PAINCHEK LTD — Capital/Financing Update 2015

Apr 21, 2015

$700,000 Fund Raising Completed, Coober Pedy Project Drill Program Proceeds, Planning Commenced for Drilling at Fyre Lake and the Marg

Highlights

22 April 2015

DIRECTORS

• MinQuest has completed a $700,000 fund raising via the issue of Convertible Notes and in addition has been granted $100,000 from the South Australian Government Plan for Accelerating Exploration (PACE) Frontiers Initiative;

• The Cyclops Prospect on the Coober Pedy Project contains an Iron Oxide Copper Gold (IOCG) target, exhibiting geophysical characteristics similar to the world-class Prominent Hill copper-gold mine;

• Mt Magnet Drilling has been contracted to mobilise in early May and complete drilling the Cyclops Prospect by mid-to-late June, 2015;

• Planning has started for drill programs at the Fyre Lake and Marg Projects in the Yukon, to commence in July, 2015;

• The Kona Mineral Resource on the Fyre Lake Project is currently 12.6Mt @ 1.56% Cu, 0.09% Co, 0.3% Zn and 0.63g/t Au at a 1% Cu cut-off;

• The high-grade Marg Mineral Resource is currently 11.74Mt @ 1.27% Cu, 3.23% Zn, 1.55% Pb, 39.78g/t Ag and 0.61g/t Au at a 0.5% Cu cut-off;

David Deloub Chairman

Jeremy Read Managing Director

Paul Niardone Non-Executive Director

Adam Davey Non-Executive Director

Kim Clark Company Secretary

SHARE INFORMATION

ASX Code: MNQ Issued Capital: 83,458,341 Fully Paid Shares 14,923,097 Unlisted Options

CONTACT INFORMATION Registered Office: 96 Stephens Road South Brisbane, QLD 4101 T: +61 7 3844 0372 F: +61 7 3844 0154 www.minquest.com.au

MinQuest Limited ACN: 146 035 127

INTRODUCTION

MinQuest Limited (“MinQuest” or “The Company” ) (ASX:MNQ) is pleased to announce that it has completed a $700,000 fund raising via the issue of Convertible Notes. This funding is in addition to the recently announced grant of $100,000 from the South Australian Government through the Plan for Accelerating Exploration ( PACE ) Frontiers Initiative (see ASX announcement 15 April, 2015).

MinQuest has now secured the funding needed to complete a 1,200m drill program to test an Iron Oxide Copper Gold ( IOCG ) target at the Cyclops Prospect, located south-west of Coober Pedy, South Australia ( Figure 1 ). Mt Magnet Drilling has been contracted to undertake the drill program at the Cyclops Prospect on the Coober Pedy Project. In addition to drill testing the Cyclops Prospect, MinQuest will also complete its planning for drill programs to be undertaken on the Fyre Lake and Marg Volcanogenic Massive Sulphide ( VMS ) Projects, in the Yukon Territory, Canada. The drill program on the Fyre Lake Project will commence in early July, 2015, followed immediately by the drill program at the Marg Project.

MinQuest’s Managing Director Mr Jeremy Read said, “Having fully funded the drill program to test the IOCG target at the Cyclops Prospect is a major step forward for MinQuest; we can proceed with the drill program with confidence.”

“The Cyclops Prospect contains a quality IOCG target with the potential to deliver a world-class discovery and that is the reason it attracted the PACE funding from the South Australian Government.”

“The generation of the target at Cyclops occurred over two years ago so it is extremely pleasing to now be able to proceed with testing the target.”

“We will also proceed with finalising the drill program plans for our Fyre Lake and Marg Projects in the Yukon; its going to be a very busy few months for MinQuest”, said Mr Read.

CONVERTIBLE NOTE FUND RAISING

The $700,000 fund raising was completed via the issuing of 70 Convertible Notes ( Notes ) each with a value of $10,000. Following shareholder approval, which will be sought at a shareholder meeting to be held on 11 May, 2015, each $10,000 Convertible Note will automatically convert into 666,667 fully paid ordinary shares at a conversion price of 1.5c per share. Upon conversion the 70 Notes will convert into 46,666,667 shares ( Shares ). Each share issued will have a free attaching option with a two-year term and exercise price of 4.5 cents.

