [87 x 58] intentionally omitted <==

Carnavale advances Kikagati Tin Project, Uganda

Carnavale Resources Limited (Carnavale, CAV, or the Company) is pleased to advise on the positive progress made on the Kikagati Tin Project, located in the southern Isingiro region of Uganda.

Due diligence has been completed to Carnavale’s satisfaction and has confirmed the project represents an exciting large-scale exploration drill target with potential to define a significant tin resource. Field activities have included geological mapping, rock chip and soil sampling (results pending). No evidence of previous drilling has been discovered.

Large-scale walk-up drill target with significant resource potential

Importantly, extensive artisanal workings together with historic British mining adits clearly define a prospective target zone covering a continuous area of 2.5km strike by 100-200m width. The small scale local artisanal mining is intense and has focused on the numerous stacked quartz veins perpendicular to bedding and other bedding parallel and highly altered units/structures.

The proposed diamond drilling programme aims to test both the more obvious quartz veining and associated muscovite rich alteration selvages and the less obvious bedding parallel structures. The diamond drilling programme is currently being planned in detail and negotiations are underway with the preferred drilling contractor. Carnavale will provide further information on the programme design and commencement of drilling in the near term once sampling results have been received and assessed.

2,000m diamond drilling programme planned

Overall, the project is well located with a good quality sealed bitumen road from the capital city of Kampala all the way to the project, existing regional power supply to the small processing plant, excellent water supply from the bordering Kagera River with an “in stream” turbine power plant currently under construction within 2km of the project. The quality infrastructure near the project is considered positive for any future mine development.

The progression to drilling and targeting the potentially very large tin system aligns with Carnavale’s strategy to acquire and explore high quality advanced exploration and development projects prospective for strategic minerals associated with the rapidly increasing demand within the electric battery sector and other new-age disruptive technologies. Tin has been identified as one of the top six most likely metals to be in increased demand by new-age disruptive technologies as an electrical contact material in robotics, electric vehicles, renewable energy generation and advanced computerisation.

Tin - increasing demand

Under the existing agreement, Carnavale may earn an initial 51% equity in APRU, the 100% owner of the Kikagati (Isingiro) Project tenements, by completing 2,000m of diamond drilling (refer to ASX release “Carnavale to Acquire Large-Scale Tin Project, Uganda“ 24 April 2018). APRU have additionally agreed to extend the timeframe to complete the drilling to 15 December 2018.

Carnavale has issued 10 million shares, (pursuant to CAV’s existing placement capacity under Listing Rule 7.1) and US$50,000 to parties associated with facilitating the transaction. None of the parties are related parties of CAV.

1

Carnavale Resources Limited ABN 49 119 450 243

Level 2, Suite 9, 389 Oxford Street, Mt Hawthorn, WA, 6016 T + 61 8 9380 9098 F + 61 8 9380 6761 E: admin@carnavaleresources.com W : www.carnavaleresources.com

CARNAVALE RESOURCES LIMITED ASX Release 30 August 2018

==> picture [87 x 58] intentionally omitted <==

An Appendix 3B is attached with respect to the new securities issued and the Company gives notice that:

• it issued the securities without disclosure to investors under Part 6D.2 of the Corporations Act 2001 (“Act”);

• this notice is being given under section 708A(5)(e) of the Act;

• as at today’s date, the Company has complied with:

• (i) the provisions of Chapter 2M of the Act as they apply to the Company; and

• (ii) section 674 of the Act; and

• as at today’s date there is no other information that is excluded information which is required to be set out in this notice pursuant to section 708A(6)(e) of the Act.

For further information contact:

Ron Gajewski (Chairman) or Andrew Beckwith (Director)

P: +61 8 9380 9098

COMPETENT PERSON STATEMENT

The information in this report that relates to Exploration Results is based on and fairly represents information compiled by Mr. Andrew Beckwith, a Competent Person who is a Member of The Australasian Institute of Mining and Metallurgy. Mr. Beckwith is a director of Carnavale. Mr. Beckwith 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 Resource and Ore Reserves”. Mr. Beckwith consents to the inclusion in this report of the matters based on his information in the form and context in which it appears.

