EV RESOURCES LTD — Interim / Quarterly Report 2023

Oct 25, 2023

ASX ANNOUNCEMENT 26 October 2023

Quarterly Activities Report

For the Period Ending 30 September 2023

HIGHLIGHTS

Parag Copper-Molybdenum Project, Peru (EVR 70%):

• EVR signed a set of agreements to finalise the acquisition of the high-grade Parag Copper-Molybdenum Project.[1]

• Extensive due diligence program verifying and reviewing over 10,000m of diamond drill core

• Advanced drill permitting and planning, with an initial 8,000m diamond drill program planned, to follow up previous historical drilling.

Don Enrique Copper Project, Peru (EVR 50%):

• Binding agreements signed with local community at Quero, near the Don Enrique Copper-Silver Project in Peru.[2]

• Drilling application permit, which requires community approval under Peruvian regulations, was progressed for submission.

La Cienega Copper Project, Arizona (EVR 100%):

• Systematic sampling program was completed over the La Cienega Copper-Gold Project

• Average values from a total of 119 samples assayed at 0.88% Cu, 2.51g/t Au and 5.61g/t Ag .[3]

• In the Eagle Zone, sample #1844128 returned the highest-grade gold assay

o 83.87g/t Au, 2.9% Cu, 7.7g/t Ag

Corporate:

• Mr Hugh Callaghan was appointed Managing Director.[4]

• US$3.4 million raised through a Convertible Note issue[5]

Battery materials explorer EV Resources (ASX:EVR) (“ EVR ” or the “ Company ”) is pleased to provide an update on its activities for the quarter ended 30 September 2023.

1 EVR Announcement – 4 August 2023 – Definitive Purchase Agreement Singed for Parag Project

2 EVR Announcement – 13 July 2023 – EVR Signs Community Agreement at Don Enrique

3 EVR Announcement – 29 September 2023 – High-Grade Sampling Results from La Cienega Project 4 EVR Announcement – 5 July 2023 – Appointment of Managing Director

5 EVR Announcement – 8 August 2023 – EVR Strengthens Balance Sheet to Accelerate Exploration evresources.com.au

311-313 Hay St Subiaco, Western Australia 6008 +61 (0) 8 6489 0600 info@evresources.com.au

REVIEW OF OPERATIONS

Parag Copper-Molybdenum Project, Peru (EVR 70%)

During the reporting period, the Company signed a set of agreements that finalise the purchase of a 70% shareholding in the high-grade Parag Copper-Molybdenum Project in Huaura Province, Peru. This follows an extensive due diligence programme that included multiple site visits and inspection of the 10,170 metres of diamond drill core.

Drill permitting and planning activities are in progress for an initial 8,000m diamond hole programme that will largely replicate 8,300 metres of drilling done in the 1990’s, the results of which are known to EVR, but unable to be reported under the JORC code.

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Figure 1 – Parag Copper-Molybdenum Project Location

evresources.com.au

311-313 Hay St Subiaco, Western Australia 6008 +61 (0) 8 6489 0600 info@evresources.com.au

Don Enrique Copper Project, Peru (EVR 50%)

During the reporting period, the Company reached a significant milestone at the Don Enrique Copper-Silver Project, with the signing of Binding Agreements with local community Quero, which is situated near the Don Enrique Project.

The Quero community is located in Jauja, Peru near the Don Enrique Copper Project, and under Peruvian regulation the submission of a drilling application requires approval from local communities. This agreement supports the application for the drilling permit at Don Enrique and provides for certain investments in the community by EVR over a 24-month period. This follows on a successful programme for the previous 12 months in which EV Resources delivered on its obligations, and a co-operative relationship was established.

The Company’s Head of Latin American Exploration Gonzalo Lemuz, General Director Giorgio Albertini, and Communities Advisor Rita Armas successfully completed several constructive communities’ engagement meetings with key representatives of the Quero Community. The meetings were well received by the community and allowed the Company to provide a thorough explanation of planned exploration at the Don Enrique Copper Project.

