GBM RESOURCES LIMITED. — Capital/Financing Update 2016

Dec 19, 2016

ABN 91 124 752 745

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ASX Release

20 December 2016

ASX Code: GBZ

Mt Coolon Gold Project Update

• Stage 1 of drilling programme has been completed at the Koala Gold Mine with 23 diamond holes drilled for a total of 1,303 metres

• Results have confirmed the presence of remnant high-grade gold mineralisation in quartz vein and breccia style settings throughout the old stope area tested.

COMPANY DIRECTORS

Peter Thompson Managing Director/ Executive Chairman

Neil Norris Exploration Director – Executive

Hun Seng Tan Non- Executive Director

CONTACT DETAILS

• The Company will commence Stage 2 drilling in January 2017 and the program forms part of the Study to evaluate recommencement of mining operations at the Koala Gold Mine.

Principal & Registered Office Suite 8, 7 The Esplanade, Mt Pleasant, WA 6153

Exploration Office 10 Parker Street, Castlemaine, Victoria 3450

Australian Resources company GBM Resources Limited (ASX: GBZ ) (“ GBM ” or “ the Company ”) wishes to advise that it has completed the first stage of its diamond drilling program testing the central mineralised zone at the Koala Gold Mine at Mount Coolon, located in the Drummond Basin, Queensland.

The drilling has confirmed the presence of remnant high-grade gold mineralisation in quartz vein and breccia style settings throughout the area tested. This high grade material is hosted within a broader halo of intense silica pyrite mineralisation.

Website

www.gbmr.com.au

Email info@gbmr.com.au Phone +61 (8) 9316 9100

Fax +61 (8) 9315 5475

Phone (Exploration Office) +61 (3) 5470 5033

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Photograph 1: Diamond core photo from KLRD0022 showing intact auriferous lode quartz within intensely silicified, pyritic
andesite host rock.
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Stage 1 drilling comprised 23 drill holes for a total of 1,303 metres of diamond drilling. All results have now been received and compilation and interpretation are underway. Significant intersections received to date are summarised below. Full results are listed in table 2 at the end of this release.

Hole ID	Intersection	Gram Metres
KLRD0002	3.5m@14.7g/t from 44m, (incl. 0.9m@ 55.7g/t Aufrom 46m)	51.5
KLRD0005	22m@2.0g/t Au from 28m, (incl. 4.7m@ 6.5g/t Aufrom 41.3)	44.0
KLRD0018	0.8m@44.2g/t Au from 71.7m	35.4
KLRD0007	3.0m@7.1g/t Au from 25m_(incl. 1m@ 19.3g/t Aufrom 26m)_	21.3
KLRD0018	1.5m@12.5g/t Au from 69.2m	18.8
KLRD0014	4m@3.5g/t Au from 30m_(incl. 0.7m@ 16.4g/t Aufrom 30.6m)_	14.1
KLRD0007	3.8m@3.1g/t Au from 30.2m_(incl. 0.8m@ 11.4g/t Aufrom 30.2m)_	11.8
KLRD0012	2.7m@3.9g/t Au from 67.4m_(incl. 1.1m@ 8.6g/t Aufrom 67.4m)_	10.5
KLRD0020	6m@1.7g/t Au from 51.3m	10.1
KLRD0021	8m@1.2g/t Au from 69m_(incl. 0.9m@ 6.7g/t Aufrom 71.7m)_	9.4

Table 1: Significant results from Stage 1 drilling (see Table 2 for full results).

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Photograph 2: Drilling at Koala Gold Mine with the Ross Mining open pit (1996) in the background.

The diamond drilling programme proved to be successful in penetrating the old mine workings on most occasions. Seventy per cent of the holes either successfully passed through the old stopes or did not encounter voids from previous mining.

The programme has in-filled previous drilling to approximately 50 metre pattern and will provide increased confidence in the location and extent of old mine workings and has also provided sample material for a range of technical studies. Apart from gold distribution, samples have been dispatched for testing to provide information on metallurgical recoveries, rock strength, and environmental testing.

In addition to the Phase 1 drilling, two holes were drilled under the old Ross Mining open pit to provide material for metallurgical testing, geo-mechanical and environmental sampling. Holes were collared at low declinations (around 35 degrees) to intersect the ore horizon within the limit of preliminary open pit designs. This resulted in difficult drilling conditions, both holes successfully reached depths that will provide valuable samples and information although one hole stopped in difficult drilling conditions prior to reaching the ore zone.

Future Work

Based on results of the Stage 1 drilling, the Company has committed to commencing the stage 2 programme with approximately 50% of this programme to be completed to test the infilling drilling around a potential pit area around the old Koala Mine underground workings to approximately a 25 metre pattern. This programme is expected to be completed early in the New Year. Following receipt of these results the resource will be reestimated and mine planning commenced.