2

Appendix 3B New issue announcement

Rule 2.7, 3.10.3, 3.10.4, 3.10.5

Appendix 3B

New issue announcement, application for quotation of additional securities and agreement

Information or documents not available now must be given to ASX as soon as available. Information and documents given to ASX become ASX’s property and may be made public.

Introduced 01/07/96 Origin: Appendix 5 Amended 01/07/98, 01/09/99, 01/07/00, 30/09/01, 11/03/02, 01/01/03, 24/10/05, 01/08/12, 04/03/13

Name of entity

Carnavale Resources Limited

ABN

49 119 450 243

We (the entity) give ASX the following information.

Part 1 - All issues

You must complete the relevant sections (attach sheets if there is not enough space).

1 +Class of+securities issued or to be issued 2 Number of+securities issued or to be issued (if known) or maximum number which may be issued 3 Principal terms of the +securities (e.g. if options, exercise price and expiry date; if partly paid +securities, the amount outstanding and due dates for payment; if +convertible securities, the conversion price and dates for conversion)	Ordinary shares
	10,000,000 ordinary shares.
	Fully paid ordinary shares ranking equally with existing shares.

• See chapter 19 for defined terms.

Appendix 3B Page 2

04/03/2013

Appendix 3B New issue announcement

4 Do the[+] securities rank equally The ordinary shares rank equally with existing in all respects from the[+] issue quoted shares (CAV). date with an existing[+] class of quoted[+] securities? If the additional[+] securities do not rank equally, please state: • the date from which they do • the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment • the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 5 Issue price or consideration Nil. 6 Purpose of the issue Facilitation fee in relation to the Kikagati (Isingiro) (If issued as consideration for Project. the acquisition of assets, clearly identify those assets) 6a Is the entity an[+] eligible entity Yes. that has obtained security holder approval under rule 7.1A? If Yes, complete sections 6b – 6h in relation to the[+] securities the subject of this Appendix 3B , and comply with section 6i 6b The date the security holder 24 November 2017. resolution under rule 7.1A was passed 6c Number of[+] securities issued 10,000,000 without security holder approval under rule 7.1 6d Number of[+] securities issued Nil. with security holder approval under rule 7.1A

• See chapter 19 for defined terms.

Appendix 3B Page 3

04/03/2013

Appendix 3B New issue announcement

6e Number of+securities issued with security holder approval under rule 7.3, or another specific security holder approval (specify date of meeting) 6f Number of+securities issued under an exception in rule 7.2 6g If+securities issued under rule 7.1A, was issue price at least 75% of 15 day VWAP as calculated under rule 7.1A.3? Include the +issue date and both values. Include the source of the VWAP calculation.	N/A.	N/A.
	N/A.
	N/A.
6h If+securities were issued under rule 7.1A for non-cash consideration, state date on which valuation of consideration was released to ASX Market Announcements	N/A
6i Calculate the entity’s remaining issue capacity under rule 7.1 and rule 7.1A – complete Annexure 1 and release to ASX Market Announcements 7 +Issue dates Note: The issue date may be prescribed by ASX (refer to the definition of issue date in rule 19.12). For example, the issue date for a pro rata entitlement issue must comply with the applicable timetable in Appendix 7A. Cross reference: item 33 of Appendix 3B.	Listing rule 7.1 – 87,199,934. Listing rule 7.1A – 64,799,956.
	30 August 2018
8 Number and +class of all +securities quoted on ASX (_including_the +securities in section 2 if applicable) 9 Number and +class of all +securities not quoted on ASX (_including_the +securities in section 2 if applicable)
	Number	+Class
	657,999,560	Ordinary Shares (CAV).
	Number	+Class
	60,000,000 36,000,000	Unlisted Options exercisable at 2 cents on or before 30 December 2019. Performance Rights expiring 30 June2021

• See chapter 19 for defined terms.

