SANTA FE MINERALS LTD — Capital/Financing Update 2021

Nov 18, 2021

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Suite 1, 9 Hampden Road Nedlands WA 6009 Tel: +61 8 9386 8382 +61 8 6183 4892 ABN: 59 151 155 734 www.santafeminerals.com.au

19 November 2021

Company Announcements Office ASX Limited

SANTA FE MINERALS ENTERS INTO OPTION TO ACQUIRE NICKEL AND LEAD/ZINC EXPLORATION PROJECTS IN WESTERN AUSTRALIA.

• Santa Fe Minerals has entered into a binding option agreement to acquire 80% of the Mt Murray Nickel and Lead/Zinc project.

• The project comprises two granted exploration licences and the metals rights over an existing mining licence.

• Nickel-copper-PGE Sulphide target - 4.2km x 1.2km mostly covered and unexplored magnetic zone with a historic rock chip result of 2,965ppm Cu, 781 ppm Ni, 425ppm Cr.

• High grade silver lead target with rock chips grading up to 39.6% Pb 134g/t Ag, 0.46g/t Au and 0.1% Zn.

Santa Fe Minerals Ltd (ASX: SFM) ( SFM, the Company ) is pleased to announce that it has entered into a binding option agreement to acquire 80% of two granted exploration licences and the metals rights over an existing mining licence. The project area covers 29km2 and is located 95km south-east of Onslow in the Ashburton region of Western Australia.

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Figure 1: Project location.
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The Mt Murray project covers a 9km north south trending zone of poly metallic copper-leadzinc-silver-gold mineralisation adjacent to a 4.2km x 1.2km magnetic high zone considered to represent a mafic-ultramafic intrusive package prospective for nickel-copper-PGE mineralisation similar to the recently discovered tier one Julimar Ni-Cu-PGE deposit (Chalice Mining Ltd).

The geology of the project area comprises Paleoproterozoic metasediments and gneiss of the Leake Springs Metamorphics (previously the Morissey Metamorphics) intruded to the west by the Kilba granite unconformably overlain to the east by the Wongida dolomite member of the Irregully Formation. Previous exploration has been light comprising surface geochemistry with only shallow minor follow up drilling.

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Rockchip grading
39.6% Pb 134g/t
Ag, 0.46g/t Au and
0.1% Zn.
Rockchip grading
2,965ppm Cu, 781
ppm Ni, 425ppm Cr.
Rockchip grading
23.4% Cu.
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Figure 2: Mt Murray tenement map over magnetics including high grade rock chip assays.

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Nickel/Copper/PGE Target

The nickel sulphide prospectively was first noted by BRL Exploration Pty Ltd in 2010 based on the discovery of small outcrop of altered ultramafic associated with a composite high magnetic zone extending over about 5km of strike. One rock chip sample of the altered ultramafic outcrop returned 2,965ppm Cu, 781 ppm Ni, 5.4% Mg, 1.8g/t Ag and 419ppm S. The sample was not assayed for platinum or palladium. Apart from the small ultramafic outcrop, the magnetic high zone is completely covered by shallow sand and alluvial cover. No further work on this target was reported at the time.

SFM considers the interpreted mafic-ultramafic complex within the Mt Murray project has potential to host nickel-copper-palladium, platinum mineralisation similar to the Chalice Mining tier one Ni-Cu-PGE discovery at Julimar. The target area high magnetic zone at Mt Murray is almost totally concealed beneath shallow sand and alluvial cover and has not previously been systematically explored.

SFM will consider a range of exploration techniques including ultrafine soil sampling and/or auger drilling to outline the ultramafic complex for follow up electromagnetic surveys and drilling. Aboriginal Heritage surveys may be required prior to the commencement of any drilling programs. SFM will engage with traditional owners to discuss a heritage program.

Lead/Zinc Target

The Hill silver lead zinc prospect is located adjacent to the North West Coastal Highway. Historic rock chip samples returned very high results of up to 39.6% Pb 134g/t Ag, 0.46g/t Au and 0.1% Zn. The mineralisation is hosted in chert and quartz over about 300m strike. Despite the high grades and its proximity to the highway no drilling has been recorded. SFM visited this prospect as part of the due diligence. SFM rock chip samples returned 3.5% Pb, 0.48g/t Au, 13g/t Ag and 0.08% Zn. SFM believes this zone extends under cover to the north and south with a possible 4km strike length. Auger geochemistry sampling or ultrafine soil sampling is planned to test this target prior to drilling.