At Glen Eva the resource model is currently being re-estimated to reflect open pit mining parameters and is nearing completion. To support possible future mining at Glen Eva, the Company has committed to completing two holes to provide sample material and information to support metallurgical, geotechnical and environmental evaluations. The first of these holes has commenced and the holes are scheduled to be completed early in the 2017 calendar year. Also currently in progress is an ecological study of the Glen Eva area to support environmental assessment of the potential impacts of any proposed future mining activities.

Discussions with potential toll milling service providers are ongoing and remain positive. The metallurgical data now being generated from test work now in progress will be critical to support ongoing discussions.

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Figure 1 : Koala Phase 1 drill hole plan showing down hole intersections. Proposed holes as part of stage 2 drilling programme shown in pale and dark blue.

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Figure 2: Mt Coolon Gold Project tenement group location plan.

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		~~Hole Orientation (Local Grid)~~ ~~Hole Location~~	~~Hole Orientation (Local Grid)~~ ~~Hole Location~~	~~Hole Orientation (Local Grid)~~ ~~Hole Location~~	~~Hole Orientation (Local Grid)~~ ~~Hole Location~~	~~Hole Orientation (Local Grid)~~ ~~Hole Location~~	~~Hole Orientation (Local Grid)~~ ~~Hole Location~~	~~Hole Orientation (Local Grid)~~ ~~Hole Location~~	~~Hole Orientation (Local Grid)~~ ~~Hole Location~~	Mineralisation Intersection	Mineralisation Intersection	Mineralisation Intersection	Mineralisation Intersection	Mineralisation Intersection	Mineralisation Intersection
Hole_ID	Local_E	**Local_N **	**Local RL_m **	MGA_E	MGA_N	RL_m	Azimuth⁰	Dip⁰	**EOH Depth_m **	m_From	m_To	**DH Length_m **	**True Width_m **	Gradeg/t Au	G*M True Width
~~KLRD0001~~	~~10016~~	~~9975~~	~~999~~	~~536804.7~~	~~7632873.1~~	~~281.1~~	~~270~~	~~-50~~	~~29.3~~	~~28~~	~~29.3~~	~~1.3~~	~~0.4~~	~~1.6~~	~~0.6~~
~~KLRD0002~~	~~10016~~	~~9925~~	~~1003~~	~~536839.2~~	~~7632837.0~~	~~285.1~~	~~270~~	~~-50~~	~~47.5~~	~~44~~	~~47.5~~	~~3.5~~	~~1.2~~	~~14.7~~	~~17.3~~
										~~46~~	~~46.9~~	~~0.9~~	~~0.3~~	~~55.7~~	~~16.7~~
~~KLRD0003~~	~~9988~~	~~10225~~	~~987~~	~~536611.6~~	~~7633034.3~~	~~269.1~~	~~90~~	~~-50~~	~~35.6~~	~~18~~	~~19~~	~~1~~	~~0.6~~	~~1.4~~	~~0.8~~
										~~26~~	~~28.3~~	~~2.3~~	~~1.3~~	~~1.5~~	~~2.0~~
~~KLRD0004~~	~~9967~~	~~10225~~	~~987~~	~~536596.5~~	~~7633019.8~~	~~269.1~~	~~90~~	~~-50~~	~~59.6~~	~~NSI~~					~~0.0~~
~~KLRD0005~~	~~9961~~	~~10125~~	~~995~~	~~536661.3~~	~~7632943.5~~	~~277.1~~	~~90~~	~~-50~~	~~68.6~~	~~18~~	~~19~~	~~1~~	~~0.5~~	~~4.2~~	~~2.1~~
										~~28~~	~~50~~	~~22~~	~~11.3~~	~~2.0~~	~~22.5~~
										~~41.3~~	~~46~~	~~4.7~~	~~2.4~~	~~6.5~~	~~15.7~~
~~KLRD0006~~	~~9957~~	~~10125~~	~~996~~	~~536658.4~~	~~7632940.7~~	~~278.1~~	~~90~~	~~-60~~	~~53.5~~	~~NSI~~					~~0.0~~
~~KLRD0007~~	~~9975~~	~~10025~~	~~998~~	~~536740.5~~	~~7632880.9~~	~~280.1~~	~~90~~	~~-50~~	~~43.1~~	~~25~~	~~28~~	~~3~~	~~2.1~~	~~7.1~~	~~15.0~~
