PATERSON RESOURCES LTD — Capital/Financing Update 2018

Aug 21, 2018

ASX ANNOUNCEMENT 22 August 2018

INCREASING CONFIDENCE IN FOUR QUEENSLAND VANADIUM PROJECTS

HIGHLIGHTS

• Incremental due diligence on four highly prospective vanadium projects in Queensland, which are owned by Vanadium Mining (VanMin) that HDY intends to acquire, has increased confidence to geologically model, estimate and report under the JORC (2012) Code
• The geology team have uncovered further historic evidence there are actually 383 air-core drill-holes targeting the Toolebuc Formation (>170 reported in ASX Release 13 August 2018) along the 150km north-south trending strike running through the Spike, Cera and Petrie projects and within the Sharptooth prospect
• Encouragingly, the average drill-hole depth remains shallow at 30m, while elevated vanadium pentoxide (V2O5) assay results verify heightened mineral prospectivity across the projects, including:
  • o 3m @ 0.31% V2O5 from 4m (including 0.5m @ 0.39%) within the Sharptooth prospect1
  • o 5m @ 0.48% V2O5 from 10m and 3m @ 0.47m from 2m within the Cera prospect2
• The geology team have conducted a thorough review of the historic air-core drillholes and believe any future exploration, utilising a large diameter conventional bore-core at the same locations, may result in higher V2O5 assay values in line with peers2
  • o This clearly highlights the potential exploration upside across the four projects
• Overall, with high-grade V2O5 mineralisation confirmed near surface within weathered units, there is potentially a solid case that open pit mining methods can be employed
• The Board's strategic objective with the vanadium projects over the longer-term is to develop viable operations in Australia and Argentina – the results to date are clearly on the right trajectory

Hardey Resources Executive Chairman, Terence Clee commented: "The geology team have done a superb job uncovering incremental data points which enhances the prospect of generating a JORC compliant resource across the four Queensland projects and de-risks them further. Moving forward, the Board is increasingly optimistic that Hardey Resources can develop future vanadium supply chains from Australia and Argentina judging by the encouraging results already evidenced."

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Hardey Resources Limited's (ASX: HDY) ("HDY" or "the Company") Board is pleased to present an update on due diligence work being undertaken on the four highly prospective Queensland vanadium owned by VanMin.

***

QUEENSLAND ASSETS FURTHER DE-RISKED

The geology team have undertaken a thorough review of the geological data available across VanMin's four Queensland projects – Sharptooth, Spike, Cera and Petrie – and believe there is sufficient information to geologically model, estimate and report under the JORC (2012) Code for vanadium mineralisation. A key finding was discovering there are 383 air-core drill-holes available, which is nearly double the circa 170 initially reported on 13 August 2018. In short, this is a positive development as it further de-risks the prospectivity for Queensland projects.

Within the four projects, the Toolebuc Formation has been correlated across all the boreholes and high-grade V2O5 mineralisation constrained by horizon. The Sharptooth project1 includes 3m @ 0.31% V2O5 from 4m (including 0.5m @ 0.39%) and the Cera prospect2 contains 5m @ 0.48% V2O5 from 10m and 3m @ 0.47m from 2m. The V2O5 mineralisation distribution is displayed in Figure 1, with locations displayed in Figure 2.

FIGURE 1: VANADIUM PENTOXIDE MINERALISATION CONCENTRATIONS BY SAMPLE DEPTH
----------------------------------------------------------------------------	--

Hole ID	BUAC266
----------------	----------------

			Depth to	Unit	Average of V2O5%
Depth to	Unit	Average of V2O5%		1 Lime 01	0.122
	1 Lime 00	0.066	$\overline{2}$	Lime 02	0.473
	2Lime_00	0.052	3	Lime_02	0.550
	3 Lime 014 Lime_01	0.0970.117	$\vert 4 \vert$	Lime 02	0.388
	5 Lime_01	0.140	5	Lime 02	0.122
	6 Lime 01	0.235		6 Mlimst 03	0.099
	7 Lime_01	0.074		7 Calmud 02	0.043
	8 Lime_01	0.095		8 Calmud 02	0.049
	9 Lime_01	0.163		9 Calmud 02	0.043
	10 Lime_02	0.369		10 Calmud 02	0.046
	11 Lime 02	0.578		11 Calmud 02	0.047
	12 Lime 02	0.436		12 Calmud 02	0.044
	13 Lime 02	0.545		13 Calmud 02	0.041
	14 Lime_02	0.491		14 Calmud_02	0.045
	15 Mlimst_03	0.079		15 Calmud 02	0.045
	16 Calmud 02	0.061		16 Calmud 02	0.047
	17 Calmud 02	0.048		17 Calmud 02	0.041
	18 Calmud 02	0.041	18 1	Calmud 02	0.044
	19 Calmud 02	0.044		19 Calmud 02	0.043
	20 Calmud 02	0.048		20 Calmud 02	0.042
	21 Base mud	0.000		21 Base_mud	NA
	22 Base mud	0.000		22 Base_mud	NA
	23 Base_mud	0.000		23 Base_mud	NA
	24 Base_mud	0.000		24 Base mud	NA
	25 Base mud	0.000		25 Base_mud	NA
	26 Base_mud	0.000		26 Base_mud	NA
	27 Base_mud	0.000		27 Base mud	NA
	28 Base mud	0.000		28 Base_mud	NA
	29 Base mud	0.000		29 Base_mud	NA
	30 Base_mud	0.000		30 Base mud	NA

