SABRE RESOURCES LIMITED — Capital/Financing Update 2012

May 9, 2012

ASX ANNOUNCEMENT & MEDIA RELEASE

10 May 2012

MAJOR NEW COPPER PROJECT ACQUIRED IN NAMIBIA

• Sabre acquires a highly prospective copper project with additional strong silver, lead, zinc, and vanadium potential.

• The Otavi Valley Base Metals Project (EPL 3540) covers over 200 km[2 ] of the Otavi Mountain Land in northern Namibia and is immediately adjacent to the Company’s Ongava Polymetallic Project.

• More than 20 gazetted historic mines and prospects along strike from the historic Kombat copper mine (8.7 Mt @ 3.1% Cu, 1.1 Pb and 26 g/t Ag).

• High-grade copper mineralisation is exposed at several historic mine sites, with trenching results at Guchab deposit including:

  • 17m @ 5.86% Cu, 29g/t Ag, & 0.46% Zn; and

  • 25m @ 6.7% Cu, 59g/t Ag, & 3.09% Zn.

• Providing more of a copper bias, the Otavi Valley Base Metals Project will complement work on Sabre’s Kaskara (V-Cu-Pb-Zn), Border (Zn-Pb) and Driehoek (Zn-Pb) deposits.

ACQUISITION OF A NEW BASE METALS PROJECT

Sabre Resources Ltd (‘Sabre’) is pleased to announce that it has entered into an agreement to purchase the Otavi Valley Base Metals Project in the northeast of Namibia. The project contains numerous copper(-silver) prospects and historic mines , with additional potential provided by a series of lead, zinc and vanadium prospects. The new project lies immediately adjacent to Sabre’s Ongava Project (Figure 1), meaning that the Company’s expertise and presence in the region will transfer to it directly.

Dr Matt Painter, General Manager – Exploration, said that “the acquisition of the Otavi Valley Base Metals Project marks an exciting new chapter in the development of Sabre Resources as an Australian explorer with a production focus in Namibia”.

“The new licence contains some stunning copper prospects that have not been thoroughly explored for decades , if at all in many cases”, Dr Painter said, adding that the new project adds a strong copper bias to Sabre’s mix of projects. “I can’t wait to start drilling at the historic Guchab mine – it’s an area with huge potential and, I believe, an exciting future.”

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----- Start of picture text ----- 2– The Otavi Mountain Land, showing Sabre’s Ongava Project (EPL3542, centre) and newly acquired Otavi Valley Project (EPL3540, south)Figure 1EPL3540EPL3542----- End of picture text -----

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THE OTAVI VALLEY BASE METALS PROJECT

The Otavi Valley Base Metals Project is located in the northeast of Namibia in the Otavi Mountain Land (OML), lying within the triangle created by the mining towns of Tsumeb, Otavi and Grootfontein. The tenement covers over 200 km[2] of mineralised carbonate stratigraphy within the OML.

The entire region is well served by rail, sealed roads, electric power, telephone and water, and is close to major towns and processing facilities.

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Figure 2 – Oblique view east from the Kombat copper mine (foreground, excised area shaded) along strike to Sabre’s series of copper targets (yellow) at Nehlen and Rendezvous in the Kombat Ost copper target area, and Guchab in the Guchab mining centre. Note the white zone of hydrothermal alteration on the flank of the hill at Guchab. The Rietfontein and Odin lead-zinc targets (grey) are also shown. The licence boundary is shown in yellow.

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The region hosts a number of world class Copper, Zinc, Lead, Silver and Vanadium mines, including the Tsumeb Copper mine. The Otavi Valley Base Metals Project itself surrounds the Kombat Copper mine on all sides and covers the strike extensions of the mine stratigraphy, as well as surrounding the nearby Gross Otavi Copper mine (both on care and maintenance). To date, the Kombat Mine has produced more than 8.7 Mt @ 3.1% Cu, 1.1 Pb and 26 g/t Ag, while the Gross Otavi Copper Mine produced small tonnages of copper ore grading as high as 36.8% Cu which supplemented Kombat.

A vast dataset of geological information already exists for the project area. It comprises digital data and hard copy plans including:

• Digital Terrain Models

• Topographical Data

• Geological Mapping

• Orthophotos

• Satellite Imagery

• Airborne Magnetics

• Gravity

• Geochemistry

• Drill Data

This data set has allowed prospects and targets within the Otavi Valley Base Metals Project area to be defined and ranked, in terms of prospectivity. These prospects and targets grade from advanced exploration targets, which require drill testing, through to conceptual targets.

