MRG METALS LIMITED — Capital/Financing Update 2021

Jul 7, 2021

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ASX ANNOUNCEMENT

8 July 2021

HIGHEST GRADE TARGET TO DATE GENERATED AT MARAO PROJECT

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Key Highlights

• A new very high grade heavy mineral sands (HMS) target, Maduacua, with a surface footprint measuring 3.5 sq km of grade >5%THM (visually estimated) has been identified at the Marao Project in Mozambique.

• Maduacua is the highest grade of 3 HMS targets generated at Marao to date.

• Mineralisation at Maduacua is from surface and remains open to the north, northeast and at depth.

• A higher grade core defined by 2 holes of >6%THM (vis est) is surrounded by 5 holes of 5-6% THM (vis est). Results from these holes:

• 21MUHA131 0 – 13.5m 13.5m @ 6.9% THM;

• • 21MUHA126 0 – 13.5m 13.5m @ 6.7% THM; • 21MUHA124 0 – 13.5m 13.5m @ 5.4% THM;

• 21MUHA128 0 – 13.5m 13.5m @ 5.4% THM;

• • 21MUHA132 0 – 13.5m 13.5m @ 5.4% THM; • 21MUHA127 0 – 13.5m 13.5m @ 5.3% THM; and • 21MUHA130 0 – 13.5m 13.5m @ 5.0% THM.

• Mineral assemblage investigations will be conducted from Heavy Mineral Concentrate (HMC) generated during drilling to follow-up on encouraging initial results of 50.05% Valuable Heavy Mineral (VHM) content (Ilmenite, Altered Ilmenite, Rutile and Zircon) from Scanning Electron Microscopy (SEM, refer ASX Announcement 27 April 2021).

• Auger drilling reconnaissance program at Marao is now 35% completed.

MRG Metals Limited (“ MRG ” or “ the Company ”) ( ASX Code: MRQ ) is pleased to supply an update to the market on the ongoing progress at the Company’s Marao (6842L) HMS licence (Figure 1) where a third high grade target has been identified. This update covers 53 reconnaissance grid (500m X 1000m spaced; Figure 2 and 3) hand auger holes for a total of 621.5m (21MUAC086 to ‘138; Table 1) and the discovery of MRGs third target, the Maduacua Target (Figures 3 and 4). MRG has now completed 138 of the planned 391 (35%) reconnaissance auger holes at Marao.

MRG Metals Limited ABN: 83 148 938 532 / ASX Code: MRQ

Phone: +61 3 5330 5800 / Fax: +61 3 53330 5890

12 Anderson Street West, Ballarat VIC 3350 / PO Box 237 Ballarat VIC 3353

www.mrgmetals.com.au / info@mrgmetals.com.au

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The previous two Marao market updates covered the initial 25 auger holes and the discovery of the Magonde Target (refer ASX Announcement 18 March 2021), followed by the next 60 holes and the discovery of the Mandende Target (refer ASX Announcement 18 June 2021; Figure 3). The Mandende Target remains open in the north. In this program, holes 21MUHA092, ‘093 and ‘094 drilled have demonstrated VIS EST grades of 3.2% THM, 3.7% THM and 3.6% THM respectively (Table 1), therefore increasing the area of the Mandende Target from >9 sq km to >11 sq km (Figure 3). Further smaller targets that will be followed up with additional drilling have also been generated, hole 21MUAC0121 for instance returned VIS EST 6.3% THM from surface to 13.5m and is still open at depth (Figure 4 and Table 1).

The new Maduacua Target displays the best VIS EST THM grades discovered at Marao to date. 12 auger holes have demonstrated VIS EST THM grades of >3% THM per hole, showing the excellent potential of this target to be the next very high grade deposit for MRG. Of these holes:

• 2 holes have VIS EST 4.0 – 4.9% THM;

• 5 holes have VIS EST 5.0 – 6.0% THM;

• Hole 21MUHA126 with VIS EST 6.7% THM from surface to 13.5m; and

• Hole 21MUHA131 with VIS EST 6.9% THM from surface to 13.5m.

Individual 1.5m interval VIS EST THM grades as high as 9% THM was intersected (Table 1, Figure 5). The Maduacua Target is still open towards the North (Figure 4) and has an area currently of >6 sq km. All the holes within the Maduacua Target were mineralised from surface and still in mineralisation at end of drilling depth, several holes had VIS EST THM grades of >5% at the end of drilling depth, with 4 holes (21MUAC126, ‘130, ‘131 and ‘132) in VIS EST >6% THM at the final drilling interval. The Maduacua target remains open at depth.

