PATERSON RESOURCES LTD — Interim / Quarterly Report 2017

Jan 30, 2018

HARDEY RESOURCES LIMITED

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ASX: HDY ASX ANNOUNCEMENT

31 January 2018

Quarterly Activities Report Quarter Ended 31 December 2017

Highlights:

• Completion of Hardey Resources Acquisition and Change of Company Name

• Gold nugget discovery within outcropping basalt conglomerate at Bellary Project

• High grade 3.89% copper and 0.9g/t gold from quartz veins at Bellary Project

• Appointment of Matthew Bowles as Non-Executive Director

Pilbara Conglomerate Gold Projects:

During the December Quarter 2017 the Company undertook a first pass reconnaissance field exploration program at the Bellary Project (E47/3578) 20 kilometres west of Paraburdoo, Western Australia.

Gold nuggets (6) were discovered within the Hardey Formation basalt conglomerate via metal detecting over a 50m strike extent (Figure 1, 2), and rock chip samples from outcropping quartz veins recorded a best result of 3.89% Cu and 0.9g/t Au (HR0002), Appendix 1. Further stream sampling across the broader tenement area did not record any anomalous results. The sampling technique most appropriate for conglomerate gold is being assessed for the upcoming field work in 2018.

A PoW was approved at the Bellary Project by the Department of Mines, Industry Regulation and Safety (DMIRS) for two (2) trenches at the locality where the six (6) gold nuggets were discovered at Bellary. Further necessary approvals are required from the respective native title claimant groups prior to the PoW work commencing.

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1

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Figure 1. Flat-pitted watermelon seed and coarse gold nuggets found at the Bellary Project.

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Figure 2. Location of gold nuggets (foreground) in relation to Hardey Formation basalt conglomerate unit (background).

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2

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Figure 3. Location of gold nuggets discovered within the Hardey Formation.

Grace Gold Project

In December 2017, three (3) applications were lodged over 1,594km² in the Western Australian Paterson Province. The applications complement the existing Grace Gold Project which the Company is currently reviewing for the upcoming 2018 exploration calendar year.

The world-class Paterson Province is known to host huge economic gold, copper and uranium deposits such as Newscrest’s 32Moz Telfer gold-copper-silver mine and O’Callaghans tungsten-base metal deposit, Metals X’s Nifty copper mine and Cameco and Mitsubishi Development’s Kintyre uranium deposit.

Hardey now has 100% ownership over a consolidated 1,651km² land package in the southern region of the Telfer District (refer to Figure 1 and Table 1). The Company’s focus is to systematically explore the Telfer District projects which includes the advanced Grace asset and the considerable regional greenfields tenement applications covering 1,594km².

The Grace Project PoW application for 20 drill holes has been approved by the Department of Mines, Industry Regulation and Safety (DMIRS). Further necessary approvals are required from the respective native title claimant groups prior to the PoW work commencing. In conjunction, the Company is planning a heritage survey to be conducted in early 2018.

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The Company is currently working up an exploration programme for the area which will include geochemical surveys, IP geophysical surveys and drill targeting to be announced on its finalisation shortly.

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Figure 1. Hardey’s Telfer District tenements identifying major deposits and mines overlayed with Regional Magnetics Image.

Other Exploration Projects

Hardey Resources also has several other highly prospective projects including the polymetallic Au-Ag-Zn-Pb Cheela Project in the Ashburton region Western Australia, coppergold porphyry Malang Project in East Java Indonesian, and the copper-gold VMS Horseshoe South Project in the Murchison, Western Australia.

No exploration work was carried out on these projects however, the Company is in the process of identifying further value accretive options either through discovery or divestment.

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Burraga Copper Project NSW

The Company’s wholly owned copper project is centered on the former Lloyds Copper Mine near Burraga NSW.

The Company completed two RC drill holes from the same pad (EYMRC032 & EYMRC033, Figure 1) during the previous quarter. Hardey Resources drilled towards 210°N and 250°N (true) angled at -80° and -60° to allow for testing of mineralisation and sampling of alteration halos.

