FIRST AU LIMITED — M&A Activity 2020

Jun 2, 2020

First Au Limited

(ASX: FAU)

3 June 2020

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FIRST AU TO ACQUIRE

VICTORIAN GOLD EXPLORATION PROJECT

HIGHLIGHTS

• FAU to acquire control of Victorian gold project centred on Haunted Stream historical gold workings in East Gippsland and including newly interpreted orogenic gold and porphyry copper targets

• VicGold team (Vendors) were ‘first movers’ in applying for tenure, using recent breakthroughs in the understanding of the tectonic history and related gold fertility in Southeast Australia

• Historical mines were worked at Haunted Stream along 8km in strike, with production records indicating high head grades (i.e. > 1 ounce / tonne Au)

• Mineralised systems study heavily based on fieldwork by the VicGold geological team has provided a new conceptual model to be tested in the area

• This study shows the geology and mineralisation style at Haunted Stream is similar to Central Victorian Goldfields area in and around Bendigo

• Several targets for exploration have been identified near and under old mine workings, and are almost ready to be drill tested

• The 2250 km2 tenement application area would subject to grant make FAU a significant exploration player in Eastern Victoria

• One of the tenement applications also contains a structurally modified Cu-Au Porphyry target which has had limited exploration

• The FAU geological team is further strengthened through the appointment of highly recognised structural geologist Ian Neilson B.Sc, M.Sc (Geology) from VicGold, as a consultant

• In addition, once the transaction is completed, it is proposed that Dr Gavin England, who has been providing FAU exploration management, will also take the position of Technical Director

First Au Limited ACN 000 332 918 Registered Office: Level 1 / 123 Whitehorse Road, Balwyn Vic. 3103 Australia. Telephone 03 9817 0700 Facsimile 03 9817 0799 Website: www.firstau.com Email: info@firstau.com

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First Au Limited (ASX:FAU) ( “FAU ” or “the Company ”) is pleased to announce that it has entered into a binding term sheet ( Term Sheet ) to acquire 80% of the issued share capital of Victorian Goldfields Pty Ltd [A.C.N. 632 935 052] (“ VicGold ”) which holds applications making up the Victorian Goldfields Project (“ the Project ”). The Project comprises 5 Exploration License Applications (EL 006975, EL 006976, EL 006977, EL 005422 and EL 006816) in East Gippsland, Victoria, located around the towns of Bruthen, Swift Creek and Dargo (Figures 1 and 2). The Project presents an opportunity for FAU to establish a stake in the highly prospective Victorian goldfields. The flagship Haunted Stream application area (EL 006816) shows potential for significant high-gold continuity, indicated from historic workings and rock chip sampling for over 8 Km strike length (Figure 3). Historic mine records dating back as far as the 1880’s from Victorian Government show ore being extracted at above 1 ounce per tonne[1,2,3] (e.g. Exhibition Mine reported production at over 5 oz Au per tonne). The total application area of over ~ 2,250 km[2] , would subject to grant make FAU one of the significant leaseholders in Eastern Victoria.

The Haunted Stream area contains significant historic workings that have had limited to no drilling to effectively test their depth extents. In addition to the historic workings, there occur untested, prospective, saddle-reef style zones and numerous under-explored mafic intrusive dykes associated within the system presenting new and immediate high-grade Central Victoria-style orogenic targets, as well as Walhalla and Morning Star analogue exploration opportunities. The gold fertility of the tenement package is also further evident in the long history of alluvial mining in the area.

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Figure 1. Location map of the Victorian Goldfields Project, Gippsland Victoria

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Figure 2. Outline of the tenement applications, showing main project focus of Haunted Stream Au and Dogwood Cu-Au Porphyry, East Gippsland. Black dots indicate historic gold workings (Coordinates in MGA94 zone 55)

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Figure 3. TMI magnetic image with Haunted Stream Tenement Application EL006816 showing rock chip data and historic workings. Note location of figure 4 (Coordinates in MGA94 zone 55)

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About the VicGold Project

The VicGold Project is in the southern extent of the Lachlan Fold Belt of Victoria’s East Gippsland region (Figure 1). Previous exploration efforts on the Project area have targeted geophysical features or assumed a simple deposit style without a structural geological context.

Gold exploration in the East Gippsland region has traditionally focused on Cassilis and other deposits around the Omeo area which are high sulphidation systems hosted in the Silurian-Devonian stratigraphy, whereas the focus here in the VicGold Project is low-sulphide orogenic gold deposits hosted in the Ordovician stratigraphy. VicGold identified the prospectivity of the region early in 2018 after academic studies presented by the Geological Survey of Victoria (GSV) cited new geological evidence which supported the porphyry copper exploration initiative for the Stavely Province, Western Victoria. This same study also presented a new interpretation for the origin of the eastern arm of Ordovician Turbidites in East Gippsland as an equivalent and extension of the highly mineralised Bendigo-Fosterville terrane (i.e. Orocline Model). In addition, academic research undertaken by the GSV included two new seismic traverses across the Alpine region in South Eastern Australia to provide deep insight into the subsurface geology and major tectonicscale structures which further supported this model. VicGold used this knowledge to apply for prospective tenure. Subsequently, detailed field mapping by VicGold was conducted in conjunction with geophysics reprocessing and interpretation, which has led to the development of a new prospectivity map for the project areas, focusing primarily on orogenic turbidite-hosted gold deposits.