Auger drilling at Marao is continuing on the reconnaissance grid. Mineralogical studies are ongoing from composite HMC samples from the auger drilling, which is following up on very encouraging initial mineralogical investigations from grab samples at two road quarry sites (Figure 3) within the Marao licence. The investigation showed encouraging up to 50.05% VHM content (Ilmenite, Altered Ilmenite, Rutile and Zircon) results from Scanning Electron Microscopy (SEM, refer ASX Announcement 27 April 2021) A significant percentage of the HMC (up to 8.36%) is represented by Andalusite, the Zircon content of 3.12% is also relatively high compared to MRG’s Koko Massava deposit (refer ASX Announcement 22 April 2020).

MRG Metals Chairman, Mr Andrew Van Der Zwan said: “Marao continues to prove itself as a dynamic project for MRG with the latest results in from auger drilling reconnaissance program delivering our third very high grade target, Maduacua, which is now the highest grade target at Marao. Even with only the 3.5 sqkm surface footprint to date identified, at 13.5m depth there is potential for an at surface resource in excess of 75 MT – before we have done any further follow up. With previous assemblage analysis of VHM components greater than 50%, this is a potentially high value discovery. Our auger reconnaissance program is now 35% complete and we look forward to providing further updates as we progress.”

MRG Metals Limited ABN: 83 148 938 532 / ASX Code: MRQ

Phone: +61 3 5330 5800 / Fax: +61 3 53330 5890

12 Anderson Street West, Ballarat VIC 3350 / PO Box 237 Ballarat VIC 3353

www.mrgmetals.com.au / info@mrgmetals.com.au

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Figure 1: MRG Projects in Mozambique, aircore drilling taking place within Corridor Central (6620L) and Corridor South (6621L) projects.

MRG Metals Limited ABN: 83 148 938 532 / ASX Code: MRQ

Phone: +61 3 5330 5800 / Fax: +61 3 53330 5890 www.mrgmetals.com.au / info@mrgmetals.com.au

12 Anderson Street West, Ballarat VIC 3350 / PO Box 237 Ballarat VIC 3353

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Figure 2: Planned 500m by 1000m reconnaissance Hand Auger drilling grid at Marao 6842L.

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Figure 3: Exploration hand auger drilling done to date at Marao 6842, position of the Magonde, Mandende and new Maduacua Targets, previously reported drillholes in blue and new drilling in yellow.

MRG Metals Limited ABN: 83 148 938 532 / ASX Code: MRQ

Phone: +61 3 5330 5800 / Fax: +61 3 53330 5890

12 Anderson Street West, Ballarat VIC 3350 / PO Box 237 Ballarat VIC 3353

www.mrgmetals.com.au / info@mrgmetals.com.au

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Figure 4: The VIS EST +3% THM Maduacua Target from reconnaissance grid hand auger drilling at Marao 6842.

MRG Metals Limited ABN: 83 148 938 532 / ASX Code: MRQ 12 Anderson Street West, Ballarat VIC 3350 / PO Box 237 Ballarat VIC 3353

Phone: +61 3 5330 5800 / Fax: +61 3 53330 5890 www.mrgmetals.com.au / info@mrgmetals.com.au

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Figure 5: The panned HMC from hand auger holes within the Mandende Target in the west of Marao 6842.

Table 1: Summary collar and visual estimated (VIS EST) THM% results for hand auger drill data for the reconnaissance Marao license completed from the 12 June 2021 to the 3 July 2021.

HOLE ID	UTM NORTH WGS84	UTM EAST WGS84	ELEV'N (M)	EOH (M)	TARGET	DRILL TYPE	DOWNHOLE AVG % VIS EST THM FOR ENTIRE HOLE	INTERSECTION (M)	MIN % VIS EST THM	MAX % VIS EST THM
21MUHA086	7290914	591401	75	13.5	Marao	HAND AUGER	1.9	0-13.5	1.5	2.0
21MUHA087	7292326	591409	66	7.0	Marao	HAND AUGER	1.7	0-7.0	1.5	2.0
21MUHA088	7291972	591768	72	13.5	Marao	HAND AUGER	1.7	0-13.5	1.5	2.5