Source: HDY geology team, refer to Table 1 for a summary of the historical open file tenure pXRF value statistical analysis

FIGURE 2: HIGH GRADE BOREHOLE LOCATIONS

Source: HDY geology team

Exploration upside

The historic data review across the Spike, Cera and Petrie projects confirmed a typically thick mineralised zone, with an average 0.23% V2O5 content. However, indicative pXRF values of up to 0.587% V2O5 have been reported in Cera suggesting increased mineralisation potential across the projects, subject to samples being fully assayed.

Moreover, the team believes the drilling methods employed across the projects could be improved by: increasing the depth; and utilising larger diameter drill-cores. Typically, the Toolebuc Formation zones within the projects was not tested below 30m.

As many of the historic boreholes are interpreted to terminate prematurely, not capturing the entire mineralised sequence, the full potential of the project areas is still to be realised. Consequently, there is clearly significant exploration upside from undertaking a more thorough drilling program.

Lastly, with elevated mineralisation typically occurring in shallow environments, the projects are amenable to shallow, open-pit mining methods.

Weathered zones

The geology team worked to define base weathering – a critical inclusion in the geological model for the projects. Establishing the base for weathering has revealed substantial vanadium enrichment within these zones. The enrichment is in line with published research, and the enriched vanadium zone can be seen within the pXRF values and sampled intervals of Figure 1. Quantification of the enriched vanadium zone across the QLD VanMin projects is not possible, until the creation and validation of a geological model is complete.

VanMin's projects are targeted to map significant areas of Toolebuc Formation which are at surface or interpreted to be shallow and under minimal cover. These significant outcropping areas and regional mapping suggest large subsurface areas of weathered Toolebuc formation, are present in the VanMin projects, based on the shallow dip of the Toolebuc formation.

Next steps

Preliminary review on VanMin's Northern Territory projects.

Terence Clee Executive Chairman

References

• 1. QDEX Report No: CR 6421, discussed in the accompanying Table 1.
• 1. QDEX Report No: CR4344, discussed in the accompanying Table 1.

COMPETENT PERSON'S STATEMENT:

The information in this report that relates to Geological Interpretation, Historical Exploration Results, or Historical Mineral Resources is based on information compiled by Nicholas Ryan, a Competent Person who is a Member of The Australasian Institute of Mining and Metallurgy. Mr Ryan has been a Member of the Australian Institute of Mining and Metallurgy for 12 years and is a Chartered Professional (Geology). Mr Ryan is employed by Xplore Resources Pty Ltd. Mr Ryan has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being 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 Ryan consents to the inclusion in the report of the matters based on his information and the form and context in which it appears.

• JORC Code, 2012 Edition – Table 1 report template

Drilling results summarized in the Table 1 Sections below are associated with the Spike, Cera, and Petrie projects.