Appendix 3B Page 4

04/03/2013

Appendix 3B New issue announcement

10 Dividend policy (in the case of a No plans to pay dividends at this stage. trust, distribution policy) on the increased capital (interests)

Part 2 - Pro rata issue – Not Applicable

	Part 2 - Pro rata
11	Is security holder approval
	required?
12	Is the issue renounceable or non-
	renounceable?
13	Ratio in which the+securities
	will be offered
14	+Class of+securities to which the
	offer relates
15	+Record date to determine
	entitlements
16	Will holdings on different
	registers (or subregisters) be
	aggregated for calculating
	entitlements?
17	Policy for deciding entitlements
	in relation to fractions
18	Names of countries in which the
	entity has security holders who
	will not be sent new offer
	documents
	Note: Security holders must be told how their
	entitlements are to be dealt with.
	Cross reference: rule 7.7.
19	Closing date for receipt of
	acceptances or renunciations
20	Names of any underwriters
21	Amount of any underwriting fee
	or commission
22	Names of any brokers to the
	issue

• See chapter 19 for defined terms.

Appendix 3B Page 5

04/03/2013

Appendix 3B New issue announcement

23	Fee or commission payable to
	the broker to the issue
24	Amount of any handling fee
	payable to brokers who lodge
	acceptances or renunciations on
	behalf of security holders
25	If the issue is contingent on
	security holders’ approval, the
	date of the meeting
26	Date entitlement and acceptance
	form and offer documents will be
	sent to persons entitled
27	If the entity has issued options,
	and the terms entitle option
	holders to participate on
	exercise, the date on which
	notices will be sent to option
	holders
28	Date rights trading will begin (if
	applicable)
29	Date rights trading will end (if
	applicable)
30	How do security holders sell
	their entitlements_in full_through
	a broker?
31	How do security holders sell_part_
	of their entitlements through a
	broker and accept for the
	balance?
32	How do security holders dispose
	of their entitlements (except by
	sale through a broker)?
33	+Issue date

Part 3 - Quotation of securities

You need only complete this section if you are applying for quotation of securities

• 34 Type of[+] securities ( tick one )

• (a) √ +Securities described in Part 1 – ordinary shares only

• See chapter 19 for defined terms.

Appendix 3B Page 6

04/03/2013

Appendix 3B New issue announcement

• (b)[All other ][+][securities ]

Example: restricted securities at the end of the escrowed period, partly paid securities that become fully paid, employee incentive share securities when restriction ends, securities issued on expiry or conversion of convertible securities

Entities that have ticked box 34(a)

Additional securities forming a new class of securities

Tick to indicate you are providing the information or documents

• 35 If the[+] securities are[+] equity securities, the names of the 20 largest holders of the additional[+] securities, and the number and percentage of additional[+] securities held by those holders

• 36 If the[+] securities are[+] equity securities, a distribution schedule of the additional +securities setting out the number of holders in the categories

• 1 - 1,000

• 1,001 - 5,000 5,001 - 10,000 10,001 - 100,000 100,001 and over

• 37 A copy of any trust deed for the additional[+] securities

Entities that have ticked box 34(b)

• 38 Number of[+] securities for which +quotation is sought

• 39 +Class of +securities for which quotation is sought

• See chapter 19 for defined terms.

Appendix 3B Page 7

04/03/2013

Appendix 3B New issue announcement

40 Do the[+] securities rank equally in all respects from the[+] issue date with an existing[+] class of quoted +securities? If the additional[+] securities do not rank equally, please state:

• the date from which they do

• • the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment

• the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment

41 Reason for request for quotation now Example: In the case of restricted securities, end of restriction period

(if issued upon conversion of another[+] security, clearly identify that other[+] security)

42 Number and +class of all +securities quoted on ASX ( including the[+] securities in clause 38)

Number +Class

• See chapter 19 for defined terms.

