S2 RESOURCES LTD — Capital/Financing Update 2021

Mar 3, 2021

ASX Announcement

4

th March 2021

FINNISH COURT APPROVES GRANT OF KEY EXPLORATION LICENCE AT RUOPAS: PATH CLEARED TO DRILL NICKEL-COPPER-PGE TARGET

Key Points

• Finnish Administrative Court dismisses objection to the grant of the Ruopas Isovaara exploration permit
• Path now cleared to drill previously identified Ruopas Isovaara EM target
• Target to be drilled in the upcoming Finnish Summer after follow-up drilling to recent high grade intercepts at the Aarnivalkea gold prospect

S2 Resources ("S2" or the "Company") advises that it has received notice that an objection to the grant of exploration permit ML2018:0065 has been dismissed by the Administrative Court of Northern Finland, and no further appeals have been lodged with the Supreme Administrative Court, allowing the permit to be granted.

This area, previously referred to as Ruopas 1, will henceforth be named Ruopas Isovaara ("Isovaara", see Figures 1 and 2). It is considered prospective for intrusive magmatic style nickel-copper-PGE mineralisation and contains a previously identified target comprising a well-defined electromagnetic (EM) conductor with coincident anomalous nickel and copper in base of till (BoT) drilling.

It is located in the same district that hosts Anglo American's Sakatti nickel-copper-PGE deposit (44.4Mt at 1.9% Cu, 0.69% Ni and 1.46g/t PGE) and Boliden's nickel-copper-precious metals Kevitsa mine (297.5Mt at 0.33% Cu, 0.23% Ni and 0.32g/t Au-Pt-Pd).

S2 is planning a diamond drill program in the upcoming Finnish Summer at Isovaara. The initial focus will be on a well-defined nickel-copper target identified in an airborne VTEM survey and subsequently confirmed in a ground-based fixed loop electromagnetic (FLEM) survey. This conductor comprises a large 280 metre by 240 metre plate plunging steeply to the northeast. It is coincident with a zone of anomalous nickel and copper identified in historic BOT drilling by the Finnish Geological Survey (the "GTK"). The BoT anomaly sits on a regional gravity high, indicative of underlying mafic / ultramafic geology (see S2 ASX announcement dated 16th May 2019 and Figure 3).

Drilling at Isovaara will follow the next round of diamond drilling at the Company's Aarnivalkea gold prospect, which aims to follow-up recent high grade gold intercepts in holes FAVD0062 (6.9 metres @ 11.8g/t gold, including 4.0 metres at 18.1g/t gold) and FAVD0064 (20.4 metres at 4.0g/t gold, including 8.5 metres at 8.6g/t gold*). These two holes are located 575 metres apart and represent the only two deep holes drilled to date under the main zone of anomalous gold mineralisation identified in shallow drilling (refer to previous S2 ASX announcement on 4 January 2021).

*Hole FAVD0064 was re-assayed on 0.5 metre sample intervals returning 20.4m at 4.0g/t Au from 193.1 metres downhole, including 8.5 metres at 8.6g/t Au from 197.5 metres. The initial assay based on 2.0 metre sample intervals was 20.4m at 2.3g/t Au from 193.1m, including 8.0 metres at 4.8g/t from 198.0 metres.

Figure 1. S2's landholding in the Central Lapland Greenstone Belt in Finland showing the Ruopas project and the Aarnivalkea gold prospect.

Figure 2. Location map of the Ruopas Isovaara exploration area (formerly named Ruopas 1), part of the greater Ruopas nickelcopper project, underlain by regional aeromagnetic data

Figure 3. Location of the EM conductor on a gravity ridge (colour) with a coincident BoT copper-nickel anomaly at Isovaara. The conductor plunges to the northeast so any eroded up-plunge component would have been located to the west where the main BoT anomalism occurs. Magnetics, gravity and BoT drilling were sourced from the GTK.

This announcement has been provided to the ASX under the authorisation of Mark Bennett, Executive Chairman.

This announcement has been provided to the ASX under the authorisation of Mark Bennett, Executive Chairman.

For further information, please contact:

Matthew Keane	Mark Bennett
Chief Executive Officer	Executive Chairman
+61 8 6166 0240	+61 8 6166 0240

Past Exploration results reported in this announcement have been previously prepared and disclosed by S2 Resources Ltd in accordance with JORC 2012. The Company confirms that it is not aware of any new information or data that materially affects the information included in these market announcements. The Company confirms that the form and content in which the Competent Person's findings are presented here have not been materially modified from the original market announcement. Refer to www.s2resources.com.au for details on past exploration results.