==> picture [452 x 337] intentionally omitted <==

Figure 2 – EV Resources team with members of the local community

evresources.com.au

311-313 Hay St Subiaco, Western Australia 6008 +61 (0) 8 6489 0600 info@evresources.com.au

==> picture [452 x 210] intentionally omitted <==

Figure 3 – The Assembly of the Community of Quero

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Figure 4 – EVR Management Executing Agreement with Representatives of the Quero Community

La Cienega Copper Project, Arizona (EVR 100%)

The recently pegged Eagle Zone has returned excellent sampling results. The Eagle Zone contains numerous old mine workings and more than 4,000m of underground workings are noted in State and County records. Many of the underground developments were completed prior to 1910 and minimal reporting exists. The historic mining in the Eagle Zone is concentrated within the craggy peaks and outcrops of the Double Eagle Shaft and Gray Eagle Shaft. Historic records, maps, and sections are being integrated into a working 3D model. There are numerous existing access roads and only minor rehabilitation will be required to mobilise drilling operations.

evresources.com.au

311-313 Hay St Subiaco, Western Australia 6008 +61 (0) 8 6489 0600 info@evresources.com.au

In the Eagle Zone, copper-oxide mineralisation occurs in conjunction with massive hematite, hematite-breccia, and local mushketovite (hydrothermal magnetite). Copper-Oxide species are more advanced and include malachite, chrysocolla, azurite, brochanthite and others. Later emplacement of sub-vertical volcanics is along trend with the vertical sedimentary rocks and west of a 100m-thick Tertiary basalt flow. The historic mining area is focused on mineralised contacts of the sedimentary sequence. Numerous vein trends extend to the southwest, a basement detachment fault has also been observed nearby.

Average values from a total of 119 samples assayed at 0.88% Cu, 2.51g/t Au, 5.61g/t Ag.

In the Eagle Zone, sample #1844128 returned the highest-grade gold assay

• 83.87g/t Au, 2.9% Cu, 7.7g/t Ag

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Figure 5 – La Cienega Claims and Geological Features

evresources.com.au

311-313 Hay St Subiaco, Western Australia 6008 +61 (0) 8 6489 0600 info@evresources.com.au

==> picture [452 x 339] intentionally omitted <==

Figure 6 – Eagle Zone, within the La Cienega Project

New Standard Zone – Revisited and Refocused

The New Standard Project Area was visited during the summer field season. Access from Parker, AZ is 15 miles by paved and dirt road. Previous sampling of the project in 2022 was made available to Mineoro by EV Resources, this information was used to supplement a complete geologic reconnaissance.

The New Standard Project can be broken into the East and West, divided by the Central Arizona Project Water Canal. The East half was visited briefly and had been previously mapped and sampled in 2022. Mineralisation observed in the East Half is hosted in carbonates, Iron-Oxides and Copper-Oxides is patchy and discontinuous, although concentrated along stratigraphic controls. This land position has been dropped, to focus exploration on the West Half - auriferous mineralisation here is related to both low-angle structural zones and sub-vertical structures which host volcanic-related mineralisation.

A layered rhyolitic vent can be traced for about 500m on surface; this feature is silicified and contains leached sulphide grains.

evresources.com.au

311-313 Hay St Subiaco, Western Australia 6008 +61 (0) 8 6489 0600 info@evresources.com.au

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Figure 7 – Vertical rhyolite Vent. New Standard West Zone

Sampling by Mineoro in the West Half returned Gold values ranging from 0.019ppm up to 23.10ppm and having and average value of 2.78ppm (grams per ton) from 19 samples.

evresources.com.au

311-313 Hay St Subiaco, Western Australia 6008 +61 (0) 8 6489 0600 info@evresources.com.au

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Figure 8 – Vertical Rhyolite Vent New Standard West Zone

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Yanamina Project, Peru (EVR 100% interest)

EVR continues to work with the local representatives to understand the potential impacts on the community from mining activities.

Shaw River Project, Australia (EVR 100% Interest)

The Company is in the process of assessing further targets based on previous work.

Khartoum Project, Australia (EVR 100% interest)

The Company is in the process of assessing further targets based on previous work.

