S2 RESOURCES LTD — Regulatory Filings 2018

Oct 15, 2018

ASX Announcement

GEOPHYSICS COMPLETED AT ECRU, NEVADA FIRST DRILLING STARTS THIS WEEK

Key points

• Detailed gravity and AMT surveys complete
• Geophysics has defined numerous features of interest in both AMT (conductive and resistive zones) and gravity (high and low density zones)
• The combination of AMT conductivity and gravity density anomalies defines targets for initial stratigraphic drilling, which is starting later this week

S2 Resources Ltd ("S2" or the "Company") advises that recent gravity and audiomagnetotelluric (AMT) surveys undertaken at its Ecru project have been completed and that the project is ready for initial stratigraphic drilling to commence. These surveys cover the original Ecru project area together with the additional areas incorporated into the project via S2's area of influence rights on ground recently subleased from Newmont by S2's partner, Renaissance Gold (refer to S2's ASX announcement of 3 rd August 2018). The integrated geophysics is being used to site two or three initial stratigraphic drill holes that are scheduled to commence later this week.

A detailed gravity survey undertaken on 100 metre centres shows distinct highs, lows and discontinuities (see Figure 1). The gravity highs and lows may represent variations in the basement geology itself, or preserved pockets of later volcanics, or variations in the depth of the transported colluvium (pediment). Gravity anomalies in the basement geology may reflect the presence of intrusions or stratigraphic variation (with the receptive limestones being relatively dense), and at a smaller scale, may reflect zones of alteration such as decalcification, dissolution and porosity enhancement within the limestones that is often associated with Carlin-style mineralizing events.

Various linear discontinuities in the gravity response may also represent the presence of cross-cutting structures, which are an important prerequisite for channelising the flow of mineralizing fluids into such receptive hostrocks. Many of these appear to have a WNW or NNE orientation, which is considered a favourable orientation in this district.

An audiomagnetotelluric (AMT) survey over the same area has highlighted a broad zone of low resistivity/high conductivity in the centre and south of the project area (see Figures 2 to 4). Three dimensional modelling of this data defines an extensive and cohesive highly conductive source measuring more than two kilometres across at the 3 ohm threshold. This anomaly starts at a depth of 150 metres below surface and extends to a depth of at least 500 metres below surface.

Figure 1. Detailed gravity image, showing distinct WNW and NNE trending breaks, distinct lows and highs (centre), and a broad high (NE quadrant).

Such high conductance may reflect the presence of stratigraphy such as graphitic shales, or the presence of carbonaceous or graphitic alteration, which is a common feature of many Carlin-style gold deposits.

The combination of the AMT and gravity anomalies at Ecru (see Figure 3) may represent the presence of and variation in upper plate stratigraphy (those rocks overlying the more prospective lower plate limestones) or the presence of lower plate limestones and/or discrete zones of carbonaceous alteration and/or decalcification within them – key ingredients of Carlin-style gold mineralized systems.

Drilling of two or three stratigraphic holes to test this concept is scheduled to start later this week.

Figure 2. The 3 ohm isosurface identified in the AMT survey. Outlying linear zones may represent spurious line effects.

Background

The Ecru project is located to the north of Barrick's giant Cortez gold mining complex, which comprises a number of individually significant gold deposits. These include Pipeline (~20Moz), Cortez Hills (~15Moz), Goldrush (~12Moz) and also the Robertson deposit located on ground immediately to the south of the Ecru project, which comprises a resource of 2.74Moz (refer to Coral Gold's NI43-101 report of January 2012) (see Figure 4).

S2 is earning a 70% interest in the Ecru project from Renaissance Gold by expenditure of US$3 million before 30th July 2022. Through the area of influence provisions in the S2-Renaissance agreement, S2 is

also earning a 70% interest in the adjacent ground recently subleased from Newmont by Renaissance (refer to S2's ASX release of 3 rd August 2018).

Figure 3. Plan showing location of the 3 ohm AMT isosurface relative to gravity. The highly conductive modelled body spans discrete gravity highs (limestones?) and lows (alteration?) and numerous WNW and NNE gravity breaks (structures acting as conduits for mineralizing fluids?).

