SKY METALS LIMITED — Interim / Quarterly Report 2021

Jul 26, 2021

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ASX: SKY

Quarterly activities report to 30 June 2021

HIGHLIGHTS

CULLARIN: GOLD-LEAD-ZINC-COPPER

• Twelve diamond drillholes completed for a total of 3698m at three targets.

• Hume Target: Diamond drill hole HUD031 intercepted broad, massive sulphide mineralisation – Assays Pending.

IRON DUKE: COPPER-GOLD

• Maiden RC and Diamond drilling significantly extended copper-gold mineralisation at the Iron Duke Target, results include:

IDRC006: 5m @ 1.11 % Copper & 1.19 g/t Gold from 104m, and IDRC008: 5m @ 0.55 % Copper & 0.31 g/t Gold from 232m

• Second phase of diamond drilling to commence next quarter.

• Previously undrilled historic Christmas Gift Copper Mines to be drill tested by SKY.

GALWADGERE: COPPER-GOLD

• SKY has completed the acquisition 100% of the Galwadgere Copper-Gold Project in NSW from Alkane Resources.

• Maiden JORC-2012 Inferred Resource of . 3.6Mt at 0.82% Copper and 0.27g/t Gold

• Soil sampling has identified multiple Copper-Gold targets along strike and within 3km of the Galwadgere Resource.

The Board of Sky Metals Limited (‘SKY’ or ‘The Company’) is pleased to provide a Quarterly Activities Report outlining SKY’s aggressive advance of its high-quality gold, copper-gold and copper-tin projects in NSW. Work this quarter has focussed on the Iron Duke, Cullarin and Galwadgere Projects. SKY’s aggressive exploration program has continued into the September quarter with SKY continuing its multi drill rig program across five projects, per below:

1 Sky Metals Limited ǀ ABN 46 098 952 035 ǀ 207 Byng Street, Orange NSW 2800

September 2021 Quarter – Proposed work Program

• Diamond drilling at the Hume Target, Cullarin Gold-Lead-Zinc-Copper Project

• RC and Diamond drilling of Iron Duke Copper-Gold Project

• RC and Diamond drilling of Doradilla Copper-Tin-Indium-Silver Project

• Aircore drilling of Caledonian Gold Target

• EM surveys at Iron Duke, Cullarin, Doradilla & Galwadgere

CULLARIN PROJECT: GOLD-LEAD-ZINC-COPPER (EL 7954, SKY 80%; HRR JV)

Hume Target – Diamond Drilling

In the March 2021 quarter, a series of three drill holes were completed at the Hume Target to establish extensions to the highgrade gold mineralisation delineated in previous programs. Results for this drilling were received in the June 2021 quarter. The first of these holes, HUD023, was drilled to test the continuity of the Hume structure between HUD013 and HUD014 . The Hume structure was intersected as strong lead-zinc mineralisation as per below:

HUD023 : 9m @ 0.57g/t Au, 0.31% Cu, 4.55% Pb+Zn from 136m, and; 4m @ 0.29g/t Au & 5.35% Pb+Zn from 193m, and; 6m @ 0.11g/t Au & 6.36% Pb+Zn from 209m

HUD024 and HUD025 were both drilled as step-out holes along strike on the Hume structure to extend the mineralisation to the northwest. These holes intercepted broad intervals of strong lead and zinc mineralisation, however, did not intercept the strong high-grade gold previously intercepted on the Hume structure. This has led to an interpreted plunge and folding of the high-grade gold mineralisation on the Hume structure. Significant intercepts for these holes are listed below and in Table 2 :

HUD024: 3m @ 4.65% Pb+Zn from 289m

HUD025 : 4m @ 0.12g/t Au, 0.11% Cu, 4.17% Pb+Zn from 61m, and; 3m @ 0.15% Cu & 4.77% Pb+Zn from 331m

In addition to testing the Hume structure for along strike extensions, further diamond drilling at the Hume Target recommenced in late-June to follow up the strong gold, lead, zinc and copper results intercepted in the previous drilling by SKY. HUD030 was drilled to extend the strong base metal intercept from HUD005 drilled in May 2020 (SKY:ASX Announcement 22[nd] June 2020, Figure 1 and Figure 5 ):

HUD005: 6m @ 1.28% Cu, 6.61% Zn, 5.83% Pb, 26g/t Ag & 0.09g/t Au from 273m

HUD030 intercept several zones of strong chalcopyrite (copper sulphide), sphalerite and galena mineralisation, Figure 1 shows a cross section of this hole and Figure 2 shows drill core from one of these mineralised intervals at approximately 225m which is roughly 60m vertically above the copper-lead-zinc massive sulphide mineralisation intercepted in HUD005 .

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Figure 1 : Schematic Cross Section of HUD005 and HUD030.

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Figure 2: Massive zinc, lead and copper sulphide with quartz-sericite banding at approximately 225m downhole in HUD0030 – Assay Pending .

HUD031 was drilled on section and below the high-grade gold, lead and zinc mineralisation intercepted in HUD013 and HUD020 to test for extensions of this high-grade zone at depth. HUD031 intercepted broad zones of pyrite mineralisation with lesser sphalerite, galena and chalcopyrite (zinc, lead and copper sulphide, respectively) and intervals of massive sulphide from approximately 395m-450m ( Figure 4 ). This may indicate that the high-grade zone intercepted in HUD013 and HUD020 widens at depth. Figure 3 shows a cross section of these drillholes with the interval of visual sulphide mineralisation in HUD031 indicated.

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Figure 3 – Hume Target – Cross section of hole HUD004, HUD013, HUD020 and HUD031.

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Figure 4 – Hume Target – Massive sulphides and quartz in HUD031 from 444.5m-451.0m within broader sulphide-rich interval from approximately 396m-451m – Assay Pending.

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Figure 5 – Cullarin Gold-Lead-Zinc-Copper Project - Hume Target – Drillhole Locations

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Figure 6 - Hume Target – Long Section (schematic). Significant Intersections

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Hole ID Easting Northing RL (m) Dip Azimuth (MGA) Total Depth (m) Comments
(MGA) (MGA)
HUD023 724869 6144673 722 -60 235 271.4 Completed
HUD024 724880 6144870 721 -53 242 321.5 Completed
HUD025 724888 6144875 721 -65 243 405.7 Completed
HUD030 725115 6144960 727 -60 235 303.6 Completed; Assays Pending
HUD031 725020 6144780 716 -60 245.5 515.6 Completed; Assays Pending
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Table 1 – Cullarin Gold-Lead-Zinc-Copper Project, Hume Target. Collar summary for drill holes – June 2021 quarter

Hume Target – Au > 0.2g/t, Cu > 0.1%, Pb/Zn > 2%

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From To Interval Au Cu Pb Zn Ag Comment
Hole ID
(m) (m) (m) g/t % % % g/t
HUD023 136 145 9 0.57 0.31 1.39 3.17 -
193 197 4 0.29 - 1.42 3.94 -
209 215 6 0.11 - 1.86 4.5 -
HUD024 289 292 3 - - 1.17 3.48 -
HUD025 61 65 4 0.12 0.11 1.16 3.01 -
331 334 3 - 0.15 0.89 3.88 -
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Table 2: Cullarin Gold-Lead-Zinc-Copper Project, Hume Target. Significant drillhole intersections – June 2021 quarter

MURRAYS TARGET – DIAMOND DRILLING

A diamond drilling program has been completed at the Murray’s Target (previously Breadalbane Iron Mine/B1) where historic drilling resampled by SKY at the NSW Mines Department core library and soil sampling has highlighted a Copper-Gold target (SKY ASX announcement 26[th] October 2020).