Appendix 3B Page 8

04/03/2013

Appendix 3B New issue announcement

Quotation agreement

• 1 +Quotation of our additional +securities is in ASX’s absolute discretion. ASX may quote the[+] securities on any conditions it decides.

• 2 We warrant the following to ASX.

• The issue of the[+] securities to be quoted complies with the law and is not for an illegal purpose.

• There is no reason why those[+] securities should not be granted +quotation.

• An offer of the[+] securities for sale within 12 months after their issue will not require disclosure under section 707(3) or section 1012C(6) of the Corporations Act.

Note: An entity may need to obtain appropriate warranties from subscribers for the securities in order to be able to give this warranty

• Section 724 or section 1016E of the Corporations Act does not apply to any applications received by us in relation to any[+] securities to be quoted and that no-one has any right to return any[+] securities to be quoted under sections 737, 738 or 1016F of the Corporations Act at the time that we request that the[+] securities be quoted.

• If we are a trust, we warrant that no person has the right to return the +securities to be quoted under section 1019B of the Corporations Act at the time that we request that the[+] securities be quoted.

• 3 We will indemnify ASX to the fullest extent permitted by law in respect of any claim, action or expense arising from or connected with any breach of the warranties in this agreement.

• 4 We give ASX the information and documents required by this form. If any information or document is not available now, we will give it to ASX before +quotation of the +securities begins. We acknowledge that ASX is relying on the information and documents. We warrant that they are (will be) true and complete.

==> picture [109 x 58] intentionally omitted <==

Sign here: ........................................................... Date: 30 August 2018. (Director/Company secretary) Print name: P Jurman == == == == ==

• See chapter 19 for defined terms.

Appendix 3B Page 9

04/03/2013

Appendix 3B New issue announcement

Appendix 3B – Annexure 1

Calculation of placement capacity under rule 7.1 and rule 7.1A for eligible entities

Introduced 01/08/12 Amended 04/03/13

Part 1

Rule 7.1 – Issues exceeding 15% of capital

Step 1: Calculate “A”, the base figure from which the placement capacity is calculated

Part 1	Part 1
Rule 7.1 – Issues exceeding 15% of capital
Step 1: Calculate “A”, the base figure from which the placement capacity is calculated
Insertnumber of fully paid+ordinary securities on issue 12 months before the+issue date or date of agreement to issue	571,999,560
Addthe following: • Number of fully paid+ordinary securities issued in that 12 month period under an exception in rule 7.2 • Number of fully paid+ordinary securities issued in that 12 month period with shareholder approval • Number of partly paid+ordinary securities that became fully paid in that 12 month period Note: • Include only ordinary securities here – other classes of equity securities cannot be added • Include here (if applicable) the securities the subject of the Appendix 3B to which this form is annexed • It may be useful to set out issues of securities on different dates as separate line items	70 million ordinary shares issued on 23 March 2018 as part of a private placement to sophisticated investors, shareholder approval given at the general meeting on 26 July 2018. 6 million ordinary shares issued to nominees of Directors, Mr Gajewski and Mr Beckwith on 10 August 2018 as part of a private placement, shareholder approval given at the general meeting on 26 July 2018.
Subtractthe number of fully paid+ordinary securities cancelled during that 12 month period	Nil
“A”	647,999,560
Step 2: Calculate 15% of “A”

• See chapter 19 for defined terms.