Figure 4. Plan showing the location of the AMT and gravity survey at the Ecru project area relative to the location of Barrick's nearby mines and resources.

For further information, please contact:

Mark Bennett Anna Neuling +61 8 6166 0240 +61 8 6166 0240

Managing Director & CEO Executive Director & Company Secretary

Competent Persons statements

The information in this report that relates to Exploration Results from Nevada 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 hassufficient 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.

Annexure 1

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

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 limiting thebroad meaning of sampling.	Rock chip samples were collected by random chip samplingwith a geological hammer of about fist size material to make acollective sample weight of about 0.5-2kg
	Include reference to measures taken to ensuresample representivity and the appropriatecalibration of any measurement tools or systemsused	Rock material that comprised the samples were selectedrandomly without bias to material appearance to give anaccurate representation of the sample being collected.
	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	Samples were dried and pulverised (total prep) and wereanalysed using an aqua regia digest ICP/OES and ICP/MS (CodeAR0531) and by fire assay with an AAS finish (Code FA50AAS).The following elements are included in the assay suite: Ag, Al,As, Au, Ba, Be, Bi, Ca, Cd, Ce, Co, Cr, Cu, Fe, K, La, Mg, Mn, Mo,Na, Ni, P, Pb, Sb, Sc, Sr, Te, Ti, Tl, V, W, Zn.
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).	No drilling has been undertaken by S2 Resources Ltd.
Drill samplerecovery	Method of recording and assessing core and chipsample recoveries and results assessed	No drilling has been undertaken by S2 Resources Ltd.
	Measures taken to maximise sample recovery andensure representative nature of the samples	No drilling has been undertaken by S2 Resources Ltd.

SECTION 1: SAMPLING TECHNIQUES AND DATA

Criteria	JORC Code explanation	Commentary
	Whether a relationship exists between samplerecovery and grade and whether sample bias mayhave occurred due to preferential loss/gain offine/coarse material.	No drilling has been undertaken by S2 Resources Ltd.
Logging	Whether core and chip samples have beengeologically and geotechnically logged to a level ofdetail to support appropriate Mineral Resourceestimation, mining studies and metallurgicalstudies.	All rock samples were described geologically detailing lithologyand alteration, and any veining and structural information.
	Whether logging is qualitative or quantitative innature. Core (or costean, channel, etc)photography.	Rock chip sampling information is both qualitative andquantitative in nature depending on the field being captured.
	The total length and percentage of the relevantintersections logged	Not applicable.
Sub-samplingtechniques andsample preparation	If core, whether cut or sawn and whether quarter,half or all core taken.	No drilling has been undertaken by S2 Resources Ltd.
	If non-core, whether riffled, tube sampled, rotarysplit, etc and whether sampled wet or dry.	No drilling has been undertaken by S2 Resources Ltd.
		Samples are analysed for gold using 30g lead collection fireassay with an ICP/ES finish at the Bureau Veritas laboratory inReno, Nevada. This sample is considered a total digest and thehighest quality assay technique available.
	For all sample types, the nature, quality andappropriateness of the sample preparationtechnique.	In addition an extensive multi-element suite (including Ag, Al,As, Au, B, Ba, Bi, Ca, Cd, Co, Cr, Cu, Fe, Ga, Hg, K, La, Mg, Mn, Mo,Na, Ni, P, Pb, S Sb, Sc, Se, Sr, Te, Th, Ti, Tl, V, W, Zn) is analysedusing an aqua regia digest with an ICP-MS finish. This method isa partial digest, but is considered appropriate to identifypotential pathfinder elements which may assist in locatingnearby gold mineralisation.
	Quality control procedures adopted for all subsampling stages to maximise representivity of	Laboratory Quality control procedures include submission ofCertified Reference Materials (CRM's), blanks and duplicatesamples with each batch of samples. Selected samples are alsore-analysed to confirm anomalous results.
	samples.	Grind size checks are routinely completed to ensure samplesmeet the industry standard of 85% passing through a 75µmmesh.
	Measures taken to ensure that the sampling isrepresentative of the in situ material collected,including for instance results for fieldduplicate/second-half sampling.	Each sample consisted of multiple rock chips collected randomlyfrom the sample site. No field duplicates were collected.
	Whether sample sizes are appropriate to the grainsize of the material being sampled.	Sample sizes are considered appropriate for gold mineralisation.
Quality of assay dataand laboratory tests	The nature, quality and appropriateness of theassaying and laboratory procedures used andwhether the technique is considered partial ortotal.	Samples are analysed for gold using 30g lead collection fireassay with an ICP/ES finish at the Bureau Veritas laboratory inReno, Nevada. This sample is considered a total digest and thehighest quality assay technique available.
		In addition an extensive multi-element suite (including Ag, Al,As, Au, B, Ba, Bi, Ca, Cd, Co, Cr, Cu, Fe, Ga, Hg, K, La, Mg, Mn,Mo, Na, Ni, P, Pb, S Sb, Sc, Se, Sr, Te, Th, Ti, Tl, V, W, Zn) isanalysed using an aqua regia digest with an ICP-MS finish. Thismethod is a partial digest, but is considered appropriate toidentify potential pathfinder elements which may assist inlocating nearby gold mineralisation.