Section 1 Sampling Techniques and Data

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

Criteria	JORC Code explanation	Commentary
Samplingtechniques	•Nature and quality of sampling (e.g. cut channels, random chips, orspecific specialised industry standard measurement tools appropriateto the minerals under investigation, such as down hole gammasondes, or handheld XRF instruments, etc). These examples shouldnot be taken as limiting the broad meaning of sampling.•Include reference to measures taken to ensure sample representivityand the appropriate calibration of any measurement tools or systemsused.•Aspects of the determination of mineralisation that are Material to thePublic Report.•In cases where 'industry standard' work has been done this would berelatively simple (e.g. 'reverse circulation drilling was used to obtain 1m samples from which 3 kg was pulverized to produce a 30 g chargefor fire assay'). In other cases more explanation may be required,such as where there is coarse gold that has inherent samplingproblems. Unusual commodities or mineralisation types (e.g.submarine nodules) may warrant disclosure of detailed information.	•Sharptooth project –historical drilling reported previously in the HDY ASXRelease dated 19/07/2018, refer to that Announcement and Table 1 forfurther details.Spike, Cera & Petrie projects –Hancock Exploration Management Services, on•behalf of Jacaranda Alliance JV, from May to August 2010: drilled 413 aircoredrillholes for a total of 12,400m of drilling, with at least 383 aircore drillholesaccumulating to 11,542 of drilling that potentiallycan be used in a geologicalmodel, with a total depth range from 25 to 30m within the Vanadium Miningproject areas.•"Check samples were analysed by ALS Chemex in Mt Isa to provide calibrationfactors for correcting the Niton XRF readings". No further sampling techniquesdetails were accessible from the QDEX publicly available reports.•Sample intervals were obtained on a 1m basis from down hole depths fromaircore drilling, samples were only taken on an integer depth basis. Sampleswere analysed at 1m intervals using a hand-held Niton XRF spectrometer forelements U, Cu, Pb, Zn and V.•The Competent Person considers that the drilling, sampling, hand-held NitonXRF spectrometer, or assay results are appropriate for consideration of themineralisation potential of the project.•No drilling or sample results are reported in this announcement for the otherVanadium Mining Pty Ltd projects.
Drillingtechniques	•Drill type (e.g. core, reverse circulation, open-hole hammer, rotary airblast, auger, Bangka, sonic, etc) and details (e.g. core diameter, tripleor standard tube, depth of diamond tails, face-sampling bit or othertype, whether core is oriented and if so, by what method, etc).	•Sharptooth project –historical drilling reported previously in the HDY ASXRelease dated 19/07/2018, refer to that Announcement and Table 1 forfurther details.•Spike, Cera & Petrie projects –Aircore Drilling was the drilling method thatJacaranda Alliance JV used for the exploration campaign. No further drillingtechnique details were provided.

CriteriaJORC Code explanation	Commentary
	•The Competent Person considers that the drilling, sampling, hand-held NitonXRF spectrometer, or assay results are appropriate for consideration of themineralisation potential of the project, additional drilling would be required toestimateand report an exploration target or a mineral resource to the JORC(2012) Code.•No drilling or sample results are reported in this announcement for the otherVanadium Mining Pty Ltd projects.
Drill sample•Method of recording and assessing core and chip sample recoveriesrecoveryand results assessed.•Measures taken to maximise sample recovery and ensurerepresentative nature of the samples.•Whether a relationship exists between sample recovery and gradeand whether sample bias may have occurred due to preferentialloss/gain of fine/coarse material.	•Sharptooth project –historical drilling reported previously in the HDY ASXRelease dated 19/07/2018, refer to that Announcement and Table 1 forfurther details.•Spike, Cera & Petrie projects –Aircore Drillingwas the drilling method that theJacaranda Alliance JV used, no further information had been reported on thedrilling process and sample recovery in their tenure reporting.•The Competent Person considers that the drilling, sampling, hand-held NitonXRF spectrometer, or assay results are appropriate for consideration of themineralisation potential of the project. The geological data can be geologicallymodelled, the historical drillhole data & any subsequent developed geologicalmodel & would need to be thoroughly evaluated/interrogated, beforeconsideration of any reporting of an exploration target or a mineral resourceto the JORC (2012) Code.•No drilling or sample results are reported in this announcement for the otherVanadium Mining Pty Ltd projects.
Logging•Whether core and chip samples have been geologically andgeotechnically logged to a level of detail to support appropriateMineral Resource estimation, mining studies and metallurgicalstudies.•Whether logging is qualitative or quantitative in nature. Core (orcostean, channel, etc) photography.•The total length and percentage of the relevant intersections logged.	•Sharptooth project –historical drilling reported previously in the HDY ASXRelease dated 19/07/2018, refer to that Announcement and Table 1 forfurther details.•Spike, Cera & Petrie projects –In annual reporting Jacaranda Alliance JV statesit compiled all lithological data for the aircore holes. The lithology for each 1minterval was recorded in the analyses text files attached to the annual reports.The lithology of each 1m interval was categorised into either soil, mudstone,limestone, muddy limestone, calcareous limestone or coquinite.The Competent Person considers that the drilling, sampling, hand-held Niton•XRF spectrometer, or assay results are appropriate for consideration of themineralisation potential of the project. The geological data can be geologicallymodelled, the historical drillhole data & any subsequent developed geologicalmodel & would need to be thoroughly evaluated/interrogated, beforeconsideration of any reporting of an exploration target or a mineral resourceto the JORC (2012) Code.•No drilling or sample results are reported in this announcement for the otherVanadium Mining Pty Ltd projects.
Sub-•If core, whether cut or sawn and whether quarter, half or all core	•Sharptooth project –historical drilling reported previously in the HDY ASX

