VERITY RESOURCES LIMITED — Capital/Financing Update 2017

Sep 17, 2017

ASX ANNOUNCEMENT

18 SEPTEMBER 2017

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ASX:BML

ABN: 96 122 995 073

Issued Capital: 1,824,315,814 ordinary shares

SIGNIFICANT COPPER VISIBLE FROM INITIAL HOLES AT DIBETE - PROGRAM PROGRESS UPDATE

The Board of Botswana Metals Limited is pleased to provide a progress update on the 1500m Reverse Circulation (RC) drill program targeting highgrade copper and silver mineralisation at the Dibete and Airstrip Copper projects in North-eastern Botswana ( see ASX announcement 4 September 2017 ).

Directors:

Mr Patrick Volpe (Chairman) Mr Steve Groves (Director/Geologist) Mr Josh Letcher (Non-executive) Mr Ed Bulseco (Non-executive)

Registered Office:

Suite 506, Level 5 1 Princess Street, Kew Victoria, Australia, 3101

Contact:

p: +61 (3) 9855 1885 e: info@botswanametals.com.au

About Botswana Metals

The drill rig has been operating for the past week and has completed over 450m across 8 of the planned 22-hole program. Most of the holes have intersected significant widths of visible supergene copper mineralisation at shallow depths.

HIGHLIGHTS

• Hole DBRC123: 17m of strong malachite-azurite mineralisation from 15m.

• Hole DBRC124: 23m of strong malachite-azurite mineralisation from 24m.

• Hole DBRC126: 5m of strong malachite mineralisation from 22m.

• Hole DBRC128: 6m of strong malachite mineralisation from 24m.

Botswana Metals is exploring for nickel, copper, cobalt, tantalum and lithium within its ~1,500 square kilometre exploration portfolio. These “new world” metals are becoming increasingly important as the world switches to cleaner sources of energy.

The company announced a maiden JORC Inferred Resource of 2.38Mt on 28[th] April 2015 from drilling within a small 185 square kilometre section of its exploration portfolio in which it had entered a joint venture with BCL. At the time cobalt was not included in the resource calculation.

Historical drilling outside of the joint venture ground has intercepted further nickel as well as significant intercepts of copper and cobalt.

A soil sampling program detected traces of lithium and tantalum which warrant further exploration.

Large tracts of BML’s exploration portfolio remain unexplored.

• Hole DBRC129: 12m of strong malachite-azurite-chalcocite mineralisation from 37m.

• Hole DBRC130: 13m of strong malachite-azurite-chalcocite mineralisation from 41m.

Samples from the first week of drilling are currently being sent to an independent laboratory in South Africa for analysis. Results will be released to the market as soon as they are received.

DRILL PROGRAM

The 1500m RC drilling program has been designed to test new mineralisation models at both the Dibete and Airstrip Copper – Silver projects. Approximately 1000m at Dibete and 500m at Airstrip will be completed. The program will comprise twin, scissor and close-spaced infill drilling to replicate a number previous intersections and to test gaps and extensions to the current mineralisation models.

The new information generated by the drilling will provide a framework for further geological interpretation that will guide future regional and deeper exploration programs.

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7 7
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Figure 1: Location of the Airstrip and Dibete Prospects (highlighted in red) within BML's Magogophate exploration portfolio in North-eastern Botswana 8 OF 22 PLANNED HOLES DRILLED.

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DBRC124
DBRC123
DBRC129
DBRC127
DBRC130
(Lost sample return– to be re drilled)
DBRC128
DBRC126
DBRC125
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Figure 2: Plan view of the Dibete Project showing modelled mineralisation shells (pink), previous drill holes (thin grey traces) and proposed holes (thicker black traces). Holes completed to date are indicated by red text and arrows.

The Board will keep the market informed of the progress of the drill program including all assay results as they come to hand.

