ENCOUNTER RESOURCES LIMITED — Capital/Financing Update 2018

May 8, 2018

Level 7, 600 Murray Street West Perth WA 6005

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PO Box 273 West Perth WA 6872 P 08 9486 9455 F 08 9486 8366 www.enrl.com.au

9 May 2018

ASX: ENR

Company Announcements Office Australian Securities Exchange 4th Floor, 20 Bridge Street Sydney NSW 2000

New Gold Project Acquired in the Laverton Tectonic Zone

• Encounter has secured an exciting new gold project in the Laverton Tectonic Zone

• Exploration licence E28/2709, which covers the Nazare Gold Project, was recently granted with on ground activities to commence in May 2018

• The Laverton Tectonic Zone is a prolific gold district that hosts major gold mines at Laverton (>2Moz), Granny Smith (>2Moz), Wallaby (>8Moz) and Sunrise Dam (>10Moz)

• Nazare is located at the southern extension of the interpreted greenstone/gneissic corridor and is situated south-east of the recent Bombora gold discovery by Apollo Consolidated Limited (ASX:AOP)

• Initial exploration will focus on a priority structural intersection identified in the regional magnetic surveys in an area of shallow cover with no prior gold exploration

• Aircore drilling is scheduled for July-August 2018

The directors of Encounter Resources Ltd (“Encounter” or “the Company”) are pleased to announce that Encounter has acquired a prospective new gold project located at the southern extension of the Laverton Tectonic Zone in Western Australia (“WA”) (see Figure 1).

Commenting on the new project, Encounter Managing Director Will Robinson said: “Encounter continues to build its exciting gold portfolio in regions that have demonstrated potential for large scale, high quality gold deposits. The Laverton belt is one of Australia’s most productive and prospective gold regions and extensions of this belt, where it extends under shallow cover, have been a focus of Encounter’s ongoing targeting activities. Preparations for the first drill program at Nazare are well advanced and the initial drilling will commence when a suitable rig becomes available, which is expected in July-August 2018.”

The exploration licence covering the Nazare Gold Project, E28/2709, was recently granted and covers an area of 98km[2] . The project is located approximately 150km east-north-east of Kalgoorlie. Exploration at the project will initially focus on a structural intersection where an interpreted structure extending south-east from the Bombora gold discovery intersects with the interpreted greenstone/gneissic extension of the Laverton Tectonic Zone in an area of cover and no prior gold exploration (see Figure 2).

The only prior drilling completed at the Nazare Gold Project is a single RC hole drilled more than 10 years ago by a uranium explorer that was not assayed for gold.

Next Steps

A field reconnaissance visit is planned later in May 2018 in preparation for drilling. The initial drill program will include a series of aircore drill traverses and is expected to commence in July-August 2018.

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Figure 1 – Nazare regional location plan, regional TMI magnetics and major gold mines

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Figure 2 – Nazare target summary over airborne TMI (magnetics) image

About Encounter

Encounter Resources Limited is a Western Australian (“WA”) based project generation, exploration and resource development company listed on the Australian Stock Exchange.

Encounter controls a major ground position in the Paterson Province in WA exploring for gold-copper deposits in the Telfer region and a highly prospective land package in the Tanami region to be explored via five Joint Ventures with Newcrest Mining Limited (ASX:NCM).

Encounter is one of the most active greenfield exploration companies in Australia.

For further information, please contact: Will Robinson Managing Director +61 8 9486 9455 contact@enrl.com.au michael.vaughan@fivemark.com.au

The information in this report that relates to Exploration Results is based on information compiled by Mr. Peter Bewick who is a Member of the Australasian Institute of Mining and Metallurgy. Mr. Bewick holds shares and options in and is a full time employee of Encounter Resources Ltd and has sufficient experience which is relevant to the style of mineralisation under consideration to qualify as a Competent Person as defined in the 2012 Edition of the 'Australian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Mr Bewick consents to the inclusion in the report of the matters based on the information compiled by him, in the form and context in which it appears.

The Company confirms that it is not aware of any new information or data that materially affects the information in the relevant ASX releases and the form and context of the announcement has not materially changed.