PATERSON RESOURCES LTD — Capital/Financing Update 2018

Jul 18, 2018

ASX ANNOUNCEMENT 19 July 2018

MOVING TO ESTABLISH VANADIUM FOOTPRINT IN AUSTRALIA

HIGHLIGHTS

• Following the proposed acquisition of Nelly Vanadium Mine (NVM) in Argentina1, HDY has agreed to acquire six highly-prospective vanadium projects close to proven resources in Queensland and Northern Territory
  • Four prospects in west Queensland near to Intermin Resources' (ASX: IRC) globally significant Richmond project (inferred mineral resource 2,579Mt @ 0.32% V2O5, cutoff grade of 0.29% V2O5)2
  • Two Northern Territory projects contiguous to TNG Ltd's (TNG) Mt Peake project (total mineral resource – 160Mt @ 0.28% V205 cut-off grade of 0.10% V2O5)3
• Critically, all six projects are in well-known mining districts with supportive infrastructure, ready access to ports and skilled labour pools
• With NVM1 and the six projects in Australia, the HDY Board believes it can rapidly build a strong scalable global platform to meet growing demand for vanadium
• Moving forward, the Board intends to place a greater emphasis on developing the vanadium assets to facilitate HDY evolving into an emerging supplier to the renewable energy sector
• Shareholders will be informed of due diligence findings on the six Australian projects as they materialise

Hardey Resources Executive Chairman, Terence Clee commented: "The Board has taken the decision to evolve Hardey Resources into an emerging vanadium supplier to the renewable energy sector, which explains the move to acquire these six highly prospective projects across Queensland and Northern Territory. The new projects will complement the Nelly Vanadium Mine in Argentina and deliver Hardey Resources a solid, yet geographically diversified, platform to develop moving forward."

***

Hardey Resources Limited (ASX: HDY) ("HDY" or "the Company") is pleased to announce that it has entered into a share sale agreement with the major shareholders of Vanadium Mining Pty Ltd (VanMin). Under the terms of this agreement, HDY has been granted a 40-day option to acquire 100% of the issued capital of VanMin, which is a mineral explorer that owns six highly prospective vanadium projects in Queensland and the Northern Territory.

***

The key terms of the VanMin acquisition are detailed in Appendix A to this announcement.

OVERVIEW

VanMin was established with the principal objective of acquiring vanadium projects in Queensland and the Northern Territory.

Currently, VanMin has seven shareholders holding 55,900,200 fully paid ordinary shares on issue. HDY has paid VanMin $75,000 in consideration for the grant of an option to acquire 100% of the issued capital in VanMin, exercisable at any time within 40 days following the date of the agreement. During this time, HDY will undertake due diligence in relation to VanMin and six projects in Queensland and the Northern Territory. If the option is exercised, at settlement of the acquisition HDY will issue 550,000,000 fully paid ordinary shares and 550,000,000 listed options (exercisable at $0.02 on or before 30 April 2020) (ASX: HDYOC) to VanMin shareholders.

The HDY shares to be issued at settlement to VanMin shareholders, as consideration for the VanMin acquisition, will account for circa 20.76% of HDY's expanded issued capital. In addition, HDY will pay a 3% net smelter return royalty to VanMin's founding shareholders for all minerals produced from the six projects.

Queensland projects

VanMin owns four projects in the Mount Isa region of western Queensland – Sharptooth, Spike, Cera and Petrie. These projects are located in an area that favours shallow surface mining for large tonnages of low-grade vanadium mineralisation (Figure 1).

FIGURE 1: SHARPTOOTH, SPIKE, CERA AND PETRIE PROJECTS

Source: VanMin geology team

Notably, these four highly prospective areas are near to IRC's globally significant Richmond project (inferred mineral resource 2,579Mt @ 0.32% V2O5 cut-off grade of 0.29% V2O5)2 and ground held by Liontown Resources (LTR). Of note, LTR's tenure contains historic vanadium resources, but they do not comply with the JORC (2012) code4.

Within the Mt Isa region, the Toolebuc Formation is increasingly recognised for elevated vanadium potential (Figure 2). Furthermore, areas known for the prevalence of oil shale usually have occurrences of vanadium and uranium mineralisation. This combination of mineralisation is typically found within the Toolebuc Formation and is consistent with the underlying geology apparent at IRC and LTR's respective projects.

