TESORO GOLD LTD - Annual Report 2021

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Tesoro Resources Limited

ABN 91 106 854 175

Annual Report for the year ended 30 June 2021

TABLE OF CONTENTS

Corporate Directory	2
Chairman’s Letter	3
Directors’ Report	5
Auditor’s Independence Declaration	25
Consolidated Statement of Profit or Loss and Other Comprehensive Income	26
Consolidated Statement of Financial Position	27
Consolidated Statement of Changes in Equity	28
Consolidated Statement of Cash Flows	29
Notes to the Financial Statements	30
Directors’ Declaration	54
Independent Auditor’s Report	55
ASX Additional Shareholder Information	58
Tenements Schedule	61

CORPORATE DIRECTORY

Tesoro Resources Limited is an Australian listed company focused on the acquisition, exploration and development of commercially significant resource projects in Chile, with a focus on gold. For more details visit www.tesororesources.com.au.

DIRECTORS

Mr John Toll (Non-Executive Chairman)

Mr Zeffron Reeves (Managing Director)

Mr Linton Putland (Executive Director – Mining and Development) Mr Geoffrey McNamara (Non-Executive Director) Ms Kristie Young (Non-Executive Director)

JOINT COMPANY SECRETARIES

Ms Shannon Coates Ms Sarah Wilson

REGISTERED OFFICE

Suite 5 62 Ord Street WEST PERTH WA 6005

AUDITORS

RSM Australia Partners Level 32 Exchange Tower 2 The Esplanade PERTH WA 6000

SHARE REGISTRAR

Automic Pty Ltd Level 2, 267 St Georges Terrace PERTH WA 6000

GPO Box 5193, SYDNEY, NSW 2000 Telephone: 1300 288 664 (within Australia) Email: [email protected]

SECURITIES EXCHANGE LISTING

Australian Securities Exchange Limited (Home Exchange: PERTH, Western Australia) Code: TSO

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Tesoro Resources Limited Chairman’s Letter

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Dear Fellow Shareholders,

On behalf of the Board of Directors, it is my pleasure to present the 2021 Annual Report for Tesoro Resources Limited (“Tesoro” or “the Company”), in what was a significant year in the continued growth and progression of our El Zorro Gold Project (“El Zorro”) in Chile.

The Company’s Ternera Gold Deposit (“Ternera”), located at El Zorro, is ideally situated in the Coastal Cordillera region of Chile, which is host to multiple world class copper and gold mines, has well established infrastructure, service providers and an experienced mining workforce. Notwithstanding the continuing challenges that COVID-19 presents, the last 12 months has seen an extraordinary amount of work undertaken at Ternera by the Tesoro team, the results of which continue to indicate that the project has the potential to host a large-scale gold deposit.

During the year a total of 155 diamond drill holes were drilled with drill rigs running continuously throughout the year, which again evidences the benefits of the location of Ternera by virtue of the ability to undertake surface exploration drilling all year round.

Immediately following the end of the financial year, the Company announced its maiden resource estimate at Ternera of 25.1Mt @ 0.8g/t for 660koz of gold using a 0.3g/t Au cut-off1 (“MRE”). Whilst successfully delivering this MRE in under 18 months at discovery cost of approximately $21.00 per ounce is in itself an outstanding achievement, we very much view this achievement as only the first step in defining the potential of Ternera which we expect to continue to grow. This growth potential is highlighted by the fact that the MRE only included assay results from 148 drill holes of a total of 204 holes drilled at the time of release of the MRE. Subsequent assay results received since and from outside the MRE area highlight the potential for further resource growth at Ternera including the following outstanding intersections:

76.15m @ 1.15g/t Au including 8.00m @ 3.56g/t Au2;
19.00m @ 2.58g/t Au including 4.0m @ 10.63g/t Au12;
67.00m @ 3.44 g/t Au including 13.50m @ 15.40 g/t Au3; and
59.00m @ 2.49 g/t Au including 21.00m @ 5.26 g/t Au4.

The Company is targeting to release of an upgraded MRE before the end of CY2021.

In addition to the significant exploration work undertaken during the year, the Company has also begun to shift its focus to a scoping study to help define the preliminary operating metrics and economics of a potential mine development at Ternera. The team is excited by the early work undertaken on the study and is confident that the combination of the encouraging preliminary metallurgy results, potential for an attractive strip ratio given the outcropping orebody and logistical advantages will result in positive findings supportive of further study work and exploration.

In recognition of the evolving focus of the business away from purely exploration, the Company was delighted to announce the recent appointment of Mr Linton Putland as Executive Director – Mining and Development and Ms Kristie Young as Non-Executive Director. Both appointments bring significant relevant industry experience and with backgrounds in mining engineering are expected to be valuable contributors to the on-going development of the Company and its assets.

As referenced above, the Company, like everyone in the global community, continues to deal with the on-going impacts of COVID-19 and is acutely focused on the implications for the health and wellbeing of our employees, contractors and stakeholders. We are pleased to confirm that all the Company’s staff and contractors, including those on site at El Zorro are safe. We are pro-active with respect to our response and have operational procedures and plans in-place in-line with official health advice and government directives. Logistics and planning are more complex but in what can only be attributed to the dedicated efforts of the Tesoro management team, there have not been significant delays or cost impacts on our programs to date related to COVID-19.

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Tesoro Resources Limited Chairman’s Letter

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I would like to take this opportunity, on behalf of the Board, to thank all our Shareholders for their ongoing support. I would also like to thank the Managing Director, the broader management team, contractors, and my fellow Directors for their ongoing efforts. We are committed to progressing the Company by identifying and testing new targets, growing our resources, and progressing towards development, through high-quality exploration and technical studies for the benefit of all Tesoro shareholders.

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John Toll Chairman

Tesoro Resources Limited

Refer to ASX Announcement 28 July 2021.
Refer to ASX Announcement 27 August 2021. 3. Refer to ASX Announcement 5 August 2021.
Refer to ASX Announcement 19 August 2021.

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Tesoro Resources Limited Directors' report 30 June 2021

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The Directors present their report, together with the financial statements, of the Group (referred to hereafter as the “consolidated entity” or “the Group”) and the entities it controlled at the end of, or during, the financial year ended 30 June 2021.

Directors

The following persons were Directors of Tesoro Resources Limited during or since the end of the financial year:

John Toll Non-Executive Chairman Zeffron Reeves Managing Director Linton Putland Executive Director – Mining and Development (appointed 14 September 2021) Geoffrey McNamara Non-Executive Director Kristie Young Non-Executive Director (appointed 14 September 2021)

Information on Directors

John Toll Non-Executive Chairman

B Comm, CA

Mr Toll brings valuable experience as a partner of Azure Capital Limited, a leading corporate advisory firm based in Perth, Western Australia. Mr Toll has over 15 years’ experience in corporate advisory, focusing mainly on equity financing transactions across a range of industries including mining, technology and, general industrials. He has advised local and international clients on transactions ranging from mergers and acqusitions, private capital raisings for early stage companies through to strategic and transformation capital raising for established businesses. Mr Toll has a Bachelor of Commerce, has completed the Institute of Chartered Accountants CA Program and a Graduate Diploma in Applied Finance.

Zeffron Reeves Managing Director

BSc (Hons) (Applied Geology), MBA, MAIG

Mr Reeves is a geologist with over 20 years’ experience in the resources sector working on mineral resource projects through all facets of development from greenfield exploration, discovery, definition and feasibility, construction, production to closure. Mr Reeves was most recently Managing Director of ASX listed Metallum Ltd which had a number of development and operational projects in Chile. He has also held senior management positions with Cleveland Mining Ltd and Ashburton Minerals Ltd, developing projects in Brazil. Mr Reeves has a Bachelor of Applied Geology (Honours), a Masters of Business Administration from Curtin University and is a member of the Australia Institute of Geoscientists.

Linton Putland Executive Director – Mining and Development (appointed 14 September 2021)

BEng, MSc (Economics)

Mr Putland holds degrees in Mining Engineering (Bachelor of Engineering, Western Australian School of Mines) and a Masters in Science (Mineral Economics, Western Australian School of Mines) with more than 30 years’ experience in mining operations, joint ventures and corporate management in Australia, Africa and the Americas, over a wide range of commodities.

Mr Putland is principal of LJ Putland & Associates, a private mining consultancy company which was founded in 2002, providing advisory and consultancy services in mining project and company evaluation and due diligence appraisals with a focus on corporate growth. During this period, he has also been Managing Director of a privately-owned exploration company with joint venture interests in Africa.

Prior to this he held corporate and senior management roles in IAMGOLD, AurionGold, Delta Gold and Pancontinental Mining. He is a Member of AusIMM and a Graduate Member of AICD.

Mr Putland is currently Non-Executive Director of Breaker Resources Limited (ASX:BRB) and WA Kaolin Limited, previously he was Non-Executive Director of Pacific Energy Limited which was acquired by the Queensland Investment Corporation (QIC) for A$422m for its global infrastructure fund.

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Tesoro Resources Limited Directors' report 30 June 2021

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Geoffrey McNamara Non-Executive Director

BSc (Applied Geology), AusIMM, FINSIA, AICD

Mr McNamara is a geologist with over 27 years of international resource sector experience, operational roles include Project Manager, Senior Mine Geologist and Mine Geologist for Ivanhoe Mines, Lion Ore International and Western Mining Corporation. Previously he worked in Private Equity (FUM USD800 million) and as a Director of Societe General’s Mining Finance team in New York. Geoffrey holds a Bachelors degree in Geology and a Graduate Diploma in Applied Finance and Investment from the Financial Services Institute of Australasia. He is a member of the Australian Institute of Company Directors (AICD) and the Australasian Institute of Mining and Metallurgy (AusIMM).

Kristie Young Non-Executive Director (appointed 14 September 2021)

BEng (Mining) Hons, GAICD

Ms Young holds a Bachelor of Engineering (Mining) Hons from the University of Queensland and a Post Graduate Diploma of Education (Mathematics & IT) from the University of Western Australia. She is a graduate of the Australian Institute of Company Directors and holds a CertIV HR from the Australian HR Institute.

Ms Young’s background includes more than 20 years’ experience across a range of sectors, including technical engineering, project evaluation, strategy, business development, growth, marketing, commercial, client management, governance and human resources.

Prior to this she held senior growth and business development executive roles with leading professional services firms PwC and EY.

Ms Young is currently Non-Executive Chair with ChemX Materials Ltd, Non-Executive Director of Lithium Australia NL (ASX:LIT) and sits on the boards of Wesley College WA and the Energy Club of WA. Ms Young was also a Non-Executive Director of Primero Group Limited which was acquired by NRW Holdings for A$100m.

Joint Company Secretaries

Shannon Coates

LLB, BJuris, AGIA, ACIS, GAICD

Ms Coates is a qualified lawyer with over 20 years’ experience in corporate law and compliance. She is currently non-executive director of ASX listed companies Vmoto Limited and Bellevue Gold Limited and company secretary to a number of public unlisted and ASX listed companies. She has significant experience in a wide range of corporate and commercial matters, including strategy, remuneration, mergers and acquisitions, debt and equity capital markets, risk management and compliance, regulation and corporate governance, both in Australia and internationally. Shannon holds a Bachelor of Laws from Murdoch University, is a Chartered Secretary and a graduate of the AICD’s Company Directors course. She is a past recipient of the West Australian Women in Mining scholarship and was selected for the AICD Chairman’s Mentoring Program.

Sarah Wilson (appointed 14 September 2021)

Ms Wilson is a Corporate Advisor with Evolution Corporate Services Pty Ltd and has over 10 years’ experience in company secretarial, corporate advisory and corporate governance roles, which have included the provision of company secretarial services to a number of resource companies. Ms Wilson holds a Certificate in Governance Practice and is a Certified Member of the Governance Institute of Australia.

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Tesoro Resources Limited Directors' report 30 June 2021

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Directorships of Other Listed Companies

Directorships of other listed companies held by Directors currently and in the 3 years immediately before the end of the financial year are as follows:

	Company	Period of Directorship
Director
John Toll	-	-
Zeffron Reeves	Rincon Resources Ltd	07/08/2018 - current
	Culpeo Minerals Ltd	25/07/2018 - current
Linton Putland	WA Kaolin Limited	20 May 2020 - current
	Breaker Resources Limited	16 August 2018 – current
	Pacific Energy Limited	18 October 2016 – 28 November 2019
	Azumah Resources Limited	18 July 2018 – 14 November 2019
Geoffrey McNamara	Cora Gold Ltd	09 October 2017 - 19 November 2019
	Alita Resources Ltd	14 December 2018 – 18 December 2019
	Culpeo Minerals Ltd	25/07/2018 - current
	Rincon Resources Ltd	07/08/2018 - current
Kristie Young	Lithium Australia NL	22 December 2020 – current
	Primero Group Ltd	18 August 2020 – 24 February 2021

Principal activities

The principal activities of the Company and its subsidiaries are the acquisition, exploration and development of commercially significant resource projects in Chile. The Company currently holds interests in Chile, namely the El Zorro Gold Project in Chile, which is prospective for gold.

Operating results

The loss, after tax, attributable to the Group for the financial year ended 30 June 2021, amounted to $5,570,786 (2020: $4,707,766).

Dividends

No dividends were paid or declared since the start of the financial year. No recommendations for payment of dividends have been made.

Directors’ Interests in Shares, Options and Performance Rights

At the date of this report, the following represents the shares, options and performance rights holdings of the Directors of the Company:

	Ordinary shares Performance Rights
	Direct Indirect Direct Indirect
Directors John Toll1 Zeffron Reeves2 Geoffrey McNamara3 Linton Putland Kristie Young Total	- 3,671,696 - - - 36,429,797 - 47,244,620 - 69,532,230 - 42,875,380 - - - - 24,833 - - -
	24,833 109,633,723 - 90,120,000

3,671,696 fully paid ordinary shares are held by Mr John Toll as trustee for the Toll Family Discretionary Trust.
36,429,797 fully paid ordinary shares and 47,244,620 performance rights are held by Mr Zeffron Charles Reeves as trustee for the Palin Trust.
25,410,546 fully paid ordinary shares are held by Tanamera Resources Pte Ltd (a company registered in Singapore). Geoffrey McNamara is the sole director and shareholder of Tanamera Resources Pte Ltd. 44,121,684 fully paid ordinary shares and 42,875,380 performance rights are held by Linkwood Holdings Pte Ltd (a company registered in Singapore). Geoffrey McNamara is a director and substantial shareholder of Linkwood Holdings Pte Ltd.

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Tesoro Resources Limited Directors' report 30 June 2021

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REVIEW OF OPERATIONS

Tesoro, via its 95% owned subsidiary Tesoro Mining Chile SpA (TMC), holds an 85% interest in the highly prospective El Zorro Gold Project, located within the Coastal Cordillera of Chile. El Zorro is favourably located and demonstrates significant scale and gold grades. Throughout FY2021, Tesoro has focussed on delineating gold resources at El Zorro, where drilling has produced exceptional results culminating in the delivery of a maiden gold Mineral Resource Estimate (MRE) for the Ternera Gold Deposit on 28 July 2021.

El Zorro Project

Ternera Maiden Mineral Resource

The Ternera Gold Deposit occurs within Tesoro’s El Zorro Gold Project (“El Zorro” or “the Project”) which covers a total concession holding area of approximately 555km[2] , located approximately 130km north of Copiapo City, in Region III (Atacama) in northern Chile. The Ternera Gold Deposit is 13km inland from the Pacific Ocean, 57km by road from the port of Caldera and is well supported by existing road, power, and water infrastructure.

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Figure 1 – El Zorro Project Location Map

Tesoro commenced exploration work at the El Zorro Gold Project in 2017 and has subsequently drilled 203 diamond drill holes, defining the Ternera Gold Deposit. The Ternera maiden MRE was announced post FY2021 year end, on 28 July 2021. The MRE is based on the results from 148 diamond holes (46,937m

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Tesoro Resources Limited Directors' report 30 June 2021

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of drilling). Tesoro had drilled 203 holes for 61,763m of drilling at Ternera as at 30 June 2021, with diamond drilling programs ongoing post the end of the financial year.

The El Zorro Gold Project is located within the Coastal Cordillera of Chile where Tesoro has delineated the Ternera Gold Deposit. At Ternera, gold mineralisation is predominantly hosted within numerous intermediate intrusions and associated quartz and sulphide veins, veinlets, and alteration within faulted and strongly altered tonalitic intrusions (El Zorro Tonalite or EZT). The EZT intrusions have intruded Permian aged basement sedimentary sequences. Gold mineralisation at Ternera has been classified as an Intrusive Related Gold System (IRGS) which is a new style of gold mineralisation, previously undescribed in Chile. Tesoro has discovered additional gold targets in the El Zorro District which exhibit similar styles of gold mineralisation.

