SUNSTONE METALS LTD — Capital/Financing Update 2019

Apr 7, 2019

8 APRIL 2019

Bramaderos Project – Environmental Licence signed and drilling commencing

Sunstone Metals Limited (ASX:STM) is pleased to provide an update on the Bramaderos gold-copper project in southern Ecuador.

The Environmental Licence allowing for commencement of exploratory diamond drilling has been approved by the Ecuadorian Ministry of Environment (Ministerio del Ambiente).

A drill rig was mobilised to site following approval of the EIA (refer to ASX announcement dated 14 March 2019) and has been moved to the location of the first planned drill hole at the Limon prospect.

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Photo 1: Transporting components of the drill rig to site using motorised trolleys along existing tracks

As previously advised, first assay results are expected in late May to early June based on an anticipated time frame of 2-3 weeks to complete the first drill hole to a depth of approximately 500m, followed by 1-2 weeks to complete logging and sampling of the drill hole, and anticipating a turn-around time of approximately 4 weeks for sample preparation and assay results.

Drilling will commence, following final drill pad and pumping system preparations, at the Limon target where surface trenching has delivered 97.6m at 0.71g/t gold and 0.23% copper over a poorly outcropping porphyry system (refer to ASX announcement dated 29 May 2018).

The initial drill program is anticipated to be approximately 5,000m and will also include holes at Bramaderos Main to follow up on historical drilling that intersected 248m at 0.56g/t gold and 0.14% copper and recent surface trenching that delivered 615m at 0.52g/t gold and 0.11% copper (refer to ASX announcement dated 9 May 2018), and at West Zone where surface trenching has delivered 15.6m at 6.1g/t gold (refer to ASX announcement dated 8 November 2017).

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Figure 1: Location of prospects within the Bramaderos concession

About Sunstone Metals

Sunstone has an advanced portfolio of exploration and development projects in Scandinavia and Ecuador. The portfolio comprises:

1. The Bramaderos Gold-Copper Project where Sunstone has signed an earn-in agreement with TSXV listed Cornerstone Capital Resources (see ASX announcement dated 10[th] April 2017). The Bramaderos goldcopper project is located in Loja province, southern Ecuador, and is considered to be highly prospective for the discovery of large gold-copper systems. Historical results from drilling at Bramaderos include wide intervals such as 260m at 0.6g/t Au and 0.14% Cu. Trenching results at the West Zone breccia include intersections at surface of up to 42m at 3.7g/t Au. These results, together with the distribution of alteration, and large coincident gold-copper-molybdenum surface anomalies indicate multiple fertile mineralised systems with significant discovery potential.

2. The Southern Finland Gold Project includes the Satulinmäki gold prospect. Shallow diamond drilling was completed by the Geological Survey of Finland (GTK) during the period 2000-2005 and this was followed by a 7-hole diamond drilling program by Sunstone Metals in 2016. Intersections from GTK include 18m @ 4.1g/t Au from 50m downhole, including 3m @ 9.3g/t Au, and 4m @ 10.3g/t Au in drill hole R391. Intersections by Sunstone include 23.5m at 3.3g/t in SMDD007 and 2m at 10.5g/t in SMDD005. The Satulinmäki gold prospect is part of an earn-in JV with Canadian company Nortec Minerals, where Sunstone holds an ~82% interest, is funding on-going work, and has also acquired a significant land position, in its own right, in the district.

3. The Scandinavian Lithium Project includes the Kietyönmäki lithium prospect. Drilling by Sunstone has delivered 24.2m at 1.4% Li2O in a spodumene-bearing pegmatite. Additional earlier stage lithium opportunities are held in Kaustinen, Finland. Kietyönmäki is also part of the JV with Nortec Minerals.

4. Sunstone has a significant equity interest of ~39% in Stockholm listed Copperstone Resources (COPP-B.ST) following the recent sale of the Viscaria Copper project.

Competent Persons Statement

The information in this report that relates to exploration results is based upon information reviewed by Mr Malcolm Norris who is a Fellow of the Australasian Institute of Mining and Metallurgy. Mr Norris is a full-time employee of Sunstone 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 Norris consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

For further information, please visit www.sunstonemetals.com.au Mr Malcolm Norris Managing Director Sunstone Metals Ltd Tel: 07 3368 9888

Email: mnorris@sunstonemetals.com.au