SKY has drilled three diamond holes at Murray’s, MUD001, MUD002 and MUD003 . MUD001 and MUD002 intercepted moderate-minor sulphide stringer mineralisation and alteration. MUD003 intercepted encouraging mineralisation associated with magnetitechlorite alteration and these results are encouraging for follow up work to be completed to drill the main target zone which remains untested. Due to steep terrain, locations suitable for further drilling will require earthwork to build suitable pads drill pads to target high-grade copper-gold mineralisation. Results from this program include:

MUD003: 10m @ 0.21% Cu from 111m

Hole ID Easting (MGA) Northing (MGA) RL (m) Dip Azimuth (MGA) Total Depth (m) Comments	Hole ID Easting (MGA) Northing (MGA) RL (m) Dip Azimuth (MGA) Total Depth (m) Comments	Hole ID Easting (MGA) Northing (MGA) RL (m) Dip Azimuth (MGA) Total Depth (m) Comments	Hole ID Easting (MGA) Northing (MGA) RL (m) Dip Azimuth (MGA) Total Depth (m) Comments	Hole ID Easting (MGA) Northing (MGA) RL (m) Dip Azimuth (MGA) Total Depth (m) Comments	Hole ID Easting (MGA) Northing (MGA) RL (m) Dip Azimuth (MGA) Total Depth (m) Comments	Hole ID Easting (MGA) Northing (MGA) RL (m) Dip Azimuth (MGA) Total Depth (m) Comments	Hole ID Easting (MGA) Northing (MGA) RL (m) Dip Azimuth (MGA) Total Depth (m) Comments
MUD001 723920 6147380 740 -60 260 290.9 Completed
MUD002 723930 6147485 735 -60 260 307.8 Completed
MUD003	723865	6147645	732	-69	260	250.1	Completed

Table 3 – Cullarin Gold-Lead-Zinc-Copper Project, Murrays Target. Collar summary for drill holes – June 2021 quarter

	From To Interval Au Cu Comment	From To Interval Au Cu Comment	From To Interval Au Cu Comment	From To Interval Au Cu Comment	From To Interval Au Cu Comment	From To Interval Au Cu Comment
Hole ID	(m) (m) (m) g/t %
MUD001	279 280 1 0.11 0.44
MUD003	92 93 1 0.25 -
	111	121	10	-	0.21

Table 4: Cullarin Gold-Lead-Zinc-Copper Project, Murrays Target. Significant drillhole intersections – June 2021 quarter

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HUME WEST Target - DIAMOND DRILLING

Previous drilling on the southern strike extent of the Hume Target intercepted an increase in gold grades seen in HUD008 (SKY ASX announcement 24[th] July 2020):

HUD008: 6.7m @ 2.46g/t Au from 75.7

This was followed up with a soil sampling program to the southwest of HUD008 which identified a coherent multielement anomaly striking south-southwest to the west of HUD008 for over 400m. Four diamond holes were drilled, HUD026-29 , to test the down dip and along strike continuation of the mineralisation intercepted in HUD008 and the multielement soil anomaly.

HUD026 was drilled down dip and underneath HUD008 and intercepted strongly silicified alteration and mottled quartz with pyrite, sphalerite, galena and trace chalcopyrite from approximately 200m-220m before intercepting the footwall chlorite schist at approximately 250m. HUD027 was drilled due west of HUD026 to cover the width of the soil anomaly. HUD027 encountered intensely fractured ground throughout the hole and intercepted only minor mineralisation.

HUD028 was drilled 150m to the south of HUD026 and HUD027 into the centre of the soil anomaly. HUD028 also drilled intensely fractured ground with minor quartz veining with associated pyrite and trace sphalerite and galena from 180-194m. A carbonaterich/limestone unit was intercepted below this unit from 194m-229m and minor quartz veinlets with pyrite sphalerite, galena and trace chalcopyrite where logged . HUD029 was the final hole drilled and tested the southern end of the soil anomaly and also intercepted the carbonate-rich/limestone unit from approximately 80m with minor quartz veinlets with pyrite sphalerite, galena and trace chalcopyrite as in HUD028 . Significant intercepts from these holes are listed below and show encouraging signs of a southern repetition of the mineralisation delineated at the Hume Target. Results include:

HUD026: 5m @ 0.44g/t Au, 0.16% Cu, 1.05% Pb & 1.95% Zn from 230m HUD027: 2m @ 0.4% Cu, 1.44% Pb & 0.5% Zn from 249.5m HUD029 : 9m @ 0.37g/t Au from 160m

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Hole ID Easting Northing RL (m) Dip Azimuth (MGA) Total Depth (m) Comments
(MGA) (MGA)
HUD026 724517 6144310 727 -60 110 258.6 Completed
HUD027 724406 6144316 727 -60 110 280.4 Completed
HUD028 724443 6144147 730 -60 110 288.3 Completed
HUD029 724489 6143988 716 -60 110 204.5 Completed
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Table 5 – Cullarin Gold-Lead-Zinc-Copper Project, Hume West Target. Collar summary for drill holes – June 2021 quarter

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From To Interval Au Cu Pb Zn Ag Comment
Hole ID
(m) (m) (m) g/t % % % g/t
HUD026 226 235 9 0.30 0.10 0.71 1.48 6.13
including 230 235 5 0.44 0.16 1.05 1.95 7.75
HUD027 249.5 251.5 2 0.04 0.41 1.44 0.50 12.5
HUD028 217 218 1 0.06 0.05 0.52 1.31 5.46
HUD029 160 169 9 0.37 - - - -
and 200 201 1 0.51 0.10 0.07 0.22 10.3
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Table 6: Cullarin Gold-Lead-Zinc-Copper Project, Hume West Target. Significant drillhole intersections – June 2021 quarter

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Figure 7 – Cullarin Gold-Lead-Zinc-Copper Project – Hume West - Schematic Cross Section of HUD008 , HUD026 and HUD027

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Figure 8 – Cullarin Gold-Lead-Zinc-Copper Project - Hume Area– Drill targets

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IRON DUKE project: COPPER-GOLD (EL 6064, BALMAIN OPTION; EL 9191, SKY 100%)

Iron Duke Target – RC DRILLING

SKY’s maiden RC drilling program of the high-grade copper-gold mineralisation at Iron Duke intercepted strong copper-gold mineralisation. A total of 9 RC holes (IDRC001-IDRC009) have been drilled for 1,650m to extend the known mineralisation. Strong copper-gold mineralisation was intercepted in IDRC006 and IDRC008. Results include:

IDRC006: 5m @ 1.11 % Cu & 1.19 g/t Au from 104m , and IDRC008: 5m @ 0.55 % Cu and 0.31 g/t Au from 232m

These RC results have substantially extended copper-gold mineralisation at Iron Duke which remains open along strike and down plunge.

IDRC001-IDRC004 were drilled along strike to the north of the Iron Duke mine and intercepted broad zones of disseminated sulphide mineralisation, dominantly pyritic, with minor visible chalcopyrite logged. IDRC005 was abandoned due to excessive hole deviation before reaching target depth.

IDRC006 intercepted strong chalcopyrite (copper sulphide) mineralisation from approximately 104-109m downhole showing a development of intense sulphide vein networks and disseminations in silicious breccia. IDRC008 was drilled 75m north along strike from IDRC007 to test the down dip and strike extent of the mineralisation in IDRC006, representing a large step out of the mineralisation at the Iron Duke target. This hole intercepted encouraging copper-gold mineralisation including semi-massive sulphides (pyrite and chalcopyrite) between 232-237m ( Table 2 and Figure 2 ).

IDRC009 was drilled a further 100m along strike from IDRC008 and intercepted abundant sulphides, however, only minor coppergold mineralisation was present. IDRC007 was drilled to target the down dip extension of the mineralisation, this hole was abandoned due to excessive hole deviation.