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Figure 2 – El Zorro Gold Project Prospect map on geology

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Tesoro Resources Limited Directors' report 30 June 2021

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Mineralisation within the reported MRE has been classified according to JORC 2012 code and has been reported with an optimised pit shell.

A majority of the MRE area has been drilled on an approximately 50m x 50m drill spacing and is classified as Inferred Resources. A small portion in the Central Ternera area has been drilled at a sufficient density to be classified as Indicated Resources (Figure 3).

Within the Ternera Mineral Resource envelope, higher grade gold mineralisation is associated with distinct north-south faults which are both strike and dip extensive. These fault zones have formed a number of higher-grade zones which remain open down dip and along strike (Figure 4).

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Figure 3 – Ternera Gold Deposit Collar locations on geology.

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Tesoro Resources Limited Directors' report 30 June 2021

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Figure 3 – Long section view looking west of the classified Ternera block model within an optimised open pit. Red = Indicated resource, blue = Inferred Resource, grey = optimised pit shell. Black drill holes are used in the Resource calculation, green holes awaiting assays. Grid size = 200m. Datum = PSAD56 19S

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Figure 4 – Plan view of the pit optimised classified Ternera Block Model. Optimised pit shown as pale green. Red blocks >0.50g/t Au highlighting grade associated with north-south trending faults. Black holes included in resource calculation, green holes awaiting assays. 100m grid. Datum = PSAD56 19S

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Tesoro Resources Limited Directors' report 30 June 2021

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The Ternera Gold Deposit remains open in all directions. The Company has drilled >200 diamond drill holes at Ternera to date and drilling continues, with the aim of improving the reported Mineral Resource categories and expanding the overall Mineral Resource. With only 148 holes included in the MRE, there is significant scope for Tesoro to increase the Mineral Resource during the remainder of CY2021.

Exploration Potential

Since February 2020, Tesoro has been primarily focused on defining and expanding a Mineral Resource at the Ternera Gold Deposit. However preliminary drilling was also completed which confirms gold mineralisation outside of the Ternera Gold Deposit at the Ternera East, Drone Hill and Toro Gordo targets, all of which offer opportunities to increase gold resources across the project area. A large body of the prospective EZT has also been mapped at the Toro Blanco target to the north of Ternera, which is prospective for gold mineralisation.

As at the date of this Report, the Company has 6 diamond drill rigs on site at El Zorro drilling 24/7. The current drilling programs are focused on:

Defining Measured and expanding Indicated and Inferred Mineral Resources at the Ternera Gold Project;
Delineating gold Mineral Resources at Ternera East;
Further drill testing at Drone Hill; and
Initial drill testing at Toro Blanco.

Significant exploration potential exists throughout the El Zorro concessions with identification of the EZT host rocks in the wider El Zorro area. Exploration will continue throughout 2021 to assess and drill test new targets as they are identified.

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Figure 6 – Ternera Drill Section. Ternera Block Model showing areas in pink circles for further expansion and opportunity at Ternera. Red blocks >0.30g/t. New drilling not used in MRE highlighted in yellow

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Tesoro Resources Limited Directors' report 30 June 2021

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CORPORATE

El Zorro Increased Ownership

On 24 March 2021, Tesoro advised that its 95% owned Chilean subsidiary, Tesoro Mining Chile SpA (TMC), has increased its ownership of El Zorro to 85%.

Tesoro previously advised on 1 March 2021 that the original Purchase Option Agreement had been terminated and the JV company, El Zorro S.C.M., would operate on a fully diluting basis going forward.

At a shareholders’ meeting of El Zorro S.C.M. held on 11 February 2021, it was resolved that an additional capital contribution of approximately CLP$4.3 billion in total (approximately A$7.6 million) be made to the El Zorro S.C.M. to support the approved workplan and budget. The Company’s El Zorro Joint Venture partner, Wanaco SpA ( Wanaco ) elected not to participate and TMC has now contributed the A$7.6 million to increase its ownership to 85%.

Post the end of the financial year, on 26 August 2021, the Company advised it had been served notice of dispute initiated by Wanaco, lodged with 7th Civil Court de Santiago de Chile.

Wanaco is disputing the valuation and the procedure followed for the capital increase approved in the Shareholders Meeting of El Zorro SCM held on 11 February 2021. Tesoro is confident that the capital increases were properly valued and duly approved under Chilean corporate and mining law and the dispute initiated by Wanaco is vexatious and with no legal basis. Tesoro will vigorously defend its position and is considering its legal options to have this claim rejected by the court.

Oversubscribed Capital Raising

On 9 December 2020, the Company announced it had received firm commitments for a Placement and Share Purchase Plan (SPP) to raise up to $21 million (before costs). The Placement was subsequently completed in mid-December 2020, with a total of 66,666,667 new Shares issued at an issue price of $0.27 per Share, utilising the Company’s existing ASX Listing Rule 7.1 and 7.1A placement capacities.

A further 925,926 new Shares were issued to Tribeca in lieu of fees for capital raising services,

On 9 January 2021, Tesoro closed the SPP announced on 9 December 2020. Under the SPP, each Eligible Shareholder was entitled to subscribe for up to $30,000 worth of new fully paid ordinary shares (Shares) at an issue price of $0.27 per Share, without incurring brokerage or other transaction costs.

The Company received valid applications for a total of 16,836,932 new Shares from Eligible Shareholders, totaling $4,546,000 and exceeding the targeted $3,000,000. The Company conducted a pro-rata scale back of applications received in excess of $3,000,000, in accordance with the terms of the SPP, with Eligible Shareholders receiving approximately 66% of the amount for which they subscribed.

Funds raised pursuant to the Placement and SPP have and will be used to fund an accelerated 50,000m drilling program at the El Zorro Gold Project, a detailed metallurgical testwork program and the commencement of a Scoping Study at the Company’s El Zorro Gold Project in early CY2021, and for general working capital purposes, including the costs of the capital raising.

El Zorro Land Position Increased to 555km[2]

On 31 July 2020 and 23 September 2020, Tesoro announced it had secured in total an additional 344 concessions in proximity to the El Zorro Project. The addition of this ground firmly places Tesoro as the dominant regional player in the belt. The new concessions cover an area that is believed to be highly prospective for additional gold mineralisation, similar to the style being drilled at Ternera.

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Tesoro Resources Limited Directors' report 30 June 2021

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The El Zorro Project concession area now covers approximately 555km[2] of prospective strike from north to south and importantly, covers prospective structural zones identified during a regional review of the belt. These structural zones are believed to be associated with gold mineralisation.

Board Changes

Post the end of the financial year, on 15 September 2021 the Company announced the appointment of Mr Linton Putland as Executive Director – Mining and Development and Ms Kristie Young as NonExecutive Director to help drive exploration and development of its El Zorro Gold Project in Chile.

On the same date, the Company also announced the appointment of Ms Sarah Wilson as joint Company Secretary.

COVID-19 impact

All the Company’s staff and contractors, including those on site at the El Zorro Project in Chile are safe. The Company has implemented procedures to ensure all staff and contractors remain safe and healthy during the COVID-19 pandemic, including regular testing, altered rosters and strict quarantining procedures. As at the date of this report, the Company’s operations at the El Zorro Project have not been directly affected by COVID-19 restrictions in Chile, however the Company continues to monitor this closely with the health and wellbeing of all staff and contractors priority.

Meetings of Directors

The number of meetings of the Company's Board of Directors ('the Board') and of each Board committee held during the year ended 30 June 2021 were:

	Board meetings	Board meetings
	Attended	Eligible to attend
John Toll	8	8
Zeffron Reeves	8	8
Geoffrey McNamara	8	8

The full Board currently undertakes all nomination, remuneration, audit and risk functions.

As at the date of this report, there are 603,200,482 fully paid ordinary shares on issue.

Options

As at the date of this report, there are nil unissued ordinary shares of Tesoro Resources Limited under option.

During the year ended 30 June 2021, nil shares were issued upon the exercise of options.

Performance Rights

As at the date of this report, there are 98,028,551 performance rights on issue which will vest subject to meeting applicable performance criteria.

During the year ended 30 June 2021, nil performance rights vested. Post the end of the financial year, 48,202,854 performance rights vested and were converted into shares.

Financial Position

The Group had a total issued capital of $37,156,675 (2020: $14,499,180) at the end of the reporting period.

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Tesoro Resources Limited Directors' report 30 June 2021

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During the financial year, the Group had a net increase in contributed equity of $22,657,495 (2020: $11,174,114) net of share issue costs as a result of the capital raising during the year.

As at 30 June 2021, the total assets for the Group are $29,858,632 (2020: $9,058,789) and total liabilities (being trade and other payables, lease liabilities and provisions) amount to $1,873,701 (2020: $388,496).

The Directors believe the Group is in a strong financial position to pursue the current operations.

Significant changes in the state of affairs

There were no other significant changes in the state of affairs of the Group during the financial year.

Matters subsequent to the end of the financial year

On 6 July 2021, the Company announced assay results from the first hole drilled at the Ternera East Target located at the Company’s El Zorro Gold Project (El Zorro) in Chile.

On 28 July 2021, the Company announced its maiden Mineral Resource Estimate (MRE) for the Ternera Deposit at the Company’s El Zorro Gold Project, Chile of 25.1Mt @ 0.8g/t for 660 koz of gold using a 0.3g/t Au cut-off, within an optimised pit shell, from the Ternera Gold Deposit.

On 5 August 2021, the Company announced assay results from the Ternera Gold Deposit located at the Company’s El Zorro Gold Project (El Zorro) in Chile for 13 exploration diamond drill holes. On the same date the Company announced the issue of 48,282,854 shares on conversion of vested performance rights.

On 11 August 2021, the Company announced assay results from the Ternera East Gold Target, located at the Company’s El Zorro Gold Project (El Zorro) in Chile, demonstrating the high potential of defining additional resources outside of the Ternera Mineral Resource Model.

On 14 September 2021, Mr Linton Putland and Ms Kristie Young were appointed to the Board.

On 16 September 2021, the Company announced the assay results from infill and extensional drilling at the Ternera Gold Deposit, located at the Company’s El Zorro Gold Project (El Zorro) in Chile, where it is aiming to increase the existing Ternera Mineral Resource of 660,000oz gold.

As the impact of the Coronavirus (COVID-19) pandemic is ongoing, it is not practicable to estimate the potential impact, positive or negative, after the reporting date. The situation is rapidly developing and is dependent on measures imposed by the Australian Government and other countries, such as maintaining social distancing requirements, quarantine, travel restrictions and any economic stimulus that may be provided.

Other than as discussed above, no other matter or circumstance has arisen since 30 June 2021 that has significantly affected, or may significantly affect the Group's operations, the results of those operations, or the Group's state of affairs in future financial years.

Future developments, prospects and business strategies

The Group intends to continue with the advancement of exploration at its current projects located in Chile and seek out further exploration, acquisition and development gold projects in Chile.

Annual Mineral Resource Statement

On 28 July 2021, the Company announced its maiden Mineral Resource estimate for the Ternera Gold Deposit at the El Zorro Project in Chile. The Mineral Resource estimate was prepared and disclosed under the JORC Code 2012 Edition.

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Tesoro Resources Limited Directors' report 30 June 2021

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	Ternera Gold Deposit Maiden Resource Table	Ternera Gold Deposit Maiden Resource Table	Ternera Gold Deposit Maiden Resource Table	Ternera Gold Deposit Maiden Resource Table	Ternera Gold Deposit Maiden Resource Table	Ternera Gold Deposit Maiden Resource Table	Ternera Gold Deposit Maiden Resource Table	Ternera Gold Deposit Maiden Resource Table	Ternera Gold Deposit Maiden Resource Table
	Indicated			Inferred			Total
Cut-off Au g/	t Mt	Au g/t	koz	Mt	Au g/t	koz	Mt	Au g/t	koz
0.3	2.7	0.88	75	22.4	0.81	586	25.1	0.82	661
0.4	2.1	1.03	68	17.4	0.95	529	19.4	0.96	597
0.5	1.7	1.17	63	13.7	1.08	476	15.4	1.09	539
0.6	1.4	1.28	58	11.1	1.21	430	12.5	1.22	488
0.7	1.2	1.40	54	8.9	1.34	385	10.1	1.35	439
0.8	0.9	1.64	45	6.0	1.61	312	6.9	1.62	357

Table 1 – El Zorro Gold Project, Ternera Gold Deposit Mineral Resource Estimate reported at various cut offs within an optimised pit shell

Estimation Governance Statement

The Company ensures that all Mineral Resource estimations are subject to appropriate levels of governance and internal controls.

Exploration results are collected and managed by an independent competent qualified geologist. All data collection activities are conducted to industry standards based on a framework of quality assurance and quality control protocols covering all aspects of sample collection, topographical and geophysical surveys, drilling, sample preparation, physical and chemical analysis and data and sample management.

Mineral Resource estimates are prepared by appropriately qualified, independent Competent Persons. If there is a material change in the estimate of a Mineral Resource, the estimate and supporting documentation in question is reviewed by a suitable qualified independent Competent Person and announced to the ASX in accordance with the Listing Rules.

The Company will report its Mineral Resources on an annual basis in accordance with the JORC Code 2012 Edition. There have been no changes to the Mineral Resource since reported on 28 July 2021.

Competent Person’s Statement

The information in this report that relates to Exploration Results is based on information compiled by Mr Zeffron Reeves (B App Sc (Hons) Applied Geology) MBA, MAIG). Mr Reeves is a member of the Australian Institute of Geoscientists and a Director and shareholder of the Company. Mr Reeves has sufficient experience that 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 Reeves consents to the inclusion in this report of the matters based on this information in the form and context in which it appears.

The information in this report that relates to Mineral Resources is based on information compiled by Mr Daniel Saunders, a Competent Person who is a Member of The Australasian Institute of Mining and Metallurgy. Mr Saunders is a full-time employee of Cube Consulting Pty Ltd, acting as independent consultants to Tesoro Resources Limited. Mr Saunders has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration, and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Saunders consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

This Annual Mineral Resource and Ore Reserves Statement is based on and fairly represents the information and supporting documentation prepared by the above-mentioned Competent Persons. It is approved as a whole by Mr Zeffron Reeves.

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Tesoro Resources Limited Directors' report 30 June 2021

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REMUNERATION REPORT (AUDITED)

This report outlines the remuneration arrangements in place for the Key Management Personnel of the Company for the financial year ended 30 June 2021. The information provided in this remuneration report has been audited as required by Section 308(3C) of the Corporations Act 2001 .

The remuneration report details the remuneration arrangements for Key Management Personnel who are defined as those persons having authority and responsibility for planning, directing and controlling the major activities of the Company and the Group, directly or indirectly, including any Director (whether executive or otherwise) of the parent company, and includes the executives in the Group.

Key Management Personnel

The following are classified as Key Management Personnel:

Directors

John Toll Non-Executive Chairman Zeffron Reeves Managing Director Geoffrey McNamara Non-Executive Director

There were no other Key Management Personnel as at 30 June 2021.

The Remuneration Report is set out under the following main headings:

a) Principles used to determine the nature and amount of remuneration
b) Details of remuneration
c) Service agreements
d) Equity-based remuneration
e) Equity instruments issued on exercise of remuneration options
f) Loans with Key Management Personnel
g) Other transactions with Key Management Personnel

a) Principles used to determine the nature and amount of remuneration

The objective of the Group's executive reward framework is to ensure reward for performance is competitive and appropriate for the results delivered. The framework aligns executive reward with the achievement of strategic objectives and the creation of value for shareholders, and it is considered to conform to the market best practice for the delivery of reward. The Board of Directors ('the Board') ensures that executive reward satisfies the following key criteria for good reward governance practices:

competitiveness and reasonableness;
acceptability to shareholders;
performance linkage / alignment of executive compensation; and
transparency.

The Board is responsible for determining and reviewing remuneration arrangements for its directors and executives. The performance of the Group depends on the quality of its directors and executives. The remuneration philosophy is to attract, motivate and retain high performance and high-quality personnel. The Board has structured an executive remuneration framework that is market competitive and complementary to the reward strategy of the Group. The remuneration framework is designed to align executive reward to shareholders' interests. The Board considers that it should seek to enhance shareholders' interests by:

implementing coherent remuneration policies and practices to attract, motivate and retain executives and directors who will create value for shareholders and who are appropriately skilled and diverse;
observing those remuneration policies and practices;

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Tesoro Resources Limited Directors' report 30 June 2021

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REMUNERATION REPORT (AUDITED) (cont.)

fairly and responsibly rewards executives having regard to Group and individual performance; the performance of the executives and the general external pay environment; and
integrating human capital and organisational issues into its overall business strategy.