Polymetalic Copper-Lead-Zinc-Silver-Gold Target

Historic exploration work comprising high density creek sediment sampling and three 1km spaced soil sampling lines have defined a 3.5km x 500m zone comprising anomalous CuPb-Zn-Ag-Au extending from the southern tenement boundary and including the historic Kin copper workings. The anomalous trend is thought to extend further north under recent sand and alluvial cover along the western side of the magnetic high zone considered to represent a mafic ultramafic intrusive complex. Rock chip sampling of the Kin Copper workings by SFM returned a very high 23.4% Cu from a narrow quartz veined zone. Historically similar rock chip samples have been reported. The historic soil sampling on three 1km spaced lines defined broad north-south trending Au and Cu anomalies associated with the historic Kin copper workings. Highest soil results are Au 20ppb and Cu 48ppm. This soil anomaly merges to the south with the stream sediment Cu-Pb-Zn-Ag-Au anomaly discussed above forming a 3.5km long anomalous zone. The only other exploration reported here comprises 6 shallow RC holes targetting the historic Kin-1 copper workings. One of the holes located closest to the copper workings was reported to have intersected pervasive sulphide mineralization however with no significant results. The 5 other holes did not effectively test the line of the historic copper workings.

SFM considers the 3.5km strike of the anomalous polymetallic zone has potential for multiple discoveries and plans to complete systematic surface geochemistry to define targets for follow-up geophysics and drilling.

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Commercial Terms of the Acquisition

Via its wholly owned subsidiary Challa Resources Pty Ltd (ACN 619 903 196) ( Challa ), SFM has entered into a binding option agreement to acquire, subject to certain conditions precedent, 80% of the legal and beneficial interest in any or both of the exploration tenements E 08/2978 and E 08/3230 and 80% of the metals rights on M 08/139 from North West Stone Pty Ltd (ACN 159 838 712) ( NWS ) ( Option ). The key terms of the agreement are detailed below.

Key Terms

The consideration for the grant of the Option is A$50,000. The initial period of the Option will expire on 19 November 2023 ( Initial Period ) and will automatically be extended by three six month terms unless Challa provides written notice otherwise ( Option Period ). Challa must pay A$30,000 for each additional term.

As a condition to the exercise of the Option, Challa must:

• (a) incur at least A$200,000 of exploration expenditure on the tenements in the Initial Period; and

• (b) incur at least A$300,000 of exploration expenditure on the tenements (in addition to the amount detailed in paragraph (a) above) in the Option Period.

If the condition is satisfied and the Option is exercised, the Company must issue to NWS the greater of:

• (a) 5,000,000 fully paid ordinary shares in Santa Fe; or

• (b) fully paid ordinary shares in Santa Fe to a value of A$1,000,000 based on a 5 day VWAP share price prior to the date of exercise of the Option.

If the condition is satisfied, Challa may also elect to enter into a split commodity agreement with NWS for 80% of all metal rights in M 08/139 ( Split Commodity Agreement ). Upon election to enter into the Split Commodity Agreement, the Company must issue to NWS the greater of:

• (a) 500,000 fully paid ordinary shares in Santa Fe; or

• (b) fully paid ordinary shares in Santa Fe to a value of A$100,000 based on a 5 day VWAP share price prior to the date of electing to enter into the Split Commodity Agreement.

Under the agreement, the total consideration shares that SFM will issue to exercise the option in its entirety is capped at 10,000,000. The Company intends to issue the above shares using its available placement capacity under listing rule 7.1.

If the Option is exercised, the parties shall commence good faith negotiations with a view to executing a joint venture agreement for the development of the tenements Challa has an interest in, with Challa as manager and operator of the joint venture. NWS will be free carried until a decision to mine.

The option agreement is otherwise on customary terms and conditions for a transaction of this nature, including pre-completion obligations, termination rights and warranties provided by the parties.