										~~26~~	~~27~~	~~1~~	~~0.7~~	~~19.3~~	~~13.7~~
										~~30.2~~	~~34~~	~~3.8~~	~~2.7~~	~~3.1~~	~~8.4~~
										~~30.2~~	~~31~~	~~0.8~~	~~0.6~~	~~11.4~~	~~6.5~~
~~KLRD0008~~	~~9962~~	~~10025~~	~~1000~~	~~536731.1~~	~~7632871.9~~	~~282.1~~	~~90~~	~~-60~~	~~58.2~~	~~NSI~~					~~0.0~~
~~KLRD0009~~	~~9961~~	~~9925~~	~~1007~~	~~536799.5~~	~~7632799.0~~	~~289.1~~	~~90~~	~~-65~~	~~54.3~~	~~49~~	~~50.4~~	~~1.4~~	~~1.0~~	~~0.8~~	~~0.8~~
~~KLRD0010~~	~~9948~~	~~9875~~	~~1016~~	~~536824.7~~	~~7632753.9~~	~~298.1~~	~~90~~	~~-60~~	~~65.7~~	~~NSI~~
~~KLRD0011~~	~~9968~~	~~9975~~	~~1004~~	~~536770.0~~	~~7632840.0~~	~~286.1~~	~~90~~	~~-60~~	~~39.5~~	~~NSI~~
~~KLRD0012~~	~~9951~~	~~9975~~	~~1004~~	~~536757.7~~	~~7632828.2~~	~~286.1~~	~~90~~	~~-65~~	~~86.8~~	~~64.8~~	~~65.3~~	~~0.5~~	~~0.4~~	~~7.4~~	~~3.0~~
										~~67.4~~	~~70.1~~	~~2.7~~	~~2.0~~	~~3.9~~	~~7.8~~
										~~67.4~~	~~68.5~~	~~1.1~~	~~0.8~~	~~8.6~~	~~6.9~~
										~~71.5~~	~~76~~	~~10~~	~~7.4~~	~~0.7~~	~~5.2~~
~~KLRD0013~~	~~9967~~	~~9875~~	~~1013~~	~~536838.4~~	~~7632767.1~~	~~295.1~~	~~90~~	~~-55~~	~~43.5~~	~~18~~	~~19~~	~~1~~	~~0.8~~	~~1.3~~	~~1.0~~
~~KLRD0014~~	~~9954~~	~~9825~~	~~1016~~	~~536863.6~~	~~7632722.0~~	~~298.1~~	~~90~~	~~-55~~	~~41.3~~	~~30~~	~~34~~	~~4~~	~~3.2~~	~~3.5~~	~~11.2~~
										~~30.6~~	~~31.3~~	~~0.7~~	~~0.6~~	~~16.4~~	~~9.8~~
~~KLRD0015~~	~~9950~~	~~9825~~	~~1018.5~~	~~536860.7~~	~~7632719.2~~	~~300.6~~	~~90~~	~~-73~~	~~70.2~~	~~52.7~~	~~54~~	~~1.3~~	~~0.9~~	~~0.8~~	~~0.7~~
~~KLRD0016~~	~~9976~~	~~10175~~	~~990~~	~~536637.5~~	~~7632989.9~~	~~272.1~~	~~90~~	~~-50~~	~~30~~	~~NSI~~
~~KLRD0017~~	~~9965~~	~~10175~~	~~990~~	~~536629.6~~	~~7632982.3~~	~~272.1~~	~~90~~	~~-60~~	~~42.6~~	~~38.5~~	~~42.4~~	~~3.7~~	~~1.6~~	~~1.5~~	~~2.4~~
~~KLRD0018~~	~~10028~~	~~10125~~	~~991~~	~~536709.7~~	~~7632989.8~~	~~273.1~~	~~270~~	~~-55~~	~~79.8~~	~~64~~	~~66~~	~~2~~	~~1.0~~	~~2.4~~	~~2.4~~
										~~69.2~~	~~70.7~~	~~1.5~~	~~0.8~~	~~12.5~~	~~9.4~~
										~~71.7~~	~~72.5~~	~~0.8~~	~~0.4~~	~~44.2~~	~~17.7~~
										~~73.7~~	~~75~~	~~1.3~~	~~0.7~~	~~1.4~~	~~1.0~~
~~KLRD0019~~	~~10029~~	~~10025~~	~~998~~	~~536779.5~~	~~7632918.2~~	~~280.1~~	~~270~~	~~-50~~	~~67.1~~	~~NSI~~
~~KLRD0020~~	~~9960~~	~~10075~~	~~997~~	~~536695.1~~	~~7632906.7~~	~~279.1~~	~~90~~	~~-50~~	~~57.3~~	~~36~~	~~38~~	~~2~~	~~1.5~~	~~1.1~~	~~1.7~~
										~~51.3~~	~~57.3~~	~~6~~	~~4.5~~	~~1.7~~	~~7.7~~
										~~55.9~~	~~57.3~~	~~1.4~~	~~1.0~~	~~3.4~~	~~3.4~~
~~KLRD0021~~	~~9956~~	~~10075~~	~~997~~	~~536692.2~~	~~7632903.9~~	~~279.1~~	~~90~~	~~-60~~	~~80.7~~	~~49.6~~	~~51~~	~~1.4~~	~~0.9~~	~~5.9~~	~~5.3~~
										~~69~~	~~77~~	~~8~~	~~4.9~~	~~1.1~~	~~5.4~~
										~~71.7~~	~~72.6~~	~~0.9~~	~~0.6~~	~~6.7~~	~~4.0~~
KLRD0022	9935	9925	1011	536780.7	7632781.1	293.1	90	-60	92.7	58	59	1	0.7	2.4	1.7
										70	71	1	0.7	6.7	4.7
										74.7	75.7	1	0.7	2.6	1.8
										79.8	80.6	0.8	0.6	4.5	2.7
										86.5	868	0.3	0.2	4.9	1.0
										89.1	91	1.9	1.4	1.3	1.8
KLRD0023	10021	10175	989	536670.0	7633021.0	271.1	270	-50	56.3	41	45	4	2.8	1.9	5.3