Competent Persons statements

The information in this report that relates to Exploration Results is based on information compiled by John Bartlett, who is an employee and shareholder of the Company. Mr Bartlett is a member of the Australian Institute of Mining and Metallurgy (MAusIMM) and has sufficient experience of relevance to the style of mineralization and the types of deposits under

consideration, and to the activities undertaken, to qualify as a Competent Person as defined in the 2012 Edition of the Joint Ore Reserves Committee (JORC) Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Bartlett consents to the inclusion in this report of the matters based on information in the form and context in which it appears.

Table 1. Details of diamond holes completed at Aarnivalkea in 2020 by S2 (refer to previous S2 ASX announcements on 8 October 2019 and 12 November 2019 for all 2019 drill results).

Hole	Easting	Northing	RL	Dip	Azimuth	Depth	From	To	Width	GradeAu g/t
FAVD0064*	418551	7552400	245.8	-60	270	350.3	193.09	213.48	20.39	4.0
Including					197.50	206.00	8.50	8.6
Including					197.50	197.99	0.49	73.6
And Including					212.70	213.48	0.78	5.5

* Resampling of the selected interval 193.09 – 213.48m on nominal 0.5 metre intervals (original samples on nominal 2m interval)

The following Tables are provided to ensure compliance with the JORC code (2012) edition requirements for the reporting of exploration results.

SECTION 1: SAMPLING TECHNIQUES AND DATA

Criteria	JORC Code explanation	Commentary
Sampling techniques	Nature and quality of sampling (e.g. cut channels,random chips, or specific specialised industrystandard measurement tools appropriate to theminerals under investigation, such as down holegamma sondes, or handheld XRF instruments, etc).These examples should not be taken as limitingthe broad meaning of sampling.	The reported drilling was undertaken using Northdrill Oy ofRovaniemi, Finland drilling WL-76 rod size with a DDH size of76.3mm and core size of 57.5 mm. Core samples are loggedand marked up by S2 personnel. Unbiased core sampleintervals were cut in half by diamond saw with half core sentfor preparation and analysis at ALS Laboratories.Detailed sampling of selected interval in FAVD0064 wascarried out by cutting the retained half core in hlf to producea quarter core sample that was sent for preparation andanalysis at ALS Laboratories.
	Include reference to measures taken to ensuresample representivity and the appropriatecalibration of any measurement tools or systemsused	Sampling and QAQC procedures are carried out using S2protocols as per industry best practice.
	Aspects of the determination of mineralisationthat are Material to the Public Report. In caseswhere 'industry standard' work has been done thiswould be relatively simple (e.g. 'reverse circulationdrilling was used to obtain 1 m samples fromwhich 3 kg was pulverised to produce a 30 gcharge for fire assay'). In other cases moreexplanation may be required, such as where thereis coarse gold that has inherent samplingproblems. Unusual commodities or mineralisationtypes (e.g. submarine nodules) may warrantdisclosure of detailed information	Diamond drilling was used to obtain core samples that havebeen cut and sampled on intervals that are determined bylithology and mineralisation.The drill core samples are sent to ALS Laboratories foranalyses for gold and base metals. Drill core is sampled atS2's facilities in Kittila, Finland.
Drilling techniques	Drill type (e.g. core, reverse circulation, open-holehammer, rotary air blast, auger, Bangka, sonic,etc) and details (e.g. core diameter, triple orstandard tube, depth of diamond tails, facesampling bit or other type, whether core isoriented and if so, by what method, etc).	Diamond drilling with WL76 wireline bit producing a 50.7mmdiameter core.