In the Haunted Stream area, this emerging geological insight provides an opportunity to examine overlooked and misunderstood mineralised systems that remain open down plunge of historical workings or in new target areas that have had little exploration. VicGold geologists have conducted a preliminary data compilation and research examining the high-grade gold mineralisation in the area. Rock chip sampling undertaken by Mantle Mining in 2007 around the old workings show assay results as high as 444 g/t Au ( Mantle Mining announcement on the ASX 3 October 2007 and 31 October 2007 ). Plotting the high-grade rock chip results from this historic exploration work on the new mapping and the new geological interpretation by VicGold, indicated trends consistent with a series of structural controls on mineralisation not previously interpreted or reported by earlier explorers (Figure 4). These will be the initial focus for exploration by FAU, which in some cases are near drill ready targets.

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Figure 4. Historic rock chip samples highlighting some of the high-grade mineralisation and new geological interpretation of the Haunted stream area (Coordinates in MGA94 zone 55)

Note that the rock chip information obtained in the work presented by VicGold here in Figure 4, is derived from data obtained from the Mantle Mining 2007 Haunted Stream Technical Annual Report[,4 ] housed at the Victorian Mines Department. Assay results from Mantle Mining are present in Table 1 and other related information is reported in the JORC Table in the Appendix.

The other tenement applications outside Haunted Stream show similar Ordovician turbidite stratigraphy and structural architecture and are prospective to orogenic gold deposition (Figure 2). They contain historic hardrock and alluvial gold workings. Further work in these tenements is required in developing new drill targets, which will include a significant planned field program.

In addition to gold potential, Tenement Application EL006977 also contains the Dogwood Cu-Mo-Au Prospect (Figure 2). The prospect was discovered by Anglo-American Prospecting from 1978 and 1983[5] and later explored by CRA Exploration between 1988 and 1994[6] . Previous work shows evidence of both an oxide blanket and fresh sulphide copper mineralisation observed in RC and diamond drilling. Mineralisation is hosted within Devonian-aged granodiorite and surrounding Ordovician-aged sandstone country rock. This prospect trends along the same structural corridor as Haunted Stream to the northwest. Early work by VicGold has interpreted the Dogwood porphyry system as having a strong structural control to its mineralisation. This historic data was derived from the Geological Survey of Victoria open file library and is still in the process of compilation and interpretation.

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Notes

1. MURRAY, R.A.F., 1887. Notes on the mining features of the Haunted Stream goldfield. The Goldfields of Victoria. Reports of the Mining Registrars for the quarter ended 30 September 1887, appendix H. Department of Mines, Victoria, pp. 85-90.

2. WHITELAW, O.A.L., 1899. Report on the geological features of Haunted Stream goldfield. Geological Survey of Victoria Progress Report 10. Mines Department, Victoria, pp. 35-36.

3. GRAEME B WEBER AND ASSOCIATES., 2004. Blakeman, M. EL 3576, Haunted Stream, Omeo. Annual report for the period ending 30 September 2004. Earth Resources Division Expired Exploration Reports File

4. BROWN, A. & WEBER, G.B., 2007. Mantle Mining Corporation Ltd. EL 3576, Haunted Stream Project. Annual report for the period ending 30 September 2007. Earth Resources Division Expired Exploration Reports File

5. ORR, D.B., 1980. Aust Anglo American Prospecting Pl. EL 671, Bruthen. Six monthly report for the period ending 31 March 1980. Earth Resources Division Expired Exploration Reports File.

6. MAHER, S. & ARAVANIS, T., 1994. CRA Exploration Pty Ltd. EL 3309, Pretty Sally. Annual report for the period ending 27 August 1994. Report No 20305, 10 pp. Earth Resources Division Expired Exploration Reports File.

Geological Team Strengthened

FAU has further strengthened its exploration team with the appointment of Mr Ian Neilson as a geological consultant. Mr Neilson holds a Bachelor of Science (Geology and Geophysics) and a Master of Science (Geology) and is the major shareholder of VicGold. He was previously Principal Structural Geologist for Newmont Asia Pacific and Mineral and Metals Group with key skills including structural geology and 3D geological modelling. Mr Neilson has extensive geological experience, having previously worked in a variety of geographic locations including Sweden, Finland, Africa, Bulgaria, North and South America, Asia, and Australia. A significant part of Ian’s career has been spent doing high level studies of gold deposits in the Yilgarn, and this knowledge will be valuable in further exploration of the Gimlet Au project near Kalgoorlie.