Iron Duke Target – Diamond Drilling and DHEM

Diamond drilling of 4 holes for a total of 1174.6m were drilled to follow up the RC drilling at the Iron Duke Target. These were completed in June and were part of SKY’s extension drilling, results include:

IDD001: 9m @ 0.38% Cu & 0.30g/t Au from 175m including; 4m @ 0.56% Cu & 0.47g/t Au from 175m and; 1m @ 0.20% Cu & 4.83g/t Au from 256m

IDD002: 1m @ 2.54% Cu from 189m

Further diamond drilling is planned to validate historic results at the Iron Duke Target and infill the extensions to the high-grade mineralisation identified in the recent drilling completed by SKY (SKY:ASX Announcement 2[nd] June 2021). In addition to this, Downhole Electromagnetics (DHEM) is planned on two of the diamond holes from the first phase of diamond drilling ( IDD003 and IDD004 ). IDD003 and IDD004 were drilled on the southwestern and north-eastern margins of the Iron Duke mineralisation, respectively. As the mineralisation is hosted in massive sulphide and sulphide matrix breccia, this style of mineralisation is well suited to being delineated with DHEM as seen by other explorers in the region, namely Peel Mining Limited at its Wirlong prospect and Aeris Resources Limited at the Constellation prosect (PEX:ASX Announcement 17[th] May 2017, AIS:ASX Announcement 20[th] December 2020).

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Christmas Gift Mines Target – RC Drilling

The Christmas Gift Mines Target includes the historic Christmas Gift, Monarch, Mount Pleasant and Silver Lining copper mines, which lie approximately 2.5km south of Iron Duke and have not previously been drill tested ( Figure 5 ). SKY completed field reconnaissance and collected rock chip samples from the areas around these workings in the March quarter (SKY:ASX Announcement 8[th] April 2021).

Of the 21 rock chip samples collected at the Christmas Gift Mine and Monarch Mine, over half of the samples assayed >1% Copper, including maximum results of 26.1% Cu and 11.0% Cu . Surrounding the old workings were abundant copper carbonates, including malachite and azurite, which demonstrate the potential of high-grade oxide copper mineralisation at the Christmas Gift Mines Target. Drilling approvals have been received and a drill rig secured. Drilling is imminent subject to weather access.

Table 7 – Iron Duke Project, Iron Duke Target. Drillhole collar details.

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Hole ID Easting Northing RL (m) Dip Azimuth (MGA) Total Depth (m) Comments
(MGA) (MGA)
IDRC001 544144 6420531 246 -60 300 90 Completed
IDRC002 544207 6420496 236 -60 300 175 Completed
IDRC003 544100 6420436 240 -55 300 116 Completed
IDRC004 544166 6420402 246 -60 300 199 Completed
IDRC005 544207 6420339 246 -55 300 121 Abandoned due to
excessive deviation
IDRC006 543944 6420019 246 -52 300 181 Completed
IDRC007 543999 6419990 240 -52 300 252 Abandoned due to
excessive deviation
IDRC008 544033 6420051 240 -52 300 270 Completed
IDRC009 544076 6420120 240 -52 300 246 Completed
IDD001 543998 6419991 246 -60 291.3 297.7 Completed
IDD002 544064 6420087 246 -60 301.5 264.5 Completed
IDD003 544007 6419990 246 -60 238 293.8 Completed
IDD004 544201 6420338 246 -60 290 318.6 Completed
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Figure 5 – Iron Duke Project – Schematic of tenement showing the Iron Duke Shear Zone through the centre of the tenement with over 4km of strike between the Christmas Gift Mines to the Iron Duke Mine.

Table 8 – Iron Duke Project, Iron Duke Target. Significant drillhole intersections.

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Hole ID From To Interval Cu Au Co Comment
(m) (m) (m) % g/t %
IDRC006 104 109 5 1.11 1.19 0.07
IDRC008 232 237 5 0.55 0.31 0.08
IDRC009 210 211 1 0.39 0.01 -
IDD001 175 184 9 0.38 0.30 0.06
including 175 179 4 0.56 0.47 0.08
and 256 257 1 0.20 4.83 - narrow high-grade gold
IDD002 189 190 1 2.54 0.04 0.01
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Figure 9 – Iron Duke Copper-Gold Project – Long Section (schematic).

DORADILLA project: COPPER-TIN-SILVER-INDIUM (EL 6258, SKY 100%)

3KEL Target – RC and Diamond Drilling

In late 2019, SKY completed 4 RC holes for a total of 486m to validate and test beneath historic results and produce a multielement assay suite on the skarn mineralisation at Doradilla. The 3KEL Target is at the north-eastern end of the DoradillaMidway-KEL or ‘DMK’ which is a 16km long skarn that has been the focus of extensive exploration for tin and tungsten, particularly during the 1970s and 1980s.

SKY’s 2019 results identified a high-grade copper-tin-indium target at the 3KEL section on the DMK line. Results from the 2019 SKY drilling program included:

3KRC002: 6m @ 1.48% Cu, 1.11% Sn, 44g/t Ag & 65g/t In from 105m and; 3KRC001: 14m @ 0.84% Cu, 1.58% Sn, 0.38% Zn, 74.3g/t In from 39m

SKY has since inspected the historic drill core from the 3KEL target stored at the W B Clarke Geoscience Centre (NSW Core Library at Londonderry NSW). Abundant copper sulphides were observed in many intervals of the drill core inspected, including bornite and chalcopyrite. Due to only quarter core remaining for these intervals, no resampling was able to be completed and, in many holes, only the tin results have been reported. However, the bornite and chalcopyrite observed in these holes were intergrown with magnetite and many of the sections of core containing copper sulphides were found to be strongly magnetic ( Figure 10 and 11 ).

SKY completed a detailed magnetic survey with 40m line spacing over the entire 16km strike of the DMK line in August 2020, with survey processing completed in the June 2021 quarter. This survey was extremely effective at clearly delineating the DMK line, including showing strong magnetic anomalies at the 3KEL Target ( Figure 10 and 11 ). Given the observed association of the copper sulphide mineralisation with magnetite, this magnetic survey has provided SKY with an invaluable tool for targeting additional high-grade copper-tin-silver-indium mineralisation at the 3KEL Target.

A combination of RC and diamond drilling is planned to target these anomalies at 3KEL.

Drill permits have been received, drilling rig secured and drilling is expected to commence within the next fortnight.

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Figure 10 – Above- Plan View of the Doradilla-Midway-KEL (DMK) line magnetics; Bottom - Schematic long section of the DMK line.

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Figure 11 – Schematic oblique long section of the 3KEL Target with Magnetic image shown over long section looking north-northwest, bottom right corner shows core from historic diamond drill holes 3KEL-8 and 3KEL-15 from NSW core library with bornite, chalcopyrite and intergrown magnetite, field of view on pictures is 20mm.

CALEDONIAN PROJECT: GOLD (EL 8920, EL 9120, SKY 100%)

Caledonian Target – AC Drilling

SKY has now completed a soil sampling program, two phases of RC drilling and two diamond drill holes at the Caledonian Target. Results from these programs have delineated shallow high-grade gold mineralisation over a 700m x 500m area, results include:

CARC002: 3m @ 13.6 g/t Au from 14m including, 1m @ 38.4 g/t Au from 15m

CAD001: 2m @ 11.4 g/t Au from 22m including, 1m @ 21.9 g/t Au from 22m CARC011: 5m @ 4.46 g/t Au from 11m including, 2m @ 8.82 g/t Au from 11m

A review of SKY’s and historic results indicates the Caledonian gold mineralisation likely represents a shallow, sub-horizontal blanket of oxide and supergene gold mineralisation developed over an oxidised skarn . SKY considers this a compelling target, that can be readily tested with shallow aircore drilling.