FIGURE 2: TOOLEBUC FORMATION IN MT ISA REGION

Source: VanMin geology team2

Across VanMin's four Queensland projects, there is clear evidence of elevated vanadium levels in historic boreholes drilled within the Toolebuc Formation (Figure 3). Further, numerous historic reports and research confirm that VanMin's four projects, and the greater region, are generally prospective for vanadium mineralisation.

Based on this legacy work, primary and secondary targets that align with the Toolebuc Formation outcropping have been selected for follow-up fieldwork to confirm the potential for vanadium mineralisation.

FIGURE 3: TOOLEBUC FORMATION WITHIN VANMIN'S PROJECTS

Notes: 1) refer to Figure 4 for Intercept length and grade presented in Figure 3; and 2) refer to Appendix B Table 1 for additional grades, intersection lengths and hole-name for the V2O5 values presented in Figure 3 and Figure 4.

Source: VanMin geology team.

FIGURE 4: TOOLEBUC FORMATION SHARPTOOTH V2O5 GRADE AND INTERCEPTS5 FROM FIGURE 3

BoreholeIdentifier	DepthFrom (m)	SampleLength (m)	AssayGrade V (%)	Converted toV2O5(%)
1	15	1	0.10	0.18
2	13	1	0.12	0.21
3	32	1	0.14	0.25
4	41	1	0.18	0.32
5	57	1	0.13	0.23
6	52	1	0.17	0.30

Source: VanMin geology team.

Northern Territory projects

VanMin's two projects in the Northern Territory – Wollagalong and Chisholm – are contiguous with TNG's Mt Peake project (Figure 5), which has a total resource at 160Mt @ 0.28% V205 cutoff grade of 0.29% V2O5.3 TNG's project is the most advanced in the region as a Definitive Feasibility Study has already been completed, while TNG has also signed a binding life-ofmine offtake and technology transfer agreement with Korea's Woojin Metals.3

Source: VanMin geology team

Both VanMin projects are in a region with higher grade mineralisation that is associated with ore bodies with the potential to be selectively mined by open pit methods. Moreover, Wollagalong and Chisholm cover the highly prospective Arunta Orogen, which hosts TNG's Mt Peake vanadium deposit.

Assessing geophysics, the aeromagnetic image (Figure 6) identifies two phases of potential mineralisation, with East-West & North-South trending structures visible and intersecting within the project areas. Moreover, both VanMin's projects have similar geological and magnetic features to TNG's declared resource for vanadium, titanium and iron. Further, they are highly probable to be gabbro-hosted magnetite deposits which underlie the Mt Peake deposit's V-Fe-Ti mineral resources.

Leveraging the similarities with the Mt Peake deposit provides clear primary and secondary target areas for follow-up fieldwork to assess the potential for vanadium mineralisation.

FIGURE 6: AEROMAGNETIC IMAGE HIGHLIGHTS MINERALISATION

Source: VanMin geology team

Global demand drivers

Over the past two to three years, the twin effects of global supply bottlenecks and rising demand have underpinned a significant increase in the vanadium price (Figure 7).

FIGURE 7: VANADIUM PENTOXIDE PRICE CHART

On the supply side, China, which supplies around 50% of global vanadium3, is using more of its output internally following new rules to double reinforcing bar requirements in concrete structures (post-recent earthquakes). Concurrently, it has shuttered polluting mines, reducing its output moderately and propelling a search for new vanadium supply chains that includes Australia and Argentina.

Traditionally the steel industry consumes around 90% of global vanadium, but at the margin demand from the renewable battery sector is starting to take-off.

Specifically, demand for scalable energy storage is accelerating, reflecting wider renewable energy adaption. Within this product group, Vanadium Redox Batteries (VRBs) are an emerging solution end-users are starting to accept.

Some key positive attributes for VRBs1 include:

• Scalability and suitable for grid connection;
• 20-yr lifespan and instant energy release;
• Excellent charge retention / discharge; and
• Using only one element in electrolyte form: V2O5

Arguably, if this transformation progresses then it will propel vanadium towards energy commodity status.

Source: Bloomberg

Extraordinary General Meeting

HDY will shortly commence preparation of a notice of meeting to convene a general meeting of shareholders to seek shareholder approvals required to give effect to the VanMin acquisition, including for the issue of the consideration shares and options.