The FAU Board will ,subject to completion of the acquisition, be strengthened, with Dr Gavin England taking up the position as Technical Director. Dr England is currently a geological consultant and exploration manager for FAU. He is also a shareholder of VicGold and has helped develop the Victorian project. The appointment is conditional upon the VicGold transaction being completed and will be in accordance with FAU Board and shareholder approval. Dr England has a Bachelor of Science (Geology) and PhD in gold-related economic geology. He has worked in research, exploration, and project development for the past ~ 20 years (including Royal Resources, EMA, Impact Minerals, Gold Fields, and Lion Ore). Dr England’s most recent focus as a consultant has been in the areas of project management, business development and in a technical advisory capacity for junior ASX and private unlisted companies. Recently, Dr England was involved in the FAU Gimlet gold discovery near Kalgoorlie.

Structure of Transaction

The proposed acquisition by FAU of 80% of the issued share capital of VicGold is referred to as “the Transaction” . The consideration for the acquisition will be an initial allotment of 10 million ordinary shares of FAU and up to a further 70 million shares of FAU in tranches of 10 million shares each subject to achievement of specific milestones. An amount of $75,000 is also payable at completion. A summary of the Term Sheet, including the conditions precedent and milestones are set out in Annexure A . The Company notes that the Transaction remains subject to a number of conditions precedent, the prime one being that the flagship Haunted Stream exploration licence application EL 006816 must be granted. Other conditions include the satisfactory completion of due diligence investigations and FAU raising approximately $1 m of new capital. No decision has been made on the form or terms of any capital raising as this is a matter which is in FAU’s discretion as part of the Transaction proceeding to completion.

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About VicGold

VicGold is a special purpose entity incorporated to develop and hold all interests in a gold exploration project centred on the historical Haunted Steam gold workings of Gippsland Eastern Victoria. VicGold holds directly or indirectly five exploration license applications ( see Table 2 in Appendix ) over the area which together comprise the Victorian Gold Project. The founder of VicGold, Ian Neilson, is an experienced and highly regarded structural geologist who along with the other shareholders of VicGold (all of whom have significant geological credentials and experience) have invested much time, effort and resources to identify, analyse and secure the applications now comprising the Victorian Gold Project.

Competent Person’s Statement

The information in this announcement that relates to Exploration Results is based on information compiled by Dr Gavin England, a Competent Person who is a member of the Australian Institute of Mining and Metallurgy and the Australian Institute of Geosciences. Dr England is a consultant to First Au Limited (“FAU ”). Dr England declares in accordance with the transparency principles of the JORC Code that he has a personal financial interest in the transaction referred to in this Public Report (“Transaction”) in that he controls G L England Pty Ltd an entity which owns 25% of the issued shares of Victorian Goldfields Pty Ltd (“VicGold”) which will sell 20% of VicGold to the Company on completion of the Transaction. It has also been agreed that on and subject to completion of the Transaction Dr England will be appointed to the board of directors of FAU as Technical Director . Dr England has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity undertaken 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. Dr England has consented to the inclusion in this Public Report of the matters based on his information in the form and context in which it appears.

Authorised by:

Bryan Frost

Executive

Chairman

About First Au: First Au is an advanced gold and base metals exploration company listed on the Australian Securities Exchange (ASX: FAU) and is pursuing a well-funded and aggressive exploration program at its 100% owned Gimlet Gold project near Kalgoorlie and its Talga Projects in the Eastern Pilbara region of Western Australia.

Enquiries in relation to this announcement please contact :

Richard Revelins: rrevelins@firstau.com +1-310-405-4475 Bryan Frost bfrost@firstau.com +61-418 898-885

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ANNEXURE A

SUMMARY OF TERM SHEET

FAU has entered a binding Term Sheet with VicGold and the shareholders of VicGold ( Vendors ) setting out the terms of the Transaction. A summary of the key terms of the Transaction is set out below:

1. Consideration

• FAU has agreed to acquire 80% of the issued share capital of VicGold. The consideration for the acquisition is payable as follows.

• a) Ten million FAU shares at a deemed price of 1 cent per share issued on completion of the proposed transaction (i.e. on satisfaction of the conditions precedents refer (d) below) (“Completion”)

• b) Up to a further seventy million shares (Milestone Shares) issued in the following tranches of ten million Milestone Shares each, upon the satisfaction of one or more of the following conditions:

• i) Ten million issued upon FAU’s total ground exploration expenditure on the Project reaching $500,000

• ii) Ten million issued upon the granting of exploration licence applications; EL 005422, EL 006975, EL 006976, and EL 006977

• iii) Ten million issued upon FAU’s total ground exploration expenditure in relation to the Project reaching $1,000,000

• iv) Ten million shares upon FAU’s total ground exploration expenditure in relation to the Project reaching $2,000,000

• v) Ten million shares upon the delineation of a JORC classified Inferred Mineral Resource of at least 100,000 ounces of gold

• vi) Ten million shares upon the delineation of a JORC classified Inferred Mineral Resource of at least 250,000 ounces of gold

• vii) Ten million shares upon the delineation of a JORC classified Inferred Mineral Resource of at least 500,000 ounces of gold

If one or more of the Milestones (i) to (vii) above has not been achieved within 5 years from the Completion date then the obligation to issue those Milestone shares will lapse and the relevant Milestone Shares shall not form part of the consideration.