An aircore (AC) drilling program is planned to drill approximately 40 shallow holes on a 100m x 100m grid over the area. This program is expected to commence in the next week with weather permitting.

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Figure 12 – Caledonian Gold Project – Plan view of the planned drilling with previous intercepts.

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Galwadgere PROJECT: Copper-GOLD (EL 6320, SKY 100%)

Galwadgere Target – Maiden JORC-2012 Resource

During the quarter SKY announced the Galwadgere maiden JORC-2012 Inferred Resource of 3.6Mt at 0.82% Cu & 0.27g/t Au prepared by H&S Consultants (H&SC). H&S were engaged by SKY to complete the maiden resource using drilling completed by SKY in 2020 and previous drilling completed by Alkane Resources (ALK) and other past explorers. This data was been compiled into a database and subsequently has been validated with several reviews including inspection and resampling of the historic drill core at the W B Clarke Geoscience Centre (NSW Core Library) in western Sydney.

Table 9 – Galwadgere MRE showing the two cut-offs used, total tonnage, grade and contained metals for each cut-off.

Cut-off	Tonnage (Mt)	Grade	Grade	Contained Metal	Contained Metal
		Cu (%)	Au (g/t)	Cu (kt)	Au (koz)
0.7% Cu	1.9	1.02	0.29	20	18
0.5% Cu	3.6	0.82	0.27	29	31

Saddle and McDowells Target – Soil Sampling

Soil sampling undertaken along strike from the Galwadgere resource has identified two copper-gold, multielement pathfinder soil anomalies. The northern soil sampling program over the McDowell’s mine and line of workings has delineated a 200m x 100m adjacent soil anomaly which is coincident with several historic mine shafts with copper carbonate bearing rocks discovered near these workings ( Figure 14 ). Soil sampling south of the Galwadgere Target has identified another soil anomaly which appears similar in tenor to the anomaly identified at the McDowell’s mine ( Figure 15 ). These anomalies are within 3km of the Galwadgere resource and provide strong support for expanding the copper-gold resource at Galwadgere with along strike exploration. These are priority drill targets to be tested.

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Figure 13 – Galwadgere Copper-Gold Project – Geological map with the locations of the Galwadgere resources and soil anomalies at Saddle and McDowell Targets.

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Figure 14 – McDowell’s Soil Sampling grid with results for Gold and Copper in soils in ppb and ppm, respectively. Geology underlaid with same legend as Figure 13.

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Figure 15 – Saddle Soil Sampling grid with results for Gold and Copper in soils in ppb and ppm, respectively. Geology underlaid with same legend as Figure 13.

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KANGIARA project: GOLD 80% SKY (EL8400, EL8573; HERON JV)

The Kangiara Project (EL8400, EL8573) is located 30km northwest of Yass in the Southern Tablelands of New South Wales ( Figure 8 ). The project contains volcanic/volcaniclastic rocks of the Silurian Douro Group considered prospective for gold and base metal (copper-zinc) mineralisation. The high grade Kangiara Mine operated during the early 1900s, with documented production of ~40,000 tonnes at 16% Pb, 3% Cu, 5% Zn, 280g/t Ag and 2g/t Au from narrow north-south trending sulphide veins (ASX PDM 18 June 2009). Previous work by Paradigm Metals led to the calculation of an Indicated and Inferred Mineral Resource at Kangiara.

Evaluation of the regional potential of the Kangiara Project identified a number of discrete colour anomalies in Sentinel-2 satellite data. These colour anomalies are interpreted to represent areas of outcropping alteration. Field investigation of these areas is planned for the September quarter.

TIRRANA PROJECT: GOLD

100% SKY (EL9048)

As part of a regional review of the Cullarin area for McPhillamys-style gold mineralisation, SKY identified an area on open ground to the south-east of the Cullarin project that satisfied a number of the key McPhillamys criteria. SKY has thus applied for an exploration licence (ELA5968) to cover this highly prospective area ( Figure 8 ).

A detailed desktop review of previous exploration covering Tirrana was completed in the December quarter. This review identified two areas for follow up. This work is planned to be completed in the following quarters.

Tallebung project: Tin 100% SKY (EL6699)

The Tallebung Project is located approximately 70km north-west of Condobolin in central NSW ( Figure 8 ). The project encompasses the historic Tallebung Tin Mining Field at the northern extent of the Wagga Tin Belt within the central Lachlan Orogen and is considered prospective for lode-style tin - tungsten mineralisation. Outcropping mineralisation is developed over two kilometres as sheeted/stockwork quartz-cassiterite-wolframite sulphide veins above a mineralising granite.

A review of the potential of the Tallebung Project to host intrusion related gold (IRG) was completed in the December 2020 quarter. This review identified the potential of the Theirman Tin & Whytes Wolfram Mines to host IRG mineralisation and it was recommended to complete a program of surface sampling (soil and/or lag) to test their gold potential. This work is currently planned for the September 2021 quarter.

NEW ENGLAND project: Tin

100% SKY (Ela 6217 & 6218)

SKY has applied for two exploration licences in the New England Orogen covering areas of significant historical tin production – Emmaville & Gilgai. These areas were selected as they were considered to have considerable potential to host hardrock tin resource and limited modern day exploration has been conducted.

A detailed desktop review of previous exploration covering these areas is proposed for the September quarter.

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24

Corporate

Project :

During the quarter $1,558k was spent on the exploration activities outlined in this report. No mining production and development activities undertaken for the quarter.

During the quarter $32k was paid as Non-Executive Director fees.

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Holder Equity Licence ID Grant Date Expiry Date Units Area Comment
Tarago Exploration Pty Ltd 80% EL7954 19-6-2012 19-6-2022 51 144 km [2] Cullarin Project, SKY
(HRR sub) Heron JV
Ochre Resources Pty Ltd 80% EL8400 20-10-2015 20-10-2024 52 147 km [2] Kangiara Project, SKY
(HRR sub) Heron JV
Ochre Resources Pty Ltd 80% EL8573 23-5-2017 23-5-2023 17 48 km [2] Kangiara Project, SKY
(HRR sub) Heron JV
Aurum Metals Pty Ltd (SKY 100% EL8920 5-12-2019 5-12-2025 65 183 km [2] Caledonian Project
sub)
Aurum Metals Pty Ltd (SKY 100% EL9120 30-3-2021 30-3-2027 50 141 km [2] Caledonian Project –
sub) Murrum granted
Aurum Metals Pty Ltd (SKY 100% EL9048 15-2-2021 15-2-2026 52 147 km [2] Tirrana Project -
sub) granted
Gradient Energy Pty Ltd 100% EL6320 12-10-2004 12-10-2026 14 41 km [2] Galwadgere Project –
(SKY sub) Transferred
ownership from
Alkane Resources Ltd
to Sky Metals Ltd
Balmain Minerals Pty Ltd Option to EL6064 21-3-2003 20-3-2022 5 15 km [2] Iron Duke Project
Purchase
100%
Gradient Energy Pty Ltd 100% EL9191 8-6-2021 8-6-2021 60 174 km [2] Iron Duke Project –
(SKY sub) Albert Granted
Stannum Pty Ltd (SKY sub) 100% EL6258 21-6-2004 21-6-2026 38 110 km [2] Doradilla Project
Stannum Pty Ltd (SKY sub) 100% EL6699 10-1-2007 10-1-2027 14 41 km [2] Tallebung Project
Stannum Pty Ltd (SKY sub) 100% ELA6217 - - 74 221 km [2] Emmaville Project -
Granted
Stannum Pty Ltd (SKY sub) 100% ELA6218 - - 82 244 Gilgai Project –
km [2] Granted
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Table 10: Tenement Summary, changes in the March quarter highlighted

This report has been approved for release by the Board of Directors.