Pro-forma capital structure

A pro forma capital structure for HDY upon completion of the VanMin acquisition is set out below:

	Shares	Options
Current	1,361,815,830	861,810,9241
Consideration–Nelly Vanadium P/L	737,500,000	737,500,0002
Consideration –Vanadium Mining P/L	550,000,000	550,000,0002
Total	2,649,315,830	2,149,310,924

Notes:

• 1. The terms of the current options on issue are as follows:
  • a. 812,884,346 listed options exercisable at $0.02 on or before 30 April 2020 (ASX: HDYOC);
  • b. 45,525,000 options exercisable at $0.06 on or before 19 August 2020; and c. 3,401,578 options exercisable at $0.044 on or before 1 October 2020.
• 1. Consideration options are listed options exercisable at $0.02 on or before 30 April 2020 (ASX: HDYOC).

Indicative timetable*

An indicative timetable for the VanMin acquisition is set out below:

Event	Date
Execution of acquisition agreement	19July 2018
Dispatch of notice of meeting seeking shareholderapprovals for the VanMinacquisition	30July 2018
General meeting to approve the VanMinacquisition	31August 2018
Settlement of the acquisition	7 September2018

* The above dates are indicative only and may change without notice.

For and on behalf of the Board

Terence Clee Executive Chairman

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.

REFERENCES:

• 1. HDY ASX Release 3 July 2018
• 1. IRC ASX Release 20 March 2018
• 1. TNG ASX Release 20 November 2017 & TNG ASX Release 26 March 2013
• 1. LTR ASX Release 28 November 2017
• 1. Table 1 Information refer to Appendix B

APPENDIX A: SUMMARISED KEY TERMS OF PROPOSED ACQUISITION

HDY and VanMin have entered into a binding Heads of Agreement (HOA), with the key terms as follows:

Grant of option

• HDY has an exclusive 40-day option to acquire 100% of the fully paid ordinary shares in the capital of VanMin which comes into effect from the date the HOA is executed;
• In consideration for the Option, HDY has paid NVPL an option fee of $75,000; and
• The option can be exercised any time up to expiry.

Due Diligence and exclusivity

During the option period, HDY will undertake thorough due diligence across all key legal, financial, technical and geological issues relating to VanMin and six projects in Queensland and Northern Territory.

Conditions precedent

Completion of the acquisition is conditional upon the satisfaction (or waiver by HDY) of the following:

• All shareholders in VanMin agreeing to transfer their shares to the Company;
• Finalising due diligence by HDY on VanMin's business, assets and operations;
• Securing all necessary regulatory approvals to complete the acquisition; and
• Obtaining shareholder approval for all key aspects of the transaction.

The parties will use their best efforts to ensure the conditions precedent are satisfied.

Consideration

Upon the exercise of the option and the satisfaction (or waiver) of the conditions precedent, HDY will, as consideration for the acquisition:

• issue 550,000,000 fully paid ordinary shares in the capital of the HDY at a deemed issue price of $0.004;
• issue 550,000,000 listed options to acquire shares in HDY, exercisable at $0.02 on or before 30 April 2020; and

pay an aggregate 3% net smelter royalty for all minerals produced from the six projects, to VanMin's founding shareholders.

Settlement

Settlement of the acquisition will occur five business days after the option is exercised and all conditions precedent have been satisfied.

Warranties

The parties have both provided warranties that are customary to a transaction of this nature.

Exclusivity

During the term of the HOA, VanMin will be prohibited from entering into negotiations or taking any action to enter into any transactions with alternative potential purchasers.

Maintaining the status quo

During the exclusivity period, VanMin agrees not to enter into any material contract or incur any material liability; declare any dividends; or vary its capital structure without HDY's prior written consent.

Otherwise, the Heads of Agreement contains clauses typical for binding agreements of this nature.

APPENDIX B – JORC CODE, 2012 EDITION – TABLE 1 REPORT TEMPLATE

Drilling results summarized in the Table 1 Sections below are associated with the Sharptooth project.