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Figure 1: Drill collars of recent RC program (Phase 1 and 2) completed as part of the Lloyds Copper Mine extension program.

Intended depth of each hole was 300 metres however, both holes were cut short due to impenetrable ground. The drill holes were designed to test targets generated from previous ore body modelling as per Figure 2.

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Figure 2: Phase 2 drill holes were completed as per the model. Holes shown in red form integral part of the Lloyds Copper Mine extension program. (Refer ASX announcement dated 14 September 2017)

Results were made available in this quarter of these 2 holes and highlights are as follows:

EYMRC032

• 1m @ 1.6 g/t Ag (106-107m)

• 8m @ 1327.5 ppm Zn (40-48m)

• 4m @ 2130 ppm Zn (113-117m)

EYMRC033

• 10m @ 5305.8 ppm Cu (183-193EOH) including 8m @ 6369.75ppm Cu with 3.34 g/t

• Ag (183-191m)

Other exploration work at the Burraga Project

Cutting and sampling of core from the 2015 exploration drilling south of the Lloyds continued this quarter with submittal and subsequent lab analysis results expected in the next quarter.

Hardey Resources have planned an 1,820m RC drill program to test gold targets at Hackney’s Creek in 2018 (Table 1). This is subject to final landholder access approval.

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HOLE_ID	RL	DEPTH	DIP	MAG AZI	GDA AZI	HOLE DIAMETER	TARGET
EYM009	1000	200	-75	73	85	142mm	Hackney's Creek
EYM010	1000	220	-75	73	85	142mm	Hackney's Creek
EYM011	1000	300	-85	73	85	142mm	Hackney's Creek
EYM012	1000	300	-85	73	85	142mm	Hackney's Creek
EYM013	1000	300	-85	73	85	142mm	Hackney's Creek
EYM014	1000	300	-80	73	85	142mm	Hackney's Creek
EYM015	1000	200	-75	73	85	142mm	Hackney's Creek

Table 1: Outline of proposed RC programme at Hackney’s Creek Prospect.

Planning is also underway for a large-scale 100x100 grid soil geochemistry programme across the majority of EL7975.

Horseshoe South Project

Horseshoe Metals Limited ( Horseshoe Metals ) had a two-year option-to-purchase agreement with Elysium in respect to E52/2569, which was extended to 30 April 2017.

As disclosure in the Annual Report released on 29 September 2017, Horseshoe Metals offered Elysium $50,000 cash to transfer the tenement and obligations to Horseshoe Metals. Elysium rejected the offer as the Board believe that $50,000 undervalued the tenement. The Board is currently seeking a Joint Venture partner for the Horseshoe South Project.

Corporate

On 24 October 2017, the Company entered into a binding agreement subject to satisfaction of certain conditions precedent, to acquire 100% of the shares in Hardey from its current shareholders ( Acquisition ).

Hardey owns gold and base metal projects located in the Pilbara region of Western Australia, being the Bellary, Hamersley, Cheela and Elsie North Projects, covering 512km[2 ] of

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Fortescue Group Rocks, as well as the grace Project located in the Paterson Province in Western Australian (together, the Hardey Projects).

In relation to the Acquisition, the Company completed a placement of 166,666,667 fully paid ordinary shares at an issue price of $0.009, together with a one (1) for one (1) attaching Listed Options to sophisticated and professional investors to raise approximately $1.5 million before costs (Placement). The Placement was completed in two tranches, with the first tranche of 53,000,006 shares issued under the Company’s existing placement capacity on 30 October 2017. In addition, on this date the Company issued 11,111,111 shares to the Hardey Shareholders as consideration for granting an exclusive dealing period so that due diligence could be completed on the Hardey Projects.

Tranche 2 of the Placement, being 113,666,659 fully paid ordinary shares and 166,666,665 listed options (exercisable at $0.02 on or before 30 April 2020) were issued on 17 November 2017. In addition, the Company issued 277,777,777 ordinary fully paid shares and 138,888,889 Listed Options (exercisable at $0.02 on or before 30 April 2020) to the Hardey shareholders as consideration for the Acuqisition. The issue of these securities was approved by shareholders at the Company’s annual general meeting (AGM) held 15 November 2017.