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25

ABOUT SKY (ASX: SKY)

SKY is an ASX listed public company focused on the exploration and development of high value mineral resources in Australia. SKY’s project portfolio offers exposure to the gold, copper, and tin markets in the world class mining jurisdiction of NSW.

GOLD PROJECTS

CULLARIN / KANGIARA projects (EL7954; EL8400 & EL8573, HRR farm-in)

Under the HRR farm-in, SKY has now earned an 80% interest in the projects via the expenditure of $2M prior to the formation of a joint venture (ASX: 9 October 2019). Highlight, ‘McPhillamys-style’ gold results from previous drilling at the Cullarin Project include 148.4m @ 0.97 g/t Au (WL31) including 14.6m @ 5.1 g/t Au from 16.2m, & 142.1m @ 0.89 g/t Au (WL28) including 12m @ 4.4 g/t Au from 25.9m. The Cullarin Project contains equivalent host stratigraphy to the McPhillamys deposit with a similar geochemical, geophysical & alteration signature. SKY’s maiden drill program was very successful including core hole HUD002 which returned 93m @ 4.2 g/t Au from 56m.

CALEDONIAN / TIRRANA PROJECTS ( EL8920, EL9048, EL9120 100% SKY)

Highlight, ‘McPhillamys-style’ gold results from previous exploration include 36m @ 1.2 g/t Au from 0m to EOH in drillhole LM2 and 81m @ 0.87g/t Au in a costean on EL8920 at the Caledonian Project. The distribution of multiple historic drill intersections indicates a potentially large gold zone with discrete high-grade zones, e.g. 6m @ 8g /t Au recorded from lode at historic Caledonian Mines (GSNSW). A strong, robust soil gold anomaly (600 x 100m @ +0.1ppm) occurs and most drillholes (depth ~25m) terminate in the mineralised zone.

COPPER GOLD PROJECTS

GALWADGERE (EL6320, 100% SKY)

The Galwadgere project is located ~15km south-east of Wellington in central NSW. High grade copper-gold mineralisation has been intersected by previous explorers (e.g. 47m @ 0.90% Cu & 1.58g/t Au) and the mineralisation is open along strike and at depth.

IRON DUKE (EL6064, BALMAIN OPTION; EL9191 100% SKY)

The Iron Duke project is located ~10km south-east of Tottenham in central NSW. High grade copper-gold mineralisation has been intersected by previous explorers (e.g. 13m @ 1.56% Cu & 4.48g/t Au) and the mineralisation is open down dip to and to the south.

TIN PROJECTS

Tallebung Project (EL6699, 100% SKY)

The Tallebung Project is located ~70km north-west of Condobolin in central NSW. The project encompasses the historic Tallebung Tin Mining Field at the northern extent of the Wagga Tin Belt within the central Lachlan Orogen and is considered prospective for lode and porphyrystyle tin - tungsten mineralisation.

Doradilla Project (EL6258, 100% SKY)

The Doradilla Project is located ~ 30km south of Bourke in north-western NSW and represents a large and strategic tin project with excellent potential for associated polymetallic mineralisation (tin, tungsten, copper, bismuth, indium, nickel, cobalt, gold).

NEW ENGLAND project (Ela 6217 & 6218, 100% SKY)

SKY has been granted two exploration licences in the New England Orogen covering areas of significant historical tin production – Emmaville & Gilgai. These areas were selected as they were considered to have considerable potential to host hardrock tin resource and limited modern day exploration has been conducted.

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Figure 16: SKY Location Map

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26

Competent Persons Statement

The information in this report that relates to Exploration Results is based on information compiled by Rimas Kairaitis, who is a Member of the Australasian Institute of Mining and Metallurgy. Rimas Kairaitis is a Director of Sky Metals Ltd and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking 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 Kairaitis consents to the inclusion in this report of the matters based on his information in the form and context in which it appears.

Previously Reported Information

The information in this report that references previously reported exploration results is extracted from the Company’s ASX market announcements released on the date noted in the body of the text where that reference appears. The previous market announcements are available to view on the Company's website or on the ASX website (www. asx.com.au). The Company confirms that it is not aware of any new information or data that materially affects the information included in the original market announcements. The Company confirms that the form and context in which the Competent Person’s findings are presented have not been materially modified from the original market announcements.

SKY ASX releases released during the June 2021 Quarter or referenced in the announcement are listed below:

19 July 2021 – SKY ASX Announcement ‘SKY Continues Active Exploration Work Program’

7 July 2021 – SKY ASX Announcement ‘Galwadgere Acquisition Complete & Maiden JORC Resource’

2 June 2021 – SKY ASX Announcement ‘Iron Duke Exploration Update’

14 May 2021 – SKY ASX Announcement ‘Exploration Update’

Disclaimer

This report contains certain forward-looking statements and forecasts, including possible or assumed reserves and resources, production levels and rates, costs, prices, future performance or potential growth of Sky Metals Ltd, industry growth or other trend projections. Such statements are not a guarantee of future performance and involve unknown risks and uncertainties, as well as other factors which are beyond the control of Sky Metals Ltd. Actual results and developments may differ materially from those expressed or implied by these forward-looking statements depending on a variety of factors. Nothing in this report should be construed as either an offer to sell or a solicitation of an offer to buy or sell securities.

This document has been prepared in accordance with the requirements of Australian securities laws, which may differ from the requirements of United States and other country securities laws. Unless otherwise indicated, all ore reserve and mineral resource estimates included or incorporated by reference in this document have been, and will be, prepared in accordance with the JORC classification system of the Australasian Institute of Mining, and Metallurgy and Australian Institute of Geoscientists.

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27

JORC CODE, 2012 - TABLE 1

Section 1 Sampling Techniques and Data – CULLARIN, IRON DUKE, DORADILLA, GALWADGERE and CALEDONIAN PROJECTS (Criteria in this section apply to all succeeding sections)