• c) In addition, FAU shall pay the Vendors at completion the total sum of $75,000 as reimbursement for expenditures incurred in connection with the project.

2. Conditions

• Completion of the acquisition is conditional upon each of the following being satisfied or waived within 90 days:

• i) FAU completing and being satisfied with the outcome of due diligence within 45 days of execution

• ii) Completion of formal documentation

• iii) The granting of the EL 006816 (Haunted Stream application area) and that none of the other four exploration licenses or applications outlined are withdrawn or revoked by the relevant statutory authority prior to Completion

• iv) Any required regulatory consent

• v) No material adverse event prior to Completion

• vi) Execution and delivery of consulting contracts for key VicGold professionals

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vii) FAU raising approximately $1,000,000, part of which is intended to be applied towards further exploration and associated costs of the Project

3. Remaining 20%

Upon a Decision to Mine being made, FAU has the right to acquire all the remaining shares in VicGold (being the remaining 20%) at fair market value.

4. Minimum Expenditure

Following Completion FAU must spend a minimum of $500,000 on exploration activities in respect to the Project within 12 months of the grant date of the last exploration license failing which it must transfer the shares back to the vendors for nil consideration.

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Appendix

Table 1. Historic Haunted Stream Rock chip data compilation

( source of data - Mantle Mining 2007 Technical Annual Report for Haunted Stream EL3576 )

Sample_ID	MGA_E*	MGA_N*	Au_ppm#
3576RO-001	567763	5854679	444.8
3576RO-003	567852	5854176	1.83
3576RO-004	564803	5857089	45.5
3576RO-005	564785	5857102	2.06
3576RO-006	564774	5857231	1.33
3576RO-007	565566	5857017	0.005
3576RO-009	562613	5857619	27.2
3576RO-035	555095	5861860	0.03
3576RO-036	555095	5861860	2.75
3576RO-037	563015	5857524	12.64
3576RO-038	562540	5857535	6.32
3576RO-039	557158	5858955	0.89
3576RO-040	557154	5858965	15.38
3576RO-041	557198	5858949	15.69
3576RO-042	557257	5858694	10.44
3576RO-043	559011	5862558	86.05
3576RO-044	555720	5858993	38.34
3576RO-045	555700	5858980	42.42
3576RO-050	565745	5856354	1.85
3576RO‐051	563814	5857010	0.52
3576RO-052	563814	5857010	3.46
3576RO‐053	563991	5857045	0.66
3576RO-054	564329	5857047	15
3576RO‐055	564329	5857047	0.38
3576RO-056	564561	5856883	0.9
3576RO‐057	565625	5855556	0.05
3576RO-058	564544	5853969	0.68
3576RO‐059	564544	5853969	0.29
3576RO-060	564544	5853969	0.21
3576RO‐061	566777	5856584	1.41
3576RO-062	565869	5856091	0.6
3576RO‐063	565869	5856091	1.81
3576RO-064	565043	5857406	0.13
3576RO‐065	564794	5857674	0.33
3576RO-066	564762	5857593	0.45
3576RO‐067	564755	5857480	1.06

Sample_ID	MGA_E*	MGA_N*	Au_ppm#
3576RO-068	564757	5857434	0.09
3576RO‐069	567213	5855175	0.18
3576RO-070	567178	5855181	1.3
3576RO‐071	567130	5855149	21.2
3576RO-072	567651	5854565	4.63
3576RO‐073	567487	5854418	0.12
3576RO-074	567487	5854418	0.92
3576RO‐075	567487	5854418	2.06
3576RO-076	567829	5854690	1.2
3576RO‐077	565706	5856173	1.41
3576RO‐078	555814	5859172	46.8
3576RO‐079	555792	5859198	19.1
3576RO‐080	557118	5859395	0.07
3576RO-081	557312	5859029	0.1
3576RO‐082	557239	5859024	0.03
3576RO-083	557592	5859084	0.02
3576RO‐084	555294	5860690	1.24
3576RO‐085	555294	5860690	1.41
3576RO‐086	555294	5860690	1.52
3576RO‐087	555237	5860738	0.55
3576RO-088	565588	5856222	0.07
3576RO‐089	565665	5856256	0.02
3576RO-090	565454	5856460	0.01
3576RO‐091	565454	5856541	2.33
3576RO-092	565383	5856720	0.16
3576RO‐093	565281	5856744	0.88
3576RO-094	565188	5856778	1.81
3576RO‐095	565126	5856837	0.75
3576RO‐096	564774	5857127	2.17
3576RO-097	564683	5857175	3.02
3576RO-098	564593	5857165	13.3
3576RO‐099	564517	5857303	0.68
3576RO-100	564685	5857233	54.1
3576RO‐101	565495	5856680	0.13
3576RO-102	565495	5856680	0.3
3576RO‐103	565495	5856680	0.64