Patrick Volpe Chairman

PROPOSED DRILL COLLARS

Table 1: Dibete Drill Collars

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HoleID Depth EAST NORTH RL AZI DIP Zone Comment
Follow up high grades in 081,
DBRC123 50 638225 7593866 0 225 -60 6100N
082, 079
scissor 014 into high grade
DBRC124 70 638179 7593903 0 137 -60 6100N
zone
Test mineralisation down-dip
DBRC125 70 638228 7593758 0 45 -60 6100N
of 108
Test mineralisation model
DBRC126 50 638227 7593797 0 45 -60 6100N
close to 030
Test mineralisation in 098 up
DBRC127 50 638228 7593835 0 45 -60 6100N
dip
Test mineralisation in 098
DBRC128 60 638214 7593821 0 45 -60 6100N
down dip
Test mineralisation in 014,
DBRC129 50 638190 7593868 0 45 -60 6100N
028 up dip
Test mineralisation in 014,
Hole 8 90 638173 7593853 0 45 -60 6100N
028 down dip
Test mineralisation down dip
Hole 9 70 638156 7593895 0 45 -60 6100N
of 100, 006
Hole 10 60 638153 7593915 0 45 -60 6100N Test drilling gap in model
Test mineralisation between
Hole 11 40 638148 7593943 0 45 -60 6100N
026 and 104
Test NW extension of
Hole 12 40 638135 7593956 0 45 -60 6100N
mineralisation
Test NW extension of
Hole 13 60 638124 7593945 0 45 -60 6100N
mineralisation
Test min model at 114 and
Hole 14 50 638492 7594006 0 225 -60 6400N
004 up dip
Test min model at 114 and
Hole 15 70 638510 7594023 0 225 -60 6400N
004 down dip
Test mineralisation model at
Hole 16 50 638482 7594031 0 225 -60 6400N
046
Test mineralisation model at
Hole 17 50 638533 7593926 0 225 -60 6400N
005
Hole 18 40 638517 7593948 0 225 -60 6400N Test drilling gap in model
TOTAL 1020
HoleID Depth EAST NORTH RL AZI DIP Conductor Comment
Test down dip min on shoot
Hole1 90 631436 7595300 0 325 -60 C2
model beneath 130 and 019
Test down dip min on shoot
Hole2 175 631713 7595044 0 325 -60 C6
model beneath 071
Test down dip min on shoot
Hole3 110 631903 7594812 0 325 -60 C12
model beneath 067
Test down dip min on shoot
Hole4 120 631885 7594792 0 325 -60 C12
model beneath 098
TOTAL 495
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Table 2: Airstrip Drill Collars

Competent Person

The information in this report that relates to Exploration Results is based on, and fairly represents, information and supporting documentation compiled by BML staff on site and provided to Mr Steve Groves who is a Member of The Australian Institute of Geoscientists. Mr Groves is Director of, and a consulting geologist to BML and has previously been employed as the Exploration Manager at BML. Mr Groves has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr Groves consents to the inclusion in this report of the matters based on his information in the form and context in which it appears.

APPENDIX 1 – JORC Code, 2012 Edition – Table 1

Section 1 Sampling Techniques and Data

CRITERIA	JORC Code Explanation	Commentary
Sampling techniques	- Nature and quality of sampling (eg cut channels, random chips, or specific specialised industry standard measurement tools appropriate to the minerals under investigation, such as down hole gamma sondes, or handheld XRF instruments, etc). These examples should not be taken as limiting the broad meaning of sampling. - Include reference to measures taken to ensure sample representivity and the appropriate calibration of any measurement tools or systems used. - Aspects of the determination of mineralisation that are Material to the Public Report. - In cases where ‘industry standard’ work has been done this would be relatively simple (eg ‘reverse circulation drilling was used to obtain 1 m samples from which 3 kg was pulverised to produce a 30 g charge for fire assay’). In other cases, more explanation may be required, such as where there is coarse gold that has inherent sampling problems. Unusual commodities or mineralisation types (eg submarine n o d u l e s ) may warrant disclosure of detailed information.	 For Reverse Circulation holes, samples are collected for every m drilled via a riffle splitter attached to the cyclone. Samples are labeled and set aside to await determination for assay after onsite handheld XRF analysis is undertaken  Where appropriate, drill core is arranged neatly in 1m core trays for HQ (typically weathered rocks above the limit of oxidation) and 1.5m core trays for NQ core from competent rock. Core is marked at every metre along an orientation line.  Samples for independent laboratory analysis are collected at appropriate geological and or mineralization boundaries and are generally 1m or less in width.  Spot analysis using an XRF analyser is been undertaken at every 10cm interval across the mineralised intervals for core, and at several sites per sample bag for RC at t h e BML site office in Tshokwe using a portable XRF analyzer (INNOV-X Delta Premium). Industry standards and blanks are used to monitor the calibration of the instrument.  This information is used as a guide to the potential mineralised intervals and primarily used to determine appropriate sampling intervals for independent Laboratory analysis
Drilling techniques	- Drill type (eg core, reverse circulation, open- hole hammer, rotary air blast, auger, Bangka, sonic, etc) and details (eg core diameter, triple or standard tube, depth of diamond tails, face sampling bit or other type, whether core is oriented and if so, by what method, etc).	 The holes referred to in this release have been drilled by Reverse Circulation or HQ Diamond core through the weathered rock and NQ Diamond Core through unweathered rock and the mineralized zones.  All core drilling is standard tube method.  All competent core from the current program is oriented using a spear orientation method.  Historic holes have been either NQ core, HQ core or Reverse