On 29 November 2017, as approved at the AGM, the Company changed its name to Hardey Resources Limited. On that date, the ASX code changed from “EYM” to “HDY”.

Acquisition Terms and Consideration

For a summary of the key terms and consideration associated with the Acquisition please refer to the ASX announcement dated 24 October 2017.

Board Changes

Following the settlement of the acquisition of Hardey Resources Pty Ltd, Mr Matthew Bowles was appointed as a non-executive Director of the Company.

Mr Bowles is a senior corporate finance executive with extensive public corporate advisory, private equity and capital markets experience in the resources sector. He has successfully negotiated domestic and cross border financings, joint venture agreements and M&A transactions for a number of listed and private companies in Africa, the Americas and Australia.

Mr Bowles has held executive and board positions with several resource companies focusing on advancing exploration and development projects. He is currently the CEO of Tanga Resources, an ASX listed, African focused, gold and base metals explorer and was previously the Chief Development Officer for an ASX 200 West African focused gold company. Mr Bowles commenced his career with Rio Tinto where he worked in a number of corporate and commercial roles for nine years, before moving to London to work in finance and banking. Since his return to Australia he has held senior roles with global advisory firms, with a focus on the resources sector.

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In addition, Mr Robin Armstrong stepped down from the Board following Mr Bowles appointment. The Board thanks Mr Armstrong for his contribution to the Company during his time as Non-executive Director, and wishes him all the best in his future endeavours.

For further information, please contact:

Investors: Media: Sarah Smith Tom Langley Company Secretary Exploration Manager +61 8 6559 1792 + 61 431 020 984

Tenement Information as required by Listing Rule 5.3.3

The following table sets out the information as required by ASX Listing Rule 5.3.3

Table 1. Mining tenements held at the end of the Quarter and their location

	Permit Type	Permit Number	Locat ion	Holder	Tenure Status	Beneficial %
	E	47/3578	WA	Hardey Resources Pty	Granted	100%
	E	47/3827	WA	Hardey Resources Pty	Application	100%
	E	45/5020	WA	Hardey Resources Pty	Application	100%
	E	08/2880	WA	Hardey Resources Pty	Granted	100%
	E	45/4524	WA	Hardey Resources Pty	Granted	100%
	P	45/2905	WA	Hardey Resources Pty	Granted	100%
	P	45/2906	WA	Hardey Resources Pty	Granted	100%
	P	45/2907	WA	Hardey Resources Pty	Granted	100%
	P	45/2908	WA	Hardey Resources Pty	Granted	100%
	P	45/2909	WA	Hardey Resources Pty	Granted	100%
	P	45/2905	WA	Hardey Resources Pty	Granted	100%
	E	45/5130	WA	Hardey Resources Ltd	Application	100%
	E	45/5131	WA	Hardey Resources Ltd	Application	100%
	E	45/5132	WA	Hardey Resources Ltd	Application	100%

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E	52/2569	WA	Elysium Resources Ltd	Granted	100%
EL	6463	NSW	BC Exploration Pty Ltd	Granted	100%
EL	6874	NSW	BC Exploration Pty Ltd	Granted	100%
EL	7975	NSW	BC Exploration Pty Ltd	Granted	100%

1. The mining tenement interests acquired during the quarter and their location Nil.

2. Beneficial percentage interests held in farm-in or farm-out agreements at the end of the quarter

Not applicable.

3. Beneficial percentage interests in farm-in or farm-out agreements acquired or disposed of during the quarter

Not applicable.