Appendix 3B Page 10

04/03/2013

Appendix 3B New issue announcement

“B”	0.15 [Note: this value cannot be changed]
Multiply“A” by 0.15	97,199,934
Step 3: Calculate “C”, the amount of placement capacity under rule 7.1 that has already been used
Insertnumber of+equity securities issued or agreed to be issued in that 12 month period_not_ counting_those issued: • Under an exception in rule 7.2 • Under rule 7.1A • With security holder approval under rule 7.1 or rule 7.4 _Note: • This applies to equity securities, unless specifically excluded – not just ordinary securities • Include here (if applicable) the securities the subject of the Appendix 3B to which this form is annexed • It may be useful to set out issues of securities on different dates as separate line items	10 million ordinary shares issued on 30 August 2018 as a facilitation fee for the Kikagati (Isingiro) Project.
“C”	-
Step 4: Subtract “C” from [“A” x “B”] to calculate remaining placement capacity under rule 7.1
“A” x 0.15 Note: number must be same as shown in Step 2	97,199,934
Subtract“C” Note: number must be same as shown in Step 3	10,000,000
Total[“A” x 0.15] – “C”	87,199,934 [Note: this is the remaining placement capacity under rule 7.1]

“B”	0.15 [Note: this value cannot be changed]
Multiply“A” by 0.15	97,199,934
Step 3: Calculate “C”, the amount of placement capacity under rule 7.1 that has already been used
Insertnumber of+equity securities issued or agreed to be issued in that 12 month period_not_ counting_those issued: • Under an exception in rule 7.2 • Under rule 7.1A • With security holder approval under rule 7.1 or rule 7.4 _Note: • This applies to equity securities, unless specifically excluded – not just ordinary securities • Include here (if applicable) the securities the subject of the Appendix 3B to which this form is annexed • It may be useful to set out issues of securities on different dates as separate line items	10 million ordinary shares issued on 30 August 2018 as a facilitation fee for the Kikagati (Isingiro) Project.
“C”	-
Step 4: Subtract “C” from [“A” x “B”] to calculate remaining placement capacity under rule 7.1
“A” x 0.15 Note: number must be same as shown in Step 2	97,199,934
Subtract“C” Note: number must be same as shown in Step 3	10,000,000
Total[“A” x 0.15] – “C”	87,199,934 [Note: this is the remaining placement capacity under rule 7.1]

• See chapter 19 for defined terms.

Appendix 3B Page 11

04/03/2013

Appendix 3B New issue announcement

Part 2

Rule 7.1A – Additional placement capacity for eligible entities

Step 1: Calculate “A”, the base figure from which the placement capacity is calculated

calculated
“A”	647,999,560
Note: number must be same as shown in Step 1
of Part 1
Step 2: Calculate 10% of “A”
“D”	0.10
	Note: this value cannot be changed
Multiply“A” by 0.10	64,799,956
Step 3: Calculate “E”, the amount of placement capacity under rule 7.1A that
has already been used
Insertnumber of+equity securities issued or	Nil.
agreed to be issued in that 12 month period
under rule 7.1A
Notes:
• This applies to equity securities – not just
ordinary securities
• Include here – if applicable – the securities
the subject of the Appendix 3B to which this
form is annexed
• Do not include equity securities issued
under rule 7.1 (they must be dealt with in
Part 1), or for which specific security holder
approval has been obtained
• It may be useful to set out issues of
securities on different dates as separate line
items

Insertnumber of+equity securities issued or agreed to be issued in that 12 month period under rule 7.1A	Insertnumber of+equity securities issued or agreed to be issued in that 12 month period under rule 7.1A	Nil.
Notes:
•	This applies to equity securities – not just
	ordinary securities
•	Include here – if applicable – the securities
	the subject of the Appendix 3B to which this
	form is annexed
•	Do not include equity securities issued
	under rule 7.1 (they must be dealt with in
	Part 1), or for which specific security holder
	approval has been obtained
•	It may be useful to set out issues of
	securities on different dates as separate line
	items
“E”		-
Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement
capacity under rule 7.1A
“A” x 0.10		64,799,956
Note: number must be same as shown in Step 2

capacity under rule 7.1A
“A” x 0.10	64,799,956
Note: number must be same as shown in Step 2
Subtract“E”	-
Note: number must be same as shown in Step 3
Total[“A” x 0.10] – “E”	64,799,956.
	Note: this is the remaining placement capacity
	under rule 7.1A

• See chapter 19 for defined terms.

Appendix 3B Page 12

04/03/2013