Among the more than 20 identified prospects and targets, the following areas are considered to have a strong potential to produce economic mineralisation:

• Guchab (Cu-Ag) (Figure 2)

• Baltika (Pb-Zn-V)

• Odin (Pb-Zn) & Rietfontein (Pb-Zn-V) (Figure 2)

• Kombat Ost (Cu-Pb-Zn) (Figure 2)

These target areas stand out as the immediate priorities for exploration and drilling. The Otavi Valley Base Metals Project is highly prospective for both Copper and Lead-Zinc mineralisation and ranks as an outstanding project area, with the potential to host ‘world-class’ base metal ore bodies .

Guchab mining area (Cu-Ag-Zn)

The Guchab mining area is a historic series of copper mines to the east of Kombat. Tsumeb-style metamorphic copper mineralisation has formed vein and breccia style deposits throughout the area (Figure 3). Major copper minerals at surface include malachite, chalcocite, and dioptase within the copper gossans that extend over more than 4 km of strike. Copper-rich and silver-rich stratigraphy highlights extensive and very intense copper-in-soil geochemical anomalies (extremely high with values in soils commonly exceeding 10,000 ppm or 1% Cu – Figure 4).

The Guchab mining area is centred on the Guchab deposit. High-grade zones are surrounded by more moderate grade vein networks outcropping over an several areas, with the main one of these measuring approximately 1000 x 150 m. Channel sampling of the historic workings at the Guchab deposit has returned some very high-grade intercepts, including:

• 17m @ 5.86% Cu, 29g/t Ag, & 0.46% Zn (GCTR001, 0-17m)

• 16m @ 10.16% Cu, 64g/t Ag, & 0.53% Zn (GCTR002, 0-16m)

• 14m @ 6.4% Cu, 62g/t Ag, & 2.67% Zn (GCTR021, 13-27m)

• 25m @ 6.7% Cu, 59g/t Ag, & 3.09% Zn (GCTR023, 3-28m)

• 22m @ 5.83% Cu, 48g/t Ag, & 0.8% Zn (GCTR026, 2-24m)

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Figure 3 - Outcropping copper mineralisation at Guchab. a) colloform malachite; b) malachite and chalcocite; c) malachitic and chalcocitic stockworks above one of the histroric adits at Guchab.

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Figure 4 - Soil geochemistry at Guchab, Rodgerberg and Schlangental, with copper in soil values of up to 4%.

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As well as the Guchab deposit, the Guchab mining centre also comprises the Rodgerberg deposit and the Schlangental prospect which are located along strike from the Guchab deposit. Rodgerberg in particular was a substantial copper mine during the 1920s, and a series of small pits and underground workings are present at Schlangental.

Drill targets have been identified for a pilot programme that will define in detail the style of the mineralisation at Guchab and the preferred orientations of the controlling structures. The highly prospective Guchab mining centre will be a major focus for forthcoming exploration given its potential for significant copper deposits.

Kombat Ost (Cu-Pb-Zn)

The Kombat Ost area has the strong potential to host eastern repetitions of the Kombat copper mine. It covers 10 kilometres of strike between Kombat and the Guchab mining area, and includes the Nehlen, Hermanus, Rendez-vous and Buschbrunnen prospects.

The Nehlen prospect (Figure 5) is particularly interesting, butting up against the eastern edge of the Kombat mining licence excision (Figure 6). Chalcocite, malachite and sphalerite mineralisation have been identified in outcrop and in historic pits on the flats over an extensive area. It is also marked by an extensive Figure 5 – and intense copper-in-soil anomaly that shows the centre of the prospect to lie beneath soil cover directly along strike from Kombat.

Figure 5 – View of Nehlen (flats, foreground), looking east towards Guchab.

The Kombat Ost area will require detailed geological investigation, including geophysical surveys, to define a number of drill targets.

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Figure 6 – Soil geochemistry sampling at the Nehlen prospect within the Kombat Ost target area, showing a strong copper-insoil anomaly. Nehlen lies along strike from the Kombat mine (excised), the eastern end of which is shown in blue.

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Baltika (Cu-Pb-Zn-V)

The Baltika area comprises historic workings at Kupferberg, Baltika mine, and the Rhovers Group of workings to the west of Kombat copper mine, covering over 6 kilometres of strike.

At Rhovers and Kupferberg, historic workings to the west of Kombat have received little to no exploration for at least 90 years. Tsumeb-style copper-bearing breccia pipes were exploited at both localities. Both prospect areas are marked by extensive soil geochemistry haloes that require investigation.

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Figure 7 – Outcropping Pb-Zn-Cu-V mineralisation at Baltika (above) and workings (below).