Weinebene and Eastern Alps Projects, Austria (EVR 80% interest)

No further work was carried out during the quarter.

Serbian Permits (EVR 14.5% interest)

During the quarter, EVR reduced its holding in Balkan Mining and Minerals (ASX:BMM), the holder of 100% of the Serbian licences.

evresources.com.au

311-313 Hay St Subiaco, Western Australia 6008 +61 (0) 8 6489 0600 info@evresources.com.au

CORPORATE

Board Changes

Mr Hugh Callaghan was appointed as Managing Director of the Company.

Convertible Notes

The Company secured firm funding commitments via senior secured convertible notes to raise up to US$3.4 million (Convertible Notes) from Obsidian Global GP LLC (Obsidian) comprising two tranches of US$850,000 each and a third tranche of US$1,700,000. Tranche 1 funds of US$850,000 were received during the quarter with Tranche 2 pending. Tranche 3 will only be drawn if both parties agree.

The funds strengthen the Company’s balance sheet and will be used to accelerate exploration activities across its highly prospective portfolio of copper assets in the Americas.

Other

The Group’s cash balance as 30 September 2023 was $640k

During the quarter the aggregated amount of payments made to related parties and their associates totalled $155k comprising director fees, company secretarial fees and accounting fees.

$402k was spent on exploration expenditure during the quarter and further details of the exploration activity during the quarter are set out in this report.

SCHEDULE OF TENEMENTS

Project	Tenement ID	Indirect Interest thisQuarter*	Indirect Interest previous Quarter*
PERU – YANAMINA PROJECT
Malu I	RJ. N° 5721-95-RPM	100%	100%
Malu II	R.P. N° 1294-2010	100%	100%
Malu III	R.P. N° 4646-2010	100%	100%
MonicaT	R.P.N°6057-2008	100%	100%
Gladys E	R.P. N°4152-2009	100%	100%
AUSTRALIA - KHARTOUM PROJECT
Khartoum	EPM19112	100%	100%
Khartoum	EPM19113	100%	100%
Khartoum	EPM19114	100%	100%
Khartoum	EPM19203	100%	100%
Khartoum	EPM14797	100%	100%
Khartoum	EPM27892	100%	100%
Khartoum	EPM28310-Application	100%	100%
UNITED STATES – LA CIENEGA
La CienegaProject	AZ105298039 to AZ105298112	100%	100%
La CienegaProject	AZ105298113 to AZ105298187	100%	100%

evresources.com.au

311-313 Hay St Subiaco, Western Australia 6008 +61 (0) 8 6489 0600

info@evresources.com.au

	AUSTRALIA – PILBARA LITHIUM PROJECTS
	Shaw River	E45/5849	100%	100%
	AUSTRIA – WEINEBENE PROJECT
	Weinebene	82/16(001/16)– 141/16(060/16)	80%	80%
	AUSTRIA – EASTERN ALPS PROJECT
	Glanzalm-Ratzell-Poling	01/19/JDR – 17/19/JDR	80%	80%
	Millstätter Seerücken	18/19/JDR–23/19/JDR, 55/16 (FS 13)	80%	80%
	Thalheim(Judenburg)	43/16(FS 1)- 44/16(FS 2)	80%	80%
	Hohenwart	56/16 (1083/16)–81/16 (1181/16)	80%	80%
	Mitterberg	45/16 (FS 3)–49/16 (FS 7)	80%	80%
	St. Radegund - Garrach	51/16(FS 9)– 53/16(FS-11)	80%	80%
	Mittereck	24/19/JDR-36/19/JDR	80%	80%
	PERU – DON ENRIQUE PROJECT
	Don Enrique	0100769-12	50%	50%
	Chaupiloma 2007	0105549-07	50%	50%
	Chaupiloma 2008	0101581-08	50%	50%
	COCOA Beach	0101558-15	50%	50%
	PERU – PARAG PROJECT
	Viento	010196004	70%	-
	Parag 192	650003719	70%	-
	Viento 193	650003819	70%	-
	Parag191	650003619	70%	-