Criteria	JORC Code explanation	Commentary
samplingtechniquesand samplepreparation	taken.•If non-core, whether riffled, tube sampled, rotary split, etc andwhether sampled wet or dry.•For all sample types, the nature, quality and appropriateness of thesample preparation technique.•Quality control procedures adopted for all sub-sampling stages tomaximise representivity of samples.•Measures taken to ensure that the sampling is representative of the insitu material collected, including for instance results for fieldduplicate/second-half sampling.•Whether sample sizes are appropriate to the grain size of the materialbeing sampled.	Release dated 19/07/2018, refer to that Announcement and Table 1 forfurther details.•Spike, Cera & Petrie projects –Aircore Drilling samples were obtained at 1mintervals and tested by hand-held Niton XRF spectrometer. Check sampleswere analysed by ALS Chemex in Mt Isa to provide calibration factors andanalytical data was compiled and was re-calculated using check samplesanalysed by ALS. No further information had been reported on the drilling andsampling process.•The Competent Person considers that the drilling, sampling, handheld XRFspectrometer results are appropriate for consideration of the mineralisationpotential of the project, additional drilling would be required to estimate andreport an exploration target or a mineral resource to the JORC (2012) Code.•No drilling or sampleresults are reported in this announcement for the otherVanadium Mining Pty Ltd projects.
Quality ofassay dataandlaboratorytests	•The nature, quality and appropriateness of the assaying andlaboratory procedures used and whether the technique is consideredpartial or total.•For geophysical tools, spectrometers, handheld XRF instruments, etc,the parameters used in determining the analysis including instrumentmake and model, reading times, calibrations factors applied and theirderivation, etc.•Nature of quality control procedures adopted (eg standards, blanks,duplicates, external laboratory checks) and whether acceptable levelsof accuracy (ie lack of bias) and precision have been established.	•Sharptooth project –historical drilling reported previously in the HDY ASXRelease dated 19/07/2018, refer to that Announcement and Table 1 forfurther details.Spike, Cera & Petrie projects -Annual reports by the Jacaranda Alliance JV•states all samples were analysed using a hand-held Niton XRF spectrometerfor at least U, Cu, Pb, Zn and V.•Vanadium assay data or hand-held Niton XRF spectrometer readings were inpart of the dataset reported to zero decimal places in the original historicaltenure reports. The original data was sourced from the original tenementholder through a government appointed intermediary and validated againstthe available original data and found to match.•Historical tenure report CR67931 stated "Check samples were analysed by ALSChemex in Mt Isa to provide calibration factors for correcting the Niton XRFreadings" for elements U, Cu, Pb, Zn and V –the outcome of the calibrationprocess is not publicly available.•A subset of holes were logged where possible using an Auslog gamma probeand assessed for Uranium mineralization potential.•No drilling or sample results are reported in this announcement for the otherVanadium Mining Pty Ltd projects.
Verificationof samplingandassaying	•The verification of significant intersections by either independent oralternative company personnel.•The use of twinned holes.	•Sharptooth project –historical drilling reported previously in the HDY ASXRelease dated 19/07/2018, refer to that Announcement and Table 1 forfurther details.•Spike, Cera & Petrie projects -All samples were analysed using a hand-heldNiton XRF spectrometer. Check samples were analysed by ALS Chemex in Mt

