Alchemy Resources : Quarterly Activities Report - March 2022

29 April 2022

BOARD AND MANAGEMENT

QUARTERLY ACTIVITIES REPORT

MR LINDSAY DUDFIELD

NON-EXECUTIVE CHAIRMAN

For the period ending 31 March 2022

MR JAMES WILSON

CHIEF EXECUTIVE OFFICER

Highlights

MS LIZA CARPENE

NON-EXECUTIVE DIRECTOR

KARONIE PROJECT (WA) - Gold / Lithium

MR ANTHONY HO

NON-EXECUTIVE DIRECTOR

• • Major aircore drill program commenced at the Karonie Gold Project east of Kalgoorlie testing multiple high priority targets.

  MS CARLY TERZANIDIS

  COMPANY SECRETARY

• • The two new zones of gold anomalism have strike length of 950m and 4,300m, with significant results that include:

  PROJECTS

  • o KEAC009: 2m @ 2.7g/t Au from 48m including 1m @ 3.99g/t Au (48m) and 1m @ 1.41g/t Au (from 49m)

    LAKE REBECCA (ALY 100%)

    KARONIE (ALY 100%)

  • o KEAC045: 2m @ 3.79g/t Au from 84m including 1m @ 5.24g/t Au (from 84m) and 1m @ 2.34g/t Au (from 85m)

  LACHLAN (ALY 80%)

  WEST LYNN (ALY 80%)

• • Broad lithium and indicator element soil anomalies consistent with lithium-caesium-tantalum ("LCT") pegmatite mineralisation outlined at Karonie in April 2022 with follow up sampling underway.

BRYAH BASIN (ALY 20%, TSX-V SGI 80%)

MELROSE AND YELLOW MOUNTAIN (NSW) - Gold / Base Metals

BRYAH BASIN (ALY 20%, SFR 80%)

• • Yellow Mountain Project heritage surveys completed in New South Wales to enable access for future drill programs around the historic mine area. Land Access Agreements well advanced.

WEST LYNN (NSW) - Nickel-Cobalt-Alumina

• • Strategic review commenced on West Lynn Nickel-Cobalt-Alumina battery metals assets to revisit the potential for resource growth and optimisation of metallurgical process routes.

BRYAH BASIN PROJECT (WA) - Gold / Base Metals Sandfire Resources JV (ALY 20%):

• • A basin wide study is underway to review geochemical and structural data.

Superior Gold JV (ALY 20%):

• • Mining Proposal for Hermes South submitted to DMIRS.

• • Resource extension and Sterilisation drilling completed at Hermes South. Diamond drilling commenced at Central Bore and Seaborg.

CORPORATE

• • Alchemy had $2.524m cash at hand at 31 March 2022. Exploration expenditure for the reporting period was $431,000.

At the 100% owned Karonie Gold Project in Western Australia, work focussed on the commencement of the Karonie

East Aircore drill program. Phase 2 of Alchemy's planned drilling was focussed on the Karonie East target area as a priority target, after the high-resolution magnetics flown in 2021 pin-pointed multiple high tenor structures in proximity to the existing deposits1 and open pits at the adjacent Aldiss Mining Operations currently operated by Silver Lake Resources (ASX: SLR, "Silver Lake"). The program aimed to test the 10km long corridor AC and consisted of 112 holes for a total of 6,357m of drilling. The program was split into two zones, in the north and south of the trend. Assays returned numerous anomalous zones in saprolite along the two key areas of mineralisation with a strike extent of ~950m in the northern zone and 5km in the southern zone. Best results included 2m @ 3.79g/t Au (from 84m) including 1m @ 5.24g/t Au (84m) and 1m @ 2.34g/t Au (85m).

Encouraging lithium and indicator element soil anomalies consistent with LCT pegmatite mineralisation were outlined at Karonie in April 2022, with anomalies extending over an area of 7km x 1km at the Pecan, Mesquite, Hickory and Cherry prospects2.

Alchemy's New South Wales Projects advanced with the completion of the Heritage Surveys at the Yellow Mountain Mine Prospect. Alchemy hosted representatives of the Condobolin Aboriginal Land Council to the Project for a further two days after rainfall delayed the first half of the survey in late 2021. The outcomes of the survey and the report are due for completion early in the next quarter. A strategic review commenced on the West Lynn assets to revisit the potential for resource growth and optimisation of the metallurgy for High Purity Alumina ("HPA").

At the Bryah Basin Project Joint Venture ("JV"), Sandfire Resources (ASX: SFR, "Sandfire") commenced a basin wide study on the joint venture tenure. The work will include the construction of a 3D basin scale lithostructural model and a review of geochemical and structural data. No field work was undertaken.