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ABOUT HARDEY RESOURCES:

Hardey Resources (ASX:HDY) is a publicly listed, junior mineral resources company focused on the exploration and development of key demand-driven commodities. The Company’s current focus is in discovering Paleo-placer Witwatersrand style mineralisation in the Pilbara region of Western Australia. The Pilbara conglomerate-hosted gold projects consist of three exploration licences (E47/3578, E47/3827, and E45/5020). Hardey has aggregated a diversified portfolio of assets that are at multiple stages, commodities and jurisdictions. The Grace Gold-Copper Project located in the world class Paterson mineral province in Western Australia consists of one granted exploration licence and five granted prospecting licences (E45/4524, P45/2905, P45/2906, P45/2907, P45/2908, and P45/2909) with additional applications pending (E45/5130, E45/5131, E45/5132). The Burraga Copper-Gold Project, located in the world class minerals province of the East Lachlan Fold Belt in central western New South Wales consists of three contiguous exploration licences (EL6463, EL6874 and EL7975) and one exploration licence application (EL5454) covering a total area of approximately 221km². Hardey is an active explorer with the aim of discovering a valuable mineral resource and delivering shareholder value. The Company also seeks to pursue other value accretive project opportunities.

Table 1: Co-ordinate positions of where nuggets were found.

Nugget Site	East MGA 50	North MGA 50
WS1	553776	7450902
WS2	553787	7450911
WS3	553790	7450912
WS4	553805	7450911
WS5	553815	7450916
WS6	553825	7450918

Appendix 1

Rockchip ID	East MGA 50	North MGA 50	Au (g/t)	Ag (g/t)	Cu (ppm)	Pb (ppm)	Zn (ppm)
HR0001	553848	7450930	<0.01	<5	20	40	<5
HR0002	553766	7451058	0.9	65	37000	220	525
HR0003	552985	7451382	<0.01	<5	80	40	25
HR0004	544635	7458102	<0.01	<5	100	140	195
HR0005	544794	7458057	<0.01	<5	220	60	180
HR0006	545573	7458368	<0.01	<5	25	80	145
HR0007	543232	7458810	<0.01	<5	140	40	35

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Appendix 2

The following tables are provided to ensure compliance with the JORC Code (2012) requirements for the reporting of Exploration Results for the Bellary Project

Section 1 Sampling Techniques and Data

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

Criteria	JORC Code explanation	Commentary
Sampling techniques	• Nature and quality of sampling (eg cut channels, random chips, or specific specialised industry standard measurement tools appropriate to the minerals under investigation, such as down hole gamma sondes, or handheld XRF instruments, etc). These examples should not be taken as limiting the broad meaning of sampling. • Include reference to measures taken to ensure sample representivity and the appropriate calibration of any measurement tools or systems used. • Aspects of the determination of mineralisation that are Material to the Public Report. In cases where ‘industry standard’ work has been done this would be relatively simple (eg ‘reverse circulation drilling was used to obtain 1 m samples from which 3 kg was pulverised to produce a 30 g charge for fire assay’). In other cases more explanation may be required, such as where there is coarse gold that has inherent sampling problems. Unusual commodities or mineralisation types (eg submarine nodules) may warrant disclosure of detailed information.	• Rock chip samples taken from areas of geological interest. • Metal detecting to locate gold nuggets • Neither sampling style is representative as they are selective in nature. • For rock chip sampling weights between 1 and 4.5kg were collected to maximise representivity however, the geological feature tested may or may not be related to mineralisation. • Rock chip sampling and nugget detecting are only indicative of potential for mineralisation. In particular caution should be exercised when considering the presence of nuggets to be indicative of mineralisation as due to their extremely coarse nature substantial sampling is required to demonstrate representivity.
Drilling techniques	• Drill type (eg core, reverse circulation, open-hole hammer, rotary air blast, auger, Bangka, sonic, etc) and details (eg core diameter, triple or	• Not applicable as no drilling undertaken.

