POLYMETALS RESOURCES LTD — Regulatory Filings 2021

Jul 21, 2021

QUARTERLY ACTIVITIES REPORT PERIOD ENDED 30 JUNE 2021

KEY HIGHLIGHTS

Alahiné Project, Guinea

• 2021 Exploration drill program (Phase 2) commenced at Alahiné on 29 June 2021.
• 5,100 metres of combined Air-Core (AC) and Reverse Circulation (RC) drilling planned to test artisanal gold diggings enclosed by 40 ppb Au-in-soil contours at the East Alahiné North, Central and South prospects.
• The Phase 2 program commenced with testing the lateral and vertical extent of Phase 1 Hole 14 gold-mineralised zone and shallow Siguiri-style oxide gold potential.

Corporate

• Polymetals Resources Ltd (ASX:POL) aims to become a gold production company, initially focusing on its two 100% owned exploration licences within Guinea's Siguiri Basin, totalling 112km² .
• Successful listing on Australian Stock Exchange (ASX), commencing trading on 29 June 2021 following \$5.2m IPO at \$0.20. The IPO was supported by institutional investors, resource-focussed funds and sophisticated and retail investors.
• Polymetals is actively looking at business development opportunities to diversify its asset base.

Following its successful listing on the ASX on the 29 June 2021, Polymetals Resources Ltd (POL, Polymetals or the Company), is pleased to provide its Quarterly Activities Report for the quarter ended 30 June 2021 (Quarter).

ASX: POL

ALAHINÉ PROJECT, GUINEA

Polymetals is focussed on exploring two 100% owned exploration licences within Guinea's Siguiri Basin. The region hosts several large active gold mining operations and is notable for its significant and widespread gold anomalism.

Polymetals' Exploration Licences, known as Alahiné (64.2km² ) and Mansala (48.2km² ), host extensive historic and current artisanal gold production which reinforces exploration potential of the area.

Figure 1: Proximal gold deposits relative to the Company's Exploration Licences

Phase 2 East Alahiné Drilling Program

A planned 5,100-metre Phase 2 Air-Core (AC) and Reverse Circulation (RC) drilling program at East Alahiné commenced on 29 June 2021.

Target Drilling, an Australian-based West African drilling contractor, was commissioned to complete the Phase 2 drilling program. The program is designed to test the areas enclosed by the 40 ppb Au-in-soil contours generated from two previous whole of licence geochemical soil sampling campaigns. A total of 112 holes along 14 drill fences are planned and are shown in Figure 2.

Figure 2: Phase 2 Program – Alahiné grid image highlighting the 40 ppb Au-in-soil contours, Phase 1 and Phase 2 drilling program

ASX Announcement

Phase 2 will test the lateral and vertical extent of the Phase 1 Hole 14 gold mineralised zone, and Siguiri-like shallow oxide gold potential across the Alahiné licence.

A senior POL Australian geologist is on-site managing the Phase 2 drilling program, assisted by four local geologists and the Company's Country Manager.

Figure 3: Phase 2 drilling at North Alahiné (AH21ARC029)

All samples generated by the Company's drilling activities are to be analysed by SGS at their Bamako facility in Mali.

CORPORATE

Initial Public Offering

Polymetals Resources Ltd successfully completed its Initial Public Offer (IPO) and ASX Listing on 29 June 2021, marking a major milestone for the Company in progressing its aim of becoming a gold explorer and producer.

Established in September 2020, POL has now successfully raised \$5.2 million through the issue of 26 million new shares at \$0.20 per share in its IPO. Following the IPO, Polymetals has 79.44 million ordinary shares on issue.

Polymetals' Board of Directors consists of Non-Executive Chairman Mr David Sproule, Independent Non-Executive Director Dr Christopher Johnston and Independent Non-Executive

Director Mr Christopher Schroor who together have a broad range of experience in gold exploration, mining, production and corporate management.

Business Development

As indicated in its Prospectus, the Company is investigating new business development opportunities within the Siguiri Basin as well as advanced mining opportunities in Australia.

ASX Additional Information

The Company provides the following information pursuant to ASX Listing Rule requirements:

1. ASX Listing Rule 5.3.1: Exploration and Evaluation Expenditure spend during the quarter was \$220,770.

Full details of exploration activity during the June 2021 quarter are set out in this report. Below is the breakdown of the expenditure incurred:

Property	Nature of expenses	Amount (\$)
Mansala	Wages, security and storage	33,736
Mansala	Legal and compliance costs	1,485
Alahiné	Geology and Geophysics	150,328
Alahiné	Wages, security and storage	33,736
Alahiné	Legal and compliance costs	1,485
	Total Exploration costs	220,770

2. ASX Listing Rule 5.3.2:

The Company confirms that there was no mine production and development activities for the quarter.