1.1 Section 1 Sampling Techniques and Data

Criteria	JORC Code explanation	Commentary
Samplingtechniques	•Nature and quality of sampling (e.g. cut channels, randomchips, or specific specialised industry standard measurementtools appropriate to the minerals under investigation, such asdown hole gamma sondes, or handheld XRF instruments, etc).These examples should not be taken as limiting the broadmeaning of sampling.•Include reference to measures taken to ensure samplerepresentivity and theappropriate calibration of anymeasurement tools or systems used.•Aspects of the determination of mineralisation that are Materialto the Public Report.•In cases where 'industry standard' work has been done thiswould be relatively simple (e.g. 'reverse circulation drilling wasused to obtain 1 m samples from which 3 kg was pulverized toproduce a 30 g charge for fire assay'). In other cases moreexplanation may be required, such as where there is coarsegold that has inherent sampling problems. Unusualcommodities or mineralisation types (e.g. submarine nodules)may warrant disclosure of detailed information.	•Sharptooth project –Central Coast Exploration N.L., from 28 Feb1980 to 6 Oct 1981, drilled 19 drillholes accumulating to 1,199m ofdrilling, with atotal depth range from 33 to 95m. Sample intervalswere obtained on a 1m basis from down hole depths, sampleswere only taken on an integer depth basis. Limited informationhad been reported on the drilling process by Central CoastExploration N.L. in their tenure reporting.•The Competent Person considers that the drilling, sampling, assayresults are appropriate for consideration of the mineralisationpotential of the project, additional drilling would be required toestimate and report an exploration target or a mineral resourceto the JORC (2012) Code.•No drilling or sample results are reported in this announcement forthe other Vanadium 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. corediameter, triple or standard tube, depth of diamond tails, facesampling bit or other type, whether core is oriented and if so, bywhat method, etc).	•Sharptooth project –Percussion Drilling was thedrilling methodthat Central Coast Exploration N.L., limited information had beenreported on the drilling process by Central Coast Exploration N.L.in their tenure reporting.•The Competent Person considers that the drilling, sampling, assayresults are appropriate for consideration of the mineralisationpotential of the project, additional drilling would be required toestimate and 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 other Vanadium Mining Pty Ltd projects.
Drill sample	•Method of recording and assessing core and chip sample	•Sharptooth project –Percussion Drilling was the drilling method
recovery	recoveries and results assessed.	that Central CoastExploration N.L., limited information had been
	•Measures taken to maximise sample recovery and ensurerepresentative nature of the samples.	reported on the drilling process by Central Coast Exploration N.L.in their tenure reporting.•The Competent Person considers that the drilling, sampling, assay
	•Whether a relationship exists between sample recovery and	results are appropriate for consideration of the mineralisationpotential of the project, additional drilling would be required to
	grade and whether sample bias may have occurred due topreferential loss/gain of fine/coarse material.	estimate and report an exploration target or a mineral resourceto the JORC (2012) Code.
		•No drilling or sample results are reported in this announcement forthe other Vanadium Mining Pty Ltd projects.
Logging	•Whether core and chip samples have been geologically and	•Sharptooth project –Central Coast Exploration N.L. presented thedrilling results in a two (2) tenure reports, the lithological logging
	geotechnically logged to a level of detail to support appropriateMineral Resource estimation, mining studies and metallurgical	of the percussion drilling process included a basic lithology
	studies.	description and an observation of the Bitumen content.
	•Whether logging is qualitative or quantitative in nature. Core (or	•The Competent Person considers that the drilling, sampling, assay
	costean, channel, etc) photography.	results are appropriate for consideration of the mineralisationpotential of the project, additional drilling would be required to
	•The total length and percentage of the relevant intersections	estimate and report an exploration target or a mineral resourceto the JORC (2012) Code.
	logged.	•No drilling or sample results are reported in this announcement for
		the otherVanadium Mining Pty Ltd projects.
Subsampling	•If core, whether cut or sawn and whether quarter, half or allcore taken.	•Sharptooth project –Central Coast Exploration N.L. presentedthedrilling results in a two (2) tenure reports, limited information had
techniquesand sample	•If non-core, whether riffled, tube sampled, rotary split, etc and	been reported on the drilling process by Central CoastExploration N.L. in their tenure reporting.
preparation	whether sampled wet or dry.	•The Competent Person considers that the drilling, sampling, assay
	•For all sample types, the nature, quality and appropriateness ofthe sample preparation technique.	results are appropriate for consideration of the mineralisationpotential of the project, additional drilling would be required toestimate and report an exploration target or a mineral resource
	•Quality control procedures adopted for all sub-sampling stagesto maximise representivity of samples.	to the JORC (2012) Code.•No drilling or sample results are reported in thisannouncement for
	•Measures taken to ensure that the sampling is representativeofthe in situ material collected, including for instance results forfield duplicate/second-half sampling.	the other Vanadium Mining Pty Ltd projects.
	•Whether sample sizes are appropriate to the grain size of thematerial being sampled.