Table 2. Summary of Koala Phase 1 drill holes. Please note that co-ordinates are preliminary and subject to minor change on final survey pickup. Intersections are based on a 0.3g/t Cut-off and a maximum of 2 metres of included sub-grade material.

For Further information please contact:

Peter Thompson Karen Oswald Managing Director Marko Communications GBM Resources Limited Tel: 0423 602 353 Tel: 08 9316 9100 Email: Karen.oswald@markocommunications.com.au

About GBM Resources

GBM Resources Ltd (ASX: GBZ) is an Australian resource company that listed on the ASX in 2007, headquartered in Perth WA, with exploration operations in Queensland and Victoria.

The Company’s primary focus is in key commodities of gold and copper-gold, assets in Australia. GBM tenements cover an area greater than 3,200 square kilometres in eight major projects areas in Queensland and Victoria.

GBM is prioritising the exploration and development of the Mount Coolon Gold Project and Mount Morgan Gold Copper Project.

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Mt Coolon Project Resource Summary

Project	Location	Resource Category	Resource Category	Resource Category	Resource Category	Resource Category	Resource Category	Resource Category	Resource Category	Resource Category	000' t Aug/t Au ozs Total	000' t Aug/t Au ozs Total	000' t Aug/t Au ozs Total	Cut-off
		000' t Aug/t Au ozs Measured			000' t Aug/t Au ozs Indicated			000' t Aug/t Au ozs Inferred
Koala	Open Pit				370	2.8	33,500	750	2.1	51,700	1,110	2.4	85,000	0.4
	Underground Extension				50	3	5,100	230	3.9	28,500	280	3.7	33,700	2.0
	Tailings	114	1.6	6,200	9	1.6	400				124	1.6	6,600	1
	Total	114 1.7 6,200 429 2.8 39,000 980 2.5 80,200 1,514 2.6 125,300
Eugenia	Oxide				1,305	0.9	39,300	219	0.7	5,100	1,524	0.9	44,400	0.4
	Sulphide				2,127	0.9	62,300	1,195	1.2	45,500	3,322	1.0	107,800	0.4
	Total	3,432 0.9 101,600 1,414 1.1 50,600 4,846 1.0 152,200 0.4
Glen Eva	Belowpit.				132	7.8	33,200	21	5.9	4,000	154	7.5	37,200	3.0
Total		114 1.7 6,200 3,993 1.4 173,800 2,415 1.7 134,800 6,514 1.5 314,700

Table 3: Current global resource table for Mt Coolon Gold Project. Please note rounding; tonnes (1,000t), grade (0.1g/t) and contained gold (100 ounces). Refer ASX announcement 23 August 2016.

Notes

The information in this report that relates to Mineral Resources, Exploration Targets and Exploration Results is based on information compiled by Neil Norris, who is a Member of The Australasian Institute of Mining and Metallurgy and The Australasian Institute of Geoscientists. Mr Norris is a full-time employee of the company, and is a holder of shares and options in the company. Mr Norris has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Norris consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

The Company confirms that the form and context in which the Competent Persons findings are presented have not been materially modified from the original market announcements.

The Company confirms that it is not aware of any new information or data that materially affects the information included in the respective announcements and all material assumptions and technical parameters underpinning the resource estimate with those announcements continue to apply and have not materially changed.

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JORC Code, 2012 Edition – Table 1 report template

Section 1 Sampling Techniques and Data

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

Important Note:

This Table 1 refers to drilling completed at the Koala Project by MCGM in 2016 only. Drilling and exploration has been carried out at Koala over a 30 year period by a variety of companies using varied drilling, sampling and assaying methods. Table 1 data has previously been reported for historic exploration in the 2016 MCGM Koala Resource Estimate Report.