Criteria	JORC Code explanation	Commentary
	•Documentation of primary data, data entry procedures, dataverification, data storage (physical and electronic) protocols.•Discuss any adjustment to assay data.	Isa to provide calibration factors for correcting the handheld Niton XRFspectrometer readings. Analytical data was compiled and was re-calculatedusing check samples analysed by ALS. No further details relating to verificationwere provided in the publicly available historical tenure reports on QDEX.•The Competent Person considers that the drilling, sampling, hand-held NitonXRF spectrometer, or assay results are appropriate for consideration of themineralisation potential of the project. The geological data can be geologicallymodelled, the historical drillhole data & any subsequent developed geologicalmodel & would need to be thoroughly evaluated/interrogated, beforeconsideration of any reporting of an exploration target or a mineral resourceto the JORC (2012) Code.•Nodrilling or sample results are reported in this announcement for the otherVanadium Mining Pty Ltd projects.
Location ofdata points	•Accuracy and quality of surveys used to locate drill holes (collar anddown-hole surveys), trenches, mine workings and other locationsused in Mineral Resource estimation.•Specification of the grid system used.•Quality and adequacy of topographic control.	•Sharptooth project –historical drilling reported previously in the HDY ASXRelease dated 19/07/2018, refer to that Announcement and Table 1 forfurther details.•Spike, Cera & Petrie projects –Drillholes were surveyed by handheld GPS.Hancock Exploration Management Services, on behalf of Jacaranda AllianceJV, from May to August 2010: drilled 413 aircore drillholes for a total of12,400m of drilling, with at least 383 aircore drillholes accumulating to 11,542of drilling that potentially can be used in a geological model, with a total depthrange from 25 to 30m within the Vanadium Mining project areas.•No drilling or sample results are reported in this announcement for the otherVanadium Mining Pty Ltd projects.
Data spacinganddistribution	•Data spacing for reporting of Exploration Results.•Whether the data spacing, and distribution is sufficient to establishthe degree of geological and grade continuity appropriate for theMineral Resource and Ore Reserve estimation procedure(s) andclassifications applied.•Whether sample compositing has been applied.	•Sharptooth project –historical drilling reported previously in the HDY ASXRelease dated 19/07/2018, refer to that Announcement and Table 1 forfurther details.•Spike, Cera & Petrie projects –Drillhole spacing of traverses varies fromapproximately 200m to 1km based on targets distribution throughout theprojects.Drilling spacing reported in this announcement is indicative of the local•geological structures, intercept width, and handheld Niton XRF spectrometervalues.•The Competent Person considers that the drilling, sampling, handheld XRFspectrometer results are appropriate for consideration of the mineralisationpotential of the project. The geological data can be geologically modelled, thehistorical drillhole data & any subsequent developed geological model &would need to be thoroughly evaluated/interrogated, before consideration ofany reporting of an exploration target or a mineral resource to the JORC(2012) Code.

ASX Announcement 22 August 2018

Criteria	JORC Code explanation	Commentary
		•No drilling or sample results are reported in this announcement for the otherVanadium Mining Pty Ltd projects.
Orientationof data inrelation togeologicalstructure	•Whether the orientation of sampling achieves unbiased sampling ofpossible structures and the extent to which this is known, consideringthe deposit type.•If the relationship between the drilling orientation and the orientationof key mineralised structures is considered to have introduced asampling bias, this should be assessed and reported if material.	•Sharptooth project –historical drilling reported previously in the HDY ASXRelease dated 19/07/2018, refer to that Announcement and Table 1forfurther details.•Spike, Cera & Petrie projects –Drilling occurred perpendicular / vertical intothe ground surface, the mineralisation targeted is the Toolebuc Oil Shale thatcontains Vanadium mineralisation, dipping at approximately 1-2 degrees fromhorizontal, occasionally up to 5 degrees within the project areas.•Given the drilling orientation as near perpendicular, with shallow drilling(Total Depth =< 100m), the drilling intercepts approximate true thickness ofthe vanadium mineralisation in assayed samples or hand-held Niton XRFspectrometer analysed samples that show high grades. The drilling canprovide confidence in laterally continuity of the drilling data, based onappropriately determined appropriate drillhole spacing and geologicalinterpretation.•No drilling or sample results are reported in this announcement for the otherVanadium Mining Pty Ltd projects.
Samplesecurity	•The measures taken to ensure sample security.	•Sharptooth project –historical drilling reported previously in the HDY ASXRelease dated 19/07/2018, refer to that Announcement and Table 1 forfurther details.•Spike, Cera & Petrie projects –It is assumed that the sample securitymeasures in place at the time of the historical drilling, sampling, and ALSsample dispatch were assumed to be comparable to the contemporary samplesecurity measures.
Audits orreviews	•The results of any audits or reviews of sampling techniques and data.	•No formal audits or reviews of the Central Coast Exploration N.L. samplingtechniques and datahave taken place.•No drilling or sample results are reported in this announcement for the otherVanadium Mining Pty Ltd projects.

