SUNSTONE METALS LTD — Investor Presentation 2021

Oct 27, 2021

ASX STM

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October 2021

Disclaimer

DISCLAIMER

To the maximum extent permitted by law, no representation, warranty or undertaking, express or implied, is made and, to the maximum extent permitted by law, no responsibility or liability is accepted by Sunstone or any of its officers, employees, agents or consultants or any other person as to the adequacy, accuracy, completeness or reasonableness of this Presentation. To the maximum extent permitted by law, no responsibility for any errors or omissions from this Presentation whether arising out of negligence or otherwise is accepted.

This Presentation contains general information about Sunstone Metals Limited (Sunstone) which is in the business of exploring for minerals which is a speculative and risky venture. It does not purport to contain all the information that a prospective investor may require. The Presentation should not be considered as an offer or invitation to subscribe for or purchase of any securities in Sunstone and no agreement to subscribe for securities will be entered into on the basis of this Presentation. Potential investors should conduct their own investigation and analysis and should check the accuracy, reliability, and completeness of the information provided and obtain independent and specific advice from appropriate professional advisors.

FORWARD-LOOKING STATEMENTS

This Presentation includes certain statements that may be deemed “forwardlooking statements”. All statements in this Presentation, other than statements of historical facts, that address future activities and events or developments that Sunstone expects, are forward looking statements.

Although Sunstone believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially from those in forward-looking statements include market prices, continued availability of capital and financing, and general economic, market or business conditions.

Investors are cautioned that any such statements are not guarantees of future performance and that actual results or developments may differ materially from those projected in forward-looking statements.

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Corporate

Listed on the Australian Stock Exchange ASX:STM

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A$148M A$20M 2,210M ~39% 3.7%
MARKET CASH + EQUITY SHARES ON ISSUE TOP 20 SHAREHOLDERS BOARD &
CAPITALISATION INVESTMENTS As of October 2021 Hold almost half of all MANAGEMENT
At share price of A$0.067 As of October 2021 shares on issue Have participated in most
(7-day VWAP) – unaudited placements in last 4-8 years
Substantial Shareholders
Valbonne II 5.8%
STM 2020-21 SHARE PRICE GRAPH
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Investment Highlights

Well funded junior, track record, recent discovery success

• Sunstone is well funded and in a strong position to deliver strong shareholder returns with ongoing discovery

• Market Capitalisation = ~A$148 mill

• Equity Investments + Cash = ~A$20 mill

• Delivering Enterprise Value of Ecuador exploration projects = ~A$128 mill – we would argue, this is undervalued for the early stages of what could be a significant discovery at the El Palmar project

• Sunstone holds 51%, and is acquiring 100%, of the El Palmar gold-copper porphyry project in northern Ecuador

• Through a Staged Acquisition Agreement based on cash payments linked to milestones (US$300,000 payment to move to 70%, US$2mill to go from 70 to 100%)

• The project is located in northern Ecuador, in the same regional belt as the giant Cascabel copper-gold porphyry deposit, and Llurimagua copper-moly porphyry deposit

• Sunstone has drilled 4 holes so far, all mineralised, 5[th] hole in progress

• Assays for Holes EPDD001 and part of EPDD002 have delivered a significant gold-copper porphyry discovery with considerable upside

• 3-D modelling of ground magnetic data is guiding exploration drilling. Gold and copper mineralisation correlate with magnetic rocks

• Soil sampling in progress to help define additional targets

• Sunstone owns 87.5% of the Bramaderos Gold-Copper Project in southern Ecuador

• The Bramaderos Project has delivered ore grade intercepts of gold and copper, from surface, in the Brama porphyry system. Phase 2 drilling in progress, leading to a mineral resource estimate in early 2022

• There remains 5 additional highly ranked porphyry gold-copper systems – all of which are mineralised and only partially tested

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The Team

A hi h- ualit team in Ecuador and Australia g q y

• A well qualified and focussed team in Ecuador, comprising 100% Ecuadorians, working across the El Palmar and Bramaderos Projects

• The team in Ecuador is expanding and covering all aspects of corporate, social, environmental, safety, technical exploration, logistics, and administration

• A small corporate team in Australia

• Consultant support in specialised areas as needed, including geology, geophysics, ESG, and development

• Considerable experience, and a track record of success, in discovery, studies and responsible management of gold-copper porphyry exploration opportunities

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Ecuador

Building an exploration and mining sector

New President, Guillermo Lasso, is a supporter of responsible mining

Ecuador is managing through the coronavirus pandemic, with over 60% of the population fully vaccinated

Mining is now playing an important part in Ecuadorian economic growth (source Bloomberg);

• mineral resources now represent one of Ecuador’s top five exports;

• US$810 million in exports generated by the mining sector in 2020;

• US$430 million in taxes paid in 2020 by mining companies in Ecuador

• US$374 million direct foreign investment for Ecuador during 2020

• Thousands of direct jobs generated across the industry in Ecuador

• Significant expenditure for goods and services in local communities and at the provincial level