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Sample_ID	MGA_E*	MGA_N*	Au_ppm#		Sample_ID	MGA_E*	MGA_N*	Au_ppm#
3576RO-104	565641	5856490	1.11		SG4227	567675	5854410	0.06
3576RO‐105	565808	5855907	1.09		SG4228	567634	5854453	0.28
3576RO-106	557350	5856722	0.01		SG4229	567634	5854453	0.82
3576RO-107	557427	5856459	-0.01		SG4230	567612	5854441	0.01
3576RO-108	558714	5855391	-0.01		SG4231	567559	5854363	1.25
3576RO‐109	564386	5856004	0.09		SG4232	567494	5854343	0.01
3576RO-110	564088	5856862	0.12		SG4233	566769	5855373	0.01
3576RO-111	564088	5856862	1.22		SG4234	566669	5855543	2.34
3576RO-112	564199	5856902	0.13		SG4235	566462	5855697	8.16
3576RO‐113	564508	5856922	0.14		SG4236	566462	5855697	0.46
3576RO-114	564555	5856889	11.9		SG4237	566462	5855697	0.03
3576RO-115	565036	5856894	3.05		SG4238	565774	5856113	0.06
3576RO-124	563688	5856917	-0.01		SG4239	565714	5856385	1.62
3576RO-126	562411	5857463	0.02		SG4240	565714	5856385	0.66
3576RO-127	563197	5857290	0.62		SG4241	565660	5856361	1.86
3576RO-128	562839	5857375	0.05		SG4242	565659	5856459	0.12
3576RO-129	563214	5857801	264		SG4243	565735	5856378	0.03
3576RO-129	563214	5857801	244		SG4244	565735	5856378	0.19
3576RO-142	567277	5854893	15.7		SG4245	565735	5856378	0.03
3576RO-143	565670	5856052	63.8		SG4246	565564	5856608	0.09
3576RO-151	568068	5854431	33.3		SG4247	565564	5856608	0.06
3576RO-167	561831	5858307	17.2		SG4248	565512	5856603	0.19
3576RO-179	565569	5856425	17.4		SG4249	565512	5856603	0.07
3576RO-180	565569	5856425	87.7		SG4250	565534	5856533	4.46
HSR 08	562289	5857849	42.9		SG4251	565534	5856553	16.11
SG4207	567934	5854833	0.08		SG4252	565644	5856883	0.37
SG4208	567934	5854833	0.16		SG4253	565474	5857193	0.08
SG4209	567934	5854833	0.05		SG4254	565144	5857233	5.61
SG4210	567934	5854833	0.25		SG4255	565144	5857233	0.22
SG4211	567901	5854723	0.01		SG4256	564974	5856983	0.01
SG4212	567869	5854629	14.1		SG4257	564974	5856983	43.42
SG4213	567869	5854629	16.75		SG4258	564984	5857153	0.01
SG4214	567815	5854583	1.64		SG4259	564984	5856843	0.06
SG4215	567689	5854563	2.41		SG4260	566144	5855923	0.03
SG4216	567709	5854563	3.72		SG4261	566194	5855923	0.12
SG4217	567751	5854495	0.88		SG4262	566214	5855963	0.57
SG4218	567809	5854537	0.06		SG4263	566264	5855893	0.15
SG4219	567898	5854623	0.17		SG4264	566264	5855893	0.18
SG4220	567834	5854330	0.08		SG4268	564159	5856793	0.66
SG4221	567934	5854323	0.32		SG4271	564099	5856833	0.3
SG4222	568030	5854369	0.07		SG4272	564074	5856863	0.74
SG4223	567934	5854333	0.25		SG4273	564046	5856849	0.92
SG4224	568022	5854427	0.43		SG4274	564088	5856925	1.17
SG4225	567699	5854503	0.15		SG4275	564134	5856903	0.09
SG4226	567710	5854443	0.17		SG4276	564134	5856903	0.3

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Sample_ID	MGA_E*	MGA_N*	Au_ppm#
SG4277	564134	5856903	0.08
SG4278	564054	5857193	0.01
SG4279	564054	5857193	0.78
SG4280	564014	5857113	0.15
SG4281	563914	5857053	2.3
SG4282	563984	5857053	0.06
SG4283	557304	5860693	-0.01
SG4284	556984	5861083	0.01
SG4285	563484	5856948	0.08
SG4286	563469	5856968	16.98
SG4287	563469	5856968	0.04
SG4288	563469	5856968	31.91
SG4289	564002	5856861	2.2
SG4290	564002	5856861	6.81
SG4291	564025	5856957	0.45
SG4292	564025	5856957	0.1
SG4293	564025	5856957	0.42
SG4294	563929	5856953	0.06
SG4295	563929	5856953	0.03
SG4296	563989	5856928	0.1
SG4297	565849	5856193	0.2
SG4298	565824	5856263	0.05
SG4299	565734	5856458	-0.01