Section 2 Reporting of Exploration Results

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

Criteria	JORC Code explanation	Commentary
Mineraltenementand landtenure status	•Type, reference name/number, location and ownership includingagreements or material issues with third parties such as jointventures, partnerships, overriding royalties, native title interests,historical sites, wilderness or national park and environmental	•Vanadium Mining Pty Ltd holds 100% of the following mineral tenureapplications:Sharptooth Project, Queensland ("QLD"), Australia –TenureIdentifier EPM26801 [Exploration Permit Mineral Application], 100

ASX Announcement 22 August 2018

Criteria	JORC Code explanation	Commentary
	settings.•The security of the tenure held at the time of reporting along with anyknown impediments to obtaining a licence to operate in the area.	sub-blocks, submitted to the QLD Department of NaturalResources, Mines, and Energy ("DNRM") on the 23 February 2018;Cera Project, QLD, Australia –Tenure Identifier EPM26802[Exploration Permit Mineral Application], 100 sub-blocks, submittedto the DNRM on the 26 February 2018;Spike Project, QLD, Australia –Tenure Identifier EPM26803[Exploration Permit Mineral Application], 100 sub-blocks, submittedto the DNRM on the 26 February 2018;Petrie Project, QLD, Australia –Tenure Identifier EPM26804[Exploration Permit Mineral Application], 100 sub-blocks, submittedto the DNRM on the 26February 2018;Wollagalong Project, Northern Territory ("NT"), Australia –TenureIdentifier EL31841 [Exploration Licence Application], submitted tothe NT Department of Primary Industries and Resources ("DPIR")on the 5 March 2018; &Chisholm Project, NT,Australia –Tenure Identifier EL31842[Exploration Licence Application], submitted to the NT DPIR on the5 March 2018.•Note: No drilling or sample results are reported in this announcement forthe Northern Territory Vanadium Mining Pty Ltd projects.
Explorationdone byother parties	•Acknowledgment and appraisal of exploration by other parties.	•Sharptooth project –historical drilling reported previously in the HDY ASXRelease dated 19/07/2018, refer to that Announcement and Table 1 forfurther details.•The announcement contains the following publicly reported explorationactivity:Hancock Exploration Management Services, on behalf of JacarandaAlliance JV, from May to August 2010, drilled 413 aircore drillholesfor a total of 12,400m of drilling, with at least 383 aircore drillholesaccumulating to 11,542 of drilling that potentially can be used in ageological model, with a total depth range from 25 to 30m withinthe Vanadium Mining project areas.•Upon the completion of comprehensive Desktop Studies are complete,additional Historical Exploration Activity could be publicly reported.
Geology	•Deposit type, geological setting and style of mineralisation.	For its Queensland projects Vanadium Mining Pty Ltd is targeting the•following styles Early Cretaceous Toolebuc Shale: this is an oil-bearingshale that contains vanadium mineralisation occurring in the EromangaBasin and exposed in outcrop throughout Central and NorthernQueensland. The Eromanga Basin is a shallow dipping depression wherethe Toolebuc Shaleoccurs at the surface.•The Toolebuc Shale contains sediment that predominantly consists of

black carbonaceous shale, bituminous shale, minor siltstone, withlimestone lenses and coquinites (mixed limestone and clays). Claysassociated with the Toolebuc Shale are vanadium bearing, associated withpyrite, or are chemically bound to the fresh oil kerogens.•The Toolebuc Shale dips between 1-10 degrees from horizontal, near
outcrops of the Vanadium Mining projects is typically 1-2 degrees and canbe up to 5 degrees dip.•Sharptooth project –historical drilling reported previously in the HDY ASXDrill hole•A summary of all information material to the understanding of theRelease dated 19/07/2018, refer to that Announcement and Table 1 forInformation
exploration results including a tabulation of the following informationfurther details.for all Material drill holes:•Spike, Cera & Petrie projects –Hancock Exploration Management Services,easting and northing of the drill hole collaro
on behalf of Jacaranda Alliance JV, from May to August 2010, drilled: 413aircore drillholes for a total of 12,400m of drilling, with at least 383 aircoreelevation or RL (Reduced Level –elevation above sea level inodrillholes accumulating to 11,542 of drilling that potentially can be used inmeters) of the drill hole collara geological model, with a total depth range from 25 to 30m within the
dip and azimuth of the holeVanadium Mining project areas.o
•The drillhole dataset with regard to drillhole collar locations/sampledown hole length and interception deptholocations is incomplete and efforts are being made to source the complete
dataset from the original tenement holder: approximately 60 boreholeshole length.ohave been identified as potentially residing in the Spike, Cera, & Petrie
•If the exclusion of this information is justified on the basis that theproject areas in historical tenure maps, however borehole collar coinformation is not Material and this exclusion does not detract fromordinate information was not tabulated in the body of the historicalthe understanding of the report, the Competent Person should clearlytenure reports, nor the borehole names clearly legible for all holes on theexplain why this is the case.historical tenure maps.•During May-August 2010 Hancock Exploration Management Servicescompleted an air core drilling programme in EPMs 15234, 15235, 15236,15240, 15241, 15298 and 15299. A total of 413 air core holes were drilledfor 12,400 meters –with at least 383 aircore drillholes accumulating to11,542 of drilling that potentially can be used in a geological model, with atotal depth range from 25 to 30m within the Vanadium Mining projectareas.•The currently available drillhole and subsequent sample/pXRF informationwere sourced from multiple historical tenure reports that include: 1)CR64271, 2) CR64273 & 3) CR64276, & 4) CR67931. pXRF had beenconducted on 3,581 samples for boreholes that are known to be withinthe Vanadium Mining QLD Spike, Cera, & Petrie project areas.No drilling or sample resultsare reported in this announcement for the•other Vanadium Mining Pty Ltd projects.
Data••Sharptooth project –historical drilling reported previously in the HDY ASXIn reporting Exploration Results, weighting averaging techniques,Release dated 19/07/2018, refer to that Announcement and Table 1 foraggregationmaximum and/or minimum grade truncations (eg cutting of high