Additionally, the remuneration framework must refer to the following principles when developing recommendations to the Board regarding executive remuneration:

motivating management to pursue the Group's long-term growth and success;
demonstrating a clear relationship between the Group's overall performance and the performance of individuals; and
complying with all relevant legal and regulatory provisions.

In accordance with best practice corporate governance, the structure of non-executive director and executive director remuneration is separate.

During the year, the Company adopted an Incentive Option and Performance Rights Plan (“IOPR”) to provide incentive and reward for Eligible Participants and align the interests to participants more closely with the interests of the Shareholders. There were no issues under the EIP during the year ended 30 June 2021.

The Board encourages directors to hold shares in the Company. The Company has a Share Trading Policy which directors and employees are required to comply with. No shares or options were acquired by key management personnel during the year other than as part of remuneration.

All remuneration paid to directors and executives is valued at the cost to the Company and expensed.

All performance rights have been valued in accordance with AASB 2, which takes into account factors such as the underlying share price, the expected vesting date and vesting probability in achieving the specified vesting hurdles at the reporting date.

Executive remuneration

The Group aims to reward executives based on their position and responsibility, with a level and mix of remuneration which may have both fixed and variable components. In respect of executive remuneration, remuneration packages should include an appropriate balance of fixed and performance-based remuneration and may contain any or all of the following:

Fixed remuneration

Any fixed remuneration component should:

be reasonable and fair;
take into account the Group's legal and industrial obligations and labour market condition;
be relative to the scale of the Group's business; and  reflect core performance requirements and expectations.

Performance-based remuneration

Any performance-based remuneration should:

take into account individual and corporate performance; and
be linked to clearly-specified performance targets, which should be
aligned to the Group's short and long-term performance objectives; and
appropriate to its circumstances, goals and risk appetite.

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Tesoro Resources Limited Directors' report 30 June 2021

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REMUNERATION REPORT (AUDITED) (cont.)

Equity-based remuneration

Equity-based remuneration can include options or performance rights or shares and is especially effective when linked to hurdles that are aligned to the Group’s longer-term performance objectives. However, they should be designed so that they do not lead to ‘short-termism’ on the part of senior executives or the taking of undue risks. The Board is of the opinion that the adoption of performancebased compensation for executives is necessary to reward executives consistent with increases in shareholder returns.

Termination payments

Termination payments should be agreed in advance, and any agreement should clearly address what will happen in the case of early termination. There should be no payment for removal for misconduct.

Non-Executive Director’s Remuneration

Fees and payments to Non-Executive Directors reflect the demands and responsibilities of their role. Non-Executive Directors’ fees and payments are reviewed annually by the Board. The Board may, from time to time, receive advice from independent remuneration consultants to ensure nonexecutive directors’ fees and payments are appropriate and in line with the market.

In respect of Non-Executive Director remuneration, remuneration packages could contain cash fees, superannuation contributions and non-cash benefits in lieu of fees (such as salary sacrifice into superannuation or equity) and may contain any or all of the following:

fixed remuneration – this should reflect the time commitment and responsibilities of the role
performance-based remuneration – The Company acknowledges that the ASX Corporate Governance Council recommends that non-executive directors should generally not receive performance-based remuneration as it may lead to bias in their decision-making and compromise their objectivity. However, the Board may from time to time form the view that an award of performance based remuneration is appropriate in light of the Company’s current position, and strategic objectives.
equity-based remuneration – non-executive directors can receive equity based remuneration if shareholders have approved such an allocation in accordance with the ASX Listing Rules; and
termination payments – non-executive directors should not be provided with retirement benefit other than superannuation.

ASX Listing Rules require the aggregate non-executive directors’ remuneration be determined periodically by a general meeting. The maximum aggregate remuneration payable to Non-Executive Directors currently stands at $500,000 per annum.

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Tesoro Resources Limited Directors' report 30 June 2021

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REMUNERATION REPORT (AUDITED) (cont.)

b) Details of Remuneration

Remuneration of Key Management Personnel is set out below.

					Post-
		Short-term employee benefits			employ- ment	Share-	based payments
					benefits
Director and other KMP	Year	Cash salary and fees	Other	fees	Superannu- ation	Shares		Performance Rights	Total	Performance based % of remuneration
		$	$		$	$		$	$	%
Non-Executive
Chairman
John Toll	2021	50,000		-	-		-	-	50,000		0.0%
Managing	2020	18,854		-	1,980		-	-	20,834		0.0%
Director
Zeffron Reeves1	2021	240,000		-	22,800	633,333		614,225	1,510,358	40.7%
	2020	100,000	50,000		9,500		-	144,838	304,338		47.6%
Non-Executive
Directors
Geoffrey McNamara	2021	50,000		-	-		-	906,285	956,285	94.8%
	2020	18,854		-	1,980		-	231,449	252,283		91.7%
Total	2021	340,000		-	22,800	633,333		1,520,510	2,516,643
	2020	137,708	50,000		13,460		-	376,287	577,455

Mr Zeffron Reeves was issued 8,333,333 fully paid shares during the year pursuant to the Executive Services Agreement entered into on 25 October 2019. Refer Note 13 for details.

Performance income as a proportion of total income

Performance income as a proportion of total income for Key Management Personnel is disclosed in this the Remuneration Report. The Managing Director’s performance related income comprised 40.7% of his total income for FY2021. The performance related component resulted from the vesting period value ascribed to performance rights issued during the year.

Equity holdings

All equity dealings with directors have been entered into with terms and conditions no more favourable than those that the Company would have adopted if dealing at arms’ length. The relevant interests of each director in share capital at the date of this report are as follows:

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Tesoro Resources Limited Directors' report 30 June 2021

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REMUNERATION REPORT (AUDITED) (cont.)

Fully Paid ordinary Shares

Movement in shareholdings of key management personnel

	Opening balance Granted as remuneration On Exercise of Options Other changes Balance at 30 June 2021
Directors John Toll1 Zeffron Reeves2 Geoffrey McNamara3 Total	3,263,729 - - 407,967 3,671,696 12,963,889 8,333,333 - (650,000) 20,647,222 37,594,805 - -(1,797,012) 35,797,793
	53,822,423 8,333,333 - (2,039,045) 60,116,711

3,263,729 fully paid ordinary shares are held by Mr John Toll as trustee for the Toll Family Discretionary Trust.
20,647,222 fully paid ordinary shares are held by Mr Zeffron Charles Reeves as trustee for the Palin Trust.
22,613,534 fully paid ordinary shares are held by Tanamera Resources Pte Ltd (a company registered in Singapore). Geoffrey McNamara is the sole director and shareholder of Tanamera Resources Pte Ltd. 13,184,259 fully paid ordinary shares are held by Linkwood Holdings Pte Ltd (a company registered in Singapore). Geoffrey McNamara is a director and substantial shareholder of Linkwood Holdings Pte Ltd.

Performance Rights

Movement in Performance Rights of key management personnel

	Opening balance Granted Converted Balance at 30 June 2021	Total vested at 30 June 2021
Directors John Toll Zeffron Reeves1 Geoffrey McNamara2 Total	- - - - 63,027,195 - - 63,027,195 73,812,805 - - 73,812,805	- - -
	136,840,000 - - 136,840,000	-

63,027,195 performance rights are held by Mr Zeffron Charles Reeves as trustee for the Palin Trust.
73,812,805 performance rights are held by Linkwood Holdings Pte Ltd (a company registered in Singapore). Geoffrey McNamara is a director and substantial shareholder of Linkwood Holdings Pte Ltd.

c) Service agreements

Key Management Personnel employment terms are formalised in a service agreement, a summary of which is set out below.

Name	Base Salary/Fees	Terms of Agreement	Termination Notice Period
Mr Zeffron Reeves (Managing Director)	$240,000 per annum plus superannuation	Until terminated	3 months written notice
Mr John Toll_(Non- _executive Chairman)	$50,000 per annum inclusive of superannuation	Until terminated	None
Mr Geoffrey McNamara	$50,000 per annum inclusive of superannuation	Until terminated	None

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Tesoro Resources Limited Directors' report 30 June 2021

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REMUNERATION REPORT (AUDITED) (cont.)

Non-Executive Directors

All non-executive Directors were appointed by a letter of appointment. Directors can retire in writing as set out in the Constitution.

d) Equity-based remuneration

The Company rewards Directors for their performance and aligns their remuneration with the creation of shareholder wealth by issuing performance rights. Equity-based remuneration is at the discretion of the Board and no individual has a contractual right to receive any guaranteed benefits.

During the year, the Company issued 8,333,333 fully paid shares to the Managing Director, Mr Zeffron Reeves in pursuant to the Executive Services Agreement dated 25 October 2019 and as approved by shareholders at a general meeting held 3 July 2020.

There were no other equity based issues to key management personnel during the year.

e) Equity instruments issued on exercise of remuneration options

No remuneration options were exercised during the financial year.

f) Loans to/from Key Management Personnel

There were no loans with key management personnel of the Company during the financial year.

g) Other transactions with key management personnel

A company associated with Geoffrey McNamara, a director, Tanamera Resources Pte Ltd was paid $87,000 (2020: $47,201) in consulting fees.

Tesoro Resources Limited provided administrative support services to Culpeo Minerals Limited and Rincon Resources Limited, both companies associated with directors, Geoffrey McNamara and Zeffron Reeves, for $2,538 and $7,910 respectively (2020: nil).

Voting and Comments at the Company’s 2020 Annual General Meeting

The adoption of the Remuneration Report for the financial year ended 30 June 2020 was put to the shareholders of the Company at the Annual General Meeting held on 19 November 2020. The Company received 99.54% of the vote, of those shareholders who exercised their right to vote, in favour of the remuneration report for the 2020 financial year. The resolution was passed without amendment on a poll. The Company did not receive any specific feedback at the AGM or throughout the year on its remuneration policies.

END OF REMUNERATION REPORT

Diversity

The Company believes that the promotion of diversity on its Board and within the organisation generally is good practice and is committed to managing diversity as a means of enhancing the Company’s performance. As at 30 June 2021, there were no women on the Company’s Board or filling senior management positions within the Company, however both the contract Company Secretary and CFO were female. Post 30 June 2021, a female Director, Ms Kristie Young and joint Company Secretary, Ms Sarah Wilson, were appointed.

The Company as set out in the Diversity Policy, (accessible from the Company’s website) will focus on participation of women on its Board and within senior management and intends to set measurable objectives for achieving gender diversity which will be adhered to once the size and scale of the Company increases sufficiently to permit further additions to the Board or senior management.

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Tesoro Resources Limited Directors' report 30 June 2021

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Environmental regulation

The Directors have considered the National Greenhouse and Energy Reporting Act 2007 (the NGER Act) which introduces a single national reporting framework for the reporting and dissemination of information about the greenhouse gas emissions, greenhouse gas projects, and energy use and production of corporations. At the current stage of development, the Directors have determined that the NGER Act will have no effect on the Company for the current or subsequent financial year. The Directors will reassess this position as and when the need arises.

Unissued shares under option

There are currently no unissued shares under option of the Company.

Indemnifying officers or auditor

In accordance with the constitution, except as may be prohibited by the Corporations Act 2001 every officer, auditor or agent of the Company shall be indemnified out of the property of the Company against any liability incurred by him in his capacity as officer, auditor or agent of the Company or any related corporation in respect of any act or omission whatsoever and howsoever occurring or in defending any proceedings, whether civil or criminal.

The Group has a Directors and Officers insurance policy in place.

Proceedings on behalf of the company

No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf of the Company, or to intervene in any proceedings to which the Company is a party for the purpose of taking responsibility on behalf of the Company for all or part of those proceedings.

Non-Audit Services

The Company may decide to employ the auditor on assignments additional to their statutory audit duties where the auditor’s expertise and experience with the Company and/or the group are important.

Details of the amounts paid or payable to the auditor for non-audit services provided during the year by the auditor are outlined in Note 24 to the financial statements.

The Board of Directors has considered the position and is satisfied that the provision of the non-audit services is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001. The Directors are satisfied that the provision of non-audit services by the auditors, as set out below, did not compromise the auditor independent requirements of the Corporations Act 2001 for the following reasons:

all non-audit services have been reviewed by the Board of Directors to ensure they do not impact the impartiality and objectivity of the auditor; and
none of the services undermine the general principles relating to the auditor independence as set out in APES 110 Code of Ethics for Professional Accountants.

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Tesoro Resources Limited Directors' report 30 June 2021

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Auditor's independence declaration

A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out immediately after this Directors' report.

Auditors

RSM Australia Partners continues in office in accordance with section 327 of the Corporations Act 2001 .

This report is made in accordance with a resolution of Directors, pursuant to section 298(2)(a) of the Corporations Act 2001.

On behalf of the Directors

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________ John Toll Non-Executive Chairman 24 September 2021

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RSM Australia Partners

Level 32, Exchange Tower 2 The Esplanade Perth WA 6000 GPO Box R1253 Perth WA 6844

T +61 (0) 8 9261 9100 F +61 (0) 8 9261 9111

www.rsm.com.au

AUDITOR’S INDEPENDENCE DECLARATION

As lead auditor for the audit of the financial report of Tesoro Resources Limited for the year ended 30 June 2021, I declare that, to the best of my knowledge and belief, there have been no contraventions of:

(i) the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
(ii) any applicable code of professional conduct in relation to the audit.

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RSM AUSTRALIA PARTNERS

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Perth, WA Dated: 24 September 2021

TUTU PHONG Partner

THE POWER OF BEING UNDERSTOOD AUDIT | TAX | CONSULTING

RSM Australia Partners is a member of the RSM network and trades as RSM. RSM is the trading name used by the members of the RSM network. Each member of the RSM network is an independent accounting and consulting firm which practices in its own right. The RSM network is not itself a separate legal entity in any jurisdiction.

RSM Australia Partners ABN 36 965 185 036

Liability limited by a scheme approved under Professional Standards Legislation

Tesoro Resources Limited Consolidated Statement of Profit or Loss and Other Comprehensive Income For the year ended 30 June 2021

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Interest revenue Other income Administration expenses Corporate and compliance expenses Depreciation Employee related expenses Equity based payment 13 Impairment of assets Interest and finance expenses Legal and professional fees Consultants expense Other expenses Non-recurring items relating to acquisition Espina project impairment Foreign currency translation Loss before income tax from continuing operations Income tax expense 11 Loss after tax Other comprehensive income/(loss) Items that may be reclassified to profit or loss: Exchange differences on translation of foreign operations Other comprehensive income/(loss) for the year, net of tax Total comprehensive loss for the year Loss attributable to: Non-controlling interests Members of the parent Total comprehensive loss attributable to: Non-controlling interests Members of the parent Basic and diluted loss per share attributable to members of the parent 16	Consolidated 30 June 2021 $ 30 June 2020 $ 2,323 31 68,743 28,652 (228,265) (71,260) (256,988) (152,879) (44,618) (328) (357,303) (161,219) (2,451,120) (410,550) (1,555,202) (103,521) (2,623) (61,935) (304,412) (213,847) (289,442) (204,602) (15,491) (24,354) - (2,319,023) - (1,013,052) (136,388) 121 (5,570,786) (4,707,766) - - (5,570,786) (4,707,766) 410,142 (424,520) 410,142 (424,520) (5,160,644) (5,132,286) (222,976) - (5,347,810) (4,707,766) (5,570,786) (4,707,766) (222,976) - (4,937,668) (5,132,286) (5,160,644) (5,132,286) (1.03) (3.05)	Consolidated 30 June 2021 $ 30 June 2020 $ 2,323 31 68,743 28,652 (228,265) (71,260) (256,988) (152,879) (44,618) (328) (357,303) (161,219) (2,451,120) (410,550) (1,555,202) (103,521) (2,623) (61,935) (304,412) (213,847) (289,442) (204,602) (15,491) (24,354) - (2,319,023) - (1,013,052) (136,388) 121 (5,570,786) (4,707,766) - - (5,570,786) (4,707,766) 410,142 (424,520) 410,142 (424,520) (5,160,644) (5,132,286) (222,976) - (5,347,810) (4,707,766) (5,570,786) (4,707,766) (222,976) - (4,937,668) (5,132,286) (5,160,644) (5,132,286) (1.03) (3.05)
		(4,707,766) -
		(4,707,766)
		(424,520)
		(424,520)
		(5,132,286)
		- (4,707,766) (4,707,766) - (5,132,286) (5,132,286) (3.05)

