AusQuest Limited reported results from the initial reconnaissance Reverse Circulation (RC) drilling program completed at the Morrisey Nickel-Copper-Platinum Group Element (Ni-Cu-PGE) Project, located in the Narryer Terrane approximately 500km north of Perth in WA. The Morrisey Project is subject to the Strategic Alliance Agreement (SAA) with a wholly-owned subsidiary of South32 Limited (South32). Drilling was designed to test three discrete electromagnetic (EM) targets that were closely associated with magnetic anomalies similar to the anomaly over the Gonneville intrusion that hosts Ni-Cu-PGE mineralisation at the Julimar Project, just north of Perth.

The initial three-hole drilling program (726m) intersected a mixed sequence of high-grade metamorphic rocks including iron formations, mafic (meta-gabbros) and ultramafic (meta- pyroxenites) units, interleaved within a sequence of granitic gneisses. The ultramafic units reflect potential host rocks for Ni-Cu-PGE mineralisation. Drilling at the Waterfall and Sandfly prospects intersected increased sulphide levels (up to 13% S) within and marginal to the iron formations that coincide with the location of the modelled EM plates.

The sulphide zones vary in thickness from a few metres up to 34 metres (in 22MYRC02) and consist of pyrrhotite and pyrite mineralisation, with no significant base metal anomalism reported. Narrow (<20m) intervals of ultramafics containing elevated chrome (>1000ppm Cr), magnesium (>10% Mg) and nickel (up to 1,350ppm Ni) values were also intersected at Sandfly and Waterfall, reflecting potential host rocks for Ni-Cu-PGE mineralisation. The extent of these units is unknown but is likely to be more extensive than indicated by this initial drilling program.

High iron values (25% to 39% Fe) reported in drill-holes 22MYRC001 and 22MYRC002 occur within relatively thick metamorphosed iron formations (up to 60 metres) that contain coarsely crystalline magnetite, which could reflect a new opportunity for the Company if the magnetite can be easily beneficiated. Test work is currently being considered under the SAA. At the Bilga Rocks prospect, drilling (hole 22MYRC003) intersected a thick body (>120m) of meta-gabbro, which appears to form part of a much larger magnetic complex that extends for several kilometres to the north.

Trace sulphides (mainly pyrite) reported throughout the meta- gabbro partly explain the EM response that was targeted by drilling. Strong magnetic anomalies north of 22MYRC003 reflect possible ultramafic units within the inferred complex that have not been tested by drilling. Numerous magnetic responses evident in the regional aeromagnetic data are now considered to be potential prospects for either magnetite and/or nickel-copper-PGE mineralisation based on the results of this program.

None of these targets have previously been tested by drilling.