ASX Announcement 22 August 2018

Criteria	JORC Code explanation	Commentary
methodsRelationshipbetweenmineralisation widths andinterceptlengths	grades) and cut-off grades are usually Material and should be stated.•Where aggregate intercepts incorporate short lengths of high graderesults and longer lengths of low grade results, the procedure usedfor such aggregation should be stated and some typical examples ofsuchaggregations should be shown in detail.•The assumptions used for any reporting of metal equivalent valuesshould be clearly stated.•These relationships are particularly important in the reporting ofExploration Results.•If the geometry of the mineralisation with respect to the drill holeangle is known, its nature should be reported.•If it is not known and only the down hole lengths are reported, thereshould be a clear statement to this effect (eg 'down hole length, truewidth not known').	further details.•Spike, Cera & Petrie projects –Hancock Exploration Management Services,on behalf of Jacaranda Alliance JV, from May to August 2010, drillingsample results were reported on the historical portable Niton XRFspectrometry values obtained on the interval sampled and assayed.•Data aggregation occurred in this announcement when values have beenreported over an intersection length of more than 1m, using samplelength weighting of each individual hand-held Niton XRF spectrometerreading. No ALS assay results have been reported in this announcement.•No drilling or sample results are reported in this announcement for theother Vanadium Mining Pty Ltd projects.•Sharptooth project –historical drilling reported previously in the HDY ASXRelease dated 19/07/2018, refer to that Announcement and Table 1 forfurther details.•Spike, Cera & Petrie projects –Drilling occurred perpendicular / verticalinto the ground surface, the mineralisation targeted is the Toolebuc OilShale that contains Vanadium mineralisation, dipping at approximately 1-5degrees from horizontal.•The Competent Person considers that the drilling, sampling, hand-heldNiton XRF spectrometer, or assay results are appropriate for considerationof the mineralisation potential of the project. The geological data can begeologically modelled, the historical drillhole data & any subsequentdeveloped geological model & would need to be thoroughlyevaluated/interrogated, before consideration of any reporting of anexploration target or a mineral resource to the JORC (2012) Code.
		•No drilling or sample results are reported in this announcement for theother Vanadium Mining Pty Ltd projects.
Diagrams	•Appropriate maps and sections (with scales) and tabulations ofintercepts should be included for any significant discovery beingreported These should include, but not be limited to a plan view ofdrill hole collar locations and appropriate sectional views.	•All QLD projects –appropriate plan view diagrams are shown in theannouncement to display vanadium mineral prospectivity.The Competent Person considers that the drilling, sampling, assay results•are appropriate for consideration of the mineralisation potential of theproject. The geological data can be geologically modelled, the historicaldrillhole data & any subsequent developed geological model & wouldneed to be thoroughly evaluated/interrogated, before consideration ofany reporting of an exploration target or a mineral resource to the JORC(2012) Code.No drilling or sample results are reported in this announcement for the•other Vanadium Mining Pty Ltd projects.
Balanced	•Where comprehensive reporting of all Exploration Results is notpracticable, representative reporting of both low and high grades	•Sharptooth project –historical drilling reported previously in the HDY ASXRelease dated 19/07/2018, refer to that Announcement and Table 1 for