The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes

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Tesoro Resources Limited Consolidated Statement of Financial Position As at 30 June 2021

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*ASSETS* *CURRENT ASSETS* Cash and cash equivalents 3 Trade and other receivables 4 *TOTAL CURRENT ASSETS* *NON-CURRENT ASSETS* Exploration and evaluation expenditure 5 Plant and equipment 6 Right of use Assets 25 TOTAL NON-CURRENT ASSETS *TOTAL ASSETS* *LIABILITIES* *CURRENT LIABILITIES* Trade and other payables 7a Provisions 7b Lease liability 7c TOTAL CURRENT LIABILITIES *Non-Current Liabilities* Lease liability 8 *Total Non-Current Liabilities* *TOTAL LIABILITIES* NET ASSETS *EQUITY* Issued capital 9 Reserves 10 Accumulated losses Equity attributable to owners of the Company Non-controlling interest TOTAL EQUITY	Consolidated As at 30 June 2021 $ As at 30 June 2020 $ 13,728,277 5,871,130 329,534 252,332 14,057,811 6,123,462 15,506,028 2,934,007 75,839 1,320 218,954 - 15,800,821 2,935,327 *29,858,632* *9,058,789* 1,726,468 388,496 35,887 - 2,422 - 1,764,777 388,496 108,924 - 108,924 388,496 *1,873,701* *388,496* 27,984,931 8,670,293 37,156,675 14,499,180 2,422,689 194,760 (13,729,842) (6,023,647) 25,849,522 8,670,293 2,135,409 - 27,984,931 8,670,293	Consolidated As at 30 June 2021 $ As at 30 June 2020 $ 13,728,277 5,871,130 329,534 252,332 14,057,811 6,123,462 15,506,028 2,934,007 75,839 1,320 218,954 - 15,800,821 2,935,327 *29,858,632* *9,058,789* 1,726,468 388,496 35,887 - 2,422 - 1,764,777 388,496 108,924 - 108,924 388,496 *1,873,701* *388,496* 27,984,931 8,670,293 37,156,675 14,499,180 2,422,689 194,760 (13,729,842) (6,023,647) 25,849,522 8,670,293 2,135,409 - 27,984,931 8,670,293
		6,123,462
		2,934,007 1,320 -
		2,935,327
		*9,058,789*
		388,496 - -
		388,496
		-
		388,496

		*388,496*
		8,670,293
		14,499,180 194,760 (6,023,647)
		8,670,293
		-
		8,670,293

The above consolidated statement of financial position should be read in conjunction with the accompanying notes

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Tesoro Resources Limited Consolidated Statement of Changes in Equity For the year ended 30 June 2021

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CONSOLIDATED Balance at 1 July 2020 Loss for the year Exchange differences arising on translation of foreign currency Total comprehensive loss for the year Recognition of NCI Capital raising Equity based payments Capital raising costs Balance at 30 June 2021 CONSOLIDATED Balance at 1 July 2019 Loss for the year Exchange differences arising on translation of foreign currency Total comprehensive loss for the year Consideration shares – RTO Placement – RTO Lead manager facilitation shares - RTO Shares issued for conversion of convertible loan Shares issued for conversion of director loan Shares issued in lieu of fees Lead manager facilitation shares – Convertible loan Accelerated offer Placement Equity based payments Capital raising costs Balance at 30 June 2020	Issued Capital Accumulated Losses Equity Based Payment Reserve Foreign Currency Reserve Non- Controlling Interest Total Equity $ $ $ $ $ $ 14,499,180 (6,023,647) 410,550 (215,790) - 8,670,293
	- (5,347,810) - - (222,976) (5,570,786)

	- - - 410,142 - 410,142

	- (5,347,810) - 410,142 (222,976) (5,160,644)

	- (2,358,385) - - 2,358,385 -
	22,581,289 - - - - 22,581,289
	1,283,120 - 1,817,787 - - 3,100,907
	(1,206,914) - - - - (1,206,914)
	37,156,675 (13,729,842) 2,228,337 194,352 2,135,409 27,984,931
	Issued Capital Accumulated Losses Equity Based Payment Reserve Foreign Currency Reserve Non- Controlling Interest Total Equity $ $ $ $ $ $ 3,325,066 (1,315,881) - 208,730 - 2,217,915 - (4,707,766) - - - (4,707,766) - - - (424,520) - (424,520)
	- (4,707,766) - (424,520) - (5,132,286) 1,404,282 - - - - 1,404,282 4,633,601 - - - - 4,633,601 575,000 - - - - 575,000 300,000 - - - - 300,000 372,011 - - - - 372,011 132,738 - - - - 132,738 18,750 - - - - 18,750 1,132,309 - - - - 1,132,309 3,264,060 - - - - 3,264,060 - - 410,550 - - 410,550 (658,637) - - - - (658,637)
	14,499,180 (6,023,647) 410,550 (215,790) - 8,670,293

The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes

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Tesoro Resources Limited Consolidated Statement of Cash Flows For the year ended 30 June 2021

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Cash flows from operating activities Interest received Interest paid ATO cash flow boost received Other revenues Payments to suppliers and employees Net cash flows used in operating activities 22 Cash Flows from investing activities Payments for exploration and evaluation Purchase of plant and equipment Cash acquired on acquisition of Tesoro Australia Limited Net cash flows used in investing activities Cash flows from financing activities Proceeds from share issue Payments for share issue cost Repayment of lease liabilities Proceeds from convertible note Proceeds from borrowings Repayment of borrowings Net cash flows from financing activities Net increase in cash and cash equivalents Cash and cash equivalents at beginning of the financial year/period Effect of exchange rate changes on cash and cash equivalents Cash and cash equivalents at end of the financial year	Year ended 30 June 2021 $ 2,323 (2,623) 57,304 11,439 (1,215,928) (1,147,485) (12,321,311) (83,114) - (12,404,425) 22,538,811 (1,004,955) (142,839) - - - 21,391,017 7,839,107 5,871,130 18,040 13,728,277	Year ended 30 June 2020 $ 16 - 28,652 - (1,217,116)
		(1,188,448)
		(1,604,436) - 79,011
		(1,525,425)
		8,362,178 - 300,000 145,000 (242,812)
		8,564,366
		5,850,494 20,636 -
		5,871,130

The above consolidated statement of cash flows should be read in conjunction with the accompanying notes

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Tesoro Resources Limited Notes to the Consolidated Financial Statements For the year ended 30 June 2021

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Note 1. Statement of significant accounting policies

This financial report includes the financial statements and notes of Tesoro Resources Limited and controlled entities (“consolidated entity” or the “Group”). The separate financial statements and notes of Tesoro Resources Limited as an individual parent entity (“Company”) have not been presented within this financial report as permitted by the Corporations Act 2001 .

Basis of preparation

The financial report is a general purpose financial report, which has been prepared in accordance with the requirements of the Corporations Act 2001 , Accounting Standards and Interpretations and complies with other requirements of the law.

The financial report has been prepared on an accrual basis and is based on historical costs, modified, where applicable, by the measurement at fair value of selected non-current assets, financial assets and financial liabilities.

The Company is an ASX listed public company, incorporated in Australia and operating in Australia and Chile.

The Group’s principal activities are mineral exploration.

Historical cost convention

The financial statements have been prepared under the historical cost convention, except for, where applicable, the revaluation of available-for-sale financial assets, financial assets and liabilities at fair value through profit or loss, investment properties, certain classes of property, plant and equipment and derivative financial instruments.

Statement of Compliance

The financial report was authorised for issue on 24 September 2021.

The financial report complies with Australian Accounting Standards, which include Australian equivalents to International Financial Reporting Standards (AIFRS). Compliance with AIFRS ensures that the financial report, comprising the financial statements and notes thereto, complies with International Financial Reporting Standards (IFRS).

New or amended Accounting Standards and Interpretations adopted

The Group has adopted all of the new or amended Accounting Standards and Interpretations issued by the Australian Accounting Standards Board (“AASB”) that are mandatory for the current reporting period.

Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted.

The following Accounting Standards and Interpretations are most relevant to the Group:

Conceptual Framework for Financial Reporting (Conceptual Framework)

The Group has adopted the revised Conceptual Framework from 1 July 2020. The Conceptual Framework contains new definition and recognition criteria as well as new guidance on measurement that affects several Accounting Standards, but it has not had a material impact on the Group's financial statements.

New Accounting Standards and Interpretations not yet mandatory or early adopted

Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet mandatory, have not been early adopted by the Group for the annual reporting period ended 30 June 2021. The Group has not yet assessed the impact of these new or amended Accounting Standards and Interpretations.

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Tesoro Resources Limited Notes to the Consolidated Financial Statements For the year ended 30 June 2021

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Note 1. Statement of significant accounting policies (cont.)

Principles of consolidation

The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Tesoro Resources Limited (“Company” or “parent entity”) as at 30 June 2021 and the results of all subsidiaries for the period then ended. Tesoro Resources Limited and its subsidiaries together are referred to in these financial statements as the “consolidated entity” or “Group”.

Subsidiaries are all those entities over which the Company has control. The Company controls an entity when the Company is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Company. They are de-consolidated from the date that control ceases.

Intercompany transactions, balances and unrealised gains on transactions between entities in the Group are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset transferred. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.

The acquisition of subsidiaries has been accounted for using the purchase method of accounting. The purchase method of accounting involves allocating the cost of the business combination to the fair value of the assets acquired and the liabilities and contingent liabilities assumed at the date of acquisition. Accordingly, the consolidated financial statements include the results of subsidiaries for the period from their acquisition.

Non-controlling interest in the results and equity of subsidiaries are shown separately in the statement of profit or loss and other comprehensive income, statement of financial position and statement of changes in equity of the consolidated entity. Losses incurred by the consolidated entity are attributed to the non-controlling interest in full, even if that results in a deficit balance.

Where the consolidated entity loses control over a subsidiary, it derecognises the assets including goodwill, liabilities and non-controlling interest in the subsidiary together with any cumulative translation differences recognised in equity. The consolidated entity recognises the fair value of the consideration received and the fair value of any investment retained together with any gain or loss in statement of profit or loss and other comprehensive income.

Foreign currency translation

The financial statements are presented in Australian dollars, which is the Group's functional and presentation currency.

Foreign currency transactions

Foreign currency transactions are translated into Australian dollars using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at financial period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in statement of profit or loss and other comprehensive income.

Foreign operations

The assets and liabilities of foreign operations are translated into Australian dollars using the exchange rates at the reporting date. The revenues and expenses of foreign operations are translated into Australian dollars using the average exchange rates, which approximate the rates at the dates of the transactions, for the period. All resulting foreign exchange differences are recognised in other comprehensive income through the foreign currency reserve in equity.

The foreign currency reserve is recognised in statement of profit or loss and other comprehensive income when the foreign operation or net investment is disposed of.

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Tesoro Resources Limited Notes to the Consolidated Financial Statements For the year ended 30 June 2021

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Note 2. Significant accounting estimates and judgements

The application of accounting policies requires the use of judgements, estimates and assumptions about carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

Exploration and evaluation expenditure:

The Directors have conducted a review of the Group’s capitalised exploration expenditure to determine the existence of any indicators of impairment. Based upon this review, the Directors have determined that no impairment exists.

Share-based payment transactions:

The Group measures the cost of equity-settled transactions with employees by reference to the fair value of the equity instruments at the date at which they are granted. The fair value is determined by using an appropriate valuation model.

The fair value is expensed over the vesting period.

Lease term

The lease term is a significant component in the measurement of both the right-of-use asset and lease liability. Judgement is exercised in determining whether there is reasonable certainty that an option to extend the lease or purchase the underlying asset will be exercised, or an option to terminate the lease will not be exercised, when ascertaining the periods to be included in the lease term. In determining the lease term, all facts and circumstances that create an economical incentive to exercise an extension option, or not to exercise a termination option, are considered at the lease commencement date. Factors considered may include the importance of the asset to the consolidated entity's operations; comparison of terms and conditions to prevailing market rates; incurrence of significant penalties; existence of significant leasehold improvements; and the costs and disruption to replace the asset. The consolidated entity reassesses whether it is reasonably certain to exercise an extension option, or not exercise a termination option, if there is a significant event or significant change in circumstances.

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Tesoro Resources Limited Notes to the Consolidated Financial Statements For the year ended 30 June 2021

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30	June	30	June
	2021		2020
	$		$

Note 3. Cash and cash equivalent

Cash at bank

13,728,277 5,871,130

Cash comprises cash at bank and in hand. Cash equivalents are short term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. For the purposes of the statement of cash flows, cash and cash equivalents consist of cash and cash equivalents as defined above. Cash at bank earns interest at floating rates based on daily bank deposit rates.

de and other receivables Advances to external parties GST/VAT receivable Prepayments Advances to related parties Other receivables	30 June 2021 $ 169,110 39,860 95,487 21,283 3,794 329,534	30 June 2020 $ 54,322 32,183 136,660 29,167 -
		252,332

Note 4. Trade and other receivables

Current trade receivables are non-interest bearing and are normally settled on 60-day terms. This balance is current receivables incurred on a day to day operational basis and considered unimpaired.

Expected credit losses

The Group applies the AASB 9 simplified model of recognising lifetime expected credit losses for all trade receivables as these items do not have a significant financing component.

Where applicable, in measuring the expected credit losses, the trade receivables are assessed on a collective basis as they possess shared credit risk characteristics. They are grouped based on the days past due and also according to the geographical location of customers.

The expected loss rates are based on the payment profile for sales over the past 48 months before 30 June 2021 and 30 June 2020 respectively as well as the corresponding historical credit losses during that period. The historical rates are adjusted to reflect current and forwarding looking macroeconomic factors affecting the customer’s ability to settle the amount outstanding.

Trade receivables are written off when there is no reasonable expectation of recovery. Failure to make payments within 180 days from the invoice date and failure to engage with the Group on alternative payment arrangement amongst other is considered indicators of no reasonable expectation of recovery.

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Tesoro Resources Limited Notes to the Consolidated Financial Statements For the year ended 30 June 2021

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Note 5. Exploration and evaluation expenditure Costs carried forward in respect of areas of interest Exploration expenditure capitalised Option payment Espina project writedown Foreign currency translation	30 June 2021 $ 2,934,007 11,890,574 380,000 - 301,447 15,506,028	30 June 2020 $ 2,870,423 1,604,436 - (1,013,052) (527,800)
		2,934,007

The recoupment of costs carried forward in relation to areas of interest in the exploration and evaluation phases are dependent on the successful development and commercial exploitation or sale of the respective areas.

Exploration and evaluation expenditures in relation to each separate area of interest are recognised as an exploration and evaluation asset in the year in which they are incurred where the following conditions are satisfied:

the rights to tenure of the area of interest are current; and
at least one of the following conditions is also met:
(i) the exploration and evaluation expenditures are expected to be recouped through successful development and exploitation of the area of interest, or alternatively, by its sale; or
(ii) exploration and evaluation activities in the area of interest have not at the balance date reached a stage which permits a reasonable assessment of the existence or otherwise of economically recoverable reserves, and active and significant operations in, or in relation to, the area of interest are continuing.

Exploration and evaluation assets are initially measured at cost and include acquisition of rights to explore, studies, exploratory drilling, trenching, assaying, sampling and associated activities and an allocation of depreciation and amortised of assets used in exploration and evaluation activities. General and administrative costs are only included in the measurement of exploration and evaluation costs where they are related directly to operational activities in a particular area of interest.

Exploration and evaluation assets are assessed for impairment when facts and circumstances suggest that the carrying amount of an exploration and evaluation asset may exceed its recoverable amount. The recoverable amount of the exploration and evaluation asset (for the cash generating unit(s) to which it has been allocated being no larger than the relevant area of interest) is estimated to determine the extent of the impairment loss (if any). Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, but only to the extent that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset in previous years.

Where a decision has been made to proceed with development in respect of a particular area of interest, the relevant exploration and evaluation asset is tested for impairment and the balance is then reclassified to a mine development asset.

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Tesoro Resources Limited Notes to the Consolidated Financial Statements For the year ended 30 June 2021

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Note 6. Plant and Equipment Plant and equipment At cost Accumulated depreciation Total Plant and equipment Office equipment Beginning of period Accumulated depreciation Total Office equipment Leasehold improvements At cost Accumulated depreciation Total Leasehold improvements *Movements in plant and equipment* Beginning of period Additions Depreciation Foreign current translation Balance at end of period *Movements in office equipment* Beginning of period Additions Depreciation Foreign current translation Balance at end of period *Movements in leasehold improvements* Beginning of period Additions Depreciation Foreign current translation Balance at end of period Total plant and equipment	30 June 2021 $ 37,312 (3,042) 34,270 38,173 (5,388) 32,785 9,765 (981) 8,784 322 36,379 (2,549) 118 34,270 998 36,304 (5,107) 590 32,785 - 9,765 (981) - 8,784 75,839	30 June 2020 $ 933 (611)
		322
		1,153 (155)
		998
		- -
		-
		480 - (158) -
		322
		820 453 (170) (105)
		998
		- - - -
		-

		1,320

Plant and equipment is stated at cost less accumulated depreciation and any accumulated impairment losses.