MRG Metals Limited ABN: 83 148 938 532 / ASX Code: MRQ

Phone: +61 3 5330 5800 / Fax: +61 3 53330 5890

12 Anderson Street West, Ballarat VIC 3350 / PO Box 237 Ballarat VIC 3353

www.mrgmetals.com.au / info@mrgmetals.com.au

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21MUHA089	7291613	592111	71	13.5	Marao	HAND AUGER	2.6	0-13.5	2.0	3.0
21MUHA090	7291261	592465	74	13.5	Marao	HAND AUGER	2.4	0-13.5	2.0	3.0
21MUHA091	7290903	592814	87	13.5	Marao	HAND AUGER	2.9	0-13.5	2.0	3.5
21MUHA092	7290551	593164	75	13.5	Marao	HAND AUGER	3.2	0-13.5	3.0	3.5
21MUHA093	7290189	593517	77	13.5	Marao	HAND AUGER	3.7	0-13.5	3.0	4.0
21MUHA094	7289834	593861	70	13.5	Marao	HAND AUGER	3.6	0-13.5	3.0	4.0
21MUHA095	7291251	593874	76	13.5	Marao	HAND AUGER	2.2	0-13.5	2.0	2.5
21MUHA096	7291609	593525	82	13.5	Marao	HAND AUGER	2.2	0-13.5	2.0	2.5
21MUHA097	7291959	593178	93	13.5	Marao	HAND AUGER	2.8	0-13.5	2.0	2.5
21MUHA098	7292316	592823	94	13.5	Marao	HAND AUGER	3.1	0-13.5	2.0	3.5
21MUHA099	7292673	592475	78	13.5	Marao	HAND AUGER	1.4	0-13.5	1.0	2.0
21MUHA100	7293031	592123	74	13.5	Marao	HAND AUGER	1.7	0-13.5	1.5	2.0
21MUHA101	7293385	591771	73	13.5	Marao	HAND AUGER	1.7	0-13.5	1.0	2.0
21MUHA102	7293746	591417	61	3.0	Marao	HAND AUGER	1.0	0-3.0	1.0	1.0
21MUHA103	7295156	591429	54	2.5	Marao	HAND AUGER	2.5	0-2.5	2.5	2.5
21MUHA104	7294801	591779	77	13.5	Marao	HAND AUGER	4.0	0-13.5	3.0	5.0
21MUHA105	7294443	592132	81	13.5	Marao	HAND AUGER	2.7	0-13.5	2.0	3.5
21MUHA106	7294090	592485	101	13.5	Marao	HAND AUGER	1.9	0-13.5	1.5	2.5
21MUHA107	7293729	592833	106	13.5	Marao	HAND AUGER	2.6	0-13.5	1.5	3.0
21MUHA108	7293376	593186	106	13.5	Marao	HAND AUGER	4.3	0-13.5	3.5	5.0
21MUHA109	7293017	593536	104	13.5	Marao	HAND AUGER	3.3	0-13.5	2.5	4.0
21MUHA110	7292625	593872	90	13.5	Marao	HAND AUGER	2.7	0-13.5	2.0	3.0
21MUHA111	7292308	594236	83	13.5	Marao	HAND AUGER	1.9	0-13.5	1.5	2.5
21MUHA112	7291942	594586	73	13.5	Marao	HAND AUGER	2.4	0-13.5	2.0	3.0
21MUHA113	7291600	594934	51	4.0	Marao	HAND AUGER	2.1	0-4.0	1.5	3.0
21MUHA114	7291240	595289	47	1.0	Marao	HAND AUGER	2.5	0-1.0	2.5	2.5
21MUHA115	7291227	596705	51	8.5	Marao	HAND AUGER	4.3	0-8.5	3.0	5.5
21MUHA116	7291586	596353	45	1.0	Marao	HAND AUGER	2.5	0-1.0	2.5	2.5