further details.•Spike, Cera & Petrie projects –The currently available drillhole andsubsequent sample/pXRF information were sourced from multiplehistorical tenure reports that include: 1) CR64271, 2) CR64273 & 3)CR64276, 4) CR67931, 5) CR73656, 6) CR73657, 7) CR73676, 8) CR73739,
9) CR73746, 10) CR73748, & 11) CR73758 Appropriate plan view diagramsare shown in the announcement to display vanadium mineralprospectivity. The geological data can be geologically modelled, thehistorical drillhole data & any subsequent developed geological model &would need to be thoroughly evaluated/interrogated, beforeconsideration of any reporting of an exploration target or a mineralresource to the JORC (2012) Code.•Statistical Analysis of the lithology recorded for the approximately 1,890pXRF values reveal the following (ignoring the zero value readings):Calcareous Mudstone V2O5pXRF values: 0.01 to 0.22%, average0.04%Coquinite V2O5pXRF values: 0.03 to 0.58%, average 0.17%Limestone V2O5pXRF values: 0.02 to 0.58%, average 0.04%MuddyLimestone V2O5pXRF values: 0.01 to 0.22%, average 0.40%Mudstone V2O5pXRF values: 0.02 to 0.49%, average 0.06%Soil V2O5pXRF values: 0.03 to 0.17%, average 0.06%All Samples V2O5pXRF values: 0.01 to 0.58%, average 0.09%•Statistical Analysis of the individual pXRF values that make up the twopossible working sections in the aircore drilling:High gradeV2O5pXRF 1,070 values: thickness of the workingsection in the aircore drilling ranges from 4 to 6m, with a weightedpXRF minimum of 0.10%,maximum of 0.49%, average of 0.25%Lower grade V2O5 pXRF values, in a coherent block immediatelyabout the high grade working section, 823 pXRF values: thickness ofthe lower grade working section in the aircore drilling ranges from 0to 3m, with a weighted pXRF minimum of 0.00%(for zerothickness), maximum of 0.31%, average of 0.11%
•No drilling or sample results are reported in this announcement for theother Vanadium Mining Pty Ltd projects.
•Sharptooth project –historical drilling reported previously in the HDY ASXRelease dated 19/07/2018, refer to that Announcement and Table 1 forfurther details.•Spike, Cera & Petrie projects –Further lithological descriptions were

Criteria	JORC Code explanation	Commentary
data	method of treatment; metallurgical test results; bulk density,groundwater, geotechnical and rock characteristics; potentialdeleterious or contaminating substances.	provided during the geologicalmapping of the earlier reconnaissancestage.•The current announcement used two other forms of substantiveexploration data:•1) QLD –the Vanadium Mining Pty Ltd Geology Team generated aninterpretation of the outcrop-subcrop zone and extents of Toolebucformation at the edges of the Eromanga Basin, based on the followingdatasets:1a) Ozimic, S. and Saxby, J.D., 1983. Oil Shale Methodology: Anexamination of the Toolebuc Formation and the laterallycontiguous time equivalent units, Eromanga and CarpentariaBasins. Bureau of Mineral Resources and CSIRO research project;1b) Lewis, S.E., Henderson, R.A., Dickens, G.R., Shields, G.A., &Coxhell, S., 2010. The geochemistry of primary and weathered oilshale and coquina across the Julia Creek vanadium deposit(Queensland, Australia). Miner Deposita 45: 599–620;1c) Smart, J., Grimes, K.G., Doutch, H.F., & Pinchin, J., 1980. TheMesozoic Carpentaria Basin and the Cainozoic Karumba Basin,North Queensland. Bulletin 202, Department of Natural Resources& Energy, Bureau of Mineral Resources, Geology & Geophysics.Australian Government Publishing Service, Canberra;1d) Coxhell, S., & Fehlberg, B., 2000. Julia Creek Vanadium and OilShale Deposit. AIG Journal –Applied geoscientific research andpractice in Australia; &1e) MinesOnlineMap information publicly available from the QLDDepartment of Natural Resources and Mines, and the GeologicalSurvey of Queensland.•No drilling or sample results are reported in this announcement for theother Vanadium Mining Pty Ltd projects.
Further work	•The nature and scale of planned further work (e.g. tests for lateralextensions or depth extensions or large-scale step-out drilling).	•All Vanadium Mining Pty Ltd projects require technical evaluation toprioritize areas within the projects to focus mineral exploration efforts, to
•	Diagrams clearly highlighting the areas of possible extensions,including the main geological interpretations and future drilling areas,provided this information is not commercially sensitive.	systematically explore for vanadium mineralisation.•Geological modelling of the QLD Vanadium Mining Pty Ltd projects.