www.hardeyresources.com.au 2

Qualityofassay dataandlaboratorytests	•••	The nature, quality and appropriateness of the assaying andlaboratory procedures used and whether the technique isconsidered partial or total.For geophysical tools, spectrometers, handheld XRFinstruments, etc, the parameters used in determining theanalysis including instrument make and model, reading times,calibrations factors applied and their derivation, etc.Nature of quality control proceduresadopted (eg standards,blanks, duplicates, external laboratory checks) and whetheracceptable levels of accuracy (ie lack of bias) and precisionhave been established.	•Sharptooth project –The laboratory assay techniques werecompleted by Australian Laboratory Services Pty Ltd ("ALS").•The ALS Oil Shale testing regime included 270 samples tested for'Oil Yield' (litres/tonne), Oil Specific Gravity, Water Yield(litres/tonne), Gas Loss (kg/tonne), Gas Residue (litres/tonne), toModified Fisher Method ASTM D3904.•The ALS testing regime included 270 samples tested for U (%) noidentifiable testing method.•The ALS testing ash residue regime included 12 samples tested forCu (ppm), Pb (ppm), Zn (ppm), Mo (ppm), Ag (ppm), Au (ppb),& U (ppm), with the AAS testing method for Au & Ag.•No drilling or sample results are reported in this announcement forthe other Vanadium Mining Pty Ltd projects.
Verificationof samplingandassaying	••••	The verification of significant intersections by eitherindependent or alternative company personnel.The use of twinned holes.Documentation of primary data, data entry procedures, dataverification, data storage (physical and electronic) protocols.Discuss any adjustment to assay data.	•Sharptooth project –Central Coast ExplorationN.L. presented thedrilling results in a two (2) tenure reports, the lithological loggingof the percussion drilling process included a basic lithologydescription and an observation of the Bitumen content.•The Competent Person considers that the drilling, sampling, assayresults are appropriate for consideration of the mineralisationpotential of the project, additional drilling would be required toestimate and report an exploration target or a mineral resourceto the JORC (2012) Code.•No drilling or sample results are reported in this announcement forthe other Vanadium Mining Pty Ltd projects.
Location ofdata points	•••	Accuracy and quality of surveys used to locate drill holes (collarand down-hole surveys), trenches, mine workings and otherlocations used in Mineral Resource estimation.Specification of the grid system used.Quality and adequacy of topographic control.	•Sharptooth project –Central Coast Exploration N.L., from 28 Feb1980 to 6 Oct 1981, drilled 19 drillholes accumulating to 1199m ofdrilling, with a total depth range from 33 to 95m.•No drilling or sample results are reported in this announcement forthe other Vanadium Mining Pty Ltd projects.
Dataspacinganddistribution	•••	Data spacing for reporting of Exploration Results.Whether the data spacing and distribution is sufficient toestablish the degree of geological and grade continuityappropriate for the Mineral Resource and Ore Reserveestimation procedure(s) and classifications applied.Whether sample compositing has been applied.	•Sharptoothproject–Drillingspacingreportedinthisannouncement is indicative of the local geological structures,intercept width and assay grade.•The Competent Person considers that the drilling, sampling, assayresults are appropriate for consideration of the mineralisationpotential of the project, additional drilling would be required toestimate and report an exploration target or a mineral resourceto the JORC (2012) Code.•No drilling or sample results are reported in this announcement for

			the other Vanadium Mining Pty Ltd projects.
Orientationof data inrelationtogeologicalstructure	••	Whether the orientation of sampling achieves unbiasedsampling of possible structures and the extent to which this isknown, considering the deposit type.If the relationship between the drilling orientation and theorientation of key mineralised structures is considered to haveintroduced a sampling bias, this should be assessed andreported if material.	•Sharptooth project –Drilling occurred perpendicular / verticalinto the ground surface, the mineralisation targeted is theToolebuc Oil Shale that contains Vanadium mineralisation,dipping at approximately 5 degrees from horizontal.•Given the drilling orientation as near perpendicular, with shallowdrilling (Total Depth =< 100m), the drilling intercepts approximatetrue thickness of the vanadium mineralisation in assayed samplesthat show high grades. The drilling can provide confidence inlaterally continuity of the drilling data, based on appropriatelydetermined appropriate drillhole spacing and geologicalinterpretation.•No drilling or sample results are reported in this announcement forthe other Vanadium Mining Pty Ltd projects.
Samplesecurity	•	The measures taken to ensure sample security.	•Sharptooth project –It is assumed that the sample securitymeasures in place at the time of the historical drilling, sampling,and dispatch were assumed to be comparable to thecontemporary sample security measures.
Auditsorreviews	•	The results of any audits or reviews of sampling techniques anddata.	•No audits or reviews of the Central Coast Exploration N.L.sampling techniques and data have taken place.•No drilling or sample results are reported in this announcement forthe other Vanadium Mining Pty Ltd projects.
		(Criteria in this section apply to all succeeding sections.)