Criteria	JORC Code explanation	Commentary
	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.	Not applicable – no geophysical techniques have been used todetermine an assay value.
	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.	Sample preparation checks for fineness were carried out by thelaboratory as part of their internal procedures to ensure thegrind size of 85% passing 75 micron was being attained.Laboratory QAQC involves the use of internal lab standards usingcertified reference material, blanks, splits and replicates as partof the in house procedures.
Verification ofsampling andassaying	The verification of significant intersections byeither independent or alternative companypersonnel.	The Exploration Manager of S2 has visually verified the results.
	The use of twinned holes.	No drilling has been undertaken by S2 Resources Ltd.
	Documentation of primary data, data entryprocedures, data verification, data storage(physical and electronic) protocols.	Primary data was recorded into a field notebook and thentransferred to an Excel templates. The information was sent toan external database consultant for validation and compilationinto a Perth based SQL database.
	Discuss any adjustment to assay data.	No adjustments or calibrations were made to any assay datareported.
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.	Sample sites were recorded by a Garmin handheld GPS with anaccuracy about +/– 4m for easting and northing.
	Specification of the grid system used.	The grid system used was NAD 27 Zone 11.
	Quality and adequacy of topographic control.	No controls were utilized and are not deemed important.
Data spacing anddistribution	Data spacing for reporting of Exploration Results.	No drilling has been undertaken by S2 Resources Ltd.
	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.	No drilling has been undertaken by S2 Resources Ltd.
	Whether sample compositing has been applied.	No compositing has been applied to any rock chip sampling
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.	No drilling has been undertaken by S2 Resources Ltd.
	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.	No drilling has been undertaken by S2 Resources Ltd.
Sample security	The measures taken to ensure sample security.	Chain of custody is managed by S2 Resources. Samples arestored on site and directly to the laboratory in Reno, Nevada.Tracking sheets have been set up to track the progress ofbatches of samples.
Audits or reviews	The results of any audits or reviews of samplingtechniques and data.	No audits have been undertaken and it is not consideredmaterial at this stage of exploration.