Depreciation is calculated over the estimated useful life of the assets as follows: Plant and equipment – over 5 to 15 years (diminishing value) Computer equipment – 3 years (diminishing value) Leasehold improvements – 3-10 years (diminishing value)

The assets' residual values, useful lives and amortisation methods are reviewed, and adjusted if appropriate, at each financial year end.

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Tesoro Resources Limited Notes to the Consolidated Financial Statements For the year ended 30 June 2021

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Note 6. Plant and Equipment (cont.)

Leasehold improvements are depreciated over the unexpired period of the lease or the estimated useful life of the assets, whichever is shorter.

For an asset that does not generate largely independent cash inflows, recoverable amount is determined for the cash-generating unit to which the asset belongs, unless the asset's value in use can be estimated to be close to its fair value.

An impairment exists when the carrying value of an asset or cash-generating units exceeds its estimated recoverable amount. The asset or cash-generating unit is then written down to its recoverable amount with the impairment loss recognised in statement of profit or loss and other comprehensive income.

Derecognition and disposal

An item of plant and equipment is derecognised upon disposal or when no further future economic benefits are expected from its use or disposal.

Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in statement of profit or loss and other comprehensive income in the year the asset is derecognised.

Note 7. Current Liabilities (a) Trade and Other Payables Trade payables(i) Other payables Share application monies received in advance	30 June 2021 $ 1,452,675 273,793 - 1,726,468	30 June 2020 $
		202,707
		143,317
		42,472
		388,496

(i) Trade payables are non-interest bearing and are normally settled on 30 day terms.

Trade payables and other payables are carried at amortised cost and represent liabilities for goods and services provided to the Group prior to the end of the financial year that are unpaid and arise when the Group becomes obliged to make future payments in respect of the purchase of these goods and services. Trade and other payables are presented as current liabilities unless payment is not due within 12 months.

(b) Provisions

Annual leave	35,887 35,887	-
		-

Short-term employee benefits

Liabilities for wages and salaries, including non-monetary benefits, annual leave and long service leave expected to be settled wholly within 12 months of the reporting date are measured at the amounts expected to be paid when the liabilities are settled.

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Tesoro Resources Limited Notes to the Consolidated Financial Statements For the year ended 30 June 2021

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Note 7. Current Liabilities (cont.)

Provisions are recognised when the consolidated entity has a present (legal or constructive) obligation as a result of a past event, it is probable the consolidated entity will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting date, taking into account the risks and uncertainties surrounding the obligation. If the time value of money is material, provisions are discounted using a current pre-tax rate specific to the liability. The increase in the provision resulting from the passage of time is recognised as a expense.

(c) Lease liability Current - Lease liability Refer Note 25 for further details.	30 June 2021 $ 2,422 2,422	30 June 2020 $ -
		-

Note 8. Non-Current Liabilities

Lease liability	108,924 108,924	-
		-

Refer Note 25 for further details.

Lease liabilities

A lease liability is recognised at the commencement date of a lease. The lease liability is initially recognised at the present value of the lease payments to be made over the term of the lease, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the consolidated entity's incremental borrowing rate. Lease payments comprise of fixed payments less any lease incentives receivable, variable lease payments that depend on an index or a rate, amounts expected to be paid under residual value guarantees, exercise price of a purchase option when the exercise of the option is reasonably certain to occur, and any anticipated termination penalties. The variable lease payments that do not depend on an index or a rate are expensed in the period in which they are incurred.

Lease liabilities are measured at amortised cost using the effective interest method. The carrying amounts are remeasured if there is a change in the following: future lease payments arising from a change in an index or a rate used; residual guarantee; lease term; certainty of a purchase option and termination penalties. When a lease liability is remeasured, an adjustment is made to the corresponding right-of use asset, or to the statement of profit or loss and other comprehensive income if the carrying amount of the right-of-use asset is fully written down.

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Tesoro Resources Limited Notes to the Consolidated Financial Statements For the year ended 30 June 2021

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soro Resources Limited tes to the Consolidated Financial Statements r the year ended 30 June 2021
Note 9. Issued capital 554,997,627 (2020: 435,946,211) issued and fully paid ordinary shares Movement in ordinary shares on issue Opening balance Eliminate existing legal acquiree shares Share of legal acquirer at acquisition date Consideration shares – RTO1 Placement – RTO2 Lead manager facilitation shares – RTO3 Shares issued for conversion of convertible loan4 Lead manager facilitation shares – Convertible loan Shares issued on conversion of director loan5 Shares issued in lieu of fees Accelerated Offer6 Placement7 Share issue costs At 30 June 2020 Movement in ordinary shares on issue Opening balance Shares issued on acceleration of option exercise El Zorro project8 Shares issued in lieu of payment for advisory services9 Shares issued to Director as remuneration10 Accelerated Offer – Retail component11 Accelerated Offer – Shortfall component12 Placement13 Shares issued in lieu of payment for capital raising fees14 Share Purchase Plan15 Share issue costs At 30 June 2021	30 June 2021 $ 37,156,675 37,156,675 30 June 2020 # 73,105,603 (73,105,603) 46,809,228 112,294,158 154,453,373 19,166,667 12,499,994 625,000 12,400,367 4,424,600 18,871,816 54,401,008 - 435,946,211 30 June 2021 # 435,946,211 5,000,000 659,562 8,333,333 13,000,281 13,354,536 66,666,667 925,926 11,111,111 - 554,997,627	30 June 2020 $
		14,499,180
		14,499,180
		30 June 2020 $ 3,325,066 - - 1,404,282 4,633,601 575,000 300,000 18,750 372,011 132,738 1,132,309 3,264,060 (658,637)
		14,499,180
		30 June 2021 $ 14,499,180
		380,000 19,787 633,333 780,017 801,272 18,000,000 250,000 3,000,000 (1,206,914)
		37,156,675

1 112,294,158 fully paid ordinary shares valued at acquisition date.

2 154,453,373 fully paid ordinary shares issued at $0.03 per share.

3 19,166,667 fully paid ordinary shares issued at $0.03 per share.

4 12,499,994 fully paid ordinary shares issued at $0.03 per share.

5 12,400,367 fully paid ordinary shares issued at $0.03 per share.

6 18,871,816 fully paid ordinary shares issued at $0.06 per share.

7 54,401,008 fully paid ordinary shares issued at $0.06 per share.

8 5,000,000 fully paid ordinary shares issued at fair value of $0.076 per share.

9 659,562 fully paid ordinary shares issued at fair value of $0.03 per share.

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Tesoro Resources Limited Notes to the Consolidated Financial Statements For the year ended 30 June 2021

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Note 9. Issued capital (cont.)

10 8,333,333 fully paid ordinary shares issued at fair value of $0.076 per share.

11 13,000,281 fully paid ordinary shares issued at $0.06 per share.

12 13,354,536 fully paid ordinary shares issued at $0.06 per share.

13 66,666,667 fully paid ordinary shares issued at $0.27 per share.

14 925,926 fully paid ordinary shares issued at $0.27 per share.

15 11,111,111 fully paid ordinary shares issued at $0.27 per share.

Terms of Ordinary Shares

Voting Rights

Ordinary shares participate in dividends and the proceeds on winding up of the Company in proportion to the number of shares held and in proportion to the amount paid up on the shares held.

At shareholders meetings, each ordinary share is entitled to one vote in proportion to the paid-up amount of the share when a poll is called, otherwise each shareholder has one vote on a show of hands.

eserves Equity based payment Foreign currency translation Balance at end of the year Movement in Equity based payment Reserve Opening balance Equity based payments Balance at end of the year Movement in Foreign Currency Reserve Opening balance Foreign currency translation movement Balance at end of the year	30 June 2021 $ 2,228,337 194,352 2,422,689 410,550 1,817,787 2,228,337 (215,790) 410,142 194,352	30 June 2020 $ 410,550 (215,790)
		194,760
		- 410,550
		410,550
		208,730 (424,520)
		(215,790)

Note 10. Reserves

Equity Based Payments Reserve:

This reserve is used to record the value of equity benefits provided to directors and employees as part of their remuneration. Refer to Note 13.

Foreign Currency Translation Reserve:

Foreign currency translation reserve records exchange differences arising on translation of the subsidiaries’ functional currency (Chilean Pesos) into presentation currency at balance date.

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Tesoro Resources Limited Notes to the Consolidated Financial Statements For the year ended 30 June 2021

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30 June 2021 $ Note 11. Income tax a. The components of tax (benefit) comprise: Current tax - Deferred tax - Income tax benefit reported in statement of profit or loss and other comprehensive income - b. The prima facie tax benefit on loss from ordinary activities before income tax is reconciled to the income tax as follows: Prima facie tax benefit on loss from ordinary activities before income tax at 26% (2020: 30%) (1,448,404) Add tax effect of: - Revenue losses not recognised 397,001 - Other non-allowable items 1,115,223 - Other deferred tax balances not recognised (48,921) - Other non-allowable items (14,899) Income tax expense/(benefit) reported in the consolidated statement of profit or loss and other comprehensive income from ordinary operations - c. Deferred tax recognised at 30% (2020: 30%)1: Deferred tax liabilities: - Leases (17,314) - Unrealised foreign exchange gain (5,689) - Prepayments (600) (23,603) Deferred tax assets: - Carry forward revenue losses 23,603 Net deferred tax - d. Unrecognised deferred tax assets at 30% (2020: 30%)1: Carry forward revenue losses 2,129,235 Carry forward capital losses 73,900 Capital raising costs 125,351 Borrowing costs 32,703 Provisions and accruals 16,766 Other 30 2,377,985	30 June 2021 $ Note 11. Income tax a. The components of tax (benefit) comprise: Current tax - Deferred tax - Income tax benefit reported in statement of profit or loss and other comprehensive income - b. The prima facie tax benefit on loss from ordinary activities before income tax is reconciled to the income tax as follows: Prima facie tax benefit on loss from ordinary activities before income tax at 26% (2020: 30%) (1,448,404) Add tax effect of: - Revenue losses not recognised 397,001 - Other non-allowable items 1,115,223 - Other deferred tax balances not recognised (48,921) - Other non-allowable items (14,899) Income tax expense/(benefit) reported in the consolidated statement of profit or loss and other comprehensive income from ordinary operations - c. Deferred tax recognised at 30% (2020: 30%)1: Deferred tax liabilities: - Leases (17,314) - Unrealised foreign exchange gain (5,689) - Prepayments (600) (23,603) Deferred tax assets: - Carry forward revenue losses 23,603 Net deferred tax - d. Unrecognised deferred tax assets at 30% (2020: 30%)1: Carry forward revenue losses 2,129,235 Carry forward capital losses 73,900 Capital raising costs 125,351 Borrowing costs 32,703 Provisions and accruals 16,766 Other 30 2,377,985	30 June 2020 $ - -
		-
		(1,412,330) 414,330 1,068,158 (61,562) (8,596)
		-
		- - -
		-
		-
		-
	2,129,235 73,900 125,351 32,703 16,766 30 2,377,985	1,669,234 73,900 96,765 32,703 7,539 -
		1,880,141

The tax benefits of the above deferred tax assets will only be obtained if:

(a) the Company derives future assessable income of a nature and of an amount sufficient to enable the benefits to be utilised;

(b) the Company continues to comply with the conditions for deductibility imposed by law; and (c) no changes in income tax legislation adversely affect the Company in utilising the benefits.

1 The corporate tax rate for eligible companies will reduce from 30% to 25% by 30 June 2022 providing certain turnover thresholds and other criteria are met. Deferred tax assets and liabilities are required to be measured at the tax rate that is expected to apply in the future income year when the asset is realised or the liability is settled. The Directors have determined that the deferred tax balances be measured at the tax rates stated.

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Tesoro Resources Limited Notes to the Consolidated Financial Statements For the year ended 30 June 2021

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Note 12. Key Management Personnel Disclosures

The aggregate compensation made to the directors and other key management personnel of the Group is set out below:

	2021 2020
	$ $
Short-term benefits	340,000 137,708
Other fees	- 50,000
Post-employment benefits	22,800 13,460
Share-based payments	2,153,843 376,287
	2,516,643 577,455

Note 13. Equity Based Payments

Equity based payments included in the Statement of Financial Position for the year are as follows:

llows:
	30 June	30 June
	2021	2020
	$	$
Shares issued to the vendor of the El Zorro	380,000	-
project included in exploration and evaluation
expenditure (Note 9)
Shares issued in lieu of capital raising fees (Note	250,000	-
9)

Equity based payments included in the Statement of Profit or Loss and Other Comprehensive Income for the period are detailed below:

Shares issued to consultant included in statement of profit or loss and other comprehensive income as legal and professional fees Performance rights and share issued included in statement of profit or loss and other comprehensive income as equity based payments expense Shares issued as remuneration to a director1 Vesting period expense - performance rights (Directors2and employees3)	30 June 2021 $ 19,787 633,333 1,817,787 2,451,120	30 June 2020 $ -
		- 410,550
		410,550

On 3 July 2020, pursuant to the Executive Services Agreement between the Company and Mr Zeffron Reeves, the Company issued 8,333,333 fully paid ordinary shares at fair value of $0.076 per share. Refer to Note 9.
On 31 January 2020, the Company issued Performance Rights to the Company’s Managing Director and Nonexecutive Director in connection with their appointments as directors upon the reverse acquisition of Tesoro Australia Limited completed 29 January 2020. The total value of options issued was $2,693,265. The total amount recognised as equity based payment expense for the year ended 30 June 2021 was $1,520,510 (2020: $376,287).

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Tesoro Resources Limited Notes to the Consolidated Financial Statements For the year ended 30 June 2021

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Note 13. Equity Based Payments (cont.)

On 26 May 2020, the Company issued Incentive Performance Rights to Chilean employees under the Company’s Performance Rights and Options Plan (“Plan”). The total value of options issued was $508,915. The total amount recognised as equity based payment expense for the year ended 30 June 2021 was $297,277 (2020: $34,263).

A total of 146,231,405 performance rights were outstanding as at 30 June 2021 (2020: 146,231,405). The weighted average remaining contractual life of performance rights outstanding at the end of the financial year was 1.45 years (2020: 2.45 years).

Note 14. Related Party Disclosures

Key Management Personnel and transactions with other related parties

Disclosures relating to Key Management Personnel are set out in Note 12 and the Remuneration Report included in the Directors’ Report.

a) Transactions with Key Management Personnel and their related parties

A company associated with Geoffrey McNamara, a director, Tanamera Resources Pte Ltd was paid $87,000 (2020: $47,201) in consulting fees.

b) Outstanding balances arising from sales/purchases of goods and services, transactions

No outstanding balances with related parties during the year ended 30 June 2021 (2020: Nil).

c) Loans to Key Management Personnel and their related parties

No outstanding loans to Key Management Personnel and their related parties during the year ended 30 June 2021 (2020: Nil).

Note 15. Financial Risk Management Objectives and Policies

The main risks arising from the Group’s financial instruments are market risk, currency risk and interest rate risk.

This note presents information about the Group’s exposure to each of the above risks, their objectives, policies and processes for measuring and managing risk, and the management of capital.

The Board has overall responsibility for the establishment and oversight of the risk management framework. The Board reviews and agrees policies for managing each of these risks and they are summarised below.

The Group’s principal financial instruments comprise cash and short term deposits. The main purpose of the financial instruments is to earn the maximum amount of interest at a low risk to the Group. The Group also has other financial instruments such as trade debtors and creditors which arise directly from its operations.

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Tesoro Resources Limited Notes to the Consolidated Financial Statements For the year ended 30 June 2021

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Note 15. Financial Risk Management Objectives and Policies (cont.)

(a) Market Risk

Market risk is the risk that changes in market prices such as foreign exchange rates, interest rates and equity prices will affect the Group’s income or the value of its holdings of financial instruments.

The Group is exposed to movements in market interest rates on short term deposits. The policy is to monitor the interest rate yield curve out to 120 days to ensure a balance is maintained between the liquidity of cash assets and the interest rate return. The Group does not have short or long term debt, and therefore this risk is minimal.