1.2 SECTION 2 REPORTING OF EXPLORATION RESULTS

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

Criteria	JORC Code explanation	Commentary
Mineraltenementandlandtenurestatus	•Type, reference name/number, location and ownershipincluding agreements or material issues with third partiessuch as joint ventures, partnerships, overriding royalties,native title interests, historical sites, wilderness or nationalpark and environmental settings.•The security of the tenure held at the time of reporting alongwith any known impediments to obtaining a licence tooperate in the area.	•Vanadium Mining Pty Ltd holds 100% of the following mineraltenure applications:2.Sharptooth Project, Queensland ("QLD"), Australia –TenureIdentifier EPM26801 [Exploration Permit Mineral Application], 100sub-blocks, submitted to the QLD Department of NaturalResources, Mines, and Energy ("DNRM") on the 23 February 2018;3.Cera Project, QLD, Australia –Tenure Identifier EPM26802[Exploration Permit Mineral Application], 100 sub-blocks, submittedto the DNRM on the 26 February 2018;4.Spike Project, QLD, Australia –Tenure Identifier EPM26803[Exploration Permit Mineral Application], 100 sub-blocks, submittedto the DNRM on the 26 February 2018;5.Petrie Project, QLD, Australia –Tenure Identifier EPM26804[Exploration Permit Mineral Application], 100 sub-blocks, submittedto the DNRM on the 26 February 2018;6.Wollagalong Project, Northern Territory ("NT"), Australia –TenureIdentifier EL31841 [Exploration Licence Application], submitted tothe NT Department of Primary Industries and Resources ("DPIR") onthe 5 March 2018; &7.Chisholm Project, NT, Australia –Tenure Identifier EL31842[Exploration Licence Application], submitted to the NT DPIR on the5 March 2018.
Explorationdonebyotherparties	•Acknowledgment and appraisal of exploration by otherparties.	•The announcement contains the following publicly reportedexploration activity:Sharptooth project –Central Coast Exploration N.L., from 28 Feb1980 to 6 Oct 1981, held ATP2147M and it covered a similar area totheSharptoothproject.Thepresenteddrillinginthisannouncement being completed by Central Coast ExplorationN.L., drilling to intercept oil bearing shale (to estimate containedbarrels of oil) and at the same time quantify the vanadiummineralisation. Central Coast Exploration N.L. appeared to primarilybe focused on the oil-bearing properties of the Toolebuc Shale,with considerations for mineral impurities and/or byproducts that