MRG Metals Limited ABN: 83 148 938 532 / ASX Code: MRQ

Phone: +61 3 5330 5800 / Fax: +61 3 53330 5890

12 Anderson Street West, Ballarat VIC 3350 / PO Box 237 Ballarat VIC 3353

www.mrgmetals.com.au / info@mrgmetals.com.au

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21MUHA117	7291944	596004	47	1.0	Marao	HAND AUGER	1.5	0-1.0	1.5	1.5
21MUHA118	7292298	595652	46	1.0	Marao	HAND AUGER	2.0	0-1.0	2.0	2.0
21MUHA119	7294431	593547	93	13.5	Marao	HAND AUGER	2.8	0-13.5	1.5	3.5
21MUHA120	7294790	593197	93	13.5	Marao	HAND AUGER	2.9	0-13.5	2.0	3.5
21MUHA121	7295142	592842	101	13.5	Marao	HAND AUGER	6.3	0-13.5	5.0	8.0
21MUHA122	7292641	596715	88	13.5	Marao	HAND AUGER	2.8	0-13.5	2.5	3.5
21MUHA123	7292287	597064	70	13.5	Marao	HAND AUGER	3.1	0-13.5	2.5	3.0
21MUHA124	7291937	597418	70	13.5	Marao	HAND AUGER	5.4	0-13.5	5.0	6.5
21MUHA125	7291573	597765	68	13.5	Marao	HAND AUGER	3.9	0-13.5	2.5	4.5
21MUHA126	7292993	597781	69	13.5	Marao	HAND AUGER	6.7	0-13.5	4.0	9.0
21MUHA127	7293347	597425	80	13.5	Marao	HAND AUGER	5.3	0-13.5	4.5	6.5
21MUHA128	7293703	597079	85	13.5	Marao	HAND AUGER	5.4	0-13.5	4.5	6.5
21MUHA129	7294059	596717	96	13.5	Marao	HAND AUGER	3.3	0-13.5	3.0	4.0
21MUHA130	7295473	596732	112	13.5	Marao	HAND AUGER	5.0	0-13.5	4.0	6.0
21MUHA131	7295118	597086	113	13.5	Marao	HAND AUGER	6.9	0-13.5	6.0	8.0
21MUHA132	7294760	597438	98	13.5	Marao	HAND AUGER	5.4	0-13.5	4.5	6.0
21MUHA133	7294404	597794	92	13.5	Marao	HAND AUGER	2.8	0-13.5	2.5	3.5
21MUHA134	7294046	598136	70	13.5	Marao	HAND AUGER	2.3	0-13.5	1.5	3.0
21MUHA135	7293688	598490	61	13.5	Marao	HAND AUGER	2.4	0-13.5	2.0	3.5
21MUHA136	7293330	598841	55	12.0	Marao	HAND AUGER	2.3	0-12.0	1.5	3.0
21MUHA137	7296887	596742	106	13.5	Marao	HAND AUGER	2.9	0-13.5	2.5	3.5
21MUHA138	7296529	597097	97	13.5	Marao	HAND AUGER	4.2	0-13.5	3.0	5.5

MRG Metals Limited ABN: 83 148 938 532 / ASX Code: MRQ

Phone: +61 3 5330 5800 / Fax: +61 3 53330 5890

12 Anderson Street West, Ballarat VIC 3350 / PO Box 237 Ballarat VIC 3353

www.mrgmetals.com.au / info@mrgmetals.com.au

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Competent Persons’ Statement

The information in this report, as it relates to Mozambique Exploration Results is based on information compiled and/or reviewed by Mr JN Badenhorst, who is a member of the South African Council for Natural Scientific Professions (SACNASP) and the Geological Society of South Africa (GSSA). Mr Badenhorst is a contracted employee of the Company and has sufficient experience which is relevant to the style of mineralisation and type of deposits under consideration and to the activity which has been undertaken 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 Badenhorst consents to the inclusion in this report of the matters based on the information in the form and context in which they appear.

-ENDS-

Authorised by the Board of MRG Metals Ltd.

For more Information please contact:

MRG Metals

Andrew Van Der Zwan Chairman M: +61 (0) 400 982 987 E: andrew@mrgmetals.com.au

Investor Relations Victoria Humphries NWR Communications M: +61 (0) 431 151 676 E: victoria@nwrcommunications.com.au

MRG Metals Limited ABN: 83 148 938 532 / ASX Code: MRQ Phone: +61 3 5330 5800 / Fax: +61 3 53330 5890