Despite the best endeavours of the Company, should shareholder approval to convert the Notes into Shares, not be obtained, the Company shall repay the Funds

to each investor within 60 days of confirming that the shareholder approval could not be obtained.

COOBER PEDY PROJECT (SOUTH AUSTRALIA)

The Coober Pedy Project is currently 100% owned by Teck Australia Pty Ltd ( Teck ) and comprises three exploration licenses, located at the north-western end of the highly endowed Proterozoic Olympic Dam IOCG Province on the Gawler Craton, South Australia ( Figure 1 ). Under the terms of a joint venture agreement with Teck, MinQuest has the ability to earn up to a 100% interest in the Coober Pedy Project, subject to a 2% Net Smelter Return Royalty to be retained by Teck.

Previous work by Teck defined a strong, discrete magnetic and gravity anomaly, the “Cyclops Prospect”, to the south-west of Coober Pedy. The Cyclops Prospect contains an untested ‘walk-up’ Prominent Hill Type IOCG drill target in close proximity to the Karari Shear Zone. Forward modelling of the gravity and magnetic data indicate the potential source is a magnetite-rich body of approximately 800m x 250m, starting at a depth of approximately 100m. Soil geochemical surveys detected a gold geochemical anomaly, coincident with the geophysical feature, on one of two lines of soil samples collected at Cyclops.

The main target at Cyclops is the source of the gravity anomaly, as it may be a Prominent Hill style hematite breccia complex. However, in IOCG’s magnetite can play an important role in the deposition of copper mineralisation. Consequently the source of the magnetic anomaly will also be properly drill tested.

A contract for a 1,200m drill program to test the magnetic and gravity anomalies at Cyclops, has been awarded to Mt Magnet Drilling. The initial drill testing of the geophysical anomalies at Cyclops will involve drilling two drill holes, on the same section, to thoroughly test the source of the magnetic and gravity features. Depending upon the results from the first two holes a third hole may be drilled.

It is anticipated that Mt Magnet Drilling will mobilise to the Cyclops Prospect during the second week of May. The Cyclops drill program will take approximately four to six weeks to complete and MinQuest will update the market on any significant outcomes from the drill program during May and June, 2015.

FYRE LAKE PROJECT (YUKON TERRITORY, CANADA)

The Fyre Lake Project is located in the Finlayson Lake District, south-east Yukon Territory, Canada (Figure Two). The project contains the Kona Mineral Resource, which is classified as a Volcanogenic Massive Sulphide ( VMS ) deposit and over nine kilometres of favourable host rocks with geochemical and geophysical targets indicative of VMS mineralization. MinQuest has acquired the right to earn up to an 80% interest in the Fyre Lake Project from Pacific Ridge Exploration Limited.

MinQuest’s primary objective for the Fyre Lake Project is to increase the Mineral Resources defined on the project to support a stand-alone mining and processing operation with a Net Present Value ( NPV ) in excess of the US$150M. In order to achieve this objective it is MinQuest’s opinion that the Mineral Resources on the Fyre Lake project need to be in the range of 16-17 Mt at copper and gold grades similar to the currently defined Kona Mineral Resource (1.56% Cu and 0.63g/t Au).

Historical drilling at the Kona Prospect has defined a Mineral Resource of 12.6Mt at 1.56% Cu, 0.09% Co, 0.30% Zn and 0.63g/t Au utilising a 1.0% Cu cut-off, which has been classified under the JORC Code (2012) as set out below:

Classification	Tonnes (Mt)	Cu %	Co (%)	Zn (%)	Au (g/t)
Indicated	3.5	1.55	0.10	0.30	0.63
Inferred	9.1	1.56	0.09	0.30	0.63
Total	12.6	1.56	0.09	0.30	0.63

The Kona Mineral Resources are reported in accordance with the guidelines of the 2012 edition of the Australasian Code for reporting of Exploration Results, Minerals Resources and Ore Reserves (the JORC Code). Refer to MinQuest Limited announcement dated 23 January, 2015, entitled “Kona Mineral Resource Update.”