		could potentially be produced from extracting the oil from the oilbearing shales.•The Competent Person anticipates upon the completion ofcomprehensive Desktop Studies are complete, additional HistoricalExploration Activity couldbe publicly reported.
•Geology	Deposit type, geological setting and style of mineralisation.	•Vanadium Mining Pty Ltd is targeting the following styles ofmineralisation within its tenure applications:Queensland projects –Early Cretaceous Toolebuc Shale:this is anoil-bearing shale that contains vanadium mineralisation occurringin the Eromanga Basin and exposed in outcrop throughout Centraland Northern Queensland. The Eromanga Basin is a shallowdipping depression where the Toolebuc Shale occurs at thesurface. The Toolebuc Shale contains sediment that predominantlyconsists of black carbonaceous shale, bituminous shale, minorsiltstone, with limestone lenses and coquinites (mixed limestoneand clays). Clays associated with the Toolebuc Shale arevanadium bearing, associated with pyrite, or are chemicallybound to the fresh oil kerogens.•Northern Territory projects –Titano-magnetite Vanadium (Ti-Fe-V)mineralization associated with the Arunta orogen. The Aruntaorogen is overlain by the NT, and the State of Western Australia.The Arunta orogen age range spans the Paleoproterozoic toOrdovician and has been affected by tectonothermal events thatextend to the Carboniferous. It is mostly sedimentary in origin buthad been extensively affected by felsic andmafic magmatism,mostly in the Paleoproterozoic. The highly magnetic features in theGeophysical Survey Imagery of Total Magnetic Intensity availableas features correspond to outcrops of the Anningie member, thesame Formation that the Mt Peake project exploits for Ti-Fe-Vmineralisation. The magnetic features are interpreted to be gabbrohosted magnetite deposits that are sources of potential Ti-Fe-Vmineralisation.
•DrillholeInformation	A summary of all information material to the understandingof theexploration results including a tabulation of thefollowing information for all Material drill holes:easting and northing of the drill hole collaroelevation or RL (Reduced Level –elevation above seaolevel in metres) of the drill hole collardip and azimuth of the holeo	•Sharptooth project –Central Coast Exploration N.L., from 28 Feb1980 to 6 Oct 1981, drilled 19 drillholes accumulating to 1199m ofdrilling, with a total depth range from 33 to 95m. Central CoastExploration N.L. the drilling collars and additional drilling informationpresented in the announcement are publicly available viaMinesOnlineMaps and QDEX.•No drilling or sample results are reported in this announcement forthe other Vanadium Mining Pty Ltd projects.

	down hole length and interception deptho
	hole length.o
	•If the exclusion of this information is justified on the basisthat the information is not Material and this exclusion doesnot detract from the understanding of the report, theCompetentPerson should clearly explain why this is thecase.
Dataaggregation methods	•In reporting Exploration Results, weighting averagingtechniques, maximum and/or minimum grade truncations(eg cutting of high grades) and cut-off grades are usuallyMaterial and should be stated.•Where aggregate intercepts incorporate short lengths ofhigh grade results and longer lengths of low grade results,the procedure used for such aggregation should be statedand some typical examples of such aggregations should beshown in detail.	•Sharptooth project –Central Coast Exploration N.L. drilling sampleresults were reported on the historical assay values obtained on theinterval sampled and assayed, no data aggregation occurred orhad been reported in this announcement.•No drilling or sample results are reported in this announcement forthe other Vanadium Mining Pty Ltd projects.
	•The assumptions used for any reporting of metal equivalentvalues should be clearly stated.
Relationshipbetweenmineralisationwidthsandinterceptlengths	•These relationships are particularlyimportant in thereporting of Exploration Results.•If the geometry of the mineralisation with respect to the drillhole angle is known, its nature should be reported.•If it is not known and only the down hole lengths arereported, there should be a clear statement to this effect (eg'down hole length, true width not known').	•Sharptooth project –Drilling occurred perpendicular / vertical intothe ground surface, the mineralisation targeted is the Toolebuc OilShalethatcontainsVanadiummineralisation,dippingatapproximately 5 degrees from horizontal.•The Competent Person considers that the drilling, sampling, assayresults are appropriate for consideration of the mineralisationpotential of the project, additional drilling would be required toestimateand report an exploration target or a mineral resource tothe JORC (2012) Code.•No drilling or sample results are reported in this announcement forthe other Vanadium Mining Pty Ltd projects.
Diagrams	•Appropriate maps and sections (with scales) and tabulationsof intercepts should be included for any significant discoverybeing reported These should include, but not be limited to aplan view of drill hole collar locations and appropriatesectional views.	•Sharptooth project –Central Coast Exploration N.L. Key drillingintercepts are presented in the announcement, in table and mapform. Central Coast Exploration N.L. drilling information presentedin the announcement are publicly available via MinesOnlineMapsand QDEX.•The Competent Person considers that the drilling, sampling, assayresults are appropriate for consideration of the mineralisationpotential of the project, additional drilling would be required toestimate and 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 other Vanadium Mining Pty Ltd projects.
•BalancedWhere comprehensive reporting of all Exploration Results isnot practicable, representative reporting of both low andreportinghigh grades and/or widths should be practiced to avoidmisleading reporting of Exploration Results.	•Sharptooth project –Central Coast Exploration N.L. Key drillingintercepts are presented in the announcement, in table and mapform. Central Coast Exploration N.L. drilling information presentedin the announcement are publicly available via MinesOnlineMapsand QDEX. Below are presented assayed samples contiguous toapproximately 5m above or below the sampled assays presentedin the announcement body.
		Depth	Sample	Assay	Converte
	Borehole	From	Length	Grade V	d to V2O5
	Identifier	(m)	(m)	(%)	(%)
	1	15	1	0.10	0.18
	1	16	1	0.06	0.11
	1	17	1	0.03	0.05
	1	18	1	0.03	0.05
	1	19	1	0.03	0.05
	1	20	1	0.03	0.05
	2	13	1	0.01	0.02
	2	14	1	0.01	0.02
	2	15	1	0.07	0.12
	2	16	1	0.04	0.07
	2	17	1	0.03	0.05
	2	18	1	0.03	0.05
	2	19	1	0.04	0.07
	2	20	1	0.02	0.04
	3	28	1	0.04	0.07
	3	29	1	0.04	0.07
	3	30	1	0.04	0.07
	3	31	1	0.04	0.07
	3	32	1	0.08	0.14
	3	33	1	0.14	0.25
	3	34	1	0.13	0.23
	3	35	1	0.06	0.11
	3	36	1	0.04	0.07