3. ASX Listing Rule 5.3.4:

The Company provides the following update between its actual expenditure incurred during the quarter to that of the Use of Funds (refer to ASX release dated 25 June 2021 "Updated Use of Funds Table").

Use of Funds	Estimate of the first	Actual Use in June	Balance
	2 years after ASX	2021 Quarter (\$)	Remaining (\$)
	admission 1 (\$)
Expenditure at Alahiné and	2,350,000	220,770	2,129,230
Mansala
Environmental surveys and	150,000	-	150,000
consultants
Guinea operations and logistics	500,000	-	500,000
Expenses of the Offer	637,000	389,637	247,363
Administrative Costs	1,845,815	135,643	1,710,172
Total	5,491,815	746,050	4,736,765

1 Polymetals Use of Funds – ASX Prospectus 25 June 2021 Item 5.6 'Proposed Exploration Program and Expenditure'

Variances in the above table are due to the expenditures within the June 2021 quarter only representing a period of 3 months against the proposed use of funds which has been tabled over a 2-year period within the Company's Prospectus.

1. ASX Listing Rule 5.3.5: Payment to related parties of the Company and their associates during the quarter was \$nil in cash.

The Company advises that this relates to remuneration of Directors only. Please see the Remuneration Report in the Company's Prospectus for further details on Directors' Remuneration. Set out below is the following additional information in relation to the cash flow statement:

Name of Director	Nature of Payment	Amount (\$)
David Sproule	Ongoing Director fees	Nil
Christopher Johnston	Ongoing Director fees	Nil
Christopher Schroor	Ongoing Director fees	Nil
	Total	Nil

Tenements

In accordance with Listing Rule 5.3.3, Polymetals provides the following Information concerning its exploration licences. No applications were made during the quarter by the Company to acquire further licences or surrender its existing licences.

The following table lists the Company's exploration licences held at the end of the quarter, and their location:

Project	Exploration Licence	Location	Status	Ownership
Alahiné	EL22123	Republic of Guinea	Granted	100%
Mansala	EL22694	Republic of Guinea	Granted	100%

COMPETENT PERSON STATEMENT

The information in this ASX Announcement that relates to Exploration Results is based on information compiled by Dr Christopher Johnston, a Competent Person who is a Member of the Australian Institute of Geoscientists. Dr Johnston is a Director of Polymetals Resources Ltd and 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". Dr Johnston consents to the inclusion in this ASX Announcement of the matters based on his information in the form and context in which it appears.

This announcement was authorised for release by the Board of Polymetals Resources Ltd.

Contact information:

Alex Hanly Chief Executive Officer alex.hanly@polymetals.com +61 (0) 448 418 725

Victoria Humphries Media & Investor Relations victoria@nwrcommunications.com.au +61 (0) 431 151 676

For more information, visit www.polymetals.com.

Appendix 5B

Mining exploration entity or oil and gas exploration entity quarterly cash flow report

Name of entity
POLYMETALS RESOURCES LTD
ABN	Quarter ended ("current quarter")
73 644 736 247	JUNE 2021

	Consolidated statement of cash flows	Current quarter \$A'000	Year to date (12 months) \$A'000
1.	Cash flows from operating activities
1.1	Receipts from customers	-	-
1.2	Payments for
	(a) exploration & evaluation (if expensed)	-	-
	(b) development	-	-
	(c) production	-	-
	(d) staff costs	(33)	(51)
	(e) administration and corporate costs	(101)	(150)
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	Government grants and tax incentives	-	-
1.8	Other (provide details if material)	-	-
1.9	Net cash from / (used in) operating activities	(134)	(201)
2.	Cash flows from investing activities
2.1	Payments to acquire:
	(a) entities	-	-
	(b) tenements	-	(100)
	(c) property, plant and equipment
	(d) exploration & evaluation (if capitalised)	(220)	(364)
	(e) investments	-	-
	(f) other non-current assets	-	-

	Consolidated statement of cash flows	Current quarter \$A'000	Year to date (12 months) \$A'000
2.2	Proceeds from the disposal of:
	(a) entities	-	-
	(b) tenements	-	-
	(c) property, plant and equipment	-	-
	(d) investments	-	-
	(e) 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	(220)	(464)
3.	Cash flows from financing activities
3.1	Proceeds from issues of equity securities (excluding convertible debt securities) (after costs)	5,200	5,950
3.2	Proceeds from issue of convertible debt securities	-	-
3.3	Proceeds from exercise of options	-	-
3.4	Transaction costs related to issues of equity securities or convertible debt securities	(390)	(520)
3.5	Proceeds from borrowings (convertible note)	250	250
3.6	Repayment of borrowings	-	-
3.7	Transaction costs related to loans and borrowings	-	-
3.8	Dividends paid	-	-
3.9	Other (Tranche 2 share subscriptions in advance )	-	-
3.10	Net cash from / (used in) financing activities	5,060	5,680
4.	Net increase / (decrease) in cash and
	cash equivalents for the period
4.1	Cash and cash equivalents at beginning of period	309	-
4.2	Net cash from / (used in) operating activities (item 1.9 above)	(134)	(201)