• MGA94 zone 55 coordinates

Analysis by Fire Assay

Table 2. Tenement schedule

Tenement ID	Tenement Holder	Tenement Area Km2	Date of Application	Tenement Status
EL006816	Jacquian PtyLtd*	100	07/08/2018	Application
EL006975	Victorian Goldfields PtyLtd	745	25/06/2019	Application
EL006976	Victorian Goldfields PtyLtd	438	14/06/2019	Application
EL006977	Victorian Goldfields PtyLtd	553	25/06/2019	Application
EL005422	Ian Alexander Rathjen*	490	21/06/2012	Application

• Tenements owned or purchase agreement with Victorian Goldfields Pty Ltd

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forAppendix 1

– – JORC Code, 2012 Edition Table 1 report Haunted Stream

Section 1 Sampling Techniques and Data

(Criteria in this section apply to all succeeding sections.)

Criteria	JORC Code explanation	Commentary
Sampling techniques	Nature and quality of sampling (eg cut channels, random chips, or specific specialised industry standard measurement tools appropriate to the minerals under investigation, such as down hole gamma sondes, or handheld XRF instruments, etc). These examples should not be taken as limiting the broad meaning of sampling.	Techniques employed on the Haunted Stream Tenement referred to in the text are related to Rockchip data compiled by Mantle Mining around 2006-2007 and reported in - “BROWN, A. & WEBER, G.B., 2007. Mantle Mining Corporation Ltd. EL 3576, Haunted Stream Project. Annual report for the period ending 30 September 2007. Earth Resources Division Expired Exploration Reports File”. This was obtained from online database of the Victorian Mines Dept and was pre JORC 2102. The reporting suggests the samples were assayed for gold using Fire Assay. This data was later applied by VicGold (Victoria Goldfields Pty Ltd) in a new geological interpretation of the area.
	Include reference to measures taken to ensure sample representation and the appropriate calibration of any measurement tools or systems used.	Mantle Mining records indicate the rock chip samples were taken of representative mineralised material, concentrating around old workings. While sample locations have been visited, the information supplied by Mantle Mining cannot be verified by VicGold geologists
	Aspects of the determination of mineralisation that are Material to the Public Report. In cases where ‘industry standard’ work has been done this would be relatively simple (eg ‘reverse circulation drilling was	Rockchip sampling is a standard first pass method of surface exploration. Weights of samples are not recorded. These were assayed for gold using 25g fire assay (code PE01S, Onsite Lab Services, Victoria).

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	used to obtain 1 m samples from which 3 kg was pulverised to produce a 30 g charge for fire assay’). In other cases, more explanation may be required, such as where there is coarse gold that has inherent sampling problems. Unusual commodities or mineralisation types (eg submarine nodules) may warrant disclosure of detailed information.
Drilling techniques	Drill type (eg core, reverse circulation, open-hole hammer, rotary air blast, auger, Bangka, sonic, etc) and details (eg core diameter, triple or standard tube, depth of diamond tails, face- sampling bit or other type, whether core is oriented and if so, by what method, etc).	Not applicable
Drill sample recovery	Method of recording and assessing core and chip sample recoveries and results assessed.	Not applicable
	Measures taken to maximise sample recovery and ensure representative nature of the samples.	Not applicable
	Whether a relationship exists between sample recovery and grade and whether sample bias may have occurred due to preferential loss/gain of fine/coarse material.	Not applicable .
Logging	Whether core and chip samples have been geologically and geotechnically logged to a level of detail to support appropriate Mineral Resource estimation, mining studies and metallurgical studies.	In most case, records of geology are included the sample information by Mantle Mining
	Whether logging is qualitative or quantitative in nature. Core (or costean, channel, etc) photography.	Not applicable

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	The total length and percentage of the relevant intersections logged	Not applicable
Sub-sampling techniques and sample preparation	If core, whether cut or sawn and whether quarter, half or all core taken.	Not applicable
	If non-core, whether riffled, tube sampled, rotary split, etc and whether sampled wet or dry.	Not applicable
	For all sample types, the nature, quality and appropriateness of the sample preparation technique.	Rockchip sampling is a standard first pass method of surface exploration. There is limited information regarding sample quality in the Mantle Report.
	Quality control procedures adopted for all sub-sampling stages to maximise representation of samples.	Not recorded
	Measures taken to ensure that the sampling is representative of the in situ material collected, including for instance results for field duplicate/second-half sampling.	Mantle Mining records indicate the rock chip samples were taken of representative mineralised material around old workings and outcrop. While sample locations have been visited, the information supplied by Mantle Mining in the 2007 Mantle Mining Annual Report cannot be verified by VicGold geologists. No records of field duplicates are recorded, although assay repeats were done by the laboratory.
	Whether sample sizes are appropriate to the grain size of the material being sampled.	Not applicable
Quality of assay data and	The nature, quality and appropriateness of the assaying and laboratory procedures used and whether the technique is considered partial or total.	Gold Fire Assay technique performed in a certified laboratory (Onsite Lab Services, Victoria) and is an appropriate method to determine gold concentrate of rock chip samples collected for orogenic gold.