SERBIA PERMITS	SERBIA PERMITS	SERBIA PERMITS
Rekovac	2224	14.5%	22%
Pranjani	2427	14.5%	22%
Dobranja	2428	14.5%	22%
Ursule	2429	14.5%	22%
Siokovac	2430	14.5%	22%

• Designates EV Resources Limited’s interest in permits held through the following entities:

• Peru Permits (Yanamina) - Coripuquio SAC (formerly Minera Wealth Peru S.A.C) incorporated in Peru and owned 100%;

• Peru Permits (Don Enrique) – Minera Montserrat incorporated in Peru and owned 50%;

• Peru Permits (Parag) – Anta Parag S.A.C. incorporated in Peru and owned 70%;

• Australia Khartoum Project – EV Resources Silver Pty Ltd incorporated in Australia and owned 100%;

• United States Permits – EV Resources USA Inc incorporated in the US and owned 100%

• Australia Shaw River Project – EV Resources Pilbara Lithium Pty Ltd incorporated in Australia and owned 100%.

• Austria Permits – EV Resources Gmbh incorporated in Austria and owned 80%;

• Serbia Permits - Balkan Mining and Minerals (ASX:BMM) of which EVR holds a 14.5% interest.

-ENDS-

For further information, please contact:

Luke Martino Hugh Callaghan Non-Executive Chairman Managing Director Tel: +61 8 6489 0600 Tel: +61 8 6489 0600 E: luke@evresources.com.au E: hugh@evresources.com.au

This ASX announcement was authorised for release by the Board of EV Resources Limited.

evresources.com.au

311-313 Hay St Subiaco, Western Australia 6008 +61 (0) 8 6489 0600 info@evresources.com.au

Compliance Statements

This announcement contains information on the La Cienega Project extracted from an ASX market announcement dated 29 September 2023 and reported in accordance with the 2012 edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves” ("2012 JORC Code"). EVR confirms that it is not aware of any new information or data that materially affects the information included in the original ASX market announcement.

Forward Looking Statement

Forward Looking Statements regarding EVR´s plans with respect to its mineral properties and programs are forward-looking statements. There can be nо assurance that EVR’s plans for development of its mineral properties will proceed as currently expected. Therе can also be no assurance that EVR will be able to confirm the presence of additional mineral resources, that any mineralisation will prove to be economic or that a mine will successfully be developed on any of EVR’s mineral properties. The performance of EVR may be influenced by a number of factors which are outside the control of the Company and its Directors, staff, and contractors. These statements include, but are not limited to statements regarding future production, resources or reserves and exploration results. All of such statements are subject to certain risks and uncertainties, many of which are difficult to predict and generally beyond the control of the company, that could cause actual results to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements. These risks and uncertainties include, but are not limited to: (i) those relating to the interpretation of drill results, the geology, grade and continuity of mineral deposits and conclusions of economic evaluations, (ii) risks relating to possible variations in reserves, grade, planned mining dilution and ore loss, or recovery rates and changes in project parameters as plans continue to be refined, (iii) the potential for delays in exploration or development activities or the completion of feasibility studies, (iv) risks related to commodity price and foreign exchange rate fluctuations, (v) risks related to failure to obtain adequate financing on a timely basis and on acceptable terms or delays in obtaining governmental approvals or in the completion of development or construction activities, and (vi) other risks and uncertainties related to the company’s prospects, properties and business strategy. Our audience is cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof, and we do not undertake any obligation to revise and disseminate forward-looking statements to reflect events or circumstances after the date hereof, or to reflect the occurrence of or non-occurrence of any events.

evresources.com.au

311-313 Hay St Subiaco, Western Australia 6008 +61 (0) 8 6489 0600 info@evresources.com.au

Rule 5.5

Appendix 5B

Mining exploration entity or oil and gas exploration entity quarterly cash flow report

Name of entity EV Resources Limited ABN Quarter ended (“current quarter”) 66 009 144 503 30 Sept 2023