33710.030.0533810.030.0533910.040.0743410.020.0443510.020.0443610.030.0543710.040.0743810.080.1443910.110.20DepthSampleAssayConverteBoreholeFromLengthGrade Vd to V2O5Identifier(m)(m)(%)(%)44010.080.1444110.180.3244210.100.1844310.100.1844410.070.1244510.030.0555210.040.0755310.040.0755410.050.0955510.080.1455610.100.1855710.130.2355810.120.2155910.110.2056010.100.1856110.090.1656210.070.1256310.080.1456410.040.0763810.020.0463910.030.0564010.040.0764110.070.1264210.090.1664310.140.25

6	44	1	0.13	0.23
6	45	1	0.15	0.27
6	46	1	0.03	0.05
6	47	1	0.04	0.07
6	48	1	0.05	0.09
6	49	1	0.07	0.12
6	50	1	0.11	0.20
BoreholeIdentifier	DepthFrom	SampleLength	AssayGrade V	Converted to V2O5
	(m)	(m)	(%)	(%)
6	51	1	0.14	0.25
6	52	1	0.17	0.30
6	53	1	0.15	0.27
6	54	1	0.14	0.25
6	55	1	0.01	0.02
6	56	1	0.03	0.05
6	57	1	0.02	0.04
6	58	1	0.02	0.04
6	59	1	0.02	0.04

•	No drilling or sample results are reported in this announcement for
	the other Vanadium Mining Pty Ltd projects.

• Other substantive exploration data • Other exploration data, if meaningful and material, should be reported including (but not limited to): geological observations; geophysical survey results; geochemical survey results; bulk samples – size and method of treatment; metallurgical test results; bulk density, groundwater, geotechnical and rock characteristics; potential deleterious or contaminating substances. • The current announcement used two other forms of substantive exploration data: • 1) QLD – the Vanadium Mining Pty Ltd Geology Team generated an interpretation of the outcrop-subcrop zone and extents of Toolebuc formation at the edges of the Eromanga Basin, based on the following datasets: 1a) Ozimic, S. and Saxby, J.D., 1983. Oil Shale Methodology: An examination of the Toolebuc Formation and the laterally contiguous time equivalent units, Eromanga and Carpentaria Basins. 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 oil shale 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. The Mesozoic 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.•2) NT –the Vanadium Mining Pty Ltd Geology Team sourced theGeophysical Survey Imagery of Total Magnetic Intensity availableon the NT Strike Tenure and Geoscience Information System,hosted by the NT Department of Primary Industries and Resources.
Further work	•The nature and scale of planned further work (e.g. tests forlateral extensions or depth extensions or large-scale stepout drilling).•Diagrams clearly highlighting the areas of possibleextensions, including the main geological interpretations andfuture drilling areas, provided this information is notcommercially sensitive.	•QLD –within the QLD project areas aerial photo interpretation andfield mapping are planned to refine the outcrop-subcrop zone andmaximum extent for the Toolebuc Formation identified by theVanadium Mining Geology Team. Future exploration is thenanticipated to be planneddown dip of the outcrop-subcrop zoneof the Toolebuc Formation.•All Vanadium Mining Pty Ltd projects require technical evaluationto prioritize areas within the projects to focus mineral explorationefforts,inordertosystematicallyexploreforvanadiummineralisation.