FORTUNA METALS LTD — Capital/Financing Update 2017

Feb 9, 2017

ADDRESS Office J, Level 2, 1139 Hay St. West Perth, WA, 6005 Australia

PHONE EMAIL +61 (8) 9486 4036 pmcneil@frontierresources.com.au ABN WEBSITE 96 095 684 389 www.frontierresources.com.au

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ASX: FNT

ASX Limited

Market Announcements Platform

10[th] February 2017

Swit Kai High Grade Gold + Bulago Porphyry Copper Drilling Program Mobilisation Initiated

Frontier Resources Limited (Frontier) is pleased to announce that the mobilisation for the Bulago high-grade gold and porphyry copper-gold drilling program has commenced, with staff travelling to their respective mobilisation locations to prepare for the general move to site on Sunday 19 February 2017. Drilling should commence 2 days later.

The Supervisory Geologist – Ken Igara (34 years’ experience) will coordinate the mobilisation and organise the drill rig /drill pads for the initial part of the program, at the Central Lower Zone of the Swit Kai high-grade gold Prospect (where the rig is already situated- see photos and plan).

Frontier will initially target the dipping mineralised zone from the SUG002 drill site and attempt to intersect it multiple times from that pad. The SUG002 pad is on the hanging wall side and drillholes from it will result in the best angles of incidence to the moderately south dipping gold target zone. The rationale for originally drilling from the footwall side (CLD holes) was to try and intersect the ‘horizontal plunge or sausage’ that is thought to contain wider and higher grade mineralisation, which is not physically possible from the hanging wall side, because all such holes would drill underneath the plunge, as per hole SUG002.

Former JV partner Ok Tedi Mining Ltd targeted the depth extension to the Central Upper Zone with hole SUG002 and it returned an ‘accidental’ intercept of 1.3m grading 27.0 g/t gold from the moderate south dipping zone/ component in the Lower Zone (announced to the ASX on 4/7/2014). This intercept is located underneath the plunge of the high-grade conformable gold mineralisation we targeted last program with the CLD designated holes and shows the moderate south dipping zone itself also contains very good gold grades. The CLD holes will later be lengthened to reach the target depth that was not achieved for various reasons last drilling program.

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Frontier also hopes to be able to undertake additional general exploration to:

• Further hand trench topographic +/- lead/zinc/gold soil anomalies that appear to represent repetitions of the known high grade mineralisation and thus hope to define future and possibly more extensive drilling targets.

• Pan concentrate /stream sediment sample the watercourses to the northwest and north of the Swit Kai Prospects, as they have never been systematically evaluated, but where reconnaissance sampled they have demonstrated significant gold anomalies. This region drains an intrusive that also has significant aeromagnetic and potassium radiometric anomalies requiring follow-up.

• Reconnoitre and also hand trench the major gold/zinc/lead soil anomaly in the central north of the Bulago Valley.

Limited exploration undertaken during the late 2016 drilling program specifically targeted three topographic “flat spots” along and across strike from the known high-grade gold mineralisation, with hand trenching, mapping and sampling. Trench 3 returned a rock sample grading 16.40 g/t gold + 54.7 g/t silver that was outside the soil grid and 830m WNW of the East Creek drilling (announced to the ASX on 23/11/2016).

These geomorphological anomalies (small flat spots and possible conformable mineralisation) have steep northern sides representing possible moderate south dipping zones/ mineralisation. They were targeted because the mineralisation model for Swit Kai consists of both a moderate south dipping zone and a conformable sub-horizontal zone. These characteristics

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are reasonably expected to be repeated in other locations within the area, resulting in multiple gold mineralised zones as we have apparently observed.

These flat spots are also associated with strongly anomalous lead and zinc (with local gold) in soil geochemistry, further reinforcing the parameters of the mineralisation model and demonstrating that all such zones require concerted evaluation. There are many such geomorphological anomalies in the general Swit Kai and Bulago area and they are relatively simple to follow up and evaluate, in preparation for future drilling.

New sub-cropping and out-cropping mineralisation was also discovered over a >40m length and up/downslope on the walking track to the EZL hole drill pad, between the Central Lower Zone and East Creek drill pads. This site will be hand trenched to determine the exact location of the mineralisation and ultimately will likely be drilled to test the economic potential between the CLD and EZL sites. Sample 649006 (see plan above) at this location returned 49.80 g/t gold + 135.0 g/t silver and interestingly 0.70% copper.

The work on Trench 2 demonstrated encouraging minor gossan floats near the Bulago River, which represent a major new target zone, as previously hypothesised. The assay results were sub-economic at 0.10 g/t gold, but support the model and demand continued evaluation at this location to check for substantial gold mineralisation.

For additional information please visit our website at www.frontierresources.com.au

FRONTIER RESOURCES LTD

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P.A. McNeil, M.Sc., MAIG Chairman and Managing Director

Competent Person Statement :

The information in this report that relates to Exploration Results is based on information compiled by Peter A. McNeil - Member of the Aust. Inst. of Geoscientists. Peter McNeil is the Chairman/Managing Director of Frontier Resources, who consults to the Company. Peter McNeil has sufficient experience which is relevant to the type of mineralisation and type of deposit under consideration to qualify as Competent Person as defined in the 2012 Edition of the Australasian Code of Reporting Exploration Results, Mineral Resources and Ore Resources. Peter McNeil consents to the inclusion in the report of the matters based on the information in the form and context in which it appears.