Consolidated statement of cash flows	Consolidated statement of cash flows	Current quarter	Year to date
		$A’000	(3 months)
			$A’000
1.	Cash flows from operating activities
1.1	Receipts from customers
1.2	Payments for
	(a) exploration & evaluation	(99)	(99)
	(b) development
	(c) production
	(d) staff costs	(180)	(180)
	(e) administration and corporate costs	(381)	(381)
1.3	Dividends received (see note 3)
1.4	Interest received	3	3
1.5	Interest and other costs of finance paid
1.6	Income taxes paid
1.7	Government grants and tax incentives
1.8	Other - legal fees	(210)	(210)
1.9	Net cash from / (used in) operating	(867)	(867)
	activities
2.	Cash flows from investing activities
2.1	Payments to acquire or for:
	(a) entities
	(b) tenements
	(c) property, plant and equipment	(15)	(15)
	(d) exploration & evaluation	(402)	(402)
	(e) investments	374	374
	(f) other non-current assets

ASX Listing Rules Appendix 5B (17/07/20) + See chapter 19 of the ASX Listing Rules for defined terms.

Page 1

Appendix 5B

Mining exploration entity or oil and gas exploration entity quarterly cash flow report

Consolidated statement of cash flows	Consolidated statement of cash flows	Current quarter	Year to date
		$A’000	(3 months)
			$A’000
2.2	Proceeds from the disposal of:
	(a) entities
	(b) tenements
	(c) property, plant and equipment
	(d) investments
	(e) other non-current assets
2.3	Cash flows from loans to other entities
2.4	Dividends received (see note 3)
2.5	Other (provide details if material)
2.6	Net cash from / (used in) investing	(43)	(43)
	activities
3.	Cash flows from financing activities
3.1	Proceeds from issues of equity securities
	(excluding convertible debt securities)
3.2	Proceeds from issue of convertible debt
	securities	1,306	1,306
3.3	Proceeds from exercise of options
3.4	Transaction costs related to issues of equity
	securities or convertible debt securities	(270)	(270)
3.5	Proceeds from borrowings
3.6	Repayment of borrowings
3.7	Transaction costs related to loans and
	borrowings
3.8	Dividends paid
3.9	Other
3.10	Net cash from / (used in) financing	1,036	1,036
	activities
4.	Net increase / (decrease) in cash and
	cash equivalents for the period
4.1	Cash and cash equivalents at beginning of	514	514
	period
4.2	Net cash from / (used in) operating	(867)	(867)
	activities (item 1.9 above)
4.3	Net cash from / (used in) investing activities	(43)	(43)
	(item 2.6 above)
4.4	Net cash from / (used in) financing activities	1,036	1,036
	(item 3.10 above)

ASX Listing Rules Appendix 5B (17/07/20) + See chapter 19 of the ASX Listing Rules for defined terms.

Page 2

Appendix 5B

Mining exploration entity or oil and gas exploration entity quarterly cash flow report

Consolidated statement of cash flows	Consolidated statement of cash flows	Current quarter	Year to date
		$A’000	(3 months)
			$A’000
4.5	Effect of movement in exchange rates on	-	-
	cash held
4.6	Cash and cash equivalents at end of	640	640
	period
5.	Reconciliation of cash and cash	Current quarter	Previous quarter
	equivalents	$A’000	$A’000
	at the end of the quarter (as shown in the
	consolidated statement of cash flows) to the
	related items in the accounts
5.1	Bank balances	640	514
5.2	Call deposits	-	-
5.3	Bank overdrafts	-	-
5.4	Other	-	-
5.5	Cash and cash equivalents at end of	640	514
	quarter (should equal item 4.6 above)
6.	Payments to related parties of the entity and their		Current quarter
	associates		$A'000
6.1	Aggregate amount of payments to related parties and their		155
	associates included in item 1
6.2	Aggregate amount of payments to related parties and their		-
	associates included in item 2
Note: if any amounts are shown in items 6.1 or 6.2, your quarterly activity report must include a description of, and an
explanation for, such payments.

ASX Listing Rules Appendix 5B (17/07/20) + See chapter 19 of the ASX Listing Rules for defined terms.