Criteria	JORC Code explanation	Commentary
Sampling	• Nature and quality of sampling (e.g. cut channels, random chips, or	•Diamond core drilling was used to obtain HQ3, HQ2 or NQ2 size drill
techniques	specific specialised industry standard measurement tools appropriate	core. Core was cut at nominal 1m interval lengths or at distinctive
	to the minerals under investigation, such as down hole gamma	geological boundaries (e.g. major quartz vein margins) then half-sawn
	sondes, or handheld XRF instruments, etc.). These examples should	lengthways using a Corewise core saw. Half-core interval length
	not be taken as limiting the broad meaning of sampling.	samples were then bagged in labelled calico bags for laboratory
	• Include reference to measures taken to ensure sample representivity	shipment.
	and the appropriate calibration of any measurement tools or systems
	used.
	• 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 (e.g. ‘reverse circulation drilling was used to obtain 1
	m samples from which 3 kg was pulverized 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 (e.g.
	submarine nodules) may warrant disclosure of detailed information.
Drilling	• Drill type (e.g. core, reverse circulation, open-hole hammer, rotary air	•All drilling was completed using the Diamond Core method by an
techniques	blast, auger, Bangka, sonic, etc.) and details (e.g. core diameter,	Atlas Copco CS14 track-mounted drill rig.
	triple or standard tube, depth of diamond tails, face-sampling bit or	•Diamond core was recovered in a standard wireline core barrel. Drill
	other type, whether core is oriented and if so, by what method, etc.).	holes KLRD0001-0005 were drilled using standard HQ size
		equipment and a single wall core barrel. Recovery problems in
		broken ground in KLRD0005 forced a switch to HQ triple tube
		equipment with a split-tube barrel assembly from KLRD0006
		onwards.
		•Samples were pushed out from the core barrel, and in the case of the
		triple-tube barrel,the tophalf split was removed and the coreplaced

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Criteria	JORC Code explanation	Commentary
		in a core tray of suitable dimension.
		•All diamond core was oriented using Reflex digital orientation tools
		sized for either HQor NQcore diameters.
Drill sample	• Method of recording and assessing core and chip sample recoveries	•Larger diameter HQ size core was used to provide improved
recovery	and results assessed.	recovery for the majority of drilling and triple tube drilling was
	• Measures taken to maximise sample recovery and ensure	employed from KLRD0006 onwards to preserve core in a more
	representative nature of the samples.	coherent state for logging and also to improve recovery in very
	• Whether a relationship exists between sample recovery and grade	broken or clayey lithologies. Short (1.5m) core barrels were used
	and whether sample bias may have occurred due to preferential	for short drill runs to assist recovery.
	loss/gain of fine/coarse material.	•Diamond drill recovery was recorded run by run using the aggregate
		of all >10cm core pieces per run method. This data averages 87.8%
		recovery for holes KLRD0001-0005 and 89.4% for holes KLRD0006-
		0011. Recovery using triple-tube core barrels was very good in
		competent lithology but was compromised in loose, rubbly stope fill.
		•The relationship between grade and drilling recovery will be
		investigated at the conclusion of the Phase 1 drilling program.
Logging	• Whether core and chip samples have been geology and geotechnical	•All diamond core was logged in detail for lithology, weathering,
	features have been logged to a level of detail to support appropriate	veining, quartz percentage, alteration, structure, colour and basic
	Mineral Resource estimation, mining studies and metallurgical	geotechnical parameters (RQD).
	studies.	•Logging of a selection of holes was also completed to advanced
	• Whether logging is qualitative or quantitative in nature. Core (or	geotechnical industry standards for pit design and mine planning.
	costean, channel, etc.) photography.	•The logging has been carried out to an appropriate level for resource
	• The total length and percentage of the relevant intersections logged.	estimation.
		•All holes werephotographed from surface to EOH,both wet and dry.
Sub-	• If core, whether cut or sawn and whether quarter, half or all core	•All diamond core samples were cut with a diamond brick saw to 1.0 m
sampling	taken.	or geological intervals and half sampled using a Corewise core-
techniques	• If non-core, whether riffled, tube sampled, rotary split, etc. and	cutting saw.
and sample	whether sampled wet or dry.	•Laboratory sample preparation for all samples followed the respective
preparation	• For all sample types, the nature, quality and appropriateness of the	laboratories standard methodologies for gold fire assay and multi-
	sample preparation technique.	element techniques.
	• Quality control procedures adopted for all sub-sampling stages to	•Quality control procedures for sampling were implemented
	maximise representivity of samples.	systematically; blanks and field duplicates were inserted every 10
	• Measures taken to ensure that the sampling is representative of the in	core samples (focused in mineralized zones), and standards were
	situ material collected, including for instance results for field	inserted every consecutive 20 sample run.
	duplicate/second-half sampling.	•Field duplicates consisted of quarter-cut core of equal interval length
	• Whether sample sizes are appropriate to the grain size of the material	to the primary half-core sample.
	being sampled.	•No measures were taken to ensure the representivityof the samples.
Quality of	• The nature, quality and appropriateness of the assaying and	•ALS Laboratories Au-AA25: A prepared sample is fused with a
assay data