12 Anderson Street West, Ballarat VIC 3350 / PO Box 237 Ballarat VIC 3353 www.mrgmetals.com.au / info@mrgmetals.com.au

Appendix 1

JORC Code, 2012 Edition – Table 1

Section 1 Sampling Techniques and Data

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

Criteria	**JORC Code explanation **	Commentary
Sampling	• Nature and quality of sampling (eg cut channels, random chips, or	• Auger sampling:
techniques	specific specialised industry standard measurement tools appropriate	•A sample of sand, approximately 20g, was scooped from the sample
	to the minerals under investigation, such as down hole gamma	bag of each sample interval for wet panning and visual estimation.
	sondes, or handheld XRF instruments, etc). These examples should	•The same sample mass is used for every pan sample visual
	not be taken as limiting the broad meaning of sampling.	estimation.
	• Include reference to measures taken to ensure sample representivity	•The consistent sized pan sample is to ensure visual calibration is
	and the appropriate calibration of any measurement tools or systems	maintained for consistency in percentage visual estimation of total
	used.	heavy mineral (THM).
	• Aspects of the determination of mineralisation that are Material to the	•Geotagged photographs are taken of each panned sample with the
	Public Report.	corresponding sample bag to enable easy reference at a later date
	• In cases where ‘industry standard’ work has been done this would be	•The larger 1.5m interval auger drill samples were homogenized prior
	relatively simple (eg ‘reverse circulation drilling was used to obtain 1	to being grab sampled for panning.
	m samples from which 3 kg was pulverised to produce a 30 g charge	•Visual estimated THM% results are filtered to determine which holes
	for fire assay’). In other cases more explanation may be required,	are sent for laboratory analysis. Only holes with average uncut
	such as where there is coarse gold that has inherent sampling	downhole grade ≥3% visual estimated THM are sent for heavy liquid
	problems. Unusual commodities or mineralisation types (eg	separation laboratory analysis.
	submarine nodules) may warrant disclosure of detailed information.	•The large 1.5m drill samples have an average of about 4kg and were
		split down in Mozambique to approximately 300-600g by riffle splitter
		for export to the Primary processing laboratory.
		•At the laboratory the 300-600g laboratory sample was dried and split
		to 100g, de-slimed (removal of -45µm fraction) and oversize (+1mm
		fraction) removed, then subjected to heavy liquid separation using
		TBE to determine total heavy mineral (THM) content.
Drilling	• Drill type (eg core, reverse circulation, open-hole hammer, rotary air	• Hand Augerdrilling is a manual hand operated system produced by
techniques	blast, auger, Bangka, sonic, etc) and details (eg core diameter, triple	Dormer Engineering in Australia.
	or standard tube, depth of diamond tails, face-sampling bit or other	•Drill rods and drill bits are 1m long.
	type, whether core is oriented and if so, by what method, etc).	•The auger is a 62mm open hole drilling technique.
		•All holes have been drilled vertically.
		•The drilling onsiteis governed by aHandAuger Drilling Guideline to

1

Criteria	JORC Code explanation	Commentary
		ensure consistency in application of the method.
		•A wooden surface collar is placed on the ground at the beginning of
		each hole to prevent widening of the collar and material falling into
		the hole.
Drill sample	• Method of recording and assessing core and chip sample recoveries	• Augerdrilling is considered to be an early stage relatively
recovery	and results assessed.	unsophisticated technique of drilling.
	• Measures taken to maximise sample recovery and ensure	•The auger drill used is an open hole method and recovery of sample
	representative nature of the samples.	extracted from the holes is measured by spring balance at the drill
	• Whether a relationship exists between sample recovery and grade	site.
	and whether sample bias may have occurred due to preferential	•Samples are consistently collected at 1.5m intervals.
	loss/gain of fine/coarse material.	•No significant losses of auger sample were observed due to the
		shallow depths of drilling (<12m).
		•The initial 0–1.5m interval in each auger hole is drilled with care to
		maximize sample recovery.
		• There is potential for contamination in open hole drilling techniques
		but sample bias is not likely due to the shallow drill hole depths.
Logging	• Whether core and chip samples have been geologically and	•Foraugerthe 1.5m auger drill intervals were logged onto paper field
	geotechnically logged to a level of detail to support appropriate	log sheets prior to transcribing into a Microsoft Excel spreadsheet.
	Mineral Resource estimation, mining studies and metallurgical	•The auger samples were logged for lithology, colour, grainsize,
	studies.	rounding, sorting, estimated %THM, estimated %slimes and any
	• Whether logging is qualitative or quantitative in nature. Core (or	relevant comments, such as slope and vegetation.
	costean, channel, etc) photography.	•Geological logging is governed by a Hand Auger Drilling Guideline
	• The total length and percentage of the relevant intersections logged.	with predefined log codes and guidance of what to include in log
		fields to ensure consistency between individuals logging data.
		•Field photographs are taken of each panned sample alongside the
		sample bag with sample number to track numbers of samples per
		hole and cross reference with laboratory data.
		•Data is backed-up each day at the field base to a cloud storage site.
		• Data from the Microsoft Excel spreadsheets is imported into a
		Microsoft Access database and the data is subjected to numerous
		validationqueries to ensure dataquality.
Sub-sampling	• If core, whether cut or sawn and whether quarter, half or all core	•ForAugerthe 1.5m drill sample composites were homogenized at
techniques	taken.	the drill site and then cone-and-quarter split onsite and inserted into
and sample	• If non-core, whether riffled, tube sampled, rotary split, etc and	clean calico sample bags with metal sample tag according to the
preparation	whether sampled wet or dry.	Hand Auger Drilling Guideline.
	• For all sample types, the nature, quality and appropriateness of the	•At the field base, the samples were homogenized within the calico
	samplepreparation technique.	bagbyrotatingit and then fed through a single tier riffle splitter that is