Santa Fe has agreed to pay approximately $2,600 of rates outstanding in respect of the exploration tenements.

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Authorised for release by the Board of Directors.

For investor queries, please call:

Doug Rose

Managing Director Santa Fe Minerals Limited +61 409 465 511

COMPLIANCE STATEMENT

The information in this announcement that relates to exploration targets and exploration results is based on information compiled by Reginald Beaton, a competent person who is a member of the Australian Institute of Geoscientists (AIG). Reginald Beaton is an employee of Santa Fe Minerals Limited. Mr Beaton has sufficient experience that is relevant to the style of mineralisation and type of deposits 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’. Mr Beaton consents to the inclusion in the announcement of the matters based on his information in the form and context in which it appears.

JORC Code, 2012 Edition – Table 1 report template

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 (e.g. 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	Historic Reverse Circulation (RC) drilling was undertaken to provide the samples. Soil sampling – samples collected and sieved to -80#. Every 2ndsample was also sieved to 11/8inch.
	XRF instruments, etc.). These examples	Rock chip samples were collected based on
	should not be taken as limiting the broad	visual mineralisation.
	meaning of sampling.	Drilling samples were collected in plastic
	• Include reference to measures taken to	bags every 1m of drilling via a cyclone and
	ensure sample representivity and the	splitter mounted on the drill rig. The 1m drill
	appropriate calibration of any	samples were laid out on the ground next to
	measurement tools or systems used.	the rig. Composite samples were then
	• Aspects of the determination of mineralisation that are Material to the	collected over a 3m interval. The weight of the 3m samples is not recorded.
	Public Report.	All of the 3m composite samples were
	• In cases where ‘industry standard’ work has been done this would be relatively simple (e.g. ‘reverse circulation drilling was used to obtain 1 m samples from	submitted to a Laboratory to be crushed, pulverized and assayed. Soil samples were collected in 200mm x 100mm soil sample packets.
	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 (e.g.
	submarine nodules) may warrant
	disclosure of detailed information.
Drilling	• Drill type (e.g. core, reverse circulation,	•The drilling method described appears to
techniques	open-hole hammer, rotary air blast, auger, Bangka, sonic, etc.) and details (e.g. core	be industry standard RC. The drilling company, rig type and hole size was not
	diameter, triple or standard tube, depth of	recorded.
	diamond tails, face-sampling bit or other
	type, whether core is oriented and if so,
	by what method, etc.).
Drill sample	• Method of recording and assessing core	•No visual assessment of the sample
recovery	and chip sample recoveries and results assessed.	recovery was recorded however the report suggests the sample recovery was
	• Measures taken to maximise sample recovery and ensure representative	considered adequate for this early-stage exploration.
	nature of the samples.	•The assumption is that standard RC
	• Whether a relationship exists between sample recovery and grade and whether	drilling practice was used to ensure maximum sample recoveries.
	sample bias may have occurred due to	•For this early stage of exploration there is
	preferential loss/gain of fine/coarse	no study of the sample bias relationships
	material.	available.