CRITERIA	JORC Code Explanation	Commentary
		Circulation percussion methods.
Drill sample recovery	- Method of recording and assessing core and chip sample recoveries and results assessed. - Measures taken to maximise sample recovery and ensure representative nature of the samples. - Whether a relationship exists between sample recovery and grade and whether sample bias may have occurred due to preferential loss/gain of fine/coarse material.	 For RC, sample recovery is estimated based on the amount of material returned for each m within the sample bag. If recovery is lost or inadequate, the hole will be redrilled to achieve the target  The core is measured after every run, and the results are compared to the actual run to calculate core recoveries. Core is handled with care to avoid breakage and crumbling. Core is washed and laid onto holding core trays.  HQ core is used on friable ground, rotation speeds and water pressure are monitored to avoid destroying the core. A soft rubber mallet is used to drive out core from the barrel.  No significant core loss or recovery issues have been recorded in the current drill program.
Logging	- Whether core and chip samples have been geologically and geotechnically logged to a level of detail to support appropriate Mineral Resource estimation, mining studies and metallurgical studies. - Whether logging is qualitative or quantitative in nature. Core (or costean, channel, etc) photography. - The total length and percentage of the relevant intersections logged.	 A sub-sample from each RC m is collected and logged both dry and wet as the hole is being drilled. This sub-sample is then stored in appropriated m marked chip trays and stored onsite for future reference.  All core will be photographed with beginning, ending and intermediate intervals clearly marked on each box. Core will be photographed prior to sampling or any other procedures that may disturb the initial orientation of the core.  The core or chips will be logged in appropriate detail including identification of lithology, structure, alteration, mineralization and other notable characteristics.  Percentages of core recovery and Rock Quality Descriptor (RQD) will be included in the log. The core recovery will be calculated based on each drill run (interval). The RQD calculation will be based on the total length of core sections recovered that are greater than 2.0 times the core diameter for each drill run or interval.

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CRITERIA JORC Code Explanation Commentary
Sub- - If core, whether cut or sawn and  All RC samples are riffle-split and
sampling whether quarter, half or all core taken. sampled dry.
techniques - If non-core, whether riffled, tube sampled,  Core is cut along the marked
and sample rotary split, etc and whether sampled wet orientation line, half core is
preparation or dry. sampled for metallurgical test work.
-
For all sample types, the nature, quality The remaining half core is cut for
and appropriateness of the sample quarter core for lab assaying and
preparation technique. storage.
-
Quality control procedures adopted for  No field duplicates were taken.
all sub-sampling stages to maximise  For lab dispatch, blanks and
representivity of samples. certified reference material are
- Measures taken to ensure that the
inserted at every 5 [th] sample for
sampling is representative of the in-situ
QAQC.
material collected, including for instance
results for field duplicate/second-half
sampling.
-
Whether sample sizes are appropriate
to the grain size of the material being
sampled.
Quality of - The nature, quality and appropriateness SGS South Africa
assay data of the assaying and laboratory  For all samples the analytical
and procedures used and whether the techniques use a four acid digest
laboratory technique is considered partial or total. multi element suite with ICP/OES or
tests - For geophysical tools, spectrometers, ICP/MS finish (25 gram or 50 gram
handheld XRF instruments, etc, the FA/AAS for precious metals). The
parameters used in determining the acids used are hydrofluoric, nitric,
analysis including instrument make and perchloric and hydrochloric acids,
model, reading times, calibrations suitable for silica based samples.
factors applied and their derivation, etc. The method approaches total
-
Nature of quality control procedures dissolution of most minerals. Total
adopted (eg standards, blanks, sulphur is assayed by combustion
duplicates, external laboratory checks) furnace.
and whether acceptable levels of  Platinum group elements and gold
accuracy (ie lack of bias) and precision
are assayed by Fire Assay following
have been established.
either Pb or NiS collection followed
by ICP-MS finish.