(b) Currency Risk

Foreign exchange risk arises from future commitments, assets and liabilities that are denominated in a currency that is not the functional currency of the Group. The Group deposits are denominated in both Chilean Peso, US dollar and Australian dollars. At the year end the majority of deposits were held in Australian dollars. Currently, there are no foreign exchange programs in place. Based upon the above, the impact of reasonably possible changes in foreign exchange rates for the Group is not material.

(c) Interest Rate Risk

The table below reflects the undiscounted contractual settlement terms for financial instruments of a fixed period of maturity, as well as management’s expectations of the settlement period for all other financial instruments. As such, the amounts might not reconcile to the statement of financial position.

30 June 2021 FINANCIAL ASSETS Non-interest bearing Variable interest rate instruments FINANCIAL LIABILITIES Non-interest bearing Lease liabilities NET FINANCIAL LIABILITIES	Weighted Average Effective Interest Rate %	Less than 1 month 1 to 3 months 3 months to 1 year 1 to 5 years Total $ $ $ $ $
	0.01% 4.52%	3,838,399 - - - 3,838,399 9,889,878 - - - 9,889,878 13,728,277 - - - 13,728,277 (1,675,904) - - (86,451) (1,762,355) (198) (378) (1,847) (108,923) (111,346) (12,052,175) (378) (1,847) (195,374) 11,854,576

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Tesoro Resources Limited Notes to the Consolidated Financial Statements For the year ended 30 June 2021

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Note 15. Financial Risk Management Objectives and Policies (cont.)

30 June 2020 FINANCIAL ASSETS Non-interest bearing Variable interest rate instruments Fixed interest rate instruments FINANCIAL LIABILITIES Non-interest bearing NET FINANCIAL LIABILITIES	Weighted Average Effective Interest Rate %	Less than 1 month 1 to 3 months 3 months to 1 year 1 to 5 years Total $ $ $ $ $
	0.02%	290,284 - - - 290,284 - - - - - 5,580,846 - - - 5,580,846 5,871,130 - - - 5,871,130 (261,508) - - (84,516) (346,024) 5,609,622 - - (84,516) 5,525,106

Net fair value of financial assets and liabilities

The carrying amount of cash and cash equivalents approximates fair value because of their short-term maturity.

(d) Interest Rate Sensitivity Analysis

At 30 June 2021, the effect on loss and equity as a result of changes in the interest rate, with all other variable remaining constant would have immaterial effect.

(e) Credit Risk

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group. The Group has adopted the policy of only dealing with creditworthy counterparties and obtaining sufficient collateral or other security where appropriate, as a means of mitigating the risk of financial loss from defaults.

The Group operates in the mining exploration sector; it therefore does not supply products and have trade receivables and is not exposed to credit risk in relation to trade receivables. The Group does not have any significant credit risk exposure to any single counterparty or any Company of counterparties having similar characteristics.

The Group’s maximum exposure to credit risk at each balance date in relation to each class of recognised financial assets is the carrying amount, net of any allowance for doubtful debts, of those assets as indicated in the statement of financial position. The maximum credit risk exposure of the Group at 30 June 2021 is nil (2020: nil). There are no impaired receivables at 30 June 2021 (2020: Nil).

(f) Liquidity Risk

Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Group’s reputation.

The Group manages liquidity risk by monitoring forecast cash flows on a rolling monthly basis and entering into supply contracts which can be cancelled within a short timeframe. The

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Tesoro Resources Limited Notes to the Consolidated Financial Statements For the year ended 30 June 2021

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Note 15. Financial Risk Management Objectives and Policies (cont.)

Group does not have any significant liquidity risk as the Group does not have any collateral debts.

(g) Capital Management

The Group’s objectives when managing capital are to safeguard its ability to continue as a going concern, so it may continue to provide returns for shareholders and benefits for other stakeholders.

Due to the nature of the Group’s activities, being mineral exploration, it does not have ready access to credit facilities and therefore is not subject to any externally imposed capital requirements, with the primary sources of project funding to date being raising funds from equity markets. Accordingly, the objective of the Group’s capital risk management is to balance the current working capital position against the requirements to meet progressing exploration and evaluation work, project related costs and corporate overheads. Going forward, operations budget and cashflow forecasts are monitored to ensure sufficient funding to meet expenditure.

The directors consider that the carrying value of the financial assets and financial liabilities recognised in the consolidated financial statements approximate their fair value.

Note 16. Earnings Per Share Loss after income tax Non-controlling interest Loss after income tax attributable to the owners of the parent used in the calculation of basic and diluted loss per share (a) Weighted average number of ordinary shares outstanding during the reporting period used in calculation of basic and diluted loss per share: Basic and diluted loss per share (cents per share)	30 June 2021 $ (5,570,786) 222,976 (5,347,810) Number of Shares 517,258,081	30 June 2020 $ (4,707,766) -
		(4,707,766) Number of Shares 154,433,246
	(1.03)	(3.05)

Basic earnings per share is calculated as net profit or loss attributable to members of the parent, adjusted to exclude any costs of servicing equity (other than dividends) and preference share dividends, divided by the weighted average number of ordinary shares, adjusted for any bonus element.

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Tesoro Resources Limited Notes to the Consolidated Financial Statements For the year ended 30 June 2021

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Note 16. Earnings Per Share (cont.)

Diluted earnings per share is calculated as net profit or loss attributable to members of the parent, adjusted for:

costs of servicing equity (other than dividends) and preference share dividends;
the after tax effect of dividends and interest associated with dilutive potential ordinary shares that have been recognised as expenses; and
other non-discretionary changes in revenues or expenses during the period that would result from the dilution of potential ordinary shares; divided by the weighted average number of ordinary shares and dilutive potential ordinary shares, adjusted for any bonus element.

Note 17. Segment Reporting

Tesoro Resources Limited operates predominantly in one industry being the mining exploration and evaluation industry in Chile, with its corporate function located in Australia.

Segment Information

Identification of reportable segments

The Company has identified its operating segments based on the internal reports that are reviewed and used by the chief operating decision maker (being the Board of Directors) in assessing performance and determining the allocation of resources.

The Company is managed primarily on the basis of evaluation of its gold and copper exploration tenements in Chile and its corporate activities. Operating segments are therefore determined on the same basis.

Reportable segments disclosed are based on aggregating operating segments where the segments are considered to have similar economic characteristics.

Types of reportable segments

(i) Exploration and evaluation

Segment assets, including acquisition cost of exploration licenses and all expenses related to the licenses in Chile are reported in this segment.

(ii) Corporate

Corporate, including treasury, corporate and regulatory expenses arising from operating an ASX listed entity. Segment assets, including cash and cash equivalents, and investments in financial assets are reported in this segment.

Basis of accounting for purposes of reporting by operating segments

Accounting policies adopted

Unless stated otherwise, all amounts reported to the Board of Directors as the chief operating decision maker with respect to operating segments are determined in accordance with accounting policies that are consistent to those adopted in the annual financial statements of the Company.

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Tesoro Resources Limited Notes to the Consolidated Financial Statements For the year ended 30 June 2021

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Note 17. Segment Reporting (cont.)

Segment assets

Where an asset is used across multiple segments, the asset is allocated to the segment that receives the majority of economic value from the asset. In the majority of instances, segment assets are clearly identifiable on the basis of their nature and physical location.

Segment liabilities

Liabilities are allocated to segments where there is direct nexus between the incurrence of the liability and the operations of the segment. Segment liabilities include trade and other payables.

30 June 2021 (i) Segment performance Segment revenue *Segment results* Included within segment results: • Depreciation • Interest revenue • ATO Cashboost – COVID 19 Segment assets Segment liabilities 30 June 2020 (i) Segment performance Segment revenue *Segment results* Included within segment results: • Depreciation • Interest revenue • ATO Cashboost – COVID 19 • Exploration impairment Segment assets Segment liabilities		Corporate Exploration and Evaluation Total $ $ $
		71,014 52 71,066
		(3,551,968) (2,018,818) (5,570,786)
		(28,069) (16,549) (44,618) 2,271 52 2,323 68,743 - 68,743 11,562,262 18,296,370 29,858,632 (429,194) (1,444,507) (1,873,701)
		Corporate Exploration and Evaluation Total $ $ $
		28,683 - 28,683 (3,097,138) (1,610,628) (4,707,766) - (328) (328) 31 - 31 28,652 - 28,652 (1,013,052) (1,013,052) 5,859,813 3,198,976 9,058,789 (344,984) (43,512) (388,496)

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Tesoro Resources Limited Notes to the Consolidated Financial Statements For the year ended 30 June 2021

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Note 17. Segment Reporting (cont.)

(ii) Revenue by geographical region

There was no revenue attributable to external customers for the year ended 30 June 2021 (2020: Nil).

(iii) Assets by geographical region

Non-current assets by geographical region are as follows .

Australia Chile Commitments for expenditure The exploration commitments are as follows: Not longer than 1 year Longer than 1 but not longer than 5 years Longer than 5 years Total	30 June 2021 $ 233,769 15,567,052	30 June 2020 $ 21,307 2,914,020
	30 June 2021 $ 147,676 - - 147,676	30 June 2020 $ 15,147 - - 15,147

Note 18. Commitments for expenditure

Exploration commitments consist of annual rents payable on mineral concessions.

Note 19. Contingent assets

All purchases in Chile are subject to the payment of the Impuesto al Valor Agregado (“IVA”) which is a Value Added Tax.

As at 30 June 2021, El Zorro S.C.M. had applied for a VAT benefit. As at 30 June 2021, El Zorro S.C.M. carries an IVA tax receivable of $1,302,351. The contingent asset has not been recognised as a receivable at 30 June 2021as the receipt of the amount is dependent upon El Zorro S.C.M. meeting the IVA refund conditions stipulated by the relevant taxation authorities in Chile.

As at 30 June 2021, the IVA tax receivable for Tesoro Mining Chile SpA is $nil as it is no longer expected to be refundable, as the nature of the Company in Chile will not meet the IVA refund conditions and therefore Tesoro will not be able to claim back the IVA tax it has paid on all Chilean purchases. As at 30 June 2020, the IVA tax receivable was approximately $275,380.

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Tesoro Resources Limited Notes to the Consolidated Financial Statements For the year ended 30 June 2021

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Note 20. Contingent liabilities

Post the end of the financial year, on 26 August 2021, the Company advised it had been served notice of dispute initiated by Wanaco SpA (“Wanaco”), lodged with 7th Civil Court de Santiago de Chile.

There are no other contingent liabilities as at 30 June 2021 and 30 June 2020.

Note 21. Interest in other entities

The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiary in accordance with the accounting policies described in note 1:

Name	Country of incorporation	Ownership %	Ownership %
		2021	2020
Tesoro Mining Chile SPA Chile El Zorro SCM Chile Tesoro Australia Limited Australia The Food Box Asia Limited Hong Kong Plukka (HK) Limited Hong Kong		95 95 85* - 100 100 100 100 100 100

The above subsidiaries have share capital consisting solely of ordinary shares that are held directly by the Group, and the proportion of ownership interests held equals the voting rights held by the Group. The country of incorporation or registration is also their principal place of business.

In March 2021, the Company modified the terms of the existing Purchase Option Agreement of its acquisition of the El Zorro Gold Project (El Zorro Project), through the Company’s 95% owned Chilean subsidiary, Tesoro Mining Chile SpA (TMC), owner of 70% of El Zorro S.C.M. (El Zorro), the holder of the El Zorro concessions. The existing Purchase Option Agreement was terminated 26 February 2021, meaning that El Zorro will now be operated under normal Chilean company regulations, which includes that all shareholders must be given the opportunity to contribute proportionally to El Zorro’s capital requirements. If a shareholder elects not to contribute to a capital raising, then their ownership will be diluted.

In March 2021, the Company’s 95% owned subsidiary, TMC, has increased its ownership of the El Zorro in Chile to 85%. The minority shareholder in El Zorro elected not to participate and TMC has now contributed the A$7.6 million to increase its ownership to 85%.

Note 22. Cash flow information

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Tesoro Resources Limited Notes to the Consolidated Financial Statements For the year ended 30 June 2021

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Reconciliation of cash: Cash balances ation of net loss after tax to the net cash outflows from Net loss Non-cash items Share based payments Impairment of VAT receivable Depreciation Exchange difference Espina project writedown Director fees settled by issue of shares Write-off of liabilities Listing fee RTO related expenses Changes in assets and liabilities Receivables and other assets Payables and accruals Net cash flows used in operating activities Non-cash investing and financing activities Additions to right of use assets	Year ended 30 June 2021 $ 13,728,277 13,728,277 operations: (5,570,786) 2,451,120 1,555,202 44,618 200,170 - - - - - (77,203) 249,394 (1,147,485) Year ended 30 June 2021 $ 218,954 218,954	Year ended 30 June 2020 $ 5,871,130
		5,871,130

		(4,707,766)
		410,550 103,521 328 (30,308) 1,013,052 52,500 (90,301) 1,659,023 80,238 195,992 124,723
		(1,188,448)
		Year ended 30 June 2020 $ -
		-

Reconciliation of net loss after tax to the net cash outflows from operations:

Note 23. Parent Entity Disclosures

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Tesoro Resources Limited Notes to the Consolidated Financial Statements For the year ended 30 June 2021

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(a) Financial position Assets Current assets Non-current assets Total Assets Liabilities Current liabilities Non-current liabilities Total Liabilities Equity Issued capital Accumulated losses Reserves Total Equity (b) Financial performance Loss for the year Other comprehensive income Total comprehensive loss	Year ended 30 June 2021 $	Year ended 30 June 2020 $
	11,328,709	5,859,407
	233,553	453
	11,562,262	5,859,860


	(315,124) (885,868)	(343,173)
		(774,621)
	(1,200,992)	(1,117,794)


	37,156,675	14,499,180
	(29,023,742)	(10,167,664)
	2,228,337	410,550
	10,361,270	4,742,066
	Year ended 30 June 2021 $ (18,856,078) - (18,856,078)	Year ended 30 June 2020 $ (13,184,940) -
		(13,184,940)

(c) Contingent liabilities

Refer to Note 20 for details.

(d) Contractual Commitments

As at 30 June 2021 (2020: nil), the Company had no contractual commitments.

(e) Guarantees entered into by parent entity

As at 30 June 2021 and 2020, the Company had not entered into any guarantees.

The financial information for the parent entity, Tesoro Resources Limited, has been prepared on the same basis as the consolidated financial statements, except as set out below.

Investments in subsidiaries, associates and joint venture entities

Investments in subsidiaries, associates and joint venture entities are accounted for at cost, less any impairment, in the parent entity. Dividends received from subsidiaries are recognised as other income by the parent entity and its receipt may be an indicator of an impairment of the investment.

Note 24. Remuneration of auditors

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Tesoro Resources Limited Notes to the Consolidated Financial Statements For the year ended 30 June 2021

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During the financial year, the following fees were paid or payable for services provided by RSM Australia Partners, the auditor of the Company:

Audit and review of financial statements Investigating Accountant's Report	Year ended 30 June 2021 $ 43,000 - 43,000	Year ended 30 June 2020 $
		50,250
		13,750
		64,000

Note 25. Right-of-Use-Assets

Land and buildings – right-of-use Less: Accumulated depreciation Movement during the year	Year ended 30 June 2021 $ 255,277 (36,323) 218,954	Year ended 30 June 2020 $
		-
		-
		-

Additions Depreciation expense	Year ended 30 June 2021 $ 255,277 (36,323) 218,954	Year ended 30 June 2020 $
		-
		-
		-

The Company leases a building for its office under agreement of four years with the option to extend. On renewal, the terms of the lease are renegotiated.

Tesoro Mining Chile SpA leases a building for its core storage under agreement of two years with the option to extend. On renewal, the terms of the lease are renegotiated.

Right-of-use assets

A right-of-use asset is recognised at the commencement date of a lease. The right-of-use asset is measured at cost, which comprises the initial amount of the lease liability, adjusted for, as applicable, any lease payments made at or before the commencement date net of any lease incentives received, any initial direct costs incurred, and, except where included in the cost of inventories, an estimate of costs expected to be incurred for dismantling and removing the underlying asset, and restoring the site or asset.

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Tesoro Resources Limited Notes to the Consolidated Financial Statements For the year ended 30 June 2021

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Note 25. Right-of-Use-Assets (cont.)

Right-of-use assets are depreciated on a straight-line basis over the unexpired period of the lease or the estimated useful life of the asset, whichever is the shorter. Where the consolidated entity expects to obtain ownership of the leased asset at the end of the lease term, the depreciation is over its estimated useful life. Right-of use assets are subject to impairment or adjusted for any remeasurement of lease liabilities.