Logging	• Whether core and chip samples have	•	RC drill chips were logged on site by a
	been geologically and geotechnically		Geologist sufficiently experience in the
	logged to a level of detail to support		geological terrain being explored. An
	appropriate Mineral Resource estimation,		industry standard logging system was
	mining studies and metallurgical studies.		used recording sample recovery,
	• Whether logging is qualitative or quantitative in nature. Core (or costean,		weathering, lithology, mineralization and alteration.
	channel, etc.) photography.	•	The logging is qualitative in nature and
	• The total length and percentage of the relevant intersections logged.		each hole was logged to its completed depth.
		•	Soil sampling-no logging recorded
Sub-	• If core, whether cut or sawn and whether	•	Drill samples were collected through a
sampling techniques and sample preparation	quarter, half or all core taken. • If non-core, whether riffled, tube sampled, rotary split, etc. and whether sampled wet or dry.		cycle and riffle splitter in plastic bags for every 1m of drilling and laid out on the ground. A composite 3m sample was then collected and stored in a pre-numbered calico bag.
	• For all sample types, the nature, quality and appropriateness of the sample preparation technique.	•	For this early-stage exploration, the sampling technique is considered appropriate to determine the presents of
	• Quality control procedures adopted for all		mineralization.
	sub-sampling stages to maximise representivity of samples.	•	Only laboratory QAQC checks, and standards were recorded
	• Measures taken to ensure that the sampling is representative of the in situ material collected, including for instance results for field duplicate/second-half	•	The sample size was not recorded and is likely sufficient to determine the presence or absence of mineralization
	sampling.
	• Whether sample sizes are appropriate to
	the grain size of the material being
	sampled.
Quality of	• The nature, quality and appropriateness	•	Drill samples were submitted to Genalysis
assay data and laboratory	of the assaying and laboratory procedures used and whether the technique is considered partial or total.	•	Analytical Laboratories, Perth. Drill samples - No sample preparation descriptions provided. Only assay
tests	• For geophysical tools, spectrometers,		techniques codes provided – Au FA50, Ag
	handheld XRF instruments, etc., the		Ag, Mo, U -AT/MS, Cu, Pb, Zn AT/OES.
	parameters used in determining the
	analysis including instrument make and
	model, reading times, calibrations factors	•	Drill samples -No additional QAQC
	applied and their derivation, etc.		reported
	• Nature of quality control procedures	•	Soil sampling - no additional QAQC. The
	adopted (e.g. standards, blanks,		1/8thinch and the 80# fraction were
	duplicates, external laboratory checks)		compared and recommended the coarse
	and whether acceptable levels of		fraction be used for additional work.
	accuracy (i.e. lack of bias) and precision
	have been established.

Verification	• The verification of significant intersections	•	Drill Intersections are based on the
of sampling and assaying	by either independent or alternative company personnel. • The use of twinned holes.		Laboratory assay results and the company recorded drilling and sampling data.
	• Documentation of primary data, data entry	•	No external checks were recorded
	procedures, data verification, data storage	•	No Twinned holes completed.
	(physical and electronic) protocols.
	• Discuss any adjustment to assay data.	•	Logging and sample were record on
			standard sample and logging sheets
		•	No adjustment of assays data was done.
Location of	• Accuracy and quality of surveys used to	•	Hand-held GPS will be used to locate the
data points	locate drill holes (collar and down-hole surveys), trenches, mine workings and other locations used in Mineral Resource estimation.	•	drill holes collars. Soil sample location determined by hand- held GPS
	• Specification of the grid system used.	•	The Grid system is GDA94 Z50
	• Quality and adequacy of topographic control.	•	The terrain is flat and topographic control was provided by government topographic
			maps.
Data	• Data spacing for reporting of Exploration	•	The RC drill hole spacing is considered
spacing and distribution	Results. • Whether the data spacing, and distribution is sufficient to establish the degree of		appropriate for the early stage nature of the drilling and the size of the target tested.
	geological and grade continuity	•	The drill spacing is not sufficient to
	appropriate for the Mineral Resource and		establish either grade or continuity of
	Ore Reserve estimation procedure(s) and		mineralization.
	classifications applied.	•	No data compositing has been applied.
	• Whether sample compositing has been applied.	•	Soil sampling spacing was km lines and 50 m sample spacing.
Orientation	• Whether the orientation of sampling	•	The first 3 RC drillholes were considered
of data in relation to geological structure	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		to be down dip with respect to the mineralization. The remaining 3 holes were drilled at -60 degrees in the opposite direction at an appropriate angle to the mineralization.
	mineralised structures is considered to	•	The first 3 RC holes are not considered to
	have introduced a sampling bias, this		represent the mineralization being tested.
	should be assessed and reported if material.	•	Soil sample line were approximately 90 degrees to the regional strike.
Sample	• The measures taken to ensure sample	•	Drilling – not recorded
security	security.	•	Soil samples - not recorded
Audits or	• The results of any audits or reviews of	•	No audits or reviews completed.
reviews	sampling techniques and data.

Section 2 Reporting of Exploration Results

(Criteria listed in the preceding section also apply to this section.)