9

Criteria	JORC Code explanation	Commentary
and	laboratory procedures used and whether the technique is considered	mixture of lead oxide, sodium carbonate, borax, silica and other
laboratory	partial or total.	reagents as required, inquarted with 6 mg of gold-free silver and then
tests	• For geophysical tools, spectrometers, handheld XRF instruments,	cupelled to yield a precious metal bead. The bead is digested in 0.5
	etc., the parameters used in determining the analysis including	mL dilute nitric acid in the microwave oven. 0.5 mL concentrated
	instrument make and model, reading times, calibrations factors	hydrochloric acid is then added and the bead is further digested in the
	applied and their derivation, etc.	microwave at a lower power setting. The digested solution is cooled,
	• Nature of quality control procedures adopted (e.g. standards, blanks,	diluted to a total volume of 10 mL with de-mineralized water, and
	duplicates, external laboratory checks) and whether acceptable levels	analyzed by atomic absorption spectroscopy against matrix-matched
	of accuracy (i.e. lack of bias) and precision have been established.	standards.
		•ALS Laboratories ME-MS61: a 0.5g sample is subjected to near-total
		digestion by a four-acid mixture and finished with a combination of
		ICP Mass Spectrometry (MS) and Atomic Emission Spectroscopy
		(AES).
		•Laboratory QAQC involves the use of internal lab standards using
		certified reference material, blanks, splits and replicates as part of the
		in house ALS procedures.
		•No handheld tools were used with all assays performed at external
		laboratories
		•Quality control procedures for sampling were implemented
		systematically; blanks and field duplicates were inserted every 10
		core samples (focused in mineralized zones), and standards were
		inserted everyconsecutive 20 sample run.
Verification	• The verification of significant intersections by either independent or	•External data verification is not required at this time.
of sampling	alternative company personnel.	•No verification samples (including twinned holes) have been taken
and assaying	• The use of twinned holes. • Documentation of primary data, data entry procedures, data	•All Data, data entry procedures, data verification and data storage has been carried out by GBM staff in accordance with GBM Standard
	verification, data storage (physical and electronic) protocols.	Operating Procedures (SOPs). GBM SOP’s meet industry best
	• Discuss any adjustment to assay data.	practice standards. Final Data verification and data storage has been
		managed by GBM Data Management staff using industry standard
		Data Shed software. Field duplicates are reviewed to ensure they fall
		within acceptable limits.
		•No adjustments or calibrations were made to anyassaydata used.
Location of	• Accuracy and quality of surveys used to locate drill holes (collar and	•All collar locations were pegged by Licensed Surveyor using the
data points	down-hole surveys), trenches, mine workings and other locations	historical Koala Project Local Grid. Where peg positions required
	used in Mineral Resource estimation.	modification, collar pegs were moved using tape and compass with
	• Specification of the grid system used.	reference to a surveyed baseline.
	• Quality and adequacy of topographic control.	•At the conclusion of the Phase 1 drilling program, all collars will be
		surveyed by Licenced Surveyor.
		•Downhole drill surveys were carried out at nominally25m intervals

10

Criteria	JORC Code explanation	Commentary
		using a Reflex multi-shot digital survey tool.
		•All work was carried out in the Koala local mine grid. The local grid
		was re-established by Licenced Surveyor using a set of known survey
		points (old drill collars, local grid pegs).
		•The topographic surface was triangulated from mine survey data
		collected at the time of mine closure in 1997. The resultant surface is
		of sufficientqualityfor resource estimation.
Data spacing	• Data spacing for reporting of Exploration Results.	•Drilling has been carried out on 50m spaced sections between or to
and	• Whether the data spacing and distribution is sufficient to establish the	supplement existing historic 50m sections. Down-dip spacing of
distribution	degree of geological and grade continuity appropriate for the Mineral	mineralisation intersections is between 20-25m. Holes were drilled
	Resource and Ore Reserve estimation procedure(s) and	across strike of the main north striking (Local Grid) mineralized zone
	classifications applied.	towards both the east and west. The drill holes generally intersected
	• Whether sample compositing has been applied.	mineralization at 60º or greater.
		•The suitability of spacing and orientation of the sampling for grade
		and geological continuity will be established by variography at the
		conclusion of Phase 1 drilling. Should further infill drilling be required
		to meet resource requirements, this will be completed in Phase 2.
		•The samples were not composited prior to submission to the
		laboratory
Orientation	• Whether the orientation of sampling achieves unbiased sampling of	•The spacing and orientation of the sampling is generally appropriate
of data in	possible structures and the extent to which this is known, considering	to the main mineralized zone, however there are known (from grade
relation to	the deposit type.	control data) mineralized cross faults which have a similar orientation
geological	• If the relationship between the drilling orientation and the orientation	to the drill sections. The current drilling configuration does not
structure	of key mineralised structures is considered to have introduced a	adequately define these cross structures and so any resource
	sampling bias, this should be assessed and reported if material.	estimate is likely to under-estimate the number, volume (tonnage)
		and grade of these mineralized cross structures.
		•It is possible that the sampling is biased by not intersecting possible
		high grade cross structures. This has not been tested because too
		few cross structures have been definitivelyidentified.
Sample	• The measures taken to ensure sample security.	•All drill core is transported from drill sites to the Company core
security		processing facility in Mt Coolon by Company personnel. Prepared
		samples are then transported to a commercial courier in Moranbah by
		Company personnel where they are on-shipped directly to ALS
		Laboratories in Townsville.
		•Core, coarse chip rejects and pulps are stored at the GBM core
		facility.
Audits or	• The results of any audits or reviews of sampling techniques and data.	•No audits of either the data or the methods used in this drilling
reviews		program have been undertaken to date.