The consolidated entity has elected not to recognise a right-of-use asset and corresponding lease liability for short-term leases with terms of 12 months or less and leases of low-value assets. Lease payments on these assets are expensed to statement of profit or loss and other comprehensive income as incurred.

Note 26. Events after reporting period

On 6 July 2021, the Company announced assay results from the first hole drilled at the Ternera East Target located at the Company’s El Zorro Gold Project (El Zorro) in Chile.

On 14 September 2021, Mr Linton Putland and Ms Kristie Young were appointed to the Board.

Other than as discussed above, no other matter or circumstance has arisen since 30 June 2020 that has significantly affected, or may significantly affect the Group's operations, the results of those operations, or the Group's state of affairs in future financial years.

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Tesoro Resources Limited Directors' declaration

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In the opinion of the Directors of Tesoro Resources Limited (the ‘Company’):

a. the financial statements, notes and the additional disclosures are in accordance with the Corporations Act 2001 including:
I. giving a true and fair view of the Group’s financial position as at 30 June 2021 and of its performance for the year then ended; and
II. complying with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations Regulations 2001;
b. there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable; and
c. the financial statements and notes thereto are in accordance with International Financial Reporting Standards issued by the International Accounting Standards Board.

This declaration has been made after reviewing the declarations required to be made to the Directors in accordance with Section 295A of the Corporations Act 2001 for the financial year ended 30 June 2021.

Signed in accordance with a resolution of the Board of Directors.

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_________ John Toll Non-Executive Chairman 24 September 2021

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RSM Australia Partners

Level 32, Exchange Tower 2 The Esplanade Perth WA 6000 GPO Box R1253 Perth WA 6844

T +61 (0) 8 9261 9100 F +61 (0) 8 9261 9111

www.rsm.com.au

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF TESORO RESOURCES LIMITED

Opinion

We have audited the financial report of Tesoro Resources Limited (the Company) and its subsidiaries (the Group), which comprises the consolidated statement of financial position as at 30 June 2021, the consolidated statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies, and the directors' declaration.

In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001, including:

(i) Giving a true and fair view of the Group's financial position as at 30 June 2021 and of its financial performance for the year then ended; and
(ii) Complying with Australian Accounting Standards and the Corporations Regulations 2001.

Basis for Opinion

We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Report section of our report. We are independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board's APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.

We confirm that the independence declaration required by the Corporations Act 2001, which has been given to the directors of the Company, would be in the same terms if given to the directors as at the time of this auditor's report.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

THE POWER OF BEING UNDERSTOOD AUDIT | TAX | CONSULTING

RSM Australia Partners ABN 36 965 185 036

Liability limited by a scheme approved under Professional Standards Legislation

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Key Audit Matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial report of the current period. These matters were addressed in the context of our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Key Audit Matter	How our audit addressed this matter
*Exploration and Evaluation Expenditure* Refer to Note 5 in the financial statements
The Group has capitalised exploration and evaluation expenditure with a carrying value of $15,506,028 as at 30 June 2021. We considered this to be a key audit matter due to the significant management judgments involved in assessing the carrying value of the asset including: Determination of whether the expenditure can be associated with finding specific mineral resources, and the basis on which that expenditure is allocated to an area of interest; Determination of whether exploration activities have progressed to the stage at which the existence of an economically recoverable mineral reserve may be assessed; and Assessing whether any indicators of impairment are present, and if so, judgments applied to determine and quantify any impairment loss.	Our audit procedures included:  Ensuring that the right to tenure of each area of interest is current;  Agreeing a sample of additions to supporting documentation and ensuring the amounts are capital in nature and relate to the area of interest;  Assessing and evaluating management’s assessment that no indicators of impairment existed at the reporting date;  Assessing management’s determination that exploration and evaluation activities have not yet reached a stage where the existence or otherwise of economically recoverable reserves may be reasonably determined; and  Enquiring with management and reviewing budgets and other supporting documentation as evidence that active and significant operations in, or relation to, the area of interest will be continued in the future.

Key Audit Matter

How our audit addressed this matter

Exploration and Evaluation Expenditure
Refer to Note 5 in the financial statements

The Group has capitalised exploration and
evaluation expenditure with a carrying value of
$15,506,028 as at 30 June 2021.
We considered this to be a key audit matter due to
the significant management judgments involved in
assessing the carrying value of the asset including:
Determination of whether the expenditure can
be associated with finding specific mineral
resources, and the basis on which that
expenditure is allocated to an area of interest;
Determination of whether exploration activities
have progressed to the stage at which the
existence of an economically recoverable
mineral reserve may be assessed; and
Assessing
whether
any
indicators
of
impairment are present, and if so, judgments
applied
to
determine
and
quantify
any
impairment loss.

Our audit procedures included:

Ensuring that the right to tenure of each area of
interest is current;

Agreeing a sample of additions to supporting
documentation and ensuring the amounts are capital
in nature and relate to the area of interest;

Assessing
and
evaluating
management’s
assessment that no indicators of impairment existed
at the reporting date;

Assessing
management’s
determination
that
exploration and evaluation activities have not yet
reached a stage where the existence or otherwise of
economically
recoverable
reserves
may
be
reasonably determined; and

Enquiring with management and reviewing budgets
and other supporting documentation as evidence that
active and significant operations in, or relation to, the
area of interest will be continued in the future.

Other Information

The directors are responsible for the other information. The other information comprises the information included in the Group's annual report for the year ended 30 June 2021, but does not include the financial report and the auditor's report thereon.

Our opinion on the financial report does not cover the other information and accordingly we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of the Directors for the Financial Report

The directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error.

In preparing the financial report, the directors are responsible for assessing the ability of the Group to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so.

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Auditor's Responsibilities for the Audit of the Financial Report

Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report.

A further description of our responsibilities for the audit of the financial report is located at the Auditing and Assurance Standards Board website at: https://www.auasb.gov.au/auditors_responsibilities/ar2.pdf. This description forms part of our auditor's report.

Report on the Remuneration Report

Opinion on the Remuneration Report

We have audited the Remuneration Report included within the directors' report for the year ended 30 June 2021.

In our opinion, the Remuneration Report of Tesoro Resources Limited, for the year ended 30 June 2021, complies with section 300A of the Corporations Act 2001.

Responsibilities

The directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.

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RSM AUSTRALIA PARTNERS

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Perth, WA Dated: 24 September 2021

TUTU PHONG Partner

Additional Shareholder Information

TESORO RESOURCES LIMITED ABN 91 106 854 175 ANNUAL REPORT 30 JUNE 2021

Additional information for ASX listed public companies

The following additional information is required by the Australian Securities Exchange in respect of ASX listed public companies and is current as at 31 August 2021.

Fully Paid Ordinary Shares

The Company has 603,200,482 ordinary fully paid shares on issue, held by 3,321 shareholders. Each ordinary share is entitled to one vote when a poll is called, otherwise each member present at a meeting or by proxy has one vote on a show of hands.

Distribution of Shareholders

Category (size of holding)	Total Holders Number % Held of Issued
	Ordinary Ordinary Capital
1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 – and over	187 66,856 0.01 672 2,013,107 0.33 467 3,717,958 0.62 1,414 54,854,130 9.09 581 542,548,431 89.94
	3,321 603,200,482 100.00

Unmarketable Parcels

Number of Shares	Holders
4,762	779

As at 31 August 2021, there were 779 shareholders holding less than a marketable parcel of shares.

Performance Rights

The Company has 98,028,551 Performance Rights on issue. Performance Rights do not entitle the holders to vote in respect of that performance right, nor participate in dividends, when declared, until such time as the performance rights vest and are subsequently registered as ordinary shares.

Distribution of Class B Performance Rights

Category (size of holding)	Total Holders Units % Held

1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 – and over	- - - - - - - - - - - - 21 50,060,000 100.00
	2 50,060,000 100.00

Mr Zeffron Reeves holds 28,794,620 performance rights comprising 58% of this class; Linkwood Holdings Pte Ltd holds 21,265,380 performance rights comprising 42% of this class.

Distribution of Class C Performance Rights

Category (size of holding)	Total Holders Units % Held

1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 – and over	- - - - - - - - - - - - 21 20,030,000 100.00
	2 20,030,000 100.00

Linkwood Holdings Pte Ltd holds 10,805,000 performance rights comprising 54% of this class; Mr Zeffron Reeves holds 9,225,000 performance rights comprising 46% of this class

58 | P a g e

Additional Shareholder Information

TESORO RESOURCES LIMITED ABN 91 106 854 175 ANNUAL REPORT 30 JUNE 2021

Additional information for ASX listed public companies

Distribution of Class D Performance Rights

Category (size of holding)	Total Holders Units % Held

1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 – and over	- - - - - - - - - - - - 21 20,030,000 100.00
	2 20,030,000 100.00

Linkwood Holdings Pte Ltd holds 10,805,000 performance rights comprising 54% of this class; Mr Zeffron Reeves holds 9,225,000 performance rights comprising 46% of this class

Distribution of Employee Performance Rights

Category (size of holding)	Total Holders Units % Held

1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 – and over	- - - - - - - - - - - - 21 7,908,551 100.00
	2 7,908,551 100.00

Sergio Valdes Uribe holds 5,736,015 performance rights comprising 72% of this class; Ruben Angel Cahuana Ari holds 2,172,536 performance rights comprising 28% of this class

Restricted Securities

The Company has the following restricted securities on issue:

Class	Number of Securities	Escrow Period
Fully Paid Ordinary Shares	102,193,613	Until 7 February 2022
Class B Performance Rights	50,060,000	Until 7 February 2022
Class C Performance Rights	20,030,000	Until 7 February 2022
Class D Performance Rights	20,030,000	Until 7 February 2022

Substantial Shareholders

Number of Ordinary Fully Paid Shares Held	Number of Ordinary Fully Paid Shares Held	% Held of Issued Ordinary
		Capital
SCION HDG SPA1	28,663,619	6.01%
MR KENNETH JOSEPH HALL 2	29,240,741	5.27%
LINKWOOD HOLDINGS PTE LTD3	44,121,684	6.04%
ZEFFRON CHARLES REEVES4	36,429,797	5.77%

As released on ASX on 28 July 2020.
As released on ASX on 22 January 2021.
As released on ASX on 14 September 2021
As released on ASX on 14 September 2021

20 Largest Shareholders — Ordinary Shares as at 31 August 2021

59 | P a g e

Additional Shareholder Information

TESORO RESOURCES LIMITED ABN 91 106 854 175 ANNUAL REPORT 30 JUNE 2021

Additional information for ASX listed public companies

Rank / Name	Rank / Name	Number of	% Held of
		Ordinary Fully Paid	Issued
		Shares Held	Ordinary
			Capital
1.	LINKWOOD HOLDINGS PTE LTD	44,121,684	6.04%
2.	ZEFFRON CHARLES REEVES	36,429,797	5.77%
3.	HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED	34,817,266	4.85%
4.	MR KENNETH JOSEPH HALL	29,240,741	4.21%
5.	TANAMERA RESOURCES PTE LTD	25,410,546	3.94%
6.	CITICORP NOMINEES PTY LIMITED	23,767,505	3.25%
7.	J P MORGAN NOMINEES AUSTRALIA PTY LIMITED	19,582,545	2.92%
8.	BNP PARIBAS NOMINEES PTY LTD DRP>	17,639,933	1.77%
9.	UBS NOMINEES PTY LTD	10,670,435	1.70%
10.	WALZ SUPER PTY LTD	10,278,932	1.57%
11.	MR ANDREW DOUGLAS GLASS	9,455,000	1.31%
12.	PAC PARTNERS SECURITIES PTY LTD	7,928,018	0.94%
13.	HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED	5,656,633	0.92%
14.	DEBUSCEY PTY LTD	5,562,823	0.83%
15.	MR PHILIP ALAN SPEAKMAN	5,000,000	0.72%
16.	MR RORY EAMONN OSCAR KEANE	4,367,933	0.67%
17.	ASR NOMINEES PTY LTD	4,049,138	0.61%
18.	MR JOHN TOLL	3,671,696	0.51%
19.	MR PHILIP JOHN CAWOOD	3,066,667	0.50%
20.	MR SIMON QUAN	3,025,826	6.04%
	TOTAL	303,743,118	50.36%

On-market Buy-Back

There is no current on-market buy-back.

Corporate Governance Statement

The Company’s Corporate Governance Statement for the 2021 financial year is available from the - Company’s website at https://www.tesororesources.com.au/about/corporate governance/

Use of Funds

The Company confirms that since admission to the ASX on 7 February 2020, it has used its cash and assets in a form convertible to cash that it had at the time of admission in a way consistent with its business objectives.

60 | P a g e

TESORO RESOURCES LIMITED ABN 91 106 854 175 ANNUAL REPORT 30 JUNE 2021

Tenements Schedule as at 30 June 2021

El Zorro Gold Project Exploration Concessions (85% Tesoro, option to earn up to 100%)

Total	Concession Name	Date of Expiration	Size	Concession type
1	SIERRA PATACONES 1	14/01/2023	300	Exploration
2	SIERRA PATACONES 2	14/01/2023	300	Exploration
3	SIERRA PATACONES 3	14/01/2023	300	Exploration
4	SIERRA PATACONES 4	14/01/2023	300	Exploration
5	SIERRA PATACONES 5	14/01/2023	300	Exploration
6	SIERRA PATACONES 6	14/01/2023	300	Exploration
7	SIERRA PATACONES 7	14/01/2023	300	Exploration
8	SIERRA PATACONES 8	14/01/2023	300	Exploration
9	SIERRA PATACONES 9	14/01/2023	300	Exploration
10	SIERRA PATACONES 10	14/01/2023	300	Exploration
11	SIERRA PATACONES 11	14/01/2023	300	Exploration
12	SIERRA PATACONES 12	14/01/2023	300	Exploration
13	SIERRA PATACONES 13	14/01/2023	300	Exploration
14	SIERRA PATACONES 14	14/01/2023	300	Exploration
15	SIERRA PATACONES 15	14/01/2023	300	Exploration
16	SIERRA PATACONES 20	14/01/2023	300	Exploration
17	SIERRA PATACONES 19	14/01/2023	300	Exploration
18	SIERRA PATACONES 18	14/01/2023	300	Exploration
19	SIERRA PATACONES 17	14/01/2023	300	Exploration
20	SIERRA PATACONES 16	14/01/2023	300	Exploration
21	SIERRA PATACONES 21	14/01/2023	300	Exploration
22	SIERRA PATACONES 22	14/01/2023	300	Exploration
23	SIERRA PATACONES 23	14/01/2023	300	Exploration
24	SIERRA PATACONES 24	14/01/2023	300	Exploration
25	SIERRA PATACONES 25	14/01/2023	300	Exploration
26	SIERRA PATACONES 26	14/01/2023	300	Exploration
27	SIERRA PATACONES 27	14/01/2023	300	Exploration
28	SIERRA PATACONES 28	14/01/2023	300	Exploration
29	SIERRA PATACONES 29	14/01/2023	300	Exploration
30	SIERRA PATACONES 30	14/01/2023	300	Exploration
31	SIERRA PATACONES 31	14/01/2023	300	Exploration
32	SIERRA PATACONES 32	14/01/2023	300	Exploration
33	SIERRA PATACONES 33	14/01/2023	300	Exploration
34	SIERRA PATACONES 34	14/01/2023	300	Exploration
35	SIERRA PATACONES 35	14/01/2023	300	Exploration
36	SIERRA PATACONES 42	14/01/2023	300	Exploration
37	SIERRA PATACONES 41	14/01/2023	300	Exploration
38	SIERRA PATACONES 40	14/01/2023	300	Exploration
39	SIERRA PATACONES 39	14/01/2023	300	Exploration
40	SIERRA PATACONES 38	14/01/2023	300	Exploration
41	SIERRA PATACONES 37	14/01/2023	300	Exploration
42	SIERRA PATACONES 36	14/01/2023	300	Exploration
43	SIERRA PATACONES 43	14/01/2023	300	Exploration
44	SIERRA PATACONES 44	14/01/2023	300	Exploration
45	SIERRA PATACONES 45	14/01/2023	300	Exploration
46	SIERRA PATACONES 46	14/01/2023	300	Exploration
47	SIERRA PATACONES 47	14/01/2023	300	Exploration
48	SIERRA PATACONES 48	14/01/2023	300	Exploration
49	SIERRA PATACONES 49	14/01/2023	300	Exploration
50	SIERRA PATACONES 50	14/01/2023	300	Exploration
51	SIERRA PATACONES 51	14/01/2023	300	Exploration
52	SIERRA PATACONES 53	14/01/2023	300	Exploration
53	SIERRA PATACONES 54	14/01/2023	300	Exploration
54	SIERRA PATACONES 55	14/01/2023	300	Exploration
55	SIERRA PATACONES 56	14/01/2023	300	Exploration
56	SIERRA PATACONES 57	14/01/2023	300	Exploration
57	SIERRA PATACONES 62	14/01/2023	300	Exploration