MinQuest is now 70-80% towards its goal of increasing the Kona Mineral Resource to 16-17Mt, while maintaining metal grades.

Planning is well advanced for a drill program to be conducted on the Fyre Lake Project, commencing in July, 2015, to extend the Kona Mineral Resource and to collect samples for metallurgical test work. Within the next 1-2 weeks MinQuest expects to receive approval from the Yukon Government to proceed with the planned drill program on the Kona Mineral Resource.

MARG PROJECT (YUKON TERRITORY, CANADA)

The Marg Project is located in the central Yukon, approximately 40km east of Keno City (Figure 3). The property consists of 402 quartz mining claims covering over 84km[2 ] adjacent to the Category A land of the Na-cho Nyak Dun First Nation. MinQuest has acquired the right to earn up to a 75% interest in the Marg Project from Golden Predator Corp.

The Marg Project consists of the main Marg VMS deposit hosted in the metasedimentary and metavolcanic rocks of the Devono-Mississipian Earn Group. The project also contains an additional 15km long belt of the same felsic

metavolcanic and metasedimentary rocks that host the Marg Deposit. Within this belt, soil geochemical sampling has outlined several very promising anomalies that are yet to be properly drill tested.

The Marg deposit consists of three continuous units that contain the majority of the total defined Mineral Resource. The deposit is strongly attenuated and contains an additional eight smaller stacked sulphide lenses. The deposit can be traced in the sub-surface for over 1400m along strike. The deposit is open in both directions along strike and at depth. The main economic mineral species are chalcopyrite, sphalerite and galena associated with pyrite occurring as massive to semi-massive lenses up to 20m thick (averaging 3m to 4m).

The Marg deposit has been explored by nine diamond drill exploration programs from 1988 to 2008. A total of 33,876 metres of diamond drilling in 117 holes has been completed on the project. This drilling has located mineralisation over 1,400 metres strike distance, a down-dip distance of 700 metres and across a stratigraphic thickness of approximately 100 metres.

The drilling has defined a total Mineral Resource at the Marg Deposit of 11.74Mt at 1.27% Cu, 3.23% Zn, 1.55% Pb, 0.61g/t Au and 39.78g/t Ag utilising a 0.5% Cu cut-off, which has been classified under the JORC Code (2012) as set out below.

Classification	Tonnes (Mt)	Cu %	Pb (%)	Zn (%)	Ag (g/t)	Au (g/t)
Indicated	3.96	1.57	1.92	3.90	49.40	0.79
Inferred	7.78	1.12	1.36	2.89	34.88	0.52
Total	11.74	1.27	1.55	3.23	39.78	0.61

The Marg Mineral Resource are reported in accordance with the guidelines of the 2012 edition of the Australia Code for reporting Exploration Results, Mineral Resources and Ore Reserves (the JORC Code). Refer to MinQuest Limited announcement dated 17 March 2015 entitled “MinQuest Adds the High Grade Cu-Zn-Pb-Au-Ag “Marg” VMS Deposit To its Copper Project Portfolio”.

The mineralisation at the Marg Deposit remains open down-dip at depth, to the west along strike and to the east along strike at depth. The last drill program was completed in 2008 and further drilling has not yet been conducted to fully define the extents of mineralisation.

Immediately following the drilling conducted on the Fyre Lake Project MinQuest is planning to conduct a small drill program at the Marg to collect samples for metallurgical and geo-technical test work. It is probable that this drill program will commence in late-September or early October 2015 and can be conducted under a current work program approval from the Yukon Government. Following completion

of the drill program MinQuest will produce a Scoping Study level economic model for the development of the Marg Project on a stand alone basis. This Scoping Study will determine if MinQuest proceeds with a Feasibility Study of the Marg Project commencing in 2016.