Page 3

Appendix 5B

Mining exploration entity or oil and gas exploration entity quarterly cash flow report

7. 7.1 7.2 7.3 7.4 7.5 7.6

Financing facilities Note: the term “facility’ includes all forms of financing arrangements available to the entity. Add notes as necessary for an understanding of the sources of finance available to the entity. Total facility amount at quarter end $A’000 Amount drawn at quarter end $A’000 Loan facilities Credit standby arrangements Other 30,325 1,306 Total financing facilities 30,325 1,306 Unused financing facilities available at quarter end 29,019 Include in the box below a description of each facility above, including the lender, interest rate, maturity date and whether it is secured or unsecured. If any additional financing facilities have been entered into or are proposed to be entered into after quarter end, include a note providing details of those facilities as well.

ASX Listing Rules Appendix 5B (17/07/20) + See chapter 19 of the ASX Listing Rules for defined terms.

Page 4

Appendix 5B

Mining exploration entity or oil and gas exploration entity quarterly cash flow report

$25M Finance Facility

Terms of the $25M Equity Placement Agreement are as follows:

• Investmen t: $25 million via an equity drawdown facility.

• Term : The Company has the option to drawdown on the facility for 60 months commencing on 1 March 2023, or an earlier date agreed upon.

• Security Shares : The security provided to the Investor is 35 million shares to be issued prior to the first drawdown (Security Shares) which may be utilised to offset any drawdown.

• Placement Request : On drawdown of the facility, the Company is to send a Placement Request requiring either:

• an amount of securities for the Investor to purchase at the Placement Price. The number of securities to be purchased will be equal to the lower of:

  • § The number of securities requested;

  • § 30% of the total volume traded in the 10 trading days prior to each Placement Request;

  • § $2m divided by the Placement Price;

  • § The Available Facility Limited (being $25M less drawdowns completed) divided by the Placement Price;

  • § The Company’s available placement capacity under LR 7.1; and

• § The number of Security Shares less the aggregate amounts of any reductions; or

• o a placement amount (the “Requested Placement Amount”). The Requested Placement Amount will be the lesser of:

  • § the Requested Placement Amount;

  • § $250,000, which may be increased to $500,000 by mutual agreement;

  • § the Available Facility Limit (being $25M less drawdowns completed);

  • § the Placement Price multiplied by the total of Security Shares less the aggregate amount of any reductions to the Security Share number; and

  • § the Placement Price multiplied by the Company’s available capacity under Listing Rules 7.1.

• Placement Price: The price of the drawdown will be 95% of the average of the lowest 3 daily VWAPs during the 11 trading days following the Placement Request being sent to the Investor (“Calculation Period”).

• Trading Restriction: The Investor agrees to not trade more than $25,000 worth of EVR shares or more than 20% of the relevant days’ volume (whichever is higher), in a single day. Where the number of shares has been specified in the Placement Request, then the Investor agrees not to sell in excess of 3m shares or 20% of the daily trading volume (whichever is greater) during the Calculation Period.

• Placement Conditions : The following conditions must be met prior to a Placement:

• The Shares are not suspended from trading on the ASX or subject to a trading halt.

• It has been at least 12 Trading Days since the immediately prior Placement Request Date, provided that this may be reduced to a lesser number of days by mutual agreement between the Investor and the Company.

• The Shares have not traded below A$0.008 per Share during any of the 10 prior Trading Days;

• The immediately prior Placement Request has Completed.

• No Event of Default has occurred.

Convertible Securities Agreement

• The Company has the ability to draw down up to US$3,400,000 through the issue of Convertible Notes.

• Two tranches of US$850k each and a third tranche of US$1.7m.

ASX Listing Rules Appendix 5B (17/07/20) + See chapter 19 of the ASX Listing Rules for defined terms.

Page 5

Appendix 5B

Mining exploration entity or oil and gas exploration entity quarterly cash flow report

• Tranche 1 to be available within 5 business days.

• Tranche 2 to be available 60 days after Tranche 1.

• Tranche 3 to be available 120 days after Tranche 1.