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Criteria	JORC Code explanation	Commentary
	standard tube, depth of diamond tails, face-sampling bit or other type, whether core is oriented and if so, by what method, etc).
Drill sample recovery	• Method of recording and assessing core and chip sample recoveries and results assessed. • Measures taken to maximise sample recovery and ensure representative nature of the samples. • Whether a relationship exists between sample recovery and grade and whether sample bias may have occurred due to preferential loss/gain of fine/coarse material.	• Not applicable as no drilling undertaken.
Logging	• Whether core and chip samples have been geologically and geotechnically logged to a level of detail to support appropriate Mineral Resource estimation, mining studies and metallurgical studies. • Whether logging is qualitative or quantitative in nature. Core (or costean, channel, etc) photography. • The total length and percentage of the relevant intersections logged.	• Not applicable as no drilling undertaken.
Sub-sampling techniques and sample preparation	• If core, whether cut or sawn and whether quarter, half or all core taken. • If non-core, whether riffled, tube sampled, rotary split, etc and whether sampled wet or dry. • For all sample types, the nature, quality and appropriateness of the sample preparation technique. • Quality control procedures adopted for all sub-sampling stages to maximise representivity of samples. • Measures taken to ensure that the sampling is representative	• The entire rockchip sample was submitted to the laboratory for preparation (crushing / pulverising) prior to any sub sampling • Standard laboratory preparation and sub sampling techniques used for rockchip samples. • No sample preparation used in the detection of nuggets. • Detection of nuggets may not be representative of the area and demonstrating repeatability will require a substantial sampling programme. • Sampling is appropriate for this early stage of exploration.

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Criteria	JORC Code explanation	Commentary
	of the in situ material collected, including for instance results for field duplicate/second-half sampling. • Whether sample sizes are appropriate to the grain size of the material being sampled.
Quality of assay data and laboratory tests	• The nature, quality and appropriateness of the assaying and laboratory procedures used and whether the technique is considered partial or total. • For geophysical tools, spectrometers, handheld XRF instruments, etc, the parameters used in determining the analysis including instrument make and model, reading times, calibrations factors applied and their derivation, etc. • Nature of quality control procedures adopted (eg standards, blanks, duplicates, external laboratory checks) and whether acceptable levels of accuracy (ie lack of bias) and precision have been established.	• Rockchip samples were analysed by Bureau Veritas in Kalgoorlie and Perth, a quality certified independent laboratory. • Analysis for Au used fire assay Pb collector (40g charge); Ag, Al, As, Ba, Ca, Cd, Co, Cr, Cu, Fe, K, Li, Mg, Mn, Mo, Na, Ni, P, Pb, S, Sc, Sr, Ti, V, Y, Zn, and Zr was by multi-acid digestion and ICP-AES. • Internal laboratory standards and laboratory checks have been assessed with acceptable results for the early stage nature of the exploration. • These assay methods are considered appropriate. • No assaying was completed on the nuggets.
Verification of sampling and assaying	• The verification of significant intersections by either independent or alternative company personnel. • The use of twinned holes. • Documentation of primary data, data entry procedures, data verification, data storage (physical and electronic) protocols. • Discuss any adjustment to assay data.	• No verification has been undertaken. • Primary information is recorded in the field. • The company has not adjusted any assay data.
Location of data points	• Accuracy and quality of surveys used to locate drill holes (collar and down-hole surveys), trenches, mine workings and other locations used in Mineral Resource estimation. • Specification of the grid system used.	• Locations recorded by GPS which has an accuracy of +/- 5m. • Data collected in MGA94 Zone 50. • Topographic control is provided by publically available data and is fit for purpose.

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Criteria	JORC Code explanation	Commentary
	• Quality and adequacy of topographic control.
Data spacing and distribution	• Data spacing for reporting of Exploration Results. • Whether the data spacing and distribution is sufficient to establish the degree of geological and grade continuity appropriate for the Mineral Resource and Ore Reserve estimation procedure(s) and classifications applied. • Whether sample compositing has been applied.	• Random data spacing used based on geological features. • Sampling methods inappropriate for determining grade of mineralised system. • No compositing has been applied
Orientation of data in relation to geological structure	• Whether the orientation of sampling achieves unbiased sampling of possible structures and the extent to which this is known, considering the deposit type. • If the relationship between the drilling orientation and the orientation of key mineralised structures is considered to have introduced a sampling bias, this should be assessed and reported if material.	• Orientation of the mineralised system unknown at this time. • Exploration is at too early a stage to determine orientation of key mineralised zones and therefore assess the orientation of sampling
Sample security	• The measures taken to ensure sample security.	• The Company’s representative controls all samples.
Audits or reviews	• The results of any audits or reviews of sampling techniques and data.	• No audits or reviews have been undertaken.

