MATSA RESOURCES LIMITED — Capital/Financing Update 2018

May 8, 2018

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LIMITED ABN 48 106 732 487

ASX Announcement

9[th] May 2018

Drilling Re-Commences Lake Carey Gold Project

Highlights

• Drilling has re-commenced on the first of two high priority gold targets at lake Carey

  • Step-out drilling will test an interpreted favourable structural location on the Bindah Fault north of BE4 where aircore drilling in 2017 intersected significantly anomalous gold including 3m @ 2.62 g/t Au

  • Step out and infill drilling is also planned north of Matsa’s Fortitude gold mine, in a structurally complex part of the Fortitude Fault where very limited past drilling intersected anomalous gold values including 3m @ 3g/t Au

• The programme to consist of ~100 drill holes for a total of ~10,000m of aircore drilling

• This programme represents the recommencement of exploration activities at Lake Carey, which were largely suspended during the Trial Mining stage of Fortitude gold mine

CORPORATE SUMMARY

Executive Chairman

Paul Poli

Director

Frank Sibbel

Director & Company Secretary

Andrew Chapman

Shares on Issue

176.20 million

Unlisted Options

13.70 million @ $0.25 - $0.30

Top 20 shareholders

Hold 52.73%

Share Price on 8[th] May 2018

15.5 cents

Market Capitalisation

$27.36 million

Head Office: Suite 11, 139 Newcastle Street, Perth Western Australia 6000 Tel : +61 8 9230 3555 Fax: +61 8 9227 0370 Bangkok Office: Unit 1808, Pacific Place 2, 142 Sukhumvit Road, Klongtoey, Bangkok 10110 Tel : +66 0 2653 0258 Fax : +66 0 2653 0258 reception@matsa.com.au www.matsa.com.au

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Matsa Resources Limited (“Matsa” or “the Company” ASX: MAT) is pleased to advise that aircore drilling has re-commenced at Lake Carey gold project (Figure 1).

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Figure 1: Lake Carey Project Aircore Drilling Programme Location

The ~10,000 meter aircore programme underway covers two targets shown in Figure 1. The current programme comprising approximately 100 drill holes is to be carried out using a track mounted aircore rig designed to operate in sandy / boggy areas along the margins of salt lakes. A further drill programme will be undertaken in the near future over parts of the two targets which are under salt lake cover which will require a different drill rig.

Two targets Bindah North and Fortitude North are to be tested by the current aircore programme as summarised below:

Bindah North

The Bindah North target is designed to extend coverage of the highly prospective Bindah Extended Target Corridor where drilling during 2016 and 2017 defined significant gold anomalies at the BE1, BE2, BE3 and BE4 targets (MAT announcement to the ASX 30[th] July 2017) . The current programme is designed to test a 3km section of the Bindah Fault corridor immediately north of the BE4 prospect, where aircore drilling during 2017 intersected anomalous gold values with a best result of 3m @2.62 g/t Au. The drilling is planned to test a section where the fault swings from from a NNW to a N trend. This location is interpreted to be a favourable structural position for gold mineralisation.

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Figure 2: Lake Carey Project, Planned drilling Bindah North

Fortitude North

This target was selected to test a structurally complex zone in the Fortitude Fault approximately 4 km north of Matsa’s Fortitude gold mine. This target is a continuation of the structure which contains the Fortitude gold deposit, but due to access difficulties has only undergone limited previous drilling. Past drilling was carried out along incomplete drill lines spaced 800m apart in an area of mixed sand dunes and areas of salt lake (Figure 3). Past drilling identified anomalous gold values in aircore drilling with a best result of 3m @ 3g/t Au .

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Figure 3: Lake Carey Project, Planned drilling Fortitude North

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For further information please contact:

Paul Poli Executive Chairman

Phone +61 8 9230 3555 Fax +61 8 9227 0370 Email reception@matsa.com.au Web www.matsa.com.au

Competent Person

The information in this report that relates to Exploration results, is based on information compiled by David Fielding, who is a Fellow of the Australasian Institute of Mining and Metallurgy. David Fielding is a full time employee of Matsa Resources Limited. David Fielding has sufficient experience which is relevant to the style of mineralisation and the type of ore deposit under consideration and 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’. David Fielding consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

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