• Tranche 2 and Tranche 3 are subject to the following conditions precedent:

• receipt of shareholder approval for the issue of the relevant Convertible Notes;

• in respect of Tranche 2, a waiver in writing from Obsidian if in the 20 trading days immediate to issue:

  • § the Company’s market capitalisation is less than A$8m; and

  • § the average daily trading volume of the Company’s shares on ASX and ChiX is less than AU$25,000;

• in respect of Tranche 2, mutual agreement of the parties where the issue is to take place 180 days or more after execution of the agreement; and

• in respect of Tranche 3, mutual agreement of the parties.

• One Convertible Note will be issued for each US$1.00 advanced by Obsidian.

• Face value for each Convertible Note is US$1.08 ( Face Value ).

• Maturity is 31 July 2025 or earlier if agreed.

• Interest free other than if an event of default occurs which will result in interest accruing at 15% per annum.

• At draw down the Company will pay Obsidian a facility fee of US$170,000 (being 5% of the total available funding) in cash to be deducted from the Tranche 1 (thus having no dilutionary effect to shareholders).

Conversion Price and adjustments:

• Subject to the conversion restrictions below, Obsidian can convert Convertible Notes on issue to shares at the fixed price of AU$0.02 ( Fixed Price ), unless one the following applies;

• If after 60 days from the issue of the relevant tranche of Convertible Notes, the 5- trading day VWAP is below the Fixed Price, Obsidian may convert at a conversion price equal to a 5% discount from the lowest 3 daily VWAP’s in the 20 trading days prior to conversion ( Variable Price ).

• If after the Tranche 1 purchase the Company’s share price trades above AU$0.05 (and thereafter for every AU$0.05 multiple in price) for a minimum of 10 trading days, then the Fixed Price shall be increased to that price.

• At anytime, should the Company issue shares at a price less than the Fixed Price or any security convertible into shares at a price less than the Fixed Price then the Fixed Price will be reduced to that lesser price.

• The agreement limits the number of shares that can be issued on conversion of Tranche 1 to 132m shares which is the Company’s current placement capacity under Listing Rule 7.1.

Cash Redemption:

• The Company may at any time redeem the Convertible Notes outstanding, subject to giving notice to Obsidian however, subsequent to giving notice, Obsidian may give conversion notices in respect of the Convertible Notes to be redeemed.

• If repayment within 120 days from execution of the agreement, repayment shall be made at Face Value. If after 120 days, repayment shall be at a 5% premium to the Face Value.

• Where the Company raises funds, Obsidian may require between 20%-30% of the proceeds raised to redeem outstanding Convertible Notes at the Face Value.

• At maturity date, the Company must redeem all outstanding Convertible Notes by paying Obsidian the Face Value of those Convertible Notes in cash in US$ or in shares at a deemed issue price of the lowest daily VWAP during the 10 trading days immediately prior to the Maturity Date.

ASX Listing Rules Appendix 5B (17/07/20) + See chapter 19 of the ASX Listing Rules for defined terms.

Page 6

Appendix 5B

Mining exploration entity or oil and gas exploration entity quarterly cash flow report

Conversion restriction:

• If conversion occurs between 60 days and 120 days after the issue of the relevant tranche of Convertible Notes a maximum of AU$100,000 can be converted at the Variable Price in the relevant 30 day period.

• If conversion occurs between 120 days and 180 days after the issue of the relevant tranche of Convertible Notes a maximum of AU$250,000 can be converted at the Variable Price in the relevant 30 day period.

• Where an issue of shares would result in the voting power in the Company of Obsidian or any other person exceeding 19.99% the Company must not issue the relevant Shares to Obsidian but must instead repay to Obsidian the relevant amount outstanding in cash.

Trading restrictions:

• In respect of shares issued to Obsidian under the agreement whether on conversion or otherwise, Obsidian agrees not to trade more than the greater of (a) 20% of the daily trading volume on that trading day on ASX and Chi-X; and (b) AU$15,000 on any trading day.

Events of Default:

• Events of default applicable under the agreement are standard for an agreement of this kind.

• Where any unremedied event of default occurs, the Face Value of all outstanding Convertible Notes will automatically increase by 10% and a further 2% for subsequent unremedied events of default.