Section 2 Reporting of Exploration Results

Criteria	JORC Code explanation	Commentary
Mineral tenement and land tenure status	• Type, reference name/number, location and ownership including agreements or material issues with third parties such as joint ventures, partnerships, overriding royalties, native title interests, historical sites, wilderness or national park and environmental settings. • The security of the tenure held	• The sampling reported in this document is within E47/3578. • The tenement is located approximately 30km NW of Paraburdoo, WA. • Title is registered in the name of Topdrill Pty Ltd. • The exploration licence is within an area of Native Title claimed land by the Yinhawangka Claimant Group. • At the time of this Statement the exploration

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Criteria	JORC Code explanation	Commentary
	at the time of reporting along with any known impediments to obtaining a licence to operate in the area.	licence application complies with all requirements. To the best of the Company’s knowledge within the granted tenement there are no impediments to the Company’s operations within the tenement other than industry standard permits to operate and access requirements
Exploration done by other parties	• Acknowledgment and appraisal of exploration by other parties.	• Previous data was generated by Forsayth Limited (refer to ASX Announcement 24 October 2017).
Geology	• Deposit type, geological setting and style of mineralisation.	• Sediments prospective for conglomerate- hosted gold. • Orogenic hosted gold.
Drill hole Information	• A summary of all information material to the understanding of the exploration results including a tabulation of the following information for all Material drill holes: o easting and northing of the drill hole collar o elevation or RL (Reduced Level – elevation above sea level in metres) of the drill hole collar o dip and azimuth of the hole o down hole length and interception depth o hole length. • If the exclusion of this information is justified on the basis that the information is not Material and this exclusion does not detract from the understanding of the report, the Competent Person should clearly explain why this is the case.	• No drilling was carried out at the Bellary Project. • All geochemical data is included in the announcement.
Data aggregation methods	• In reporting Exploration Results, weighting averaging techniques, maximum and/or minimum grade truncations (eg cutting of high grades) and cut-off grades are usually Material and should be stated. • Where aggregate intercepts incorporate short lengths of high grade results and longer lengths of low grade results, the procedure used for such	• Not applicable as no drilling undertaken.

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Criteria	JORC Code explanation	Commentary
	aggregation should be stated and some typical examples of such aggregations should be shown in detail. • The assumptions used for any reporting of metal equivalent values should be clearly stated.
Relationship between mineralisation widths and intercept lengths	• These relationships are particularly important in the reporting of Exploration Results. • If the geometry of the mineralisation with respect to the drill hole angle is known, its nature should be reported. • If it is not known and only the down hole lengths are reported, there should be a clear statement to this effect (eg ‘down hole length, true width not known’).	• Not applicable as no drilling undertaken.
Diagrams	• Appropriate maps and sections (with scales) and tabulations of intercepts should be included for any significant discovery being reported These should include, but not be limited to a plan view of drill hole collar locations and appropriate sectional views.	• Maps and appropriate plans are included in this announcement.
Balanced reporting	• Where comprehensive reporting of all Exploration Results is not practicable, representative reporting of both low and high grades and/or widths should be practiced to avoid misleading reporting of Exploration Results.	• All results shown in figures / tables.
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.	• Open file data including historical exploration reports by companies listed below will be reviewed as part of the evaluation of the Bellary Tenement: CRA Exploration Pty Ltd St Francis Mining NL Outokumpu Exp Aust Pty Ltd Bacome Pty Ltd Winterfall Pty Ltd AusQuest Ltd Fortescue Metals Group

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Criteria	JORC Code explanation	Commentary
Further work	• The nature and scale of planned further work (eg tests for lateral extensions or depth extensions or large-scale step- out drilling). • Diagrams clearly highlighting the areas of possible extensions, including the main geological interpretations and future drilling areas, provided this information is not commercially sensitive.	• As detailed in this announcement.