Competent Person Statement - Mineral Resource

The information in this ASX Announcement relating to the Mineral Resource estimate for the Kona Deposit is extracted from the ASX Release entitled “Kona Mineral Resource Update” announced on 23 January 2015 and is available to view on the ASX website (ASX:MNQ), and the Company's website. The information in this ASX Announcement relating to the Mineral Resource estimate for the Marg Deposit is extracted from the ASX Release entitled “MinQuest Adds the High Grade Cu-Zn-PbAu-Ag “Marg” VMS Deposit To its Copper Project Portfolio” announced on 17 March 2015 and is available to view on the ASX website (ASX:MNQ), and the Company's website. The Company confirms that it is not aware of any new information or data that materially affects the information included in the original market announcements and, that all material assumptions and technical parameters underpinning the resource estimates in the relevant market announcement continue to apply and have not materially changed. The Company confirms that the form and context in which the Competent Person’s findings are presented have not been materially modified from the original market announcement.

The information in this report that relates to exploration results is based upon information reviewed by Mr Jeremy Read BSc (Hons) who is a Member of the Australasian Institute of Mining and Metallurgy. Mr Read is a full time employee of MinQuest Limited and 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 Read consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. Mr Read is the Managing Director of MinQuest and currently owns 2,525,253 Fully Paid Ordinary Shares and has the entitlement to a further 2,525,253 deferred consideration shares subject to relevant milestone events being achieved.

Forward Looking Statements

This announcement contains “forward-looking statements”. Such forward-looking statements include, without limitation: estimates of future earnings, the sensitivity of earnings to commodity prices and foreign exchange rate movements; estimates of future production and sales; estimates of future cash flows, the sensitivity of cash flows to commodity prices and foreign exchange rate movements; statements regarding future debt repayments; estimates of future capital expenditures; estimates of resources and statements regarding future exploration results; and where the Company expresses or implies an expectation or belief as to future events or results, such expectation or belief is expressed in good faith and believed to have a reasonable basis. However, forward looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from future results expressed, projected or implied by such forward-looking statements. Such risks include, but are not limited to commodity price volatility, currency fluctuations, increased production costs and variances in resource or reserve rates from those assumed in the company’s plans, as well as political and operational risks in the countries and states in which we operate or sell product to, and governmental regulation and judicial outcomes. For a more detailed discussion of such risks and other factors, see the Company’s Annual Reports, as well as the Company’s other filings. The Company does not undertake any obligation to release publicly any revisions to any “forward looking statement” to reflect events or circumstances after the date of this release, or to reflect the occurrence of unanticipated events, except as may be required under applicable securities laws.

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350000 400000 450000 500000 550000
6850000 SOUTH 6850000
AUSTRALIA Oodnadatta
Coober Pedy
30°S Cyclops
Prospect
Cedun a Port Augusta
EL 4542 Port Lincoln ADELAIDE
"Mount Clarence"
500 km
LOCALITY MAP
130°E 140°E
6800000 6800000
"Mabel Creek"
COOBER PEDYCOOBER PEDY
CYCLOPS PROSPECT
EL 4892 Cairn Hill
6750000 6750000
EL 4891
Lake Phillipson
"Ingomar"
Manxman Prominent Hill
6700000 6700000
"Commonwealth Hill"
350000 400000 450000 500000 550000
Exploration Licence (Teck Australia) Railway CYCLOPS PROSPECT - COOBER PEDY PROJECT
IOCG deposit Highway
Town Secondary road 0 10 20 30 40 50 km LOCATION MAP
Homestead Minor road
Track UTM Projection. MGA Zone 53. GDA94 Datum. Checked: C. DoornbosDrawn: RRM Drawing No.: FL-001.mxdDate: 09.10.2014 Revision: Figure 1
DARWINDARWIN
STUARTSTUART
ADELAIDEADELAIDE
HIGHWAYHIGHWAY
Dog Fence
R
LIA
W
A
Y
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460000

480000 6840000

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400000 420000 440000
6840000
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70°N
Inuvuk
U.S.A.
(Alaska)
Fairbanks
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Finlayson Lake
to Ross River
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Nome

