TESORO GOLD LTD — Capital/Financing Update 2021

Dec 9, 2021

A S X A N N O U N C E M E N T 1 0 D E C E M B E R 2 0 2 1

ASX: TSO | ACN 106 854 175

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Detailed Metallurgical Test Work Confirms Gravity Recovery of 45% and overall recovery of 94.5% at a 150 µm grind size

• Detailed metallurgical test work results indicate achievable gravity recovery of 45% and overall recovery of 94.5% at a 150 µm grind size and up to 98% at finer grind sizes.

• As with the Phase 1 test work, the Phase 2 leach test work demonstrated rapid leach times with the majority of tests achieving total gold extraction in excess of 90% within 8 hours.

• Phase 2 metallurgical test work completed on representative drill core samples from the Tenera Gold Deposit resulted in high gravity and leach recoveries.

• These results will be used to set the process design criteria for Tenera confirming the potential for ore processing using a simple, conventional crush, grind, gravity recovery and leach flowsheet achieving high recoveries.

Tesoro Resources Limited (Tesoro or the Company) (ASX: TSO) is pleased to announce the final results from the Phase 2 metallurgical test work conducted on mineralised material from the Ternera Gold Deposit ( Ternera ) at the Company’s El Zorro Gold Project, Chile.

The Phase 2 test work program was designed to assess the gravity recovered gold component and cyanide leaching characteristics over a range of gold grades using different grind sizes to allow the selection of the most appropriate grind size for future processing. The Phase 2 test work was completed using sea water.

The Phase 2 test work was conducted on representative samples from the various mineralised zones at Tenera over a range of grades. A total of 526kg of samples selected from the various mineralised zones that lie within the optimisation pit shell that was used to constrain the Tenera Mineral Resource Estimate as released on 29 July 2021. Samples were sent to the ALS Metallurgical Laboratory in Perth WA for test work.

The results of this testwork program and the main conclusions drawn regarding the possible metallurgical treatment of the El Zorro deposits are as follows;

• The test programme successfully determined a simple processing method for recovering gold from the Ternera gold deposit with the optimal results being:

• Bond Ball Mill work index (BWi) = 20.4 kWh/t (from Phase 1 Test Work Program);

• A leach feed grind size distribution of P80 = 150µm;

• Cyanide consumptions of 0.5kg/t;

• Lime consumption of 4.0kg/t;

• Gravity recovery of 45%;

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ASX Announcement 10 December 2021

• Overall Au recovery of 94.5%; and

• Test work undertaken using seawater.

Results of the overall test work are summarised below for a 200 micron and 150 micron grind sizes:

COMP_ID	Recoveries	Recoveries
	**P80 = 200µm **	**P80 = 150µm **
	Gravity Leach Overall	Gravity Leach Overall
	% % %	% % %
NSF_FR_LG NSF_FR_MG NSF_FR_HG EZT_FR_LG EZT_FR_MG EZT_FR_HG SED_FR_LG SED_FR_MG SED_FR_HG	48.6 42.2 90.8 51.6 40.6 92.2 54.8 37.0 92.4 48.5 47.3 95.8 51.8 39.9 91.6 49.1 42.3 91.5 42.3 49.6 92.0 49.5 42.3 91.8 47.6 43.0 90.5	48.2 44.5 92.7 52.9 42.7 95.5 57.7 39.8 97.5 48.0 47.9 95.9 52.1 42.5 94.6 49.9 42.5 93.4 35.9 50.3 88.9 52.2 42.5 94.6 48.3 45.5 93.9
AVERAGE	49.3 42.7 92.1	49.5 44.2 94.1
MEDIAN	49.1 42.3 91.8	49.9 42.7 94.6
OX_HG OX_LG	60.1 37.6 97.6 28.1 67.0 95.1

Tesoro Managing Director Zeff Reeves commented:

“These are first class metallurgical results confirming high gravity and cyanide leach recoveries that can be achieved for processing material from Ternera using conventional gravity and CIL processes at coarse grind sizes. These results have enabled the development of a very simple, generic, preliminary processing flowsheet and largely de-risks one of the projects key revenue drivers as it advances toward development.”

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ASX Announcement 10 December 2021

TERNERA PHASE 2 METALLURGICAL TESTWORK PROGRAM

A total of 526kg of mineralised rock samples were collected from 53 diamond drill holes from Tenera, representing each of the mineralised and grade zones within the Mineral Resource.

In all, twenty-five tests were conducted in the Phase 2 program. This is in addition to the three tests conducted on the Phase 1 program in 2020 (ASX Announcement 9 June 2020).