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Section 2 Reporting of Exploration Results

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

Criteria	JORC Code explanation	Commentary	Commentary
Mineral	• Type, reference name/number, location and ownership including	•	The Koala resource is located within ML1029 which along with
tenement	agreements or material issues with third parties such as joint		ML1085 and ML1086 form a contiguous group of leases that form the
and land	ventures, partnerships, overriding royalties, native title interests,		Koala project and are 100% owned by GBM Resources Ltd. ML1029
tenure status	historical sites, wilderness or national park and environmental		expires on 31/1/24
	settings.	•	GBM is not aware of any material issues with third parties which may
	• The security of the tenure held at the time of reporting along with any		impede current or future operations at Koala.
	known impediments to obtaining a licence to operate in the area.
Exploration	• Acknowledgment and appraisal of exploration by other parties.	•	In 1913 gold was discovered at MT Coolon (Koala gold mine) by a
done by other parties			boundary rider, from 1913 until 1931 gold was mined from small shallow leases and shallow shafts, from 1931 -139 Gold Mines of
			Australia (GMA) consolidated and mined the whole field. Historic
			underground mining from discovery in 1914 to 1938 produced
			approximately 180,000 ounces of gold at an average grade of
			18.4g/t Au.
		•	No activity was taken from 1939 to 1974 Saracen Minerals (~1974)
		•	Saracen Minerals explored for porphyry-style base metals in an
			area from Koala Mine to east of Bungobine Homestead during
			1974. Work involved collection of 115 rock chip samples and
			geological traverses. The two main prospects were at Bungobine
			Yards and around Mt Coolon/Koala Mine. Due to poor results, the
			tenement was relinquished.
		•	Renison Goldfields LTD/Gold Feilds Exploration (1986 – 1989)
			Carried out mapping, colour aerial photography, airborne magnetic
			and radiometric survey, ground magnetics, produced a feasibility
			study, a review of old GMA data and plans from 1939, rock chip
			sampling of the reef at surface, and drilling; 78 percussion Drill
			holes, 99 Reverse circulation collars with Diamond Drill holes tails
			to test and delineate remnant resources, the western reef and
			Hectorina deposit. Renison commenced a decline but terminated
			mining due to intersecting a major fault.
		•	ACM Gold Limited/Wirralie Gold Mines (1989 - 1992) carried out
			exploration on the Tower prospect and at Mt Koala. Producing a
			resource estimate and feasibility study for open pit mining. Work
			included evaluatingRenison’sprevious work, photo and