2

Criteria	**JORC Code explanation **	Commentary
	• Quality control procedures adopted for all sub-sampling stages to	placed on a hard surface and levelled, to reduce samples to 300-
	maximise representivity of samples.	600g sub-samples for export to the Primary processing laboratory.
	• Measures taken to ensure that the sampling is representative of the in	•The 300-600g sub-sample is deposited into a new labelled calico
	situ material collected, including for instance results for field	sample bag with metal sample tag and prepared to be sent to the
	duplicate/second-half sampling.	Primary laboratory for analysis.
	• Whether sample sizes are appropriate to the grain size of the material	•Where samples were wet when sampled, they were dried in clean
	being sampled.	plastic basins prior to riffle splitting.
		•All of the samples collected have been sand or silty-sand and the
		preparation techniques are considered appropriate for this sample
		type.
		•The sample sizes were deemed suitable based on industry
		experience of the geologists involved and consultation with laboratory
		staff.
		•Field duplicates of the samples were completed at a rate of 5%, or at
		a frequency of approximately 1 per 25 primary samples.
		•Standard Reference Material (SRM) samples are inserted into the
		sample stream at a frequency of 1 per 50 samples.
		•Employees undertaking the primary sampling and splitting are closely
		monitored by a geologist to ensure sampling qualityismaintained.
Quality of	• The nature, quality and appropriateness of the assaying and	•The wet panning of samples provides an estimate of the %THM
assay data	laboratory procedures used and whether the technique is considered	content within the sample which is sufficient for the purpose of
and	partial or total.	determining approximate concentrations of %THM.
laboratory	• For geophysical tools, spectrometers, handheld XRF instruments, etc,	•The field derived visual panned THM estimates are compared to a
tests	the parameters used in determining the analysis including instrument	range of laboratory derived THM images of pan concentrates. This
	make and model, reading times, calibrations factors applied and their	allows the field geologists to calibrate the field panned visual
	derivation, etc.	estimated THM with known laboratory measured THM grades.
	• 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. _
Verification of	• The verification of significant intersections by either independent or	•Selected visual estimated THM field data are checked by the Chief
sampling and	alternative company personnel.	Geologist.
assaying	• The use of twinned holes.	•Significant visual estimated THM >5% are verified by the Chief
	• Documentation of primary data, data entry procedures, data	Geologist. This is done either in the field or via field photographs of
	verification, data storage (physical and electronic) protocols.	the pan sample.
	• Discuss any adjustment to assay data.	•The Chief Geologist has made numerous visits to the field drill sites to
		train and embed process and procedure with field staff.
		•No twinned holes have been completed during this programme to
		date but twin holes are planned.
		•The geologicfield dataismanually transcribedinto amaster