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Criteria Explanation Commentary
Sampling techniques  Nature and quality of sampling (e.g. cut channels, random chips, or specific specialised industry Drill core sampling is by sawn half core PQ & HQ core. Nominal sample intervals are 1m with a range
standard measurement tools appropriate to the minerals under investigation, such as downhole from 0.3m to 2.0m.
gamma sondes, or handheld XRF instruments, etc). These examples should not be taken as
limiting the broad meaning of sampling.
All samples were submitted to ALS Orange for preparation and assaying.
 Include reference to measures taken to ensure sample representivity and the appropriate Assay standards or blanks are inserted at least every 30 samples for diamond drill core. All sample
calibration of any measurement tools or systems used. weights show consistency with core recovery and interval length.
 Aspects of the determination of mineralisation that are Material to the Public Report. In cases Each sample was dried, crushed and pulverised as per standard industry practice.
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 which 3 kg was pulverised to produce a
Diamond drilling - core samples were taken at nominally 1m, but with a range between 0.5-1.5m. Core
30 g charge for fire assay’). In other cases, more explanation may be required, such as where samples are cut in half, dried, crushed and pulverised to 90% passing 75 microns.
there is coarse gold that has inherent sampling problems. Unusual commodities or
mineralisation types (e.g. submarine nodules) may warrant disclosure of detailed information.
The primary metal of interest, Gold (Au) was determined by 50g fire assay (method Au-AA26) with a
detection limit 0.01ppm. Multielement assaying was completed for 48 elements by 0.25g four-acid
digest with ICPMS determination (method ME-ICP61).
Drilling techniques  Drill type (e.g. core, reverse circulation, open-hole hammer, rotary air blast, auger, Bangka, Diamond Drilling completed using PQ core until fresh rock is reached then HQ coring.
sonic, etc) and details (e.g. core diameter, triple or standard tube, depth of diamond tails, face- Core orientation was completed where possible.
sampling bit or other type, whether core is oriented and if so, by what method, etc)
Drill sample recovery  Method of recording and assessing core and chip sample recoveries and results assessed Diamond drill core recovery recorded against intervals drilled as part of geotechnical logging to
determine recovery. Recoveries are generally greater than 95% once in fresh rock.
 Measures taken to maximise sample recovery and ensure representative nature of the samples. Diamond drilling utilising triple tube drilling and short drilling runs employed to maximise core recovery.
 Whether a relationship exists between sample recovery and grade and whether sample bias may There is no known relationship between sample recovery and grade. Where samples recoveries are less
have occurred due to preferential loss/gain of fine/coarse material than 95% there is no relationship observed between grade and sample recovery. Relationships between
sample recovery and grade are not considered significant where recoveries exceeded 95% in fresh rock.
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Criteria Explanation Commentary
Logging  Whether core and chip samples have been geologically and geotechnically logged to a level of Systematic geological and geotechnical logging was undertaken by SKY when the holes were drilled.
detail to support appropriate Mineral Resource estimation, mining studies and metallurgical Data collected includes:
studies  Nature and extent of lithologies.
 Relationship between lithologies.
 Amount and mode of occurrence of ore minerals.
 Location, extent, and nature of structures such as bedding, cleavage, veins, faults etc.
Structural data (alpha & beta) are recorded for orientated core.
 Geotechnical data such as recovery, RQD, fracture frequency, qualitative IRS, microfractures,
veinlets and number of defect sets. For some geotechnical holes the orientation, nature of
defects and defect fill are recorded.
 Whether logging is qualitative or quantitative in nature. Core (or costean, channel, etc) Both qualitative and quantitative data is collected.
photography Half core (HQ) & ¾ core (PQ) samples are retained in trays for future reference.
 The total length and percentage of the relevant intersections logged All core was geologically and geotechnically logged.
Sub-sampling techniques  If core, whether cut or sawn and whether quarter, half or all core taken Diamond drilling - core was sawn with half core (HQ) or quarter core (PQ) submitted for assay. Sampling
and sample preparation was consistently on one side of the orientation line so that the same part of the core is sent for assay.
 If non-core, whether riffled, tube sampled, rotary split, etc and whether sampled wet or dry Not Applicable.
 For all sample types, the nature, quality and appropriateness of the sample preparation Core samples were dried crushed and pulverised to 90% passing 75 microns. This is considered to
technique appropriately homogenise the sample to allow subsampling for the various assay techniques.
 Quality control procedures adopted for all sub-sampling stages to maximise representivity of Certified Reference Material (CRM) and blanks were inserted at least every 30 samples to assess the
samples accuracy and reproducibility of the drill core results. The results of the standards were to be within ±10%
variance from known certified result. If greater than 10% variance the standard and up to 10 samples
each side were re-assayed. ALS conducted internal check samples every 20 samples for Au and every 20
for multielement assay.
 Measures taken to ensure that the sampling is representative of the in-situ material collected, No field duplicates are taken for core samples. Core samples were cut in ½ for HQ and ¼ for PQ generally
including for instance results for field duplicate/second-half sampling. in down hole intervals of 1m, however, intervals can range from 0.3-2.0m. This is considered
representative of the in-situ material. The sample was crushed and pulverised to 90% passing 75
microns. This was considered to appropriately homogenise the sample.
 Whether sample sizes are appropriate to the grain size of the material being sampled Sample sizes are industry standard and considered appropriate
Quality of assay data  The nature, quality and appropriateness of the assaying and laboratory procedures used and Standard assay procedures performed by a reputable assay lab, (ALS Group), were undertaken. Gold
and laboratory tests whether the technique is considered partial or total (Au) was determined by 50g fire assay (method Au-AA26) with a detection limit 0.01ppm for drill core.
Multielement assaying for drill core samples was completed for 48 elements by 30g four-acid total
digest with ICPMS determination (method ME-ICP61).
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Criteria Explanation Commentary
 For geophysical tools, spectrometers, handheld XRF instruments, etc, the parameters used in Not applicable as no geophysical tools were used in the determination of assay results.
determining the analysis including instrument make and model, reading times, calibrations
factors applied and their derivation, etc
 Nature of quality control procedures adopted (e.g. standards, blanks, duplicates, external Certified reference material or blanks were inserted at least every 30 samples. Standards are purchased
laboratory checks) and whether acceptable levels of accuracy (i.e. lack of bias) and precision from Certified Reference Material manufacture companies: Standards were purchased in foil lined
have been established packets of between 60g and 100g. Different reference materials were used to cover high grade, medium
grade, low grade, and trace ranges of elements, with a primary focus on gold.
Verification of sampling  The verification of significant intersections by either independent or alternative company Drill data is compiled and collated and reviewed by senior staff. External consultants do not routinely
and assaying personnel. verify exploration data until resource estimation procedures are deemed necessary. The intersection
calculations were viewed by >1 geological personnel.
 The use of twinned holes. Twinned holes have not been used in the drilling.
 Documentation of primary data, data entry procedures, data verification, data storage (physical Drill Hole Data including: meta data, any gear left in the drill hole, lithological, mineral, survey, sampling,
and electronic) protocols. magnetic susceptibility was collected and stored as physical and electronic copies or entered directly
into an excel spread sheet using drop down codes. When complete the spreadsheet was combined into
a master excel spreadsheet as the drill hole database.
Assay data was provided by ALS via .csv spreadsheets. The data was validated using the results received
from the known certified reference material. Hard copies of the assay certificates were stored with drill
hole data such as drillers plods, invoices, and hole planning documents.
 Discuss any adjustment to assay data Assay data is not adjusted.
Location of data points  Accuracy and quality of surveys used to locate drill holes (collar and down-hole surveys), Historic drill hole collars were located using either a licenced surveyor or on a local imperial or metric
trenches, mine workings and other locations used in Mineral Resource estimation. grid. Conversion of the local grid co-ordinates has been undertaken by previous exploration companies.
SKY has used handheld GPS to locate drillholes at this stage (accuracy ± 2m). DGPS surveying of
drillholes (± 0.1m) will be undertaken.
 Specification of the grid system used All coordinates are based on Map Grid Australia Zone 55E, Geodetic Datum of Australia 1994.
 Quality and adequacy of topographic control Historic drill hole collars were located using either a licenced surveyor or on a local imperial or metric
grid. SKY has used handheld GPS to locate drillholes at this stage (accuracy ± 2m). DGPS surveying of
drillholes (± 0.1m) will be undertaken.
Data spacing and  Data spacing for reporting of Exploration Results At this early exploration stage, the data spacing is variable as the focus is on geological mapping and
distribution identifying new zones of mineralisation.
 Data spacing for reporting of Exploration Results Whether the data spacing, and distribution is Not Applicable as no resource estimate has been completed
sufficient to establish the degree of geological and grade continuity appropriate for the Mineral
Resource and Ore Reserve estimation procedure(s) and classifications applied
 Whether sample compositing has been applied Sample compositing is not applied.
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Criteria Explanation Commentary
Orientation of data in  Whether the orientation of sampling achieves unbiased sampling of possible structures and the Drilling was orientated to cross the mineralisation trend at moderate to high angles. The use of
relation to geological extent to which this is known, considering the deposit type orientated core allows estimates of the true width and orientation of the mineralisation to be made.
structure
 If the relationship between the drilling orientation and the orientation of key mineralised No sample bias due to drilling orientation is known. However, the potential for bias is being investigated
structures is considered to have introduced sampling bias, this should be assessed and reported by the current drilling campaign
if material
Sample security  The measures taken to ensure sample security Sample chain of custody has been managed by the employees of Sky Metals who commissioned the
drilling from the drilling rig to assay laboratory.
All samples are bagged in tied numbered calico bags, grouped into larger tied polyweave bags, or placed
in a stillage box and transported to ALS in Orange by SKY personnel. All sample submissions are
documented via ALS tracking system and all assays are reported via email.
Sample pulps are returned to site and stored for an appropriate length of time (minimum 3 years). The
Company has in place protocols to ensure data security.
Audits or reviews  The results of any audits or reviews of sampling techniques and data The Company does not routinely have external consultants verify exploration data until resource
estimation procedures are deemed necessary.
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Section 2 Reporting of Exploration Results – CULLARIN, IRON DUKE, DORADILLA, GALWADGERE and CALEDONIAN PROJECTS (Criteria listed in the preceding section also apply to this section)