Criteria	JORC Code explanation	Commentary
Drill samplerecovery	Method of recording and assessing core and chipsample recoveries and results assessed	Diamond Drill core recoveries are recorded by the driller andwritten on core block markers. The exact recovery is thenrecorded on a metre basis after core mark-up and recorded inthe database.
	Measures taken to maximise sample recovery andensure representative nature of the samples	Sample quality is qualitatively logged on a metre basis,recording sample condition.
	Whether a relationship exists between samplerecovery and grade and whether sample bias mayhave occurred due to preferential loss/gain offine/coarse material.	No relationship has been seen to exist
Logging	Whether core and chip samples have beengeologically and geotechnically logged to a levelof detail to support appropriate Mineral Resourceestimation, mining studies and metallurgicalstudies.	The logging uses a standard legend developed by S2 which issuitable for implicit wireframing. All diamond holes aregeotechnically and structurally logged.
	Whether logging is qualitative or quantitative innature. Core (or costean, channel, etc)photography.	All core has been photographed both dry and wet. Geologicallogging of the diamond drill holes is into tough books usingstandardised codes and templates. These logs are thenimported into S2's central database
	The total length and percentage of the relevantintersections logged	All drill holes were logged in full.
Sub-samplingtechniques andsample preparation	If core, whether cut or sawn and whether quarter,half or all core taken.	Remaining half core was sawn in half and quarter core takenfor assay.
	If non-core, whether riffled, tube sampled, rotarysplit, etc and whether sampled wet or dry.	Not applicable
	For all sample types, the nature, quality andappropriateness of the sample preparationtechnique.	Samples were delivered by S2 personnel to ALS Mineralslaboratory in Sodankyla, Finland, where they are crushed with>70% <2mm (code CRU-31), split by riffle splitter (code SPL21), and pulverised 1000grm to 85% <75 um (code PUL-32).Crushers and pulverizers are washed with QAQC testsundertaken (codes CRU-QC, PUL-QC). The prepared samplesare forwarded to ALS Minerals Loughrea, Ireland, for analysis.
	Quality control procedures adopted for all subsampling stages to maximise representivity ofsamples.	Full QAQC system in place to determine accuracy andprecision of assays
	Measures taken to ensure that the sampling isrepresentative of the in situ material collected,including for instance results for fieldduplicate/second-half sampling.	For DDH's non biased core cutting through using anorientation line marked on core and cut to the line
	Whether sample sizes are appropriate to the grainsize of the material being sampled.	Samples of appropriate size
Quality of assaydata and laboratorytests	The nature, quality and appropriateness of theassaying and laboratory procedures used andwhether the technique is considered partial ortotal.	All samples were analysed by ALS Minerals Loughrea, Ireland.Core samples analysed for gold undergo a 50g fire assay withAA finish (code Au-AA26).
	For geophysical tools, spectrometers, handheldXRF instruments, etc, the parameters used indetermining the analysis including instrumentmake and model, reading times, calibrationsfactors applied and their derivation, etc.	No geophysical tools were used to determine any elementconcentrations.

Criteria	JORC Code explanation	Commentary
	Nature of quality control procedures adopted (e.g.standards, blanks, duplicates, external laboratorychecks) and whether acceptable levels of accuracy(i.e. lack of bias) and precision have beenestablished.	Full QAQC system in place including Certified Standards andblanks of appropriate matrix and levels
Verification ofsampling andassaying	The verification of significant intersections byeither independent or alternative companypersonnel.	all significant intercepts have been verified by senior S2exploration personnel, including verifying against drill logging,core photos and/or direct visual inspection of drill core.
	The use of twinned holes.	No twinned diamond holes have been drilled at Arnievalkea
	Documentation of primary data, data entryprocedures, data verification, data storage(physical and electronic) protocols.	Primary sampling data is collected in a set of standard Exceltemplates. The information is managed by S2's databasemanager for validation and compilation into S2's centraldatabase.
	Discuss any adjustment to assay data.	No adjustments made
Location of datapoints	Accuracy and quality of surveys used to locatedrillholes (collar and down-hole surveys), trenches,mine workings and other locations used in MineralResource estimation.	Diamond drill collars are pegged using a Trimble DGPS to +/-1m accuracy. Drill rigs are aligned to Grid west usingStandard Finnish National Grid ETRS-TM35FIN. The holes aredownhole surveyed using a Deviflex tool.
	Specification of the grid system used.	The grid system used is the Standard Finnish National GridETRS-TM35FIN.
	Quality and adequacy of topographic control.	Elevation data for all collars is determined by a digitalelevation model derived from public domain 2m Lidar data.Topographic control and map data is excellent.
Data spacing anddistribution	Data spacing for reporting of Exploration Results.	Recent drilling was not completed on a regular grid. Previousdiamond drilling at Aarnivlakea has been completed on 40mdrill spacings on lines between 80 – 240 metres apart.
	Whether the data spacing and distribution issufficient to establish the degree of geological andgrade continuity appropriate for the MineralResource and Ore Reserve estimation procedure(s)and classifications applied.	Data spacing and distribution is not sufficient at this stage toallow the estimation of mineral resources.
	Whether sample compositing has been applied.	No sample compositing has been applied
Orientation of datain relation togeological structure	Whether the orientation of sampling achievesunbiased sampling of possible structures and theextent to which this is known, considering thedeposit type.	Drillhole orientation is designed to intersect the mineralisedpackage of rocks and be perpendicular to shearing andmineralisation. Structural measurements from orientatedcore indicate that the main fabric and contacts are dippingsteeply to the east and hence holes collared at -60dip 270degazimuth are appropriate. The two southern holes were drilledobliquely due to the local terrain, but the hole orientations arestill considered appropriate.
	If the relationship between the drilling orientationand the orientation of key mineralised structures isconsidered to have introduced a sampling bias,this should be assessed and reported if material.	The drilling at this stage is preliminary and exploratory. It isnot possible to assess if any sample bias has occurred due todrillhole orientation at this stage.
Sample security	The measures taken to ensure sample security.	Chain of custody is managed by S2 personnel. Drill samplesand core is visually checked at the drill rig and thentransported to S2's logging and cutting facilities by S2personnel for logging, cutting and sampling. Bagged samplesare transferred to ALS Laboratories in Sodankyla, Finland by S2personnel.
Audits or reviews	The results of any audits or reviews of samplingtechniques and data.	No audits or reviews have been conducted at this stage.