3

Criteria	**JORC Code explanation **	Commentary
		Microsoft Excel spreadsheet which is appropriate for this stage in the
		exploration program.
		•The raw field data is checked in the Microsoft Excel format first to
		identify any obvious errors or outlier data. The data is then imported
		into a Microsoft Access database where it is subjected to various
		validation queries.
Location of	• Accuracy and quality of surveys used to locate drill holes (collar and	•Downhole surveys for these auger holes are not required due to the
data points	down-hole surveys), trenches, mine workings and other locations	relatively shallow nature.
	used in Mineral Resource estimation.	•A handheld 16 channel Garmin GPS is used to record the positions of
	• Specification of the grid system used.	the aircore holes in the field.
	• Quality and adequacy of topographic control.	•The handheld Garmin GPS has an accuracy of +/- 5m in the
		horizontal.
		•The datum used for coordinates is WGS84 zone 36S.
		•The accuracy of the drillhole locations is sufficient for this early stage
		exploration.
Data spacing	• Data spacing for reporting of Exploration Results.	•Hole spacing used in this reconnaissance drill program is 500m by
and	• Whether the data spacing and distribution is sufficient to establish the	1000m spacing between auger drillholes hole stations. The holes
distribution	degree of geological and grade continuity appropriate for the Mineral	were located from a regular grid but are reconnaissance phase holes.
	Resource and Ore Reserve estimation procedure(s) and	•The spacing between auger holes and between lines is sufficient to
	classifications applied.	provide a reasonable degree of confidence in geological models and
	• Whether sample compositing has been applied.	grade continuity between holes for aeolian style HMS deposits during
		this reconnaissance drilling phase.
		•Closer spaced drilling in follow-up drilling phases (250m x 500m and
		250m x 1000m spaced holes) will provide a higher confidence in
		geological models and grade continuity between the holes.
		•Each auger drill sample is a single 1.5m sample of sand intersected
		down the hole.
		•No compositing has been applied to values of THM, slime and
		oversize.
Orientation of	• Whether the orientation of sampling achieves unbiased sampling of	•The auger drilling was located on a grid drilling pattern covering the
data in	possible structures and the extent to which this is known, considering	entire licence along the interpreted strike of mineralization.
relation to	the deposit type.	•Drill holes were vertical and the nature of the mineralisation is
geological	• If the relationship between the drilling orientation and the orientation	relatively horizontal.
structure	of key mineralised structures is considered to have introduced a	•The orientation of the drilling is considered appropriate for testing the
	sampling bias, this should be assessed and reported if material.	lateral and vertical extent of mineralization without any bias.

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Criteria	**JORC Code explanation **	Commentary
Sample	• The measures taken to ensure sample security.	•Field photographs are taken of each sample bag with corresponding
security		sample number and panned sample in order to track numbers of
		samples per hole and per batch.
		•Auger samples remained in the custody of Company representatives
		while they were transported from the field drill site to Marao field
		camp / Chibuto field camp for splitting and other processing.
		•Auger samples remain in the custody of Company representatives
		until they are transported to Maputo for final packaging and securing.
		•The Company uses a commercial shipping company, Deugro or DHL,
		to ship samples from Mozambique to Perth.
Audits or	• The results of any audits or reviews of sampling techniques and data.	•Internal data and procedure reviews are undertaken.
reviews		•No external audits or reviews have been undertaken.

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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
Mineral	• Type, reference name/number, location and ownership including	•The exploration work was completed on the Marao tenement (6842L)
tenement and	agreements or material issues with third parties such as joint	which is 100% owned by the Company through its 100% ownership of
land tenure	ventures, partnerships, overriding royalties, native title interests,	its subsidiary, Sofala Mining & Exploration Limitada, in Mozambique.
status	historical sites, wilderness or national park and environmental	•All granted tenements have initial 5 year terms, renewable for 3
	settings.	years.
	• The security of the tenure held at the time of reporting along with any	•Traditional landowners and village Chiefs within the areas of influence
	known impediments to obtaining a licence to operate in the area.	were consulted prior to the aircore drilling programme and were
		supportive of the programme.
		•Representatives from the Provincial Directorate of Mineral Resources
		and Directorate of Lands, Environment and Rural Development, and
		District Planning and Infrastructure Departments are also part of the
		consent and consultation process.
		•An Environment Management Plan is currently being prepared by an
		independent consultant and will be submitted to the Gaza Provincial
		Directorate of Lands, Environment and Rural Development in
		accordance with Mining Law and Regulations.
Exploration	• Acknowledgment and appraisal of exploration by other parties.	•Historic exploration work was completed by Rio Tinto.
done by other		•The Company has obtained digital data in relation to this historic
parties		information.
		•The historic data comprises very limited Auger drilling.
		•The historic results are not reportable under JORC 2012.
Geology	• Deposit type, geological setting and style of mineralisation.	•Two types of heavy mineral sand mineralisation styles are possible
		along coastal Mozambique:
		1. Thin but high grade strandlines which may be related to marine
		or fluvial influences, and
		2. Large but lower grade deposits related to windblown sands.
		•The coastline of Mozambique is well known for massive dunal
		systems such as those developed near Inhambane (Rio Tinto’s
		Mutamba deposit), near Xai Xai (Rio Tinto’s Chilubane deposit) and
		in Nampula Province (Kenmare’s Moma deposit). Buried strandlines
		are likely in areas where palaeoshorelines can be defined along
		coastal zones.