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Criteria Explanation Commentary
Mineral tenement and  Type, reference name/number, location and ownership including agreements or material issues The Cullarin Project is described by NSW Exploration Licence 7954.
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Criteria Explanation Commentary	Criteria Explanation Commentary	Criteria Explanation Commentary
Mineral tenement and	 Type, reference name/number, location and ownership including agreements or material issues	The Cullarin Project is described by NSW Exploration Licence 7954.
land tenure status	with third parties such as joint ventures, partnerships, overriding royalties, native title interests, historical sites, wilderness or national park and environmental settings.	The tenement is 80% owned by SKY Metals Ltd with 20% owned by Tarago Exploration Pty Ltd, a 100% owned subsidiary of Heron Resources Ltd. This licence is one of three under the HRR-SKY JV. See SKY ASX announcement 9 October 2019 for more details. The Iron Duke project is described by EL6064 and EL 9191. EL 66064 is subject to an Option to Purchase Agreement whereby Sky Metals Ltd may purchase the tenement from Balmain Minerals Pty Ltd (Balmain). See SKY ASX announcement 11thJune 2020 for more details. EL 9191 is owned 100% by Gradient Energy, a 100% owned subsidiary of Sky Metals Ltd. The Doradilla Project is described by NSW Exploration Licence 6258. The tenement is 100% owned by Stannum Pty Ltd which is a 100% owned subsidiary of Big Sky Metals Pty Ltd and Sky Metals Ltd. The Galwadgere Project is described by NSW Exploration Licence 6320. EL6320 is 100% owned by Gradient Energy Pty Ltd which is a 100% owned subsidiary of Sky Metals Ltd. The Caledonian Project is described byNSW Exploration Licence 8920 and 9120.

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Criteria Explanation Commentary
The tenements are 100% owned by Aurum Metals Pty Ltd which is a 100% owned subsidiary of Sky
Metals Ltd.
 The security of the tenure held at the time of reporting along with any known impediments to All exploration licences are in good standing.
obtaining a licence to operate in the area EL 7954 expires on 19 June 2022.
EL 6064 expires on 21 March 2022.
EL 9191 expires on 8 June 2027.
EL 6258 expires on 21 June 2026.
EL 8920 expires on 5 December 2025.
EL 9120 expires on 30 March 2027.
EL6320 expires on 12 October 2026.
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	Criteria Explanation Commentary	Criteria Explanation Commentary	Criteria Explanation Commentary
	The tenements are 100% owned by Aurum Metals Pty Ltd which is a 100% owned subsidiary of Sky Metals Ltd.  The security of the tenure held at the time of reporting along with any known impediments to obtaining a licence to operate in the area All exploration licences are in good standing. EL 7954 expires on 19 June 2022. EL 6064 expires on 21 March 2022. EL 9191 expires on 8 June 2027. EL 6258 expires on 21 June 2026. EL 8920 expires on 5 December 2025. EL 9120 expires on 30 March 2027. EL6320 expires on 12 October 2026.
	Exploration done by other parties	 Acknowledgment and appraisal of exploration by other parties	Cullarin: Significant exploration was carried out initially interested in base metals and shifting to gold in the 1980s with the Hume prospect identified as a Au-rich VMS system with similarities to the Henty Mine in western Tasmania. Shallow diamond drilling at the Hume prospect identified broad low-grade Au mineralisation including high grade zones suitable for underground mining before the 1990s. From the 1990s a period of exploration for largely intrusion-related deposit styles commenced and included the re- assay of historic drill core and collation of previous exploration data. Iron Duke: Significant exploration focused on Iron Duke mine site was completed in the period from 1967 to 1971. AOG 1969-1971 drilled 4 short diamond drill holes 3 of which were either abandoned or did not test the target lode. IMC in 1971 drilled 3 diamond drill holes and Reef Oil completed 4 diamond drill holes in 1971. Exploration was primarily focused on copper. More recent exploration was carried out by Triako between 2004 and 2011, completing 17 RC holes for a total of 1,137m, testing the shallow oxide zone above the old workings at the Iron Duke mine site. KBL undertook exploration at the Iron Duke target between 2011-2012 completing 11 RC holes for a total of 782m. KBL produced a resource estimate for Iron Duke in 2012. The bulk of work has focused on the Iron Duke mine site, with some broader surface sampling campaigns undertaken across the tenement to locate more near-surface or sub cropping mineralisation within the conceptual structural corridor. The workings a Monarch and Christmas Gift were identified as targets with further strike potential and remain undrilled. The Doradilla Project area has an extensive exploration history, with the tenement area subject to extensive past exploration within 22 previous exploration licences. The main DMK line skarn zone was discovered by North Broken Hill Ltd in 1972. Between 1972 and 1984 several companies, (North Broken Hill Ltd, Renison Ltd, Aberfoyle Exploration Pty Ltd, Metals Exploration Ltd, and Preussag Australia Pty Ltd), drilled multiple diamond, percussion and auger drill holes on the prospect, defining a stratigraphically persistent, low grade, tin-bearing calc-silicate skarn. Significant exploration efforts were also completed by Shell Minerals, Cleveland Tin, Aberfoyle, Eastmet and Metals Exploration. More recent exploration was completed by Goldminco Corporation and YTC Resources (now Aurelia Metals), who completed aircore drilling programmes on 3KEL, the Doradilla deposit, as well as aircore and diamond core holes across a number of ultramafic serpentinite bodies, exploring for skarn related nickel mineralisation Exploration byvarious companies has takenplace intermittentlyin the Galwadgere area since 1967,as
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Criteria Explanation Commentary
described in previous sections. The bulk of the work comprised DD drilling completed during the 1970s
by Woodsreef Mines. Alkane's RC drilling in 2004 intersected altered volcanics hosting broad widths of
pyrite-chalcopyrite mineralisation with occasional massive sulphide lenses up to 5 metres thick.
Significant exploration was carried out initially focussed on base metals and shifting to gold in the 1980s
with the Caledonian prospect identified as a Au-rich skarn system. Shallow diamond drilling identified
broad low-grade Au mineralisation. From the 1990s limited exploration has occurred on the prospect.
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Geology  Deposit type, geological setting and style of mineralisation Mineralisation at the Hume prospect is associated with sulphide-rich and intensely silica-sericite altered horizons hosted in a late Silurian volcaniclastic sequence interpreted to be equivalent to the stratigraphy to that which hosts the McPhillamys deposit near Blaney NSW. This stratigraphy is likely to represent basin opening of the Hill End Trough. The mineralisation is interpreted as Au-rich VMS with similarities to the Henty Mine in western Tasmania and the McPhillamys deposit in NSW. Gold mineralisation appears to be coincident with Zn, Pb, Cu and Ag mineralisation. Regionally, the Iron Duke mineralisation is hosted within early to mid-Ordovician schists and turbidite sediments, forming part of the Girilambone group. Mineralisation is hosted within greenschist facies, ductile deformed pelitic to psammitic sediments, and sparse zones of courser sandstones. Mineralisation is hosted in quartz sulphide breccias, localised to within shear zones. Mineralisation is predominately hosted by chalcopyrite in fresh rock and the weathered upper portions of the mineralisation consists of copper carbonates, sulphates and supergene sulphides such as possible chalcocite. The bedrock geology of Doradilla-EL6258 comprises units of low to moderate metamorphic grade phyllite, schist, slate, siltstone, and conglomerate that have been previously interpreted to be part of the Ordovician Girilambone Group. The mineralisation at Doradilla is mainly skarn/replacement tin/tungsten mineralisation hosted with the DMK Line. The DMK Line is a belt of calc-silicate skarns after limestone and marl that is up to 100m thick. This unit is considered to be a conformable part of the Devonian stratigraphy. Other calc silicates have been located at Doradilla Trig, Wednesday Shaft and Northern Shaft. Post-dating deformation and regional metamorphism is the emplacement of a large fractioned A- type granite batholith with an evolved suite of quartz porphyry dykes (the Midway Granite), interpreted to be the source of mineralising fluids at Doradilla. Recent dating has demonstrated a Triassic age for these intrusions. Mineralisation appears to be related to emplacement of this batholith. Drilling at Galwadgere located an extensively altered Silurian felsic to intermediate volcanic sequence hosting base metal sulphide and gold mineralisation. While the deposit has previously been categorised as a Volcanogenic Massive Sulphide (VMS) type deposit, Alkane considered that later structural overprint may have modified the distribution of the metals. The mineralisation at Galwadgere has been traced over a strike length of at least 700 metres, with at least 400m of this strike extent covered by younger Permian sediments. The mineralisation varies in thickness from 5 to 35 metres and has been tested to a depth of 400 metres, although the bulk of the drilling is above 200 metre vertical depth. The system dips to the east at about 60°, and there is an apparent plunge to the north at 45- 50°. The mineralisation consists of disseminated and stringer pyrite-chalcopyrite lenses within altered felsic volcanic rocks. The system is structurally overturned and appears to be zoned with a capping of zinc-lead-silver-gold rich