Testwork Sample Selection

A total of 326 half HQ core samples were delivered to ALS Metallurgy Laboratory, Perth, weighing 526kg. The mineralogical and domain make-up of the samples is shown below:

• Material from the Ternera deposit of tonalite (intrusive igneous rock), identified as EZT-FR or EZ tonalite fresh samples;

• Material from the Ternera deposit which are not tonalite but are fresh, identified as NS-FR or EZ non-sediment fresh samples;

• Material from the Ternera deposit of sediments and are fresh, identified as SED-FR or fresh sedimentary samples; and

• Material from the Ternera deposit of weathered or “oxide” samples, identified as OX samples.

Details of the composite samples are shown below:

COMP_ID	EST Wgt (kg)	Calc Grade ALS Assay DESCRIPTION
		Au g/t Au g/t As ppm
NSF_FR_LG NSF_FR_MG NSF_FR_HG EZT_FR_LG EZT_FR_MG EZT_FR_HG SED_FR_LG SED_FR_MG SED_FR_HG OX_LG OX_HG LOM Composite	49.00 49.00 49.00 50.75 50.75 49.00 49.00 50.75 49.22 80.61 99.05	0.76 1.07 130 <1g/t North South Fault Zone 1.70 1.54 15 1-2.5 g/t Au - north South fault zone 6.57 3.63 980 >2.5 g/t Au north south fault Zone 0.58 0.86 440 <1g/t main tonalite 1.76 1.84 605 1-2.5g/t Au main tonalite 5.07 2.98 2,985 >2.5g/t Main Tonalite 0.66 0.41 40 <1 g/t Au sediment hosted 1.88 0.81 45 1-2.5 g/t Au Sediment hosted 4.88 4.62 825 >2.5 g/t Sediment hosted 0.54 0.73 170 <1 g/t Au Oxide zone 5.13 13.10 1,310 >1 g/t Au Oxide zone 1.12

Metallurgical Test Work Programme

Each individual sample was crushed to minus 4mm, homogenised, and split with one split stored for future use and the other half used for its respective composite of 15 to 30kg each. The composites were prepared for head assays analysing for Au, Ag, S and SiO2 along with other analytes such as As.

11 composites were prepared to investigate grind times to reach particle size distributions of 80 percent passing 850, 250, 150 and 75 micron (“P80 = 850, 250, 150 and 75µm).

Following this a bulk portion of 15kg was ground to P80 = 850µm and processed through a laboratory size Knelson gravity separator. The Knelson concentrate was then intensively leached while the Knelson tailings were dried and split into 1kg samples for conventional cyanide leaching. All gravity and leach products were analysed for Au and Ag.

A 12th composite was also generated, composed of all fresh medium and low-grade composites.

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ASX Announcement 10 December 2021

This composite was called “LOM composite” and was used as the initial “scout” tests to better determine the leach parameters.

Following initial LOM sample tests, it was decided to test the composite samples at a leach grind size of P80 = 200µm. Following review of the results from this test work, the program was re-run at a lower grind size of P80 = 150µm.

Gravity Recoverable Gold (GRG) Testwork

Large scale gravity separation tests were conducted to eliminate individual 1kg gravity test variations.

Three of the LOM composite sample tests were conducted at a Knelson Concentrator feed grind size of P80 = 850µm, with the remainder conducted at P80 = 200µm.

Gravity Recovered Au Results are shown below,

	COMP_ID	-200µ Grind	-150µ Grind
NSF_FR_LG		48.6	48.2
NSF_FR_MG		51.6	52.9
NSF_FR_HG		54.8	57.7
EZT_FR_LG		48.5	48.0
EZT_FR_MG		51.7	52.2
EZT_FR_HG		49.1	49.9
SED_FR_LG		42.3	35.6
SED_FR_MG		49.5	50.0
SED_FR_HG		47.8	48.3
OX_LG		28.1	n/a
OX_HG		60.1	n/a
LOM Composite*		41.7	n/a

Gravity recovery is relatively consistent at around 49% to 50%, disregarding the three anomalous oxide results. For study purposes the design gravity will be set at 45%.

Leaching Test Work

All leach tests conducted in the Phase 2 programme were undertaken using sea water.

As with the Phase 1 test work, the Phase 2 leach test work demonstrated rapid leach times with the majority of tests achieving total gold extraction in excess of 90% within 8 hours.