ASX Listing Rules Appendix 5B (01/12/19)

• See chapter 19 of the ASX Listing Rules for defined terms. Page 2

	Consolidated statement of cash flows	Current quarter \$A'000	Year to date (12 months) \$A'000
4.3	Net cash from / (used in) investing activities (item 2.6 above)	(220)	(464)
4.4	Net cash from / (used in) financing activities (item 3.10 above)	5,060	5,680
4.5	Effect of movement in exchange rates on cash held	-	-
4.6	Cash and cash equivalents at end of period	5,015	5,015
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	5,015	5,105
5.2	Call deposits	-	-
5.3	Bank overdrafts	-	-
5.4	Other (provide details)	-	-

6.	Payments to related parties of the entity and their associates	Current quarter \$A'000
6.1	Aggregate amount of payments to related parties and their associates included in item 1 (Director Fees)	-
6.2	Aggregate amount of payments to related parties and their associates included in item 2	-

Note : The above payments to directors reflect fees for services rendered during the current quarter. More information concerning the breakdown of the relevant director payments can be found within the accompanying Quarterly Announcement.

7.	Financing facilities Note: the term "facility' includes all forms of financing arrangements available to the entity. Add notes as necessary for an understanding of the sources of finance available to the entity.	Total facility amount at current quarter end \$A'000	Amount drawn amount at previous quarter \$A'000
7.1	Loan facilities	-	-
7.2	Credit standby arrangements	-	-
7.3	Other (please specify)	-	-
7.4	Total financing facilities	-	-
7.5	Unused financing facilities available at quarter end		-
7.6	Include in the box below a description of each facility above, including the lender, interest rate, maturity date and whether it is secured or unsecured. If any additional financing facilities have been entered into or are proposed to be entered into after quarter end, include a note providing details of those facilities as well.
	Not applicable.
8.	Estimated cash available for future operating activities		\$A'000
8.1	Net cash from / (used in) operating activities (Item 1.9)		(134)
8.2	Capitalised exploration & evaluation (Item 2.1(d))		(220)
8.3	Total relevant outgoings (Item 8.1 + Item 8.2)		(354)
8.4	Cash and cash equivalents at quarter end (Item 4.6)		5,015
8.5	Unused finance facilities available at quarter end (Item 7.5)		-
8.6	Total available funding (Item 8.4 + Item 8.5) 5,015
8.7	Estimated quarters of funding available (Item 8.6 divided 13.7 by Item 8.3)
8.8	If Item 8.7 is less than 2 quarters, please provide answers to the following questions:
	1. Does the entity expect that it will continue to have the current level of net operating cash flows for the time being and, if not, why not?
	Answer: N/A
	2. Has the entity taken any steps, or does it propose to take any steps, to raise further cash to fund its operations and, if so, what are those steps and how likely does it believe that they will be successful?
	Answer: N/A
	3. Does the entity expect to be able to continue its operations and to meet its business objectives and, if so, on what basis?
	Answer: N/A

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.

Date: 22 July 2021

Authorised by: The Board

Notes

• 1. This quarterly cash flow report and the accompanying activity report provide a basis for informing the market about the entity's activities for the past quarter, how they have been financed and the effect this has had on its cash position. An entity that wishes to disclose additional information over and above the minimum required under the Listing Rules is encouraged to do so.
• 1. If this quarterly cash flow 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 cash flow 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.
• 1. 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.
• 1. If this report has been authorised for release to the market by your board of directors, you can insert here: "By the board". If it has been authorised for release to the market by a committee of your board of directors, you can insert here: "By the [name of board committee – eg Audit and Risk Committee]". If it has been authorised for release to the market by a disclosure committee, you can insert here: "By the Disclosure Committee".
• 1. If this report has been authorised for release to the market by your board of directors and you wish to hold yourself out as complying with recommendation 4.2 of the ASX Corporate Governance Council's Corporate Governance Principles and Recommendations, the board should have received a declaration from its CEO and CFO that, in their opinion, the financial records of the entity have been properly maintained, that this report complies with the appropriate accounting standards and gives a true and fair view of the cash flows of the entity, and that their opinion has been formed on the basis of a sound system of risk management and internal control which is operating effectively.