• On an event of default Obsidian may terminate the agreement and/or convert the remaining Convertible Notes at a conversion price which is the lesser of (a) 80% of the lowest daily VWAP during the 10 trading days prior; and (b) $0.02.

Security:

• The Convertible Notes shall be senior secured through Obsidian taking a first ranking general security over all assets of the Company.

8.	Estimated cash available for future operating activities	$A’000
8.1	Net cash from / (used in) operating activities (item 1.9)		(867)
8.2	(Payments for exploration & evaluation classified as investing		(402)
	activities) (item 2.1(d))
8.3	Total relevant outgoings (item 8.1 + item 8.2)	(1,269)
8.4	Cash and cash equivalents at quarter end (item 4.6)		640
8.5	Unused finance facilities available at quarter end (item 7.5)	29,019
8.6	Total available funding (item 8.4 + item 8.5)	29,659
8.7	Estimated quarters of funding available (item 8.6 divided by item 8.3)		23.4

Note: if the entity has reported positive relevant outgoings (ie a net cash inflow) in item 8.3, answer item 8.7 as “N/A”. Otherwise, a figure for the estimated quarters of funding available must be included in item 8.7.

• 8.8 If item 8.7 is less than 2 quarters, please provide answers to the following questions:

8.8.1 Does the entity expect that it will continue to have the current level of net operating cash flows for the time being and, if not, why not?

Answer:

ASX Listing Rules Appendix 5B (17/07/20) + See chapter 19 of the ASX Listing Rules for defined terms.

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Appendix 5B

Mining exploration entity or oil and gas exploration entity quarterly cash flow report

• 8.8.2 Has the entity taken any steps, or does it propose to take any steps, to raise further cash to fund its operations and, if so, what are those steps and how likely does it believe that they will be successful?

Answer:

• 8.8.3 Does the entity expect to be able to continue its operations and to meet its business objectives and, if so, on what basis?

Answer:

Note: where item 8.7 is less than 2 quarters, all of questions 8.8.1, 8.8.2 and 8.8.3 above must be answered.

Compliance statement

• 1 This statement has been prepared in accordance with accounting standards and policies which comply with Listing Rule 19.11A.

• 2 This statement gives a true and fair view of the matters disclosed.

Date: 26 October 2023

Authorised by: The Board

(Name of body or officer authorising release – see note 4)

Notes

1. This quarterly cash flow report and the accompanying activity report provide a basis for informing the market about the entity’s activities for the past quarter, how they have been financed and the effect this has had on its cash position. An entity that wishes to disclose additional information over and above the minimum required under the Listing Rules is encouraged to do so.

2. If this quarterly cash flow report has been prepared in accordance with Australian Accounting Standards, the definitions in, and provisions of, AASB 6: Exploration for and Evaluation of Mineral Resources and AASB 107: Statement of Cash Flows apply to this report. If this quarterly cash flow report has been prepared in accordance with other accounting standards agreed by ASX pursuant to Listing Rule 19.11A, the corresponding equivalent standards apply to this report.

3. Dividends received may be classified either as cash flows from operating activities or cash flows from investing activities, depending on the accounting policy of the entity.

4. If this report has been authorised for release to the market by your board of directors, you can insert here: “By the board”. If it has been authorised for release to the market by a committee of your board of directors, you can insert here: “By the [ name of board committee – eg Audit and Risk Committee ]”. If it has been authorised for release to the market by a disclosure committee, you can insert here: “By the Disclosure Committee”.

5. If this report has been authorised for release to the market by your board of directors and you wish to hold yourself out as complying with recommendation 4.2 of the ASX Corporate Governance Council’s Corporate Governance Principles and Recommendations , the board should have received a declaration from its CEO and CFO that, in their opinion, the financial records of the entity have been properly maintained, that this report complies with the appropriate accounting standards and gives a true and fair view of the cash flows of the entity, and that their opinion has been formed on the basis of a sound system of risk management and internal control which is operating effectively.

ASX Listing Rules Appendix 5B (17/07/20) + See chapter 19 of the ASX Listing Rules for defined terms.

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