Criteria	JORC Code explanation	Commentary
Mineral tenementand land tenurestatus	Type, reference name/number, location andownership including agreements or material issueswith third parties such as joint ventures,partnerships, overriding royalties, native titleinterests, historical sites, wilderness or nationalpark and environmental settings.	S2 Resources Ltd, through its subsidiary Nevada StarExploration LLC, is earning into the following mineral tenure viaan agreement with Kinetic Gold (US) Inc ("Kinetic") and itsparent company Renaissance Gold Inc. ("RenGold")1.Kinetic holds an Option to Purchase under the IvyOptionAgreement112MineralClaims(NMC1098847–1098958) held by Ivy Minerals Incwithin Lander County, NV.2.Kinetic holds a sub-lease agreement with Newmont(USA) Ltd to the mineral rights to private held landson 2 section blocks (T29N R47E Section 27 (All) andT29N R47E Section 33 (N1/2, N1/2S1/2).
		All are subject to certain confidential royalty agreements,payable by Nevada Star Exploration LLC to Kinetic Gold (US) Incand third partiesBased on a due diligence process, no commercial, historical,
	The security of the tenure held at the time ofreporting along with any known impediments toobtaining a licence to operate in the area.	native title, heritage or environmental impediments are knownBased on a due diligence process, the claims are in goodstanding and no known impediments exist on tenementactively explored.
Exploration done byother parties	Acknowledgment and appraisal of exploration byother parties.	Ivy Minerals, in JV partnership with Kinetic Gold (US) Inc (now awholly-owned subsidiary of RenGold), completed broad spacedenzyme leach and gravity surveying over the property.Limited information on any earlier exploration activities isavailable, however it is known that Barrick Gold completed onehistoric RC drill hole on the property in 1995. And the historicdrill site has been visited and verified by a geologist working onbehalf of S2 Resources.
Geology	Deposit type, geological setting and style ofmineralisation.	The projects are located within the Great Basin of Nevada andthe deposit type being explored consists of the Carlin-stylewhich comprises fine-grained disseminated replacementsulphide(pyrite)mineralisationinzonesofsilicified,decarbonatised, argillised, silty calcareous rocks and associatedjasperoids.The mineralisation is hosted within Palaeozoic carbonate andsiliciclastic sedimentary rocks which were deposited in a marinesetting ranging from deep to shallow water on a former westerncontinental margin of North America. These units weredeformed by the Antler Orogeny and later intruded by felsicbodies of varying ages. The age of the mineralisation is Eoceneand ranges between 34-42 Ma. Later faulting developed thedistinctive 'Basin and Range' topography of the area.
Drill holeInformation	A summary of all information material to theunderstanding of the exploration results includinga tabulation of the following information for allMaterial drill holes:easting and northing of the drill holecollarelevation or RL (Reduced Level –elevation above sea level in metres) ofthe drill hole collardip and azimuth of the holedown hole length and interceptiondepthhole length.	No drilling has been undertaken by S2 Resources Ltd.

SECTION 2 REPORTING OF EXPLORATION RESULTS

Criteria	JORC Code explanation	Commentary
Data aggregationmethods	In reporting Exploration Results, weightingaveraging techniques, maximum and/or minimumgrade truncations (e.g. cutting of high grades) andcut-off grades are usually Material and should bestated.	Not applicable – no data aggregation has taken place.
	Where aggregate intercepts incorporate shortlengths of high grade results and longer lengths oflow grade results, the procedure used for suchaggregation should be stated and some typicalexamples of such aggregations should be shown indetail.	Not applicable – no data aggregation has taken place.
	The assumptions used for any reporting of metalequivalent values should be clearly stated.	Not applicable – no metal equivalent values have been reported.
Relationshipbetweenmineralisationwidths and interceptlengths	These relationships are particularly important inthe reporting of Exploration Results.If the geometry of the mineralisation with respectto the drill hole angle is known, its nature shouldbe reported.If it is not known and only the down hole lengthsare reported, there should be a clear statement tothis effect (e.g. 'down hole length, true width notknown').	Not applicable, No drilling has been undertaken by S2Resources Ltd.
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 view ofdrill hole collar locations and appropriate sectionalviews.	All Figures are contained in the body of the text.
Balanced reporting	Where comprehensive reporting of all ExplorationResults is not practicable, representative reportingof both low and high grades and/or widths shouldbe practiced to avoid misleading reporting ofExploration Results.	Not applicable.
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.	No other exploration data collected to date is consideredmaterial or meaningful at this stage.
Further work	The nature and scale of planned further work (e.g.tests for lateral extensions or depth extensions orlarge-scale step-out drilling).Diagrams clearly highlighting the areas of possibleextensions, including the main geologicalinterpretations and future drilling areas, providedthis information is not commercially sensitive	S2 plans to undertake two to three stratigraphic diamond drillholes to provide stratigraphic information on the underlyinggeology at the Ecru property.Half core sampling of the drill hole will be completed to test forgold mineralization as well as pathfinder elements.Petrophysical measurements on diamond core will be taken toprovide inputs to better refine modelling and interpretation ofthe gravity and AMT geophysical data.