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laboratory tests	For geophysical tools, spectrometers, handheld XRF instruments, etc, the parameters used in determining the analysis including instrument make and model, reading times, calibrations factors applied and their derivation, etc.	Not Applicable
	Nature of quality control procedures adopted (eg standards, blanks, duplicates, external laboratory checks) and whether acceptable levels of accuracy (ie lack of bias) and precision have been established.	This information was not reported in the 2007 Mantle Mining Annual Report. These samples relate to first pass surface exploration and may have not had extensive repeats, external lab checks or duplicates.
Verification of sampling and assaying	The verification of significant intersections by either independent or alternative company personnel.	Not Applicable
	The use of twinned holes.	Not Applicable
	Documentation of primary data, data entry procedures, data verification, data storage (physical and electronic) protocols.	Not reported in the 2007 Annual Technical Report by Mantle Mining
	Discuss any adjustment to assay data.	Not Applicable
Location of data points	Accuracy and quality of surveys used to locate drill holes (collar and down-hole surveys), trenches, mine workings and other locations used in Mineral Resource estimation.	Reported sample location captured by handheld GPS by Mantle Mining and is recorded in MGA94 zone 55 coordinates
	Specification of the grid system used.	Not Applicable
	Quality and adequacy of topographic control.	Not Applicable
Data spacing and distribution	Data spacing for reporting of Exploration Results.	Not Applicable
	Whether the data spacing and distribution is sufficient to establish the degree of geological and grade continuity	Not Applicable

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	appropriate for the Mineral Resource and Ore Reserve estimation procedure(s) and classifications applied.
	Whether sample compositing has been applied.	Not Applicable
Orientation of data in relation to geological structure	Whether the orientation of sampling achieves unbiased sampling of possible structures and the extent to which this is known, considering the deposit type.	Not Applicable
	If the relationship between the drilling orientation and the orientation of key mineralised structures is considered to have introduced a sampling bias, this should be assessed and reported if material.	Not Applicable
Sample security	The measures taken to ensure sample security.	Sample security of this rock chips sampling by Mantle Mining is not reported in the 2007 Annual Technical Report
Audits or reviews	The results of any audits or reviews of sampling techniques and data.	This has not been reported by Mantle Mining in the 2007 Annual Technical Report

Section 2 Reporting of Exploration Results

(Criteria listed in the preceding section also apply to this section.)

Criteria	JORC Code explanation	Commentary
Mineral tenement and land tenure status	Type, reference name/number, location and ownership including agreements or material issues with third parties such as joint ventures, partnerships, overriding royalties, native title interests, historical sites, wilderness or national park and environmental settings.	Sampling information by Mantle Mining in 2007 and geology reinterpreted by VicGold (Victoria Goldfields Pty Ltd) sits within tenement Application EL006816, which is held under the JAQUIAN Pty Ltd, which is own by VicGold. FAU has entered into an agreement to purchase 80% of this tenement, as well as 4 other tenements surrounding and is detailed in the announcement. VicGold has a heritage access agreement with the Native Title

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Criteria	JORC Code explanation	Commentary
		Holders of the area for Haunted Stream. There are no other agreements or JV, and the area is not located in a National Park or Reserve.
	The security of the tenure held at the time of reporting along with any known impediments to obtaining a licence to operate in the area.	The 5 tenements included in this report are in application. There are no known impediments to obtain these licences.
Exploration done by other parties	Acknowledgment and appraisal of exploration by other parties.	Most recently exploration by Mantle Mining between 2007 to 2014, completed rock chip sampling, ground magnetic surveys, and some limited drilling. The limited historic drilling information for Haunted Stream is not reported in this announcement as it is pre JORC 2012 and is currently being assessed. Once completed, it will be reported in future ASX announcements by FAU. From preliminary data compilation, some of the historic drilling under the old mine workings did intersect gold mineralisation, although initial analysis suggest that some of this drilling was ineffective in properly testing the lode positions due to poor structural control and will require re-drilling by FAU. Much of the drilling was primarily testing the magnetic highs interpreted as potential mineralised granodiorites (Wood Point type targets) and not the reef positions. Other explorers over Haunted Stream area over the past 40 years include Freeport of Australia, Canyon Resources, Enigma Gold, Condor Mining Corporation Limited and Barrick Gold. This data is still been compilated. Most of this exploration has concentrated on surface sampling of historic workings.
Geology	Deposit type, geological setting and style of mineralisation.	Field reconnaissance and review of the literature suggests that mineralisation has an orogenic signature, is hosted in folded and faulted, Turbidite sequences predominantly comprising quartz-arenite to sandstone, black shale, siltstone and greywacke sequences of Upper Ordovician age rocks. Historic reports including more recent work undertaken by Mantle Mining Geologists identified both free gold and heavily mineralised sulphide charged gold zones were the target of early miners in the mid to late 1800’s. Hand