SECTION 2: REPORTING OF EXPLORATION RESULTS

Criteria	JORC Code explanation	Commentary
Mineral tenementand land tenurestatus	Type, reference name/number, location andownership including agreements or materialissues with third parties such as joint ventures,partnerships, overriding royalties, native titleinterests, historical sites, wilderness or nationalpark and environmental settings.	The Aarnivalkea prospect is located within the Paana CentralExploration Licence. ML2018:0081The exploration licences are 100% owned by SakumpuExploration Oy, a Finnish registered 100% owned subsidiary ofS2
	The security of the tenure held at the time ofreporting along with any known impediments toobtaining a licence to operate in the area.	All of the Exploration Licences are in good standing and noknown impediments exist on the tenements being activelyexplored.
Exploration done byother parties	Acknowledgment and appraisal of exploration byother parties.	The Aarnivalkea prospect is a greenfield discovery with historicBoT holes drilled in the region by Outukumpu not having beenassayed for gold.
Geology	Deposit type, geological setting and style ofmineralisation.	The prospect is a shear zone hosted orogenic gold deposit withinthe Kittila Group of the Paleoproterozoic Central LaplandGreenstone belt.The primary host rocks include altered and sheared basalt,dacites and sedimentsAlteration assemblages include albite, sericite, carbonate,chlorite with disseminated pyrite, pyrrhotite and arsenopyrite.
Drill holeInformation	A summary of all information material to theunderstanding of the exploration resultsincluding a tabulation of the followinginformation for all Material drill holes:•easting and northing of the drill holecollar•elevation or RL (Reduced Level –elevation above sea level in metres)of the drill hole collar•dip and azimuth of the hole•down hole length and interceptiondepth•hole length.	Refer to sample plans in text.
Data aggregationmethods	In reporting Exploration Results, weightingaveraging techniques, maximum and/orminimum grade truncations (e.g. cutting of highgrades) and cut-off grades are usually Materialand should be stated.	All reported intersections of drilling undertaken by S2 have beenlength weighted.A nominal 0.2g/t lower cut-off is used for the reconnaissancediamond drill intersections. No top cut has been applied.
	Where aggregate intercepts incorporate shortlengths of high grade results and longer lengthsof low grade results, the procedure used for suchaggregation should be stated and some typicalexamples of such aggregations should be shownin detail.	High grade intervals internal to broader zones of mineralisationare reported as included intervals.
	The assumptions used for any reporting of metalequivalent values should be clearly stated.	None used.
Relationshipbetweenmineralisationwidths andintercept lengths	These relationships are particularly important inthe reporting of Exploration Results.If the geometry of the mineralisation withrespect to the drill hole angle is known, itsnature should be reported.If it is not known and only the down hole lengthsare reported, there should be a clear statementto this effect (e.g. 'down hole length, true widthnot known').	The trend of mineralisation at the targets/prospects described isestimated to be dipping steeply to the east at approximately 75to 80 deg.Refer to figures in body of text.

Criteria	JORC Code explanation	Commentary
Diagram	Appropriate maps and sections (with scales) andtabulations of intercepts should be included forany significant discovery being reported Theseshould include, but not be limited to a plan viewof drill hole collar locations and appropriatesectional views.	Refer to Figures in body of text.
Balanced reporting	Where comprehensive reporting of allExploration Results is not practicable,representative reporting of both low and highgrades and/or widths should be practiced toavoid misleading reporting of ExplorationResults.	All results considered significant are reported.
Other substantiveexploration data	Other exploration data, if meaningful andmaterial, should be reported including (but notlimited to): geological observations; geophysicalsurvey results; geochemical survey results; bulksamples – size and method of treatment;metallurgical test results; bulk density,groundwater, geotechnical and rockcharacteristics; potential deleterious orcontaminating substances.	None at present
Further work	The nature and scale of planned further work(e.g. tests for lateral extensions or depthextensions or large-scale step-out drilling).Diagrams clearly highlighting the areas ofpossible extensions, including the maingeological interpretations and future drillingareas, provided this information is notcommercially sensitive	Additional multi-element geochemical analysis of the recentholes is planned. A detailed structural and geochemical study ofthe available data to gain a better understanding of the keycontrols prior to additional diamond drilling to follow-up therecent drill intercepts.