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Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report

+Rule 5.5

Appendix 5B

Mining exploration entity and oil and gas exploration entity quarterly report

Introduced 01/07/96 Origin Appendix 8 Amended 01/07/97, 01/07/98, 30/09/01, 01/06/10, 17/12/10, 01/05/13, 01/09/16

Name of entity

Hardey Resources Limited

ABN Quarter ended (“current quarter”)

45 115 593 005

31 December 2017

Consolidated statement of cash flows	Current quarter $A’000	Year to date (6 months) $A’000
1. Cash flows from operating activities 1.1 Receipts from customers 1.2 Payments for (a) exploration & evaluation (b) development (c) production (d) staff costs (e) administration and corporate costs 1.3 Dividends received (see note 3) 1.4 Interest received 1.5 Interest and other costs of finance paid 1.6 Income taxes paid 1.7 Research and development refunds 1.8 Other (provide details if material) 1.9 Net cash from / (used in) operating activities	- (372) - - (119) (898) - 2 - - - -	- (771) - - (199) (1,486) - 4 - - - -
	(1,387)	(2,452)
2. Cash flows from investing activities 2.1 Payments to acquire: (a) property, plant and equipment (b) tenements (see item 10) (c) investments (d) other non-current assets	- (150) - -	- (150) - -

• See chapter 19 for defined terms

Page 1

Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report

Consolidated statement of cash flows	Current quarter $A’000	Year to date (6 months) $A’000
2.2 Proceeds from the disposal of: (a) property, plant and equipment (b) tenements (see item 10) (c) investments (d) other non-current assets 2.3 Cash flows from loans to other entities 2.4 Dividends received (see note 3) 2.5 Other (provide details if material) 2.6 Net cash from / (used in) investing activities	- - - - - - -	- - - - - - -
	(150)	(150)
2.1(b) During the quarter, the Company completed the acquisition of Hardey Resources Pty Ltd ("Hardey") which owns gold and base metal projects located in the Pilbara region of Western Australia. As part of the consideration of Hardey, the Company paid $150,000 to the shareholders of Hardey for exploration expenditure spent on the projects.
3. Cash flows from financing activities 3.1 Proceeds from issues of shares 3.2 Proceeds from issue of convertible notes 3.3 Proceeds from exercise of share options 3.4 Transaction costs related to issues of shares, convertible notes or options 3.5 Proceeds from borrowings 3.6 Repayment of borrowings 3.7 Transaction costs related to loans and borrowings 3.8 Dividends paid 3.9 Other (provide details if material) Share application monies 3.10 Net cash from / (used in) financing activities	1,500 - - (114) - - - - -	3,713 - - (270) - - - - -
	1,386	3,443
4. Net increase / (decrease) in cash and cash equivalents for the period 4.1 Cash and cash equivalents at beginning of period 4.2 Net cash from / (used in) operating activities (item 1.9 above) 4.3 Net cash from / (used in) investing activities (item 2.6 above) 4.4 Net cash from / (used in) financing activities (item 3.10 above)	1,918 (1,387) (150) 1,386	926 (2,452) (150) 3,443