Figure 8 – High-grade galena at Rietfontein (above) as exposed in a trench (below).

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At the Baltika Mine, around 6,000 tonnes of 9% V2O5 concentrate was produced during its operation between 1931 and 1942. Much of the mineralisation is hosted within a large north-south trending vein that has been mined to a depth of up to 50 m beneath surface. Sampling of the mine spoils included the following results:

• 10.20% Pb, 2.39% Zn, 0.60% Cu, 4.12% V2O5

• 9.39% Pb, 4.80% Zn, 0.87% Cu, 7.21% V2O5

• 16.30% Pb, 7.80% Zn, 0.07% Cu, 10.91% V2O5

A tailings dam located at the base of the hill adjacent to the mine is highly anomalous in Pb and Zn and will be investigated.

Odin (Pb-Zn) and Rietfontein (Pb-Zn-V)

Odin and Rietfontein are historically-explored Pb-Zn(-V) prospects that bear a striking resemblance to Sabre’s Driehoek deposit (on EPL3542). Odin is an advanced exploration target in the east of the new licence area. The prospect covers more than 5,000 metres of strike and is up to 1,500 metres wide. Rietfontein prospect is similarly extensive, measuring up to 3,000 metres long and 500 metres. At both prospects wide Pb and Zn soil geochemical anomalies are centred on outcropping galena and sphalerite mineralisation.

Limited historic drilling at both prospects defined (non-JORC compliant) Pb and Zn resources in the 1970s and 1980s. The Company believes that these prospects are underexplored and have the potential to host more Driehoek style deposits to complement Sabre’s holdings to the north.

The Rendezvous, Hermanus and Buschbrunnen prospects similarly have extensive soil geochemistry anomalies (up to 8 kilometres long) associated with outcropping copper mineralisation to the east of Kombat. Exploration will include mapping, geophysical surveys and soil sampling prior to initial drill programmes.

Summary

The Otavi Valley Base Metals Project is highly prospective for both copper and lead-zinc mineralisation and represents an exceptional opportunity to undertake modern exploration in an under-explored and proven terrain, and has the potential to produce ‘world-class’ base metal ore bodies.

CORPORATE

Sabre Resources Ltd (“Sabre”) has entered into an agreement to acquire all the issued capital of Starloop Holdings Pty Ltd (“Starloop”), an Australian registered private company. Starloop holds an 80% interest in Gazania Investments Nine (Pty) Ltd, a Namibian registered company, which is the holder of a 100% legal and beneficial interest in Namibian exploration tenement EPL 3540, known as the Otavi Valley Base Metals Project. An Independent Geologist’s Report has valued the Otavi project at A$32,900,000 with the 80% being acquired by Sabre valued at A$26,320,000.

Consideration for the Acquisition

The consideration for the acquisition is the allotment and issue to the Vendor of the following ordinary fully paid shares ("Consideration Shares") in the capital of Sabre:-

• (i) 46 million Shares on settlement of the Share Sale Agreement;

• (ii) 25 million Shares on achieving an inferred JORC resource of 1 million tonnes at a grade of 2% Cu; (or the metal equivalent being 20,000 tonnes contained Cu metal) from the Project; and

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• (iii) 5 million Shares on achieving an inferred JORC resource of 5 million tonnes at a grade of 3% Cu; (or the metal equivalent being 150,000 tonnes contained Cu metal) from the Project

In addition, there is a cash consideration payable of A$300,000.

The acquisition is conditional upon obtaining all necessary shareholder and regulatory approvals for the acquisition.

For further information regarding the Company’s activities, please contact:

Dr Matthew Painter – General Manager – Exploration Phone (08) 9481 7833

Or consult our website:

www.sabresources.com

Competent Persons Declarations

The information in this report that relates to Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Dr Matthew Painter of Sabre Resources Ltd, who is a member of The Australian Institute of Geoscientists. Dr Painter has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity that he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the “Australian Code for Reporting of Exploration Results, Mineral Resource and Ore Reserves”. Dr Painter consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

Forward-Looking Statements

This document may include forward-looking statements. Forward-looking statements include, but are not limited to, statements concerning Sabre Resources Ltd’s planned exploration programme and other statements that are not historical facts. When used in this document, the words such as "could," "plan," "estimate," "expect," "intend," "may”, "potential," "should," and similar expressions are forward-looking statements. Although Sabre Resources Ltd believes that its expectations reflected in these forward-looking statements are reasonable, such statements involve risks and uncertainties and no assurance can be given that actual results will be consistent with these forward-looking statements.

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