Verification - The verification of significant  The data were examined by the
of intersections by either independent or senior personnel on site.
sampling alternative company personnel.  The primary data were audited and
and - The use of twinned holes. verified and then stored in a SQL
assaying - Documentation of primary data, data entry relational data base.
procedures, data verification, data storage  No data have been adjusted.
(physical and electronic) protocols.
-
Discuss any adjustment to assay data.
Location - Accuracy and quality of surveys used to  The data were recorded in
of data locate drill holes (collar and down-hole longitude/latitude WGS84.
points surveys), trenches, mine workings and  The terrain is largely flat.
other locations used in Mineral  Down hole surveys are carried out
Resource estimation.
- on all holes at 4m intervals using a
Specification of the grid system used.
- Flexit survey tool.
Quality and adequacy of  N/A – All historic drillholes have
topographic control.
been surveyed using DGPS with an
accuracy of <1m.
Data spacing - Data spacing for reporting of  The drilling referred to was
and Exploration Results. designed to confirm previous drill
distribution - Whether the data spacing and distribution results, infill and step out from
is sufficient to establish the degree of previous holes to the tenor and
geological and grade continuity appropriate extent of mineralization.
for the Mineral Resource and Ore Reserve  The drill hole spacing is deemed
estimation procedure(s) and classifications appropriate for achieving the
applied. objectives of the program.
-
Whether sample compositing has
been applied.
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CRITERIA	JORC Code Explanation	Commentary
Orientation of data in relation to geological structure	- Whether the orientation of sampling achieves unbiased sampling of possible structures and the extent to which this is known, considering the deposit type. - If the relationship between the drilling orientation and the orientation of key mineralised structures is considered to have introduced a sampling bias, this should be assessed and reported if material.	 The drill lines are oriented at approximately 90 degrees to the strike of both local and regional geological trend.  Drill holes are at 55 degree or 60 angle and orientation of holes does address the orientation of structures.
Sample security	- The measures taken to ensure sample security.	 Samples were taken and transported by BML personnel to the BML site office Prior to XRF analyses the samples are locked in the BML office.
Audits or reviews	- The results of any audits or reviews of sampling techniques and data.	 The data were examined by the independent consultant Mr Steve Groves of Sydney in Australia and considered appropriate.

Section 2 Reporting of Exploration Results

CRITERIA	JORC Code Explanation	Commentary
Mineral tenement and land tenure status	- Type, reference name/number, location and ownership including agreements or material issues with third parties such as joint ventures, partnerships, overriding royalties, native title interests, historical sites, wilderness or national park and environmental settings. - The security of the tenure held at the time of reporting along with any known impediments to obtaining a licence to operate in the area.	 The results reported in this announcement are from activity in PL 110/94 and PL 111/94 which are granted Exploration Licences held by African Metals Limited, a 100% owned subsidiary of Botswana Metals Limited.  PL 110/94 and PL 111/94 were subject to a Joint Venture agreement with BCL Limited who are currently in provisional liquidation  PL 110/94 and PL 111/94 are both good standing.
Exploration done by other parties	- Acknowledgment and appraisal of exploration by other parties.	 Interpretations and conclusions in this announcement refer in part to results generated by historic exploration work conducted by Roan Selection Trust, Falconbridge, Cardia Mining and Botswana Metals.  Botswana Metals considers all previous exploration work to have been undertaken to an appropriate professional standard.