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Criteria Explanation Commentary
bedded massive sulphide. To the west, non-prospective Devonian sediments outcrop with the
prospective Silurian sequence cut off by a major regional east dipping thrust fault.
Mineralisation at the Caledonian prospect appears to be associated with skarn units, particularly where
iron oxides are more abundant than epidote. High gold grades were noted in the lowermost skarn unit;
values in outcrop of the upper two horizons were not sustained in drill intersections down-dip. Previous
drilling has largely been confined to a sequence of skarn and pelitic acid volcaniclastics. Three main
skarn horizons, having an overall moderate westerly dip, have been recognised. Flexuring of these units,
seemingly plunging to the south, is interpreted. Within the skarn, limonite/hematite development is
extensive, probably in part after sericite/clay altered tremolite-actinolite, whilst nontronite is also
common. Most, of the pelite/volcanics interbedded with the skarn are extensively clay altered as well.
Drill hole Information  A summary of all information material to the understanding of the exploration results including See body of announcement.
a tabulation of the following information for all Material drill holes:
-
easting and northing of the drill hole collar
-
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 interception depth
- hole length
 If the exclusion of this information is justified on the basis that the information is not Material Not applicable as drill hole information is included.
and this exclusion does not detract from the understanding of the report, the Competent Person
should clearly explain why this is the case.
Data aggregation  In reporting Exploration Results, weighting averaging techniques, maximum and/or minimum Where reported, drilling results have been length weighted. Grades greater than 0.2g/t Au and 0.1% Cu
methods grade truncations (e.g. cutting of high grades) and cut-off grades are usually Material and have been used to calculate intercepts for the Iron Duke Project. No high cut-off has been applied.
should be stated.
 Where aggregate intercepts incorporate short lengths of high-grade results and longer lengths of low Intercepts are length weighted with no cutting of grades. This may lead to elevation of intercept grades
grade results, the procedure used for such aggregation should be stated and some typical examples of due to the presence of a narrow interval of high-grade material. Such high-grade zones are reported as
such aggregations should be shown in detail. included intercepts inside the broader intercept.
 The assumptions used for any reporting of metal equivalent values should be clearly stated No metal equivalences quoted.
Relationship between  These relationships are particularly important in the reporting of Exploration Results- Orientated drill core has been used by SKY to allow determination of orientation of structures and
mineralisation widths - if the geometry of the mineralisation with respect to the drill hole angle is known, its nature mineralisation. Orientation of the mineralisation and structural trends is constrained by previous drilling
and intercept lengths should be reported. and outcrop though true widths are not yet estimated as there is insufficient data at this stage of
-
if it is not known and only the down hole lengths are reported, there should be a clear exploration.
statement to this effect (e.g. ‘down hole length, true width not known’).
Diagrams  Appropriate maps and sections (with scales) and tabulations of intercepts should be included for See body of announcement. SKY:ASX Announcement 19 July 2021, SKY:ASX Announcement 7 July 2021,
any significant discovery being reported These should include, but not be limited to a plan view SKY:ASX Announcement 2 Jun 2021, SKY:ASX Announcement 14 May 2021, SKY:ASX Announcement 8
of drill hole collar locations and appropriate sectional views. April 2021, SKY:ASX Announcement 31 March 2021, SKY:ASX Announcement 2 March 2021, SKY:ASX
Announcement 16 November 2020, SKY:ASX Announcement 10 March 2020.
Balanced reporting  Where comprehensive reporting of all Exploration Results is not practicable, representative See body of announcement. SKY:ASX Announcement 19 July 2021, SKY:ASX Announcement 7 July 2021,
reporting of both low and high grades and/or widths should be practiced to avoid misleading SKY:ASX Announcement 2 Jun 2021, SKY:ASX Announcement 14 May 2021, SKY:ASX Announcement 8
reporting of Exploration Results. April 2021, SKY:ASX Announcement 31 March 2021, SKY:ASX Announcement 2 March 2021, SKY:ASX
Announcement 16 November 2020, SKY:ASX Announcement 10 March 2020.
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Criteria	Explanation Commentary	Explanation Commentary
Other substantive exploration data	 Other exploration data, if meaningful and material, should be reported including (but not limited to): geological observations; geophysical survey results; geochemical survey results; bulk samples–size and method of treatment; metallurgical test results; bulk density, groundwater, geotechnical and rock characteristics; potential deleterious or contaminating substances. See body of announcement. SKY:ASX Announcement 2 Jun 2021, SKY:ASX Announcement 14 May 2021, SKY:ASX Announcement 8 April 2021, SKY:ASX Announcement 31 March 2021, SKY:ASX Announcement 2 March 2021, SKY:ASX Announcement 16 November 2020, SKY:ASX Announcement 10 March 2020.
Furtherwork	 The nature and scale of planned further work (e.g. tests for lateral extensions or depth extensions or large-scale step-out drilling).	Further drill testing to assess the scale and grade of the mineralisation is planned along with investigation of related targets.
	 Diagrams clearly highlighting the areas of possible extensions, including the main geological interpretations and future drilling areas, provided this information is not commercially sensitive.	See body of announcement. SKY:ASX Announcement 2 Jun 2021, SKY:ASX Announcement 14 May 2021, SKY:ASX Announcement 8 April 2021, SKY:ASX Announcement 2 March 2021, SKY:ASX Announcement 16 November 2020,SKY:ASX Announcement 10 March 2020.

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