YUKON FYRE LAKE PROJECT

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Anchorage Whitehorse
60°N
CANAD A
1,000 km
Prin c e Rupert Edmonton
LOCALITY MAP Calgary
50°N 160°W60°W0°W°WW 140°W40°W0°W°WW Vancouver 120°W20°W0°W°WW
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Whitehorse 60°N CANAD A 1,000 km Prin ~~c~~ e Rupert Edmonton LOCALITY MAP Calgary 50°N 160°W60°W0°W°WW 140°W40°W0°W°WW Vancouver ~~120°W20°W0°W°WW~~ 682 ~~0~~ 000 6820000 *** Kudz Ze Kayah Wolverine Lake 13.0 Mt @ 5.55% Zn, 1.00% Cu, GP4F *** 1.30% Pb, 125.0 g/t Ag, 1.2 g/t Au (inferred) 1.5 Mt grading 6.4% Zn, 3.1% Pb, Grass Lakes 0.1% Cu, 89.7 g/t Ag, 2.0 g/t Au (inferred) North Lakes * 4.51 Mt grading 12.04% Zn, 1.15% Cu, Wolverine Mine 1.57% Pb, 351.5 g/t Ag, 1.68 g/t Au (measured & inferred) and 1.69 Mt grading 12.16% Zn, 1.23% Cu, 1.74% Pb, 385.1 g/t Ag, 1.71 g/t Au (inferred) 6800000 6800000 FYRE LAKE Kona Deposit Fire Lake 12.6 Mt @ 1.56% Cu, 0.09% Co and 0.63g/t Au (indicated and inferred) 6780000 6780000 400000 420000 440000 460000 480000 VMS Mine Highway FYRE LAKE PROJECT - YUKON, CANADA VMS Deposit Other road REGIONAL LOCATION MAP 0 5 10 15 20km * Resource figures for Lake from J.M. Peter & Others, 2007.Finlayson VMS deposits River UTM Projection. Zone 9. NAD83 Datum. Drawn: RRM Date: 23.01.2015 Revision: Figure 2**

Drawn: RRM Date: 23.01.2015 Revision: Checked: C. Doornbos Drawing No.: FL-006.mxd

Figure 2

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460000 480000 500000 520000 540000
N
Inuvuk
U.S.A.
(Alaska)
Nome Fairbanks YUKON MARG McQuestenLake
PROJECT
Anchorage Whitehorse
N D A V I D S O N
CANADA
1,000 km R A N G E P A T T E R S O N
Prince Rupert Edmonton R A N G E
7100000 LOCALITY MAP Calgary 7100000
N Vancouver W
5.165 Mt @ 302 g/t Ag, 1.4% Pb, MARG
3.8% Zn, 50.213 Moz Ag (indicated)
0.836 Mt @ 350 g/t Ag, 2.0% Pb, 11.74 Mt @ 1.27% Cu, 3.23% Zn,
4.9% Zn, 9.403 Moz Ag (inferred) 1.55% Pb, 0.61 g/t Au, 39.78 g/t Ag
Bellekeno
Silver Mine
Elsa
Keno
Tiny Island
7080000 Lake 7080000
Mayo Lake
Edwards
Lake
Janet
Lake
7060000 7060000
Williamson
Lake
Mayo
460000 480000 500000 520000 540000
MARG PROJECT - YUKON, CANADA
Town or settlement Highway
REGIONAL LOCATION MAP
River or creek Minor road 0 5 10 15 20km
Lake Winter road Drawn: RRM Date: 24.02.2015 Revision:
UTM Projection. Zone 8. NAD83 Datum. Checked: C. Doornbos Drawing No.: MARG-001.mxd Figure 3
N R I D G E
STEWART
S O
N G E
McQuesten
V U S R A
N E L
STA
U
G
TRAIL
South
River
River
Dawson City 225 km
Whitehorse 400 km
L
A
D
Keno
Beaver
Ladue
U
E
RIVER
R
A
N
G
SILVER E
River
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