CRITERIA	JORC Code Explanation	Commentary
Geology	- Deposit type, geological setting and style of mineralisation.	 The Dibete and Airstrip projects are hosted within the Magogaphate Shear Zone - a major geological structural feature, generally considered to mark the boundary between the Archaean aged (>2.5 billion year old) Zimbabwean Craton and the Limpopo Belt or Limpopo Mobile Zone (LMZ). The nickel-copper deposits of Selebi Phikwe lie within the northern part of the Central Zone of the Limpopo Mobile Belt, whilst the nickel copper deposits of Phoenix, Selkirk and Tekwane lie in the Zimbabwean Craton. The Central Zone of the LMZ comprises variably deformed banded gneisses and granitic gneisses, infolded amphibolites and ultramafic intrusions that that have the potential to host Ni-Cu sulphide mineralization. Ni-Cu-PGE mineralization at Maibele North and Airstrip copper is spatially associated with an ultramafic intrusion.
Drill hole Information	- A summary of all information material to the understanding of the exploration results including a tabulation of the following information for all material drill holes: o easting and northing of the drill hole collar o elevation or RL (Reduced Level – elevation above sea level in metres) of the drill hole collar o dip and azimuth of the hole o down hole length and interception depth o hole length. - If the exclusion of this information is justified on the basis that the information is not Material and this exclusion does not detract from the understanding of the report, the Competent Person should clearly explain why this is the case.	 All drilling in this release has previously been released publicly with all relevant drill hole information already in the public domain.
Data aggregation methods	- In reporting Exploration Results, weighting averaging techniques, maximum and/or minimum grade truncations (eg cutting of high grades) and cut-off grades are usually Material and should be stated. - Where aggregate intercepts incorporate short lengths of high grade results and longer lengths of low grade results, the procedure used for such aggregation should be stated and some typical examples of such aggregations should be shown in detail. - The assumptions used for any reporting of metal equivalent values should be clearly stated.	 Where uneven sampling intervals have contributed to an averaged result, the result has been calculated by a weighted average technique that incorporates the interval width of each contributing sample.  A grade cut-off of 0.3%Ni or Cu and internal dilution of <2m has been used in the calculation of significant intercepts.  For the >900ppm Co intervals, a grade cut-off of 900ppm Co and internal dilution of <2m has been used in the calculation of significant Cobalt intercepts.  No grade truncations have been applied to the data.

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CRITERIA JORC Code Explanation Commentary
Relationship - These relationships are particularly  The precise geometry of the
between important in the reporting of mineralization with respect to
mineralisation Exploration Results. the drill hole angle is not
widths and - If the geometry of the mineralisation known and thus, all drill hole
intercept with respect to the drill hole angle is results are reported as down
lengths known, its nature should be reported. hole length.
-
If it is not known and only the down  The drill holes in the current
hole lengths are reported, there should
program are inclined
be a clear statement to this effect (eg reconnaissance holes based on the
‘down hole length, true width not
average dip of exposed units. The
known’). orientation of the mineralization is
unknown and true width is
unknown.
 Geotechnical logging is under way
to address the geometry of
mineralisation.
Diagrams - Appropriate maps and sections (with  Plan view and/or cross section maps
scales) and tabulations of intercepts of the reported drill holes are
should be included for any significant included in this announcement.
discovery being reported These should
include, but not be limited to a plan view of
drill hole collar locations and appropriate
sectional views.
Balanced - Where comprehensive reporting of all  N/A
reporting Exploration Results is not practicable,
representative reporting of both low and
high grades and/or widths should be
practiced to avoid misleading reporting of
Exploration Results.
Other - Other exploration data, if meaningful and  There is no other material
substantive material, should be reported including
exploration data that have not been
exploration (but not limited to): geological
data observations; geophysical survey results; previously reported.
geochemical survey results; bulk samples
– size and method of treatment;
metallurgical test
results; bulk density, groundwater,
geotechnical and rock characteristics;
potential deleterious or contaminating
substances.
Further work - The nature and scale of planned  The Maibele North project is
further work (eg tests for lateral currently the subject of mining
extensions or depth extensions or feasibility studies. If a potentially
large-scale step-out drilling). economic resource is defined,
-
Diagrams clearly highlighting the areas and can be mined profitably,
of possible extensions, including the then the necessary infill and
main geological interpretations and step-out drilling with be
future drilling areas, provided this undertaken to progress towards
information is not commercially a reserve calculation.
sensitive.
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