SUNSTONE METALS LTD — Capital/Financing Update 2023

Dec 12, 2023

13 DECEMBER 2023

Sunstone raises ~$5m to continue growing gold-copper-silver discoveries

Strong emphasis on expanding the Limon epithermal gold-silver discovery where there is already a substantial Exploration Target, demonstrating immense potential for a large open pit

Sunstone Metals Limited (ASX:STM) is pleased to advise that it has received firm commitments for $5,024,000 via a share placement at 1.2 cents ($0.012) per share (Placement) to existing institutional and sophisticated shareholders and new investors.

Directors and management are also participating in the placement, subject to shareholder approval, for a total of $170,000.

The proceeds of the Placement will be used to fund targeted exploration at both Bramaderos and El Palmar projects to confirm the potential of our existing discoveries, and further demonstrate the potential value of the discoveries to financial markets and strategic partners.

At Bramaderos in southern Ecuador, focus will be on the large, high-grade gold-silver Limon target with surface exploration to expand the scale of the opportunity and define further drill targets.

At El Palmar in northern Ecuador, exploration is also expanding and defining the near surface high grade goldsilver opportunity, and strengthening the near surface porphyry gold-copper targets.

At Verde Chico to the west of El Palmar, exploration has commenced and is following up historical high-grade gold from surface.

Morgans Corporate Limited acted as Lead Manager and Bookrunner to the Placement.

The Placement comprises 418,666,667 new shares, with 12,916,667 shares being issued to directors subject to shareholder approval, and 405,750,000 new shares to be issued within the Company’s available capacity under ASX Listing Rule 7.1.

Mr Malcolm Norris, Managing Director of Sunstone Metals Ltd., has authorised this announcement to be lodged with the ASX.

For further information, please visit www.sunstonemetals.com.au

Mr Malcolm Norris Media: Managing Director Paul Armstrong Sunstone Metals Ltd Read Corporate Tel: 07 3368 9888 +61 8 9388 1474 Email: mnorris@sunstonemetals.com.au

About Sunstone Metals

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

1. The Bramaderos Gold-Copper Project where Sunstone owns an 87.5% interest, and SolGold Canada, Inc. (formerly Cornerstone Capital Resources) a subsidiary of SolGold, holding 12.5% (loan carried through to start of commercial production) (see ASX announcement dated 10 April 2017, 28 August 2019, and 7 January 2020). The Bramaderos gold-copper project is located in Loja province, southern Ecuador, and is highly prospective for the discovery of large porphyry gold-copper systems, and high-grade epithermal gold systems. The Bramaderos concession is host to multiple fertile mineralised systems with significant discovery potential.

The Brama-Alba porphyry gold-copper-silver deposit, within the Bramaderos concession contains an initial Mineral Resource estimate of 156Mt at 0.53g/t AuEq for 2.7Moz gold-equivalent. In addition to this is the Bramaderos project porphyry gold-copper-silver Exploration Target of between 3.3Moz and 8.6Moz AuEq within 255 to 360Mt at a grade between 0.40 and 0.74g/t AuEq* (see ASX release dated 13 December, 2022).

JORC Classification	Tonnage (Mt)	Au (g/t)	Cu (%)	Ag (g/t)	AuEq (g/t)	AuEq (Mozs)*
Indicated	9	0.38	0.09	1.1	0.53	0.2
Inferred	147	0.35	0.11	1.3	0.53	2.5
Total	156	0.35	0.11	1.3	0.53	2.7

An Exploration Target for the Limon epithermal gold-silver deposit was released on 9th November 2023 consisting of between approximately 30 and 44 million tonnes at a grade of between 0.9 and 1.2g/t AuEq, for between 0.9 and 1.7mill oz AuEq

The company confirms that it is not aware of any new information or data that materially affects the information included in the original market announcement for the Mineral Resource estimate and Exploration Target referred to above and, that all material assumptions and technical parameters underpinning the estimates continue to apply and have not materially changed. 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 announcement.

The potential quantity and grade of the Exploration Target is conceptual in nature. There has been insufficient exploration to estimate a Mineral Resource for the target area reported. It is uncertain if further exploration will result in the estimation of a Mineral Resource.

*The gold equivalent calculation formula for porphyry gold-copper-silver mineralisation is AuEq(g/t) = (Au grade x Au price x Au recov / 31.1035) + (Ag grade x Ag price x Ag recov / 31.1035) + (Cu grade x Cu price x Cu recov / 100)) / (Au price x Au recov / 31.1035). The prices used were US$1,800/oz gold and US$9,500/t copper and US$22/oz silver. Recoveries are estimated at 89% for gold, 85% for copper, and 60% for silver based on metallurgical studies.

*The gold equivalent calculation formula for epithermal gold-silver mineralisation is AuEq(g/t) = Au(ppm) + (Ag (ppm)/82). The prices used were US$1,800/oz gold and US$22/oz silver. Recoveries are estimated at over 90% for gold and 90% for silver from metallurgical studies.

In Sunstone’s opinion all the elements included in the metal equivalents calculation have reasonable potential to be recovered and sold.

1. The El Palmar Copper-Gold Project where Sunstone holds 70% of the highly prospective 800ha El Palmar gold-copper porphyry project in Ecuador. Sunstone can acquire 100% through a Staged Acquisition Agreement. A Staged Acquisition Agreement to acquire the nearby Verde Chico Project has also been signed. The El Palmar and Verde Chico gold-copper projects are located in Imbabura province, northern Ecuador, within the same geological belt that includes the giant Alpala, Tandayama-America and Llurimagua porphyry copper-gold and copper-molybdenum deposits.