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Criteria	JORC Code explanation	Commentary	Commentary
			lineament analysis, rock chip sampling, and drilling; 45 RAB
			scout holes testing surface mineralisation, 291 soil auger holes
			and 1 RC hole.
		•	Ross Mining (1992 - 2000) carried out regional and detailed
			mapping, produced a new resource estimate, soil sampling,
			metallurgy testing, a gradient array Resistivity survey, IP surveys,
			CSMAT survey, Petrology, drilling; RC collars with Diamond tails
			(6 holes), 39 RC, 103 diamond holes and 157 RAB holes. Ross
			carried out mining of the northern end of the ML an area that
			Renison had planned to mine from underground and is known as
			the Koala Pit. Ross Mining produced 53,000 ounces gold at an
			average grade of 5.6g/t Au.
		•	Normandy Mining (2000 - 2002) carried out work re-modeling
			the whole deposit, a heli-borne EM survey and drilling distal to
			the main Koala resource.
		•	MCGM/Drummond Gold (2006 -2014) carried out a revaluation and
			synthesis of all previous work which included a verification and
			validation of previous work and data, mapping, HyVista imagery,
			reinterpretation of previous geophysics data sets, and drilled; 17
			RC holes, 9 RC pre collar with diamond tail holes and 4 Diamond
			holes
		•	GBM acquired the project from Drummond Gold in 2015.
		•	All drilling, sampling, surveying and assaying that forms the basis of
			this resource estimate was carried out bythese otherparties.
Geology	• Deposit type, geological setting and style of mineralisation.	•	Auriferous epithermal veining at Koala is hosted in a thick package
			of shallow dipping volcanic flow sheets, which are part of the
			regional Cycle 1 Volcanic sequence (Silver Hills Volcanics). The
			lode lies approximately 500m west of a major granodiorite intrusion
			outcrop and is preferentially hosted by porphyritic andesite. The
			gold mineralisation occurs as a narrow, steeply dipping high grade
			colloform quartz vein a wider lower grade, veinlet stockwork and is
			locally disrupted by faulting. The main vein has been defined by
			drilling over a strike length of about 1200 m and down dip about
			200 m. The main vein is offset by steeply dipping, west-northwest
			striking cross faults with high grade zones formed at the
			intersection of the cross faults and the main vein. The main vein
			changes dip direction along strike. In the south it dips steeply to the
			west, whereas in the north it dips steeply to the east. The main vein
			splits into a series of splayveins at the southern end. The up-dip

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Criteria	JORC Code explanation	Commentary
		extent of the main vein appears to be limited by a rhyolitic unit
		which results in a gentle north plunge. The main vein thins and
		weakens with depth. A number of alteration styles are evident
		including silica-sericite-pyrite+K-Feldspar associated with gold
		mineralisation.
Drill hole	• A summary of all information material to the understanding of the	•Included in table 2 in release.
Information	exploration results including a tabulation of the following information
	for all Material drill holes:
	o easting and northing of the drill hole collar
	o elevation or RL (Reduced Level – elevation above sea level in
	metres) of the drill hole collar
	o dip and azimuth of the hole
	o down hole length and interception depth
	o 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.
Data	• In reporting Exploration Results, weighting averaging techniques,	•All quoted drill intercepts have been length-weighted where required.
aggregation	maximum and/or minimum grade truncations (e.g. cutting of high	•Intercepts were calculated using a 0.3 g/t Au cutoff grade and a
methods	grades) and cut-off grades are usually Material and should be stated.	maximum 2m internal dilution. No high-grade cut was applied.
	• 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.
	• The assumptions used for any reporting of metal equivalent values
	should be clearly stated.
Relationship	• These relationships are particularly important in the reporting of	•Calculated true widths of intercepted mineralisation are included in
between	Exploration Results.	the Drill Hole Summary Table 2.
mineralisatio	• If the geometry of the mineralisation with respect to the drill hole	•Drill results have not been received to complete a detailed
n widths and	angle is known, its nature should be reported.	interpretation and resultant estimation of true width. However for
intercept lengths	• If it is not known and only the down hole lengths are reported, there should be a clear statement to this effect (e.g. ‘down hole length, true	guidance, mineralization generally dips steeply, either to the east of west, and drillholes are usually inclined at approximately 60 degrees
	width not known’).	from horizontal. True widths are usually expected to be approximately
		40% to 70% of downhole interval lengths.
Diagrams	• Appropriate maps and sections (with scales) and tabulations of	•A collar plan with all collar location and intercept callouts, and a set of
	intercepts should be included for any significant discovery being	typical 2D drill cross-sections is included in the report body.
	reported These should include, but not be limited to a plan view of
	drill hole collar locations and appropriate sectional views.

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Criteria	JORC Code explanation	Commentary
Balanced	• Where comprehensive reporting of all Exploration Results is not	•Downhole length weighted average grades have been reported for all
reporting	practicable, representative reporting of both low and high grades	drillholes where above the defined cutoff. Where values are below
	and/or widths should be practiced to avoid misleading reporting of	this no significant intersection (NSI) is noted.
	Exploration Results.
Other	• Other exploration data, if meaningful and material, should be reported	•Not applicable at this time. This programme comprises only drilling.
substantive	including (but not limited to): geological observations; geophysical	Further work will be completed and reported in due course.
exploration	survey results; geochemical survey results; bulk samples – size and
data	method of treatment; metallurgical test results; bulk density,
	groundwater, geotechnical and rock characteristics; potential
	deleterious or contaminating substances.
Further work	• The nature and scale of planned further work (e.g. tests for lateral	•Further drilling is planned to test historical stopes near surface. Infill
	extensions or depth extensions or large-scale step-out drilling).	drilling of current 50m sections may also be completed if the
	• Diagrams clearly highlighting the areas of possible extensions,	assessment of geological continuity is considered unsatisfactory.
	including the main geological interpretations and future drilling areas,
	provided this information is not commercially sensitive.

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