The total extraction curves for the P80 = 150µm leach test work are shown below,

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ASX Announcement 10 December 2021

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----- Start of picture text -----

RATE OF GOLD EXTRACTION
100
90
80
70
60
50
40
30
20
10
0
0 2 4 6 8 10 12 14 16 18 20 22 24
TIME (Hours)
SED-FR-MG Composite SED-FR-LG Composite SED-FR-HG Composite
NSF-FR-MG Composite NSF-FR-LG Composite NSF-FR-HG Composite
EZT-FR-MG Composite EZT-FR-LG Composite EZT-FR-HG Composite
EXTRACTION (%)
----- End of picture text -----

Gravity, leach and overall recoveries for each of the Phase 2 test along with respective reagent consumptions are shown below.

COMP_ID	Reagent Consumption	Reagent Consumption	Recoveries	Recoveries
	**P80 = 200µm **	**P80 = 150µm **	**P80 = 200µm **	**P80 = 150µm **
	NaCN Lime	NaCN Lime	Gravity Leach Overall	Gravity Leach Overall
	kg/t kg/t	kg/t kg/t	% % %	% % %
NSF_FR_LG NSF_FR_MG NSF_FR_HG EZT_FR_LG EZT_FR_MG EZT_FR_HG SED_FR_LG SED_FR_MG SED_FR_HG	0.47 2.08 0.54 1.78 0.54 2.17 0.54 2.74 0.54 3.18 0.54 1.71 0.61 2.80 0.57 2.66 0.57 2.88	0.50 3.12 0.46 3.55 0.47 3.73 0.57 3.67 0.47 4.32 0.48 3.63 0.43 4.36 0.43 4.49 0.41 4.25	48.6 42.2 90.8 51.6 40.6 92.2 54.8 37.0 92.4 48.5 47.3 95.8 51.8 39.9 91.6 49.1 42.3 91.5 42.3 49.6 92.0 49.5 42.3 91.8 47.6 43.0 90.5	48.2 44.5 92.7 52.9 42.7 95.5 57.7 39.8 97.5 48.0 47.9 95.9 52.1 42.5 94.6 49.9 42.5 93.4 35.9 50.3 88.9 52.2 42.5 94.6 48.3 45.5 93.9
AVERAGE	0.55 2.44	0.47 3.90	49.3 42.7 92.1	49.5 44.2 94.1
MEDIAN	0.54 2.66	0.47 3.73	49.1 42.3 91.8	49.9 42.7 94.6
OX_HG OX_LG	0.47 3.22 0.54 2.61		60.1 37.6 97.6 28.1 67.0 95.1

INTERPRETATION OF RESULTS

The Phase 2 metallurgical results confirm high gravity and cyanide leach gold recoveries from Ternera material using conventional gravity and CIL processes at a coarse grind size. Information was also produced to provide guidance on expected reagent usage to achieve these recoveries at a level appropriate for use in a Scoping Study level of assessment for the project.

These results provide the basis for a very simple, generic, preliminary processing flowsheet for the project as shown below.

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ASX Announcement 10 December 2021

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Authorised by the Board of Tesoro Resources Limited.

For more information:

Company:

Zeff Reeves Managing Director Tesoro Resources Limited +61 8 9322 1587

Investors:

Peter Taylor NWR Communications +61 (0) 412 036 231 peter@nwrcommunications.com.au

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+61 8 9322 1587 | info@tesororesources.com.au | Suite 5, 62 Ord Street, West Perth WA 6005 | www.tesororesources.com.au

ASX Announcement 10 December 2021

About Tesoro

Tesoro Resources Limited was established with a strategy of acquiring, exploring and developing mining projects in the Coastal Cordillera region of Chile. The Coastal Cordillera region is host to multiple world class copper and gold mines, has well established infrastructure, service providers and an experienced mining workforce. Large areas of the Coastal Cordillera remain unexplored due to the unconsolidated nature of mining concession ownership, but Tesoro, via its in-country network and experience has been able secure rights to a district scale gold project in-line with the Company’s strategy. Tesoro has rights to acquire up to 80% of the El Zorro Gold Project.

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Future Performance

This announcement may contain certain forward-looking statements and opinion. Forward-looking statements, including projections, forecasts and estimates, are provided as a general guide only and should not be relied on as an indication or guarantee of future performance and involve known and unknown risks, uncertainties, assumptions, contingencies and other important factors, many of which are outside the control of the Company and which are subject to change without notice and could cause the actual results, performance or achievements of the Company to be materially different from the future results, performance or achievements expressed or implied by such statements. Past performance is not necessarily a guide to future performance and no representation or warranty is made as to the likelihood of achievement or reasonableness of any forward looking statements or other forecast. Nothing contained in this announcement nor any information made available to you is, or and shall be relied upon as, a promise, representation, warranty or guarantee as to the past, present or the future performance of Tesoro.

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