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Criteria	JORC Code explanation	Commentary
		specimens indicate the presence of Arseno-pyrites, Pyrite, Chalcopyrite and Pyrrhotite which is supported with assay results from rock chip sampling undertaken by Mantle Mining in 2007 through Onsite Laboratory Services. Assessment of As against Au illustrated a 1:1 correlation suggesting that there are both refractory and free gold zones detected within the EL006816 tenement. The main fold train runs along the strike of the Haunted Stream tenement bearing a WNW-ESE axial trend with measured and observed subsequent folding occurring at high- angle to the main fold axes striking NNE-SSW. Records of historical workings denote that mining focussed on shoots and bedding parallel fault zones. Field mapping has ascertained that the shoots at Rob Roy including the Oversight mine, are steeply SSW plunging and occur on southern limbs of the earlier, WNW-ESE trending folds. At Hans Hill, historic workings and mapping along exposed adits and drives suggest the mineralisation occurs locally in planar auriferous mineralisation orientations sub-parallel to the main layering/bedding with strike continuity along the early fold axis (WNW-ESE). Where accessible, mapping of available adits and open stopes along with outcrop highlighted mineralised quartz veins occurred in tension vein arrays, conjugate spur and laminated veins, shear veins and hydrothermal breccia style veins occurs best in silicified, chlorite altered sandstone units immediately adjacent black shale contacts. Carbonate (+ ankerite) spotting occurs throughout the mineralised sections of rock as does minor calcite in conjugate veins.

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Criteria	JORC Code explanation	Commentary
Drill hole Information	A summary of all information material to the understanding of the exploration results including a tabulation of the following information for all Material drill holes: ▪ easting and northing of the drill hole collar ▪ elevation or RL (Reduced Level – elevation above sea level in metres) of the drill hole collar ▪ dip and azimuth of the hole ▪ down hole length and interception depth ▪ hole length. If the exclusion of this information is justified on the basis that the information is not Material and this exclusion does not detract from the understanding of the report, the Competent Person should clearly explain why this is the case.	Not applicable
Data aggregation methods	In reporting Exploration Results, weighting averaging techniques, maximum and/or minimum grade truncations (eg cutting of high grades) and cut-off grades are usually Material and should be stated.	Not Applicable
	Where aggregate intercepts incorporate short lengths of high grade results and longer lengths of low grade results, the procedure used for such aggregation should be stated and some typical examples of such aggregations should be shown in detail.	Not Applicable
	The assumptions used for any reporting of metal equivalent values should be clearly stated.	Not Applicable

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Criteria	JORC Code explanation	Commentary
Relationship between mineralisation widths and intercept lengths	These relationships are particularly important in the reporting of Exploration Results. If the geometry of the mineralisation with respect to the drill hole angle is known, its nature should be reported. If it is not known and only the down hole lengths are reported, there should be a clear statement to this effect (eg ‘down hole length, true width not known’).	Not Applicable, as rockchip data is only being reported.
Diagrams	Appropriate maps and sections (with scales) and tabulations of intercepts should be included for any significant discovery being reported. These should include, but not be limited to a plan view of drill hole collar locations and appropriate sectional views.	Maps have been included within the report above, with scales provided.
Balanced reporting	Where comprehensive reporting of all Exploration Results is not practicable, representative reporting of both low and high grades and/or widths should be practiced to avoid misleading reporting of Exploration Results.	Not all historic rockchip assay data is being reported in the announcement. The data used in this report for Figure 4 is to illustrate some of the high grades encountered from previous sampling around the historic workings and its relationship to new geological interpretation by VicGold. Additional samples have been included in Table 1 and Figure 3 in the Appendix, to illustrate the range of grades encountered. The full historic surface sampling dataset is still being validated and will be reported later.
Other substantive exploration data	Other exploration data, if meaningful and material, should be reported including (but not limited to): geological observations; geophysical survey results; geochemical survey results; bulk samples – size and method of treatment; metallurgical test results; bulk density, groundwater,	Not applicable

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Criteria	JORC Code explanation	Commentary
	geotechnical and rock characteristics; potential deleterious or contaminating substances.
Further work	The nature and scale of planned further work (eg tests for lateral extensions or depth extensions or large-scale step-out drilling). Diagrams clearly highlighting the areas of possible extensions, including the main geological interpretations and future drilling areas, provided this information is not commercially sensitive.	All historic data is being compilated for Haunted Stream. Further exploration work is currently under consideration, including the geophysical modelling, field mapping and rock chip sampling. This will be followed by drilling.

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