61 | P a g e

TESORO RESOURCES LIMITED ABN 91 106 854 175 ANNUAL REPORT 30 JUNE 2021

Total	Concession Name	Date of Expiration	Size	Concession type
58	SIERRA PATACONES 61	14/01/2023	300	Exploration
59	SIERRA PATACONES 60	14/01/2023	300	Exploration
60	SIERRA PATACONES 59	14/01/2023	300	Exploration
61	SIERRA PATACONES 58	14/01/2023	300	Exploration
62	SIERRA PATACONES 63	14/01/2023	300	Exploration
63	SIERRA PATACONES 64	14/01/2023	300	Exploration
64	SIERRA PATACONES 65	14/01/2023	300	Exploration
65	SIERRA PATACONES 66	14/01/2023	300	Exploration
66	SIERRA PATACONES 67	14/01/2023	300	Exploration
67	SIERRA PATACONES 68	14/01/2023	300	Exploration
68	SIERRA PATACONES 69	14/01/2023	300	Exploration
69	SIERRA PATACONES 70	14/01/2023	300	Exploration
70	SIERRA PATACONES 71	14/01/2023	300	Exploration
71	SIERRA PATACONES 72	14/01/2023	300	Exploration
72	SIERRA PATACONES 73	14/01/2023	300	Exploration
73	SIERRA PATACONES 74	14/01/2023	300	Exploration
74	SIERRA PATACONES 75	14/01/2023	300	Exploration
75	SIERRA PATACONES 76	14/01/2023	300	Exploration
76	SIERRA PATACONES 77	14/01/2023	300	Exploration
77	SIERRA PATACONES 84	14/01/2023	300	Exploration
78	SIERRA PATACONES 83	14/01/2023	300	Exploration
79	SIERRA PATACONES 82	14/01/2023	300	Exploration
80	SIERRA PATACONES 81	14/01/2023	300	Exploration
81	SIERRA PATACONES 80	14/01/2023	300	Exploration
82	SIERRA PATACONES 79	14/01/2023	300	Exploration
83	SIERRA PATACONES 78	14/01/2023	300	Exploration
84	SIERRA PATACONES 52	14/01/2023	300	Exploration
85	GOLD STORE 72	21-Jan-23	300	Exploration
86	GOLD STORE 71	21-Jan-23	300	Exploration
87	GOLD STORE 70	25-Jan-23	300	Exploration
88	GOLD STORE 69	25-Jan-23	300	Exploration
89	GOLD STORE 68	25-Jan-23	300	Exploration
90	GOLD STORE 67	25-Jan-23	300	Exploration
91	GOLD STORE 66	25-Jan-23	300	Exploration
92	GOLD STORE 1	10-Dec-22	300	Exploration
93	GOLD STORE 2	2-Dec-22	300	Exploration
94	GOLD STORE 3	10-Dec-22	300	Exploration
95	GOLD STORE 4	2-Dec-22	300	Exploration
96	GOLD STORE 5	10-Dec-22	300	Exploration
97	GOLD STORE 6	2-Dec-22	300	Exploration
98	GOLD STORE 7	10-Dec-22	300	Exploration
99	GOLD STORE 8	2-Dec-22	300	Exploration
100	GOLD STORE 9	10-Dec-22	300	Exploration
101	GOLD STORE 10	2-Dec-22	300	Exploration
102	GOLD STORE 11	5-Dec-22	300	Exploration
103	GOLD STORE 12	10-Dec-22	300	Exploration
104	GOLD STORE 13	10-Dec-22	300	Exploration
105	GOLD STORE 14	5-Dec-22	300	Exploration
106	GOLD STORE 15	10-Dec-22	300	Exploration
107	GOLD STORE 16	5-Dec-22	300	Exploration
108	GOLD STORE 17	10-Dec-22	300	Exploration
109	GOLD STORE 18	5-Dec-22	300	Exploration
110	GOLD STORE 19	10-Dec-22	300	Exploration
111	GOLD STORE 20	5-Dec-22	300	Exploration
112	GOLD STORE 21	10-Dec-22	300	Exploration
113	GOLD STORE 22	5-Dec-22	300	Exploration
114	GOLD STORE 23	10-Dec-22	300	Exploration
115	GOLD STORE 24	5-Dec-22	300	Exploration
116	GOLD STORE 25	10-Dec-22	300	Exploration
117	GOLD STORE 26	11-Dec-22	300	Exploration
118	GOLD STORE 27	17-Dec-22	300	Exploration

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TESORO RESOURCES LIMITED ABN 91 106 854 175 ANNUAL REPORT 30 JUNE 2021

Total	Concession Name	Date of Expiration	Size	Concession type
119	GOLD STORE 28	11-Dec-22	300	Exploration
120	GOLD STORE 29	17-Dec-22	300	Exploration
121	GOLD STORE 30	11-Dec-22	300	Exploration
122	GOLD STORE 36	17-Dec-22	300	Exploration
123	GOLD STORE 35	11-Dec-22	300	Exploration
124	GOLD STORE 34	17-Dec-22	300	Exploration
125	GOLD STORE 33	14-Dec-22	300	Exploration
126	GOLD STORE 32	17-Dec-22	300	Exploration
127	GOLD STORE 31	14-Dec-22	300	Exploration
128	GOLD STORE 37	17-Dec-22	300	Exploration
129	GOLD STORE 38	14-Dec-22	300	Exploration
130	GOLD STORE 39	17-Dec-22	300	Exploration
131	GOLD STORE 40	14-Dec-22	300	Exploration
132	GOLD STORE 41	17-Dec-22	300	Exploration
133	GOLD STORE 42	14-Dec-22	300	Exploration
134	GOLD STORE 43	17-Dec-22	300	Exploration
135	GOLD STORE 44	16-Dec-22	300	Exploration
136	GOLD STORE 45	17-Dec-22	300	Exploration
137	GOLD STORE 46	16-Dec-22	300	Exploration
138	GOLD STORE 47	17-Dec-22	300	Exploration
139	GOLD STORE 48	16-Dec-22	300	Exploration
140	GOLD STORE 49	17-Dec-22	300	Exploration
141	GOLD STORE 50	16-Dec-22	300	Exploration
142	GOLD STORE 51	17-Dec-22	300	Exploration
143	GOLD STORE 52	16-Dec-22	300	Exploration
144	GOLD STORE 53	17-Dec-22	300	Exploration
145	GOLD STORE 54	16-Dec-22	300	Exploration
146	GOLD STORE 55	14-Jan-23	300	Exploration
147	GOLD STORE 56	16-Dec-22	200	Exploration
148	GOLD STORE 57	14-Jan-23	300	Exploration
149	GOLD STORE 58	16-Dec-22	300	Exploration
150	GOLD STORE 59	14-Jan-23	300	Exploration
151	GOLD STORE 60	16-Dec-22	300	Exploration
152	GOLD STORE 61	14-Jan-23	300	Exploration
153	GOLD STORE 62	16-Dec-22	300	Exploration
154	GOLD STORE 63	14-Jan-23	300	Exploration
155	GOLD STORE 64	16-Dec-22	300	Exploration
156	GOLD STORE 65	20-Jan-23	300	Exploration
157	VACAS FLACAS 1	25-Jan-23	300	Exploration
158	VACAS FLACAS 2	25-Jan-23	300	Exploration
159	VACAS FLACAS 5	25-Jan-23	300	Exploration
160	VACAS FLACAS 6	25-Jan-23	300	Exploration
161	VACAS FLACAS 7	25-Jan-23	300	Exploration
162	VACAS FLACAS 8	25-Jan-23	300	Exploration
163	VACAS FLACAS 9	25-Jan-23	300	Exploration
164	VACAS FLACAS 10	25-Jan-23	300	Exploration
165	VACAS FLACAS 11	25-Jan-23	300	Exploration
166	VACAS FLACAS 12	25-Jan-23	300	Exploration
167	VACAS FLACAS 13	25-Jan-23	300	Exploration
168	VACAS FLACAS 14	25-Jan-23	300	Exploration
169	VACAS FLACAS 15	25-Jan-23	300	Exploration
170	VACAS FLACAS 16	26-Jan-23	300	Exploration
171	VACAS FLACAS 17	26-Jan-23	300	Exploration
172	VACAS FLACAS 18	26-Jan-23	300	Exploration
173	VACAS FLACAS 19	26-Jan-23	300	Exploration
174	VACAS FLACAS 20	26-Jan-23	300	Exploration
175	VACAS FLACAS 21	26-Jan-23	300	Exploration
176	VACAS FLACAS 22	26-Jan-23	300	Exploration
177	VACAS FLACAS 23	25-Jan-23	300	Exploration
178	VACAS FLACAS 24	25-Jan-23	300	Exploration
179	VACAS FLACAS 25	25-Jan-23	300	Exploration

63 | P a g e

TESORO RESOURCES LIMITED ABN 91 106 854 175 ANNUAL REPORT 30 JUNE 2021

Total	Concession Name	Date of Expiration	Size	Concession type
180	VACAS FLACAS 28	25-Jan-23	300	Exploration
181	VACAS FLACAS 27	25-Jan-23	300	Exploration
182	VACAS FLACAS 26	25-Jan-23	300	Exploration
183	VACAS FLACAS 3	4-Feb-23	300	Exploration
184	VACAS FLACAS 4	4-Feb-23	300	Exploration
185	BloodyGood Shot 13A	30-Nov-22	200	Exploration
186	BloodyGood Shot 12A	30-Nov-22	200	Exploration
187	BloodyGood Shot 11A	11-Nov-22	200	Exploration
188	BloodyGood Shot 10A	12-Nov-22	300	Exploration
189	BloodyGood Shot 9A	18-Nov-22	300	Exploration
190	BloodyGood Shot 8A	18-Nov-22	200	Exploration
191	BloodyGood Shot 7A	18-Nov-22	100	Exploration
192	BloodyGood Shot 6A	18-Nov-22	200	Exploration
193	BloodyGood Shot 5A	29-Jan-23	200	Exploration
194	BloodyGood Shot 4A	30-Nov-22	300	Exploration
195	BloodyGood Shot 3A	30-Nov-22	300	Exploration
196	BloodyGood Shot 2A	30-Nov-22	300	Exploration
197	BloodyGood Shot 1A	30-Nov-22	300	Exploration
198	NICE BARREL 1	application	200	Exploration
199	NICE BARREL 2	application	300	Exploration
200	NICE BARREL 3	application	200	Exploration
201	NICE BARREL 4	application	200	Exploration
202	NICE BARREL 5	application	200	Exploration
203	NICE BARREL 6	application	200	Exploration
204	NICE BARREL 7	application	200	Exploration
205	NICE BARREL 13	application	300	Exploration
206	NICE BARREL 12	application	200	Exploration
207	NICE BARREL 11	application	300	Exploration
208	NICE BARREL 10	application	200	Exploration
209	NICE BARREL 9	application	300	Exploration
210	NICE BARREL 8	application	200	Exploration
211	ZORRO 1A	16-Mar-22	200	Exploration
212	ZORRO 2A	16-Mar-22	200	Exploration
213	ZORRO 3A	16-Mar-22	200	Exploration
214	ZORRO 4A	16-Mar-22	100	Exploration
215	ZORRO 5A	16-Mar-22	200	Exploration
216	ZORRO 6A	29-Apr-22	200	Exploration
217	PUNTA DE DIAMENTE 1A	application	200	Exploration
218	PUNTA DE DIAMENTE 2A	application	300	Exploration
219	PUNTA DE DIAMENTE 3A	application	300	Exploration
220	LA NEGRA COJA 1A	application	200	Exploration
221	LA NEGRA COJA 2A	application	300	Exploration
222	LA NEGRA COJA 3A	application	300	Exploration
223	LA NEGRA COJA 4A	application	200	Exploration
224	LA NEGRA COJA 5A	application	300	Exploration
225	LA NEGRA COJA 6A	application	300	Exploration
226	LA NEGRA COJA 7A	application	200	Exploration
227	LA NEGRA COJA 8A	application	300	Exploration
228	LA NEGRA COJA 9A	application	200	Exploration
229	LA NEGRA COJA 10A	application	300	Exploration
230	LA NEGRA COJA 11A	application	300	Exploration
231	LA NEGRA COJA 12A	application	200	Exploration
232	LA NEGRA COJA 13A	application	300	Exploration
233	LA NEGRA COJA 14A	application	300	Exploration
234	LA NEGRA COJA 15A	application	200	Exploration
235	LA NEGRA COJA 16A	application	300	Exploration
236	LA NEGRA COJA 17A	application	300	Exploration
237	LA NEGRA COJA 18A	application	300	Exploration
238	LA NEGRA COJA 19A	application	200	Exploration
239	Buzzard 1,1 al 300	NA - constituted	300	Exploitation
240	Buzzard 2,1 al 300	NA - constituted	300	Exploitation

64 | P a g e

TESORO RESOURCES LIMITED ABN 91 106 854 175 ANNUAL REPORT 30 JUNE 2021

Total	Concession Name	Date of Expiration	Size	Concession type
241	Buzzard 3,1 al 300	NA - constituted	300	Exploitation
242	Buzzard 4,1 al 300	NA - constituted	300	Exploitation
243	LEON DOS 1-30	NA - constituted	300	Exploitation
244	LEON UNO 1-30	NA - constituted	300	Exploitation
245	LAS COQUETAS 1/10	NA - constituted	100	Exploitation
246	PATON DOS 1/29	NA - constituted	230	Exploitation
247	PATON UNO 1/29	NA - constituted	240	Exploitation

65 | P a g e

AI assistant

TESORO GOLD LTD — Annual Report 2021

65957_rns_2021-09-23_ba508a97-c731-47c7-bd96-6ef5b1e0b301.pdf

Tesoro Resources Limited

CORPORATE DIRECTORY

DIRECTORS

JOINT COMPANY SECRETARIES

REGISTERED OFFICE

AUDITORS

SHARE REGISTRAR

SECURITIES EXCHANGE LISTING

Tesoro Resources Limited

Directors

Information on Directors

John Toll Non-Executive Chairman

B Comm, CA

Zeffron Reeves Managing Director

BSc (Hons) (Applied Geology), MBA, MAIG

BEng, MSc (Economics)

Geoffrey McNamara Non-Executive Director

BSc (Applied Geology), AusIMM, FINSIA, AICD

Kristie Young Non-Executive Director (appointed 14 September 2021)

BEng (Mining) Hons, GAICD

Joint Company Secretaries

Shannon Coates

LLB, BJuris, AGIA, ACIS, GAICD

Sarah Wilson (appointed 14 September 2021)

Directorships of Other Listed Companies

Principal activities

Operating results

Dividends

Directors’ Interests in Shares, Options and Performance Rights

REVIEW OF OPERATIONS

El Zorro Project

Ternera Maiden Mineral Resource

Exploration Potential

CORPORATE

El Zorro Increased Ownership

Oversubscribed Capital Raising

El Zorro Land Position Increased to 555km[2]

Board Changes

COVID-19 impact

Meetings of Directors

Shares

Options

Performance Rights

Financial Position

Significant changes in the state of affairs

Matters subsequent to the end of the financial year

Future developments, prospects and business strategies

Annual Mineral Resource Statement

Table 1 – El Zorro Gold Project, Ternera Gold Deposit Mineral Resource Estimate reported at various cut offs within an optimised pit shell

Estimation Governance Statement

Competent Person’s Statement

REMUNERATION REPORT (AUDITED)

Key Management Personnel

Directors

a) Principles used to determine the nature and amount of remuneration

REMUNERATION REPORT (AUDITED) (cont.)

Executive remuneration

Fixed remuneration

Performance-based remuneration

REMUNERATION REPORT (AUDITED) (cont.)

Equity-based remuneration

Termination payments

Non-Executive Director’s Remuneration

REMUNERATION REPORT (AUDITED) (cont.)

b) Details of Remuneration

Performance income as a proportion of total income

Equity holdings

REMUNERATION REPORT (AUDITED) (cont.)

Fully Paid ordinary Shares

Movement in shareholdings of key management personnel

Performance Rights

Movement in Performance Rights of key management personnel

c) Service agreements

REMUNERATION REPORT (AUDITED) (cont.)

Non-Executive Directors

d) Equity-based remuneration

e) Equity instruments issued on exercise of remuneration options

TESORO GOLD LTD Annual Report 2021