Criteria	JORC Code explanation	Commentary	Commentary
Mineral	• Type, reference name/number, location	•	No National Parks.
tenement and land tenure status	and ownership including agreements or material issues with third parties such as joint ventures, partnerships, overriding royalties, native title interests, historical	•	Crown Land-former pastoral lease. Considered for Conservation at a future date – File Notation Area 9774.
	sites, wilderness or national park and	•	Mt Murray: E80/3230, E80/2978,
	environmental settings.		M80/139 all granted and held by North
	• The security of the tenure held at the time		West Stone Pty Ltd.
	of reporting along with any known	•	Native Title:
	impediments to obtaining a licence to operate in the area.	Determination Decision Exists (WCD2008/003) Buurabalayji Thalanyji
		Aboriginal Corporation.
		Macedon ILUA (WI2010/023) Yamatji
		Marlpa Aboriginal Corporation.
		•	Other than approximately $2,600 in
			shire rates (payable by Santa Fe
			immediately, the tenements are in good
			standing.
		•	Miscellaneous licence L 08/133
			encroaches on E80/3230 and M80/139.
Exploration	• Acknowledgment and appraisal of	•	Northern Gold NL 1988: E08/267
done by other parties	exploration by other parties.		Parry Range Work to December 1988. WAMEX report A028686
		•	Contact Resources Ltd 2006 Annual
			Report for the period 1/7/2005 to
			30/06/2006, E08/1183, Parry Range -
			WAMEX report A073007.
		•	Contact Uranium Ltd 2007 Annual
			Report 17/06/2006 to 16/06/2007
			WAMEX report A077473
		•	North West Stone Pty Ltd 2016 Annual
			Report Nanutarra Marble Project
			E08/2576, M08/139
		•	BLR Exploration Pty Ltd 2010:
			Assessment of E08/1865, Mt Murray,
			Ashburton Mineral Field, Western
			Australia by S.S Morete. WAMEX
			report A088615
Geology	• Deposit type, geological setting and style	•	Shear hosted and quartz stock work or
	of mineralisation.		VMS Cu-Ag-Pb-Ag mineralization
		•	Magmatic Ni-Cu-PGE sulphide
			mineralisation

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.	•RC drill hole locations are tabulated below	•RC drill hole locations are tabulated below	•RC drill hole locations are tabulated below	•RC drill hole locations are tabulated below	•RC drill hole locations are tabulated below	•RC drill hole locations are tabulated below	•RC drill hole locations are tabulated below
	Hole ID	North	East	Depth	Dip	Az	Date
	PRC5	7525162	350223	55	-60	259	17-Feb-06
	PRC6	7525167	351242	115	-60	259	19-Feb-06
	PRC7	7525162	350259	158	-60	259	19-Feb-06
	PRC23	7525190	350189	65	-60	79	19-Feb-06
	PRC24	7525178	350158	120	-60	79	20-Feb-06
	PRC25	7525175	350141	155	-60	79	21-Feb-06
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 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.	•No aggregated intersections are reported.
Relationship between mineralisati on 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 (e.g. down hole length, true width not known’).	•No significant mineralization reported.
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.	•Appropriate diagrams summarizing key data interpretations included in the body of this announcement.

Balanced	•	Where comprehensive reporting of all	•The interpretations expressed in the
reporting		Exploration Results is not practicable, representative reporting of both low and	announcement are not considered to be overstated or misleading.
		high grades and/or widths should be
		practiced to avoid misleading reporting of
		Exploration Results.
Other	•	Other exploration data, if meaningful and	•All relevant data has been included
substantive		material, should be reported including (but	within the report.
exploration data		not limited to): geological observations; geophysical survey results; geochemical survey results; bulk samples – size and	•Aeromagnetic survey data sourced from GSWA statewide data sets
		method of treatment; metallurgical test
		results; bulk density, groundwater,
		geotechnical and rock characteristics;
		potential deleterious or contaminating
		substances.
Further	•	The nature and scale of planned further	•A range of techniques will be
work		work (e.g. tests for lateral extensions or	considered to progress exploration
		depth extensions or large-scale step-out	including drilling.
		drilling).	•Refer to figures in the body of this
	•	Diagrams clearly highlighting the areas of	announcement.
		possible extensions, including the main
		geological interpretations and future
		drilling areas, provided this information is
		not commercially sensitive.