The Superior Gold (TSX-V: SGI, "Superior") JV continued with work related to the permitting and advancement of the Wilgeena Project including heritage surveys and soil sampling. Resource extension and sterilisation drilling was completed at Hermes South and diamond drilling was commenced at Central Bore and Seaborg. The Mining Proposal for Hermes South was submitted to the Department of Mines, Industry and Resources ("DMIRS"). Diamond drilling commenced at Central Bore and Seaborg with a view to exploring for near mine mineral inventory in proximity to the Hermes South deposit and proposed haul road.

Figure 1: Alchemy Resources Project Location Plan

• 1 Refer ALY announcement 31 August 2021

• 2 Refer ALY announcement 22 April 2022

Karonie Project (WA) (Alchemy 100%)

The Karonie Project includes 12 exploration licences and three exploration licence applications covering 1,179km2 of highly prospective mineralised structures within Kurnalpi Terrain greenstones 100km east of Kalgoorlie (Figure 2). The tenements are located along strike of Silver Lake's Aldiss Mining Centre (reserves/resources of over 595,000oz @ 2.0g/t Au)2, and are within 50km of Silver Lake's Randalls processing plant, and cover 38km of the under-explored, gold endowed Claypan Shear Zone commencing just 12km along strike to the south of Breaker Resources (ASX: BRB) Bombora deposit (resource of 1.7Moz @ 1.6g/t Au)3. Alchemy announced a maiden Resource for the KZ5, Taupo and Parmelia prospects of 111koz in August 20211.

Figure 2: Karonie Project tenements, prospects and interpreted major structures

• 2 Refer to SLR ASX announcement dated 15 September 2021

• 3 Refer to BRB ASX announcement dated 20 December 2021

KARONIE PROJECT EXPLORATION (WA - ALY 100%)

PHASE 2 AIRCORE DRILL PROGRAM

Phase 2 of Alchemy's planned drilling was focussed on the Karonie East target area as a priority target, after the high-resolution magnetics flown in 2021 pin-pointed multiple high tenor structures in proximity to the existing deposits and open pits at the adjacent Aldiss Mining Operations currently operated by SLR. The program aimed to test the 10km long corridor AC and consisted of 112 holes for a total of 6,357m of drilling. The program was split into two zones, in the north and south of the trend.

KARONIE EAST - NORTHERN ZONE

Holes in this area (Figure 3) were designed to test a magnetic feature which runs along the northern zone over a 2km strike length. A north-east trending structural dislocation occurs in the centre of Figure 3, which Alchemy believes is a key control on mineralisation in the region. Assays returned numerous zones of anomalous gold (>0.1g/t Au) over a strike length of approximately 950m, with a best intercept of 2m @ 2.7g/t Au (48m) in KEAC009, including 1m @ 3.99g/t Au from 48m logged in saprolite4. Follow-up reverse circulation ("RC") drilling is planned to test the mineralisation at depth and into fresh rock.

Figure 3: Karonie East - Northern Zone drilling, and updated assay results draped on magnetics

4 Refer ALY announcement 9 March 2022

KARONIE EAST - SOUTHERN ZONE

Holes in this area (Figure 4) were designed to test a series of magnetic features which run along the southern zone over a 5km strike length and returned anomalous results (>0.1g/t Au) over a 4,300m strike extent. Single metre assays of the quartz gravels in KEAC045 returned 2m @ 3.79g/t Au (from 84m), including 1m @ 5.24g/t Au from 84m and 1m @ 2.34g/t Au from 85m (previously 4m @ 1.59g/t Au from 84m)5. Analysis and panning of the quartz gravel in KEAC045 returned a small specimen of visible gold5.

Alchemy considers the Southern zone an important and high priority target which has been overlooked by previous explorers. Current drill line spacing is between 300-600m, which is not adequate to test the short strike length, with infill aircore drilling proposed. Follow-up RC drilling to test the mineralised intercepts at depth is currently underway and is due for completion in the June 2022 quarter.

Figure 4: Karonie East - Southern Zone drilling, and updated assay results draped on magnetics

KARONIE - LITHIUM EXPLORATION

Alchemy reviewed existing multi-element soil sampling at Pecan/Mesquite/Hickory/Cherry on a 400x400m offset grid (Figure 5, RHS) as part of a multi-commodity review2. The analysis of lithium and pathfinder elements shows a strong pattern of anomalism over 7km long x 1km wide with the northern zone having increasing levels of surface cover which could have obscured outcrops. Alchemy's KZ5 deposit1 located in the southern portion and adjacent

5 Refer ALY announcement 15 February 2022