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Criteria	JORC Code explanation	Commentary
Drill hole	• A summary of all information material to the understanding of the	•Summary drill hole information is presented within Table 1 of the main
Information	exploration results including a tabulation of the following information	body of text of this announcement.
	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,	•A no cut-off	THM% grade is shown for the entire hole; a cut-off of
aggregation	maximum and/or minimum grade truncations (eg cutting of high	3%THM was used for the “high				grading” value shown (if applicable).
methods	grades) and cut-off grades are usually Material and should be stated.	•The visual estimated THM% averaging					is grade-weighted.
	• Where aggregate intercepts incorporate short lengths of high grade	•An example of data averaging is shown below.
	results and longer lengths of low grade results, the procedure used for such aggregation should be stated and some typical examples of		HOLE_ID	FROM	TO	PCT VIS THM	Average visTHM	Average visTHM
	such aggregations should be shown in detail.		19CCAC104	0.0	3.0	6.0
	• The assumptions used for any reporting of metal equivalent values should be clearly stated.		19CCAC104 19CCAC104 19CCAC104 19CCAC104 19CCAC104 19CCAC104 19CCAC104 19CCAC104	3.0 6.0 9.0 12.0 15.0 18.0 21.0 24.0	6.0 9.0 12.0 15.0 18.0 21.0 24.0 27.0	6.0 6.0 8.0 6.2 6.6 5.5 8.0 4.0	37.5m @ 4.9%	27m @ 6.3%
			19CCAC104	27.0	30.0	2.5
			19CCAC104	30.0	33.0	2.0
			19CCAC104	33.0	36.0	1.7
			19CCAC104	36.0	37.5	1.5
Relationship	• These relationships are particularly important in the reporting of	•The nature of the mineralisation is broadly horizontal, thus vertical
between	Exploration Results.	auger holes are thought to			represent close to true thicknesses of the
mineralisation	• If the geometry of the mineralisation with respect to the drill hole	mineralisation.
widths and	angle is known, its nature should be reported.	•Downhole widths are		reported.
intercept	• If it is not known and only the down hole lengths are reported, there
lengths	should be a clear statement to this effect (eg ‘down hole length, true
	_width not known’). _
Diagrams	• Appropriate maps and sections (with scales) and tabulations of	•Figures are	displayed in the main text.
	intercepts should be included for any significant discovery being
	_reported These should include, but not be limited to a plan view of _

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Criteria	JORC Code explanation	Commentary
	_drill hole collar locations and appropriate sectional views. _
Balanced	• Where comprehensive reporting of all Exploration Results is not	•A summary of the visual estimated THM% data is presented in Table
reporting	practicable, representative reporting of both low and high grades	1 of the main part of the announcement, comprising downhole
	and/or widths should be practiced to avoid misleading reporting of	averages, intersection thickness, together with maximum and
	Exploration Results.	minimum estimated THM values in each hole.
Other	• Other exploration data, if meaningful and material, should be reported	•No other material exploration information has been gathered by the
substantive	including (but not limited to): geological observations; geophysical	Company.
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 (eg tests for lateral	•Further work will include heavy liquid separation analysis for
	extensions or depth extensions or large-scale step-out drilling).	quantitative THM% data.
	• Diagrams clearly highlighting the areas of possible extensions,	•Additional mineral assemblage and ilmenite mineral chemistry
	including the main geological interpretations and future drilling areas,	analyses will also be undertaken on suitable composite HM samples
	provided this information is not commercially sensitive.	to determine valuable heavy mineral components.
		•As the project advances, TiO2 and contaminant test work analyses
		will also be undertaken.

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