• Mining products ~6% of total exports, and fourth behind oil, bananas and shrimp. Mining exports growing. (by comparison, 61% of exports in Peru are from the mining sector)

Major global mining companies have a presence in Ecuador – BHP, Newcrest, Anglo American, Fortescue, Hancock, Codelco, Lundin

There will be several very significant gold and copper discoveries and developments in Ecuador over the next few years. Sunstone will be part of that industry growth

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Ecuador Exploration and development is active

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Fruta del Norte

Lundin Gold (TSX:LUG)

High grade underground gold mine; Reserve of 20.8Mt at 8.1g/t gold + 11.8g/t silver; 5.4Moz gold In production; 2021 guidance 380,000 - 420,000 ounces gold; AISC US$800/ounce; 10.4g/t head grade Ecuador’s first modern underground gold mine

Mirador

EcuaCorriente

Open Pit producing and exporting concentrate; 62,000t copper and 34,000 ounces gold annual production 673Mt at 0.58% copper and 0.19g/t gold

Cascabel

SolGold 85%/ Cornerstone 15%

Alpala resource

2,663 Mt @ 0.37% copper and 0.25g/t gold in the Measured and Indicated categories, and 544 Mt @ 0.24% copper and 0.11g/t gold in the Inferred category.

Top of main orebody ~500m below surface

Cangrejos

Lumina Gold (TSX.V:LUM) 100%

568Mt at 0.55g/t gold and 0.11% copper in the Indicated category, and 476 Mt @ 0.41g/t gold and 0.08% copper in the Inferred category.

Llurimagua

Codelco/Enami (Ecuador) JV; 982Mt at 0.89% copper and 0.04% molybdenum (1.55Bt at 0.51% copper)

Warintza

Solaris (TSX.V:SLS); small initial resource, huge new drill intersections, 7km x 5km area containing cluster of porphyry systems

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Sunstone Metals

Community, Safety and Environment

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Sunstone takes its environmental, social and governance issues very seriously and is committed to improving the quality of life in the areas where we work

Sunstone

• has significant environmental monitoring programs across it projects

• is involved in various community programs at Bramaderos and El Palmar

• undertakes considerable training programs across a large range of skills for workers and the communities in which we operate

• works with the local communities to assist where possible, for example, during the coronavirus pandemic

• Offers employment and skills development

• • has implemented strict coronavirus operating plans while not compromising local health and safety

• appreciates the strong community support that it has at its projects

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El Palmar Project

Within a mineralised belt in northern Ecuador

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Prospective for porphyry copper-gold similar to the 2.7Bt Alpala deposit at Cascabel and the 1Bt Llurimagua deposit

Recent discovery holes drilled by Sunstone

EPDD001:

• 163.55m at 0.71g/t gold and 0.20% copper

• (1.05g/t gold equivalent*) from 52.35m

• Within 480.85m at 0.41g/t gold and 0.15% copper

• (0.66g/t gold equivalent*) from 11.3m

Partial assays from hole EPDD002 for the interval 250 – 417.5m are:

• 167.50m at 0.58g/t gold and 0.26% copper (1.02g/t gold equivalent*) from 250m

See ASX announcement dated 7[th] October 2021

*AuEq is calculated on a gold and copper basis only, using metals prices at 28[th] September 2021, being US$1,750/oz gold, US$4.29/lb copper using the formula: (gold grade in g/t) + 1.68 * (Cu grade in %). No metallurgical recoveries have been applied to exploration results.

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El Palmar Project Active exploration program

Good access with upgraded roads

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Soil sampling in progress across several targets

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Ground magnetics completed across concession

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El Palmar Project

4 drill holes completed, 5[th] in progress

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El Palmar Project What do the discover results mean? y

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We are optimistic that El Palmar could be a large gold copper porphyry deposit Mineralisation from surface Very significant vertical extent from magnetic modelling Copper-gold-silver-magnetic susceptibility all correlate – guides initial exploration Hints to expect higher copper values elsewhere in system

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El Palmar Project Locally outcropping Porphyry but with cover; Auger soil sampling effective

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El Palmar

Drill targets defined, scale and potential will become evident

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El Palmar – main

target; drill holes and vertical slice through magnetic model Upper 400m of subvertical SE magnetic body shown to be mineralised from assays from holes EPDD001 and 2 Holes EPDD004 and EPDD005 testing sub-vertical NW magnetic body Planned holes EPDD007 and 8 to test deeper targets

Alpala, Cascabel (SolGold) – x- section of bornite and chalcopyritepyrite ratio; and showing CuEq grade domains 200m

(see Garwin, 23 July 2021 GeoHug presentation)

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DIAGRAMS AT
SAME SCALE
>0.3% CuEq
>0.9% CuEq
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El Palmar Project Additional tar ets bein defined and re ared for drillin in 2022 g g p p g

Gold in rock chips

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• Magnetics and historical rock chip results identify areas of interest