• See chapter 19 for defined terms

Page 2

Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report

Consolidated statement of cash flows	Current quarter $A’000	Year to date (6 months) $A’000
4.5 Effect of movement in exchange rates on cash held 4.6 Cash and cash equivalents at end of period	-	-
	1,767	1,767
5. Reconciliation of cash and cash equivalents at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts	Current quarter $A’000	Previous quarter $A’000
5.1 Bank balances 5.2 Call deposits 5.3 Bank overdrafts 5.4 Other (provide details) 5.5 Cash and cash equivalents at end of quarter (should equal item 4.6 above)	1,767 - - -	1,918 - - -
	1,767	1,918
6. Payments to directors of the entity and their associates Current quarter $A'000 6.1 Aggregate amount of payments to these parties included in item 1.2 (129) 6.2 Aggregate amount of cash flow from loans to these parties included in item 2.3 - 6.3 Include below any explanation necessary to understand the transactions included in items 6.1 and 6.2
		Current quarter $A'000
		(129)
		-
6.1 Director and consulting fees to Directors and/or Director related entities $128,836
7. Payments to related entities of the entity and their associates Current quarter $A'000 7.1 Aggregate amount of payments to these parties included in item 1.2 - 7.2 Aggregate amount of cash flow from loans to these parties included in item 2.3 - 7.3 Include below any explanation necessary to understand the transactions included in items 7.1 and 7.2
		Current quarter $A'000
		-
		-

• See chapter 19 for defined terms

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Appendix 5B Mining exploration entity and oil and gas exploration entity quarterly report

	8. Financing facilities available Add notes as necessary for an understanding of the position Total facility amount at quarter end $A’000 Amount drawn at quarter end $A’000 8.1 Loan facilities - - 8.2 Credit standby arrangements - - 8.3 Other (please specify) - - 8.4 Include below a description of each facility above, including the lender, interest rate and whether it is secured or unsecured. If any additional facilities have been entered into or are proposed to be entered into after quarter end, include details of those facilities as well.	Total facility amount at quarter end $A’000	Amount drawn at quarter end $A’000
		-	-
		-	-
		-	-
N/A

N/A

9. Estimated cash outflows for next quarter	$A’000
9.1 Exploration and evaluation 9.2 Development 9.3 Production 9.4 Staff costs 9.5 Administration and corporate costs 9.6 Other (provide details if material) 9.7 Total estimated cash outflows	(300) - - (105) (100) -
	(505)

10. Changes in tenements (items 2.1(b) and 2.2(b) above)	Tenement reference and location	Nature of interest	Interest at beginning of quarter	Interest at end of quarter
10.1 Interests in mining tenements and petroleum tenements lapsed, relinquished or reduced	N/A
10.2 Interests in mining tenements and petroleum tenements acquired or increased	47/3578, WA 47/3827, WA 45/5020, WA 08/2880, WA 45/4524, WA 45/2905, WA 45/2906, WA 45/2907, WA 45/2908, WA 45/2909, WA 45/2905, WA 45/5130, WA 45/5131, WA 45/5132, WA	Direct Interest, Granted Direct Interest, Application Direct Interest, Application Direct Interest, Granted Direct Interest, Granted Direct Interest, Granted Direct Interest, Granted Direct Interest, Granted Direct Interest, Granted Direct Interest, Granted Direct Interest, Granted Direct Interest, Granted Direct Interest, Application Direct Interest, Application Direct Interest, Application	- - - - - - - - - - - - - -	100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%

• See chapter 19 for defined terms

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Appendix 5B

Mining exploration entity and oil and gas exploration entity quarterly report

Compliance statement

• 1 This statement has been prepared in accordance with accounting standards and policies which comply with Listing Rule 19.11A.

• 2 This statement gives a true and fair view of the matters disclosed.

==> picture [59 x 77] intentionally omitted <==

Sign here: Date: 31 January 2018 Company Secretary

Print name: Sarah Smith

Notes

1. The quarterly report provides a basis for informing the market how the entity’s activities have been financed for the past quarter and the effect on its cash position. An entity that wishes to disclose additional information is encouraged to do so, in a note or notes included in or attached to this report.

2. If this quarterly report has been prepared in accordance with Australian Accounting Standards, the definitions in, and provisions of, AASB 6: Exploration for and Evaluation of Mineral Resources and AASB 107: Statement of Cash Flows apply to this report. If this quarterly report has been prepared in accordance with other accounting standards agreed by ASX pursuant to Listing Rule 19.11A, the corresponding equivalent standards apply to this report.

3. Dividends received may be classified either as cash flows from operating activities or cash flows from investing activities, depending on the accounting policy of the entity.

4. See chapter 19 for defined terms

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