• 2km long cluster of targets identified to date

• Soil sampling program underway over entire concession

• 4 Additional Porphyry Targets

• 6 Epithermal Targets

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Bramaderos Project

Multiple Targets – Porphyry gold-copper and epithermal silver-gold

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6 porphyry gold-copper systems have been identified and all are mineralized

Currently drilling the Brama target

Brama – existing drilling; ore grade intercepts Limon – existing drilling; drilled outside edge of porphyry Playas – no drilling

Melonal – very minor drilling found copper and gold Porotillo – historical drilling, some good grades Sandia – no drilling

At least 2 known mineralised epithermal gold-silver systems (NE geological extension of Dynasty goldfield)

ON PAGE 15 - AuEq is calculated on a gold and copper basis only, using metals prices at 28[th] September 2021, being US$1,750/oz gold, US$4.29/lb copper using the formula: (gold grade in g/t) + 1.68 * (Cu grade in %). No metallurgical recoveries have been applied to exploration results.

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Brama Porphyry Lar e old-co er s stem at surface g g pp y

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• 16 effective diamond drill holes to date - all mineralized, some ore grade

• Longitudinal trench BM14 – 615.14m at 0.52g/t gold and 0.11% copper (0.7g/t AuEq) , including

• 122.6m at 0.55g/t gold, 0.17% copper (0.84g/t AuEq), and

• 97m at 0.61g/t gold, 0.16% copper (0.82g/t AuEq), and

• 179.7m at 0.6g/t gold, 0.09% copper (0.75g/t AuEq)

• BMDD001; 172m at 0.52g/t gold and 0.16% copper (0.79g/t AuEq) downhole, including • 96.6m at 0.61g/t gold and 0.18% copper (0.91g/t AuEq), and

• Trench above CURI-03 returned; 140.6m at 0.57g/t gold and 0.15% copper (0.82g/t AuEq) , including • 68.2m at 0.8g/t gold and 0.18% copper (0.98g/t AuEq)

• BMDD008; drilled a mineralised intrusive breccia intersecting

• 450m at 0.47g/t gold and 0.1% copper (0.64g/t AuEq), including

• 84.3m at 0.8g/t gold and 0.11% copper (0.64g/t AuEq)

• BMDD009; 185.3m at 0.4g/t gold, 0.15% copper, (0.64g/t AuEq) from 116.8m

• BMDD010; 170.65m at 0.46g/t gold and 0.15% copper. (0.7g/t AuEq) from 311.75m, including

• 69.6m at 0.65g/t gold, 0.2% copper, (0.97g/t AuEq) from 347m

• BMDD011; 404.8m at 0.32g/t gold, 0.09% copper, (0.46g/t AuEq) from surface, including

• 51.3m at 0.54g/t gold, 0.07% copper (0.65g/t AuEq) from surface

• BMDD012-017 drilled

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• Four remaining holes in this drill program

• See ASX announcements dated 16 September 2021, 22 April 2021, 20 August 2019

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Brama Porphyry Buildin tonnes and testin other tar ets g , g g

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Sunstone Metals

What’s ahead in 2021 and into 2022

✓ 2021-22 – Demonstrate significant upside to El Palmar discovery, no near-term plans for raising capital

• ✓ El Palmar

Q4, 2021

• drilling (2[nd] rig to be added early December),

• assays from holes EPDD002 & 3 – mid November; EPDD004 – early December; EPDD005 – December

• Drill hole EPDD006 to be completed by end Nov; Drill holes EPDD007 & 8 commence in early December

• expanded soil sampling coverage in progress and assays for first 2 targets to be delivered by mid December

• • concession wide geological mapping and sampling

2022

• Deep drilling first assay results expected Feb or Mar 2022 (drill holes to be completed in mid Jan)

• Drilling on both main anomaly and on satellite targets

✓ Bramaderos

Q4, 2021

• Drilling, 1 rig, 2 holes to drill during November

2022

• deep penetrating electrical geophysics

• Inaugural mineral resource estimate over Brama target only

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El Palmar Project still early days, building an understanding of the geology

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0.43g/t Au / 0.18% Cu
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EPDD001: 304m

1.03g/t Au / 0.33% Cu 0.22g/t Au / 0.14% Cu

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0.42g/t Au / 0.16% Cu
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EPDD001 320m . Coarse-grained bornite along shear zone + actinolite.

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0.46g/t Au / 0.25% Cu
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EPDD001 225.8m. Quartz-magnetite-chalcopyrite vein in quartz-chloritemagnetite-actinolite-epidote-calcite altered porphyry

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1.6g/t Au / 0.30% Cu
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EPDD002 256m .

fine-grained diorite with quartz-magnetite veining

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0.20g/t Au / 0.92% Cu
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EPDD002 332.15m . Sulphide veins in quartz diorite

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EPDD001 173m

EPDD001 354.3m

Com etent Persons Statement p

The information in this report that relates to exploration results and exploration targets and results is based upon information reviewed by Dr. Bruce Rohrlach who is a member of the Australasian Institute of Mining and Metallurgy. Dr. Rohrlach 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”. Dr. Rohrlach consents to the inclusion in the report of the matters based on his information in the form and context in which it appears

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