Azure Minerals : Andover Ni-Cu Mineralised System Continues to Grow

ASX RELEASE

10 MARCH 2021

ANDOVER VC-07 Ni-Cu SYSTEM

CONTINUES TO EXPAND

New Near-Surface Mineralised Zone Identified

HIGHLIGHTS:

• • Five new drill holes (ANDD0019 - ANDD0023) completed with all holes intersecting significant nickel-copper (Ni-Cu) sulphide mineralisation, as confirmed by pXRF readings.

• • Newly-identified upper mineralised zone brings mineralisation to within 60m of surface.

• • VC-07 mineralised system now exceeds 300m strike, extends from near-surface to over 400m depth, up to 26m true thickness and remains open along strike and down-dip.

• • 14 out of Azure's 15 diamond drill holes completed at VC-07 have intersected significant Ni-Cu sulphide mineralisation and mineral resource definition is continuing.

Azure Minerals Limited (ASX: AZS) ("Azure" or "the Company") is pleased to provide an update on the Company's ongoing drilling campaign on the VC-07 prospect ("VC-07") at the Andover Ni-Cu Project (60% Azure / 40% Creasy Group), located in the West Pilbara region of Western Australia.

Strong sulphide mineralisation intersected in recent drilling continues to expand the VC-07 mineralised system. The Main Zone has been extended both up- and down-dip and mineralisation has now been defined over a strike length exceeding 300m. In addition, a second, mineralised horizon, designated the Upper Zone, has been intersected in three drill holes, extending mineralisation close to surface.

Two drill rigs continue working around the clock at VC-07 with a third rig scheduled to mobilise to site in April. Ongoing downhole electromagnetic (DHTEM) surveying continues to identify extensions to the EM conductor plates associated with the VC-07 Main Zone and the newly identified Upper Zone, assisting in the definition of future drill targets.

Commenting on the continued drilling success at VC-07, Azure's Managing Director, Mr. Tony Rovira, said: "The VC-07 Ni-Cu mineralised system continues to excite with significant mineralisation defined near surface, down-dip and along strike, and remaining completely open in these directions. Encouragingly, a second mineralised zone has been identified above the Main Zone, with this new Upper Zone bringing Ni-Cu sulphide mineralisation to within 60m of surface.

"We're very pleased by the fact that 14 of the 15 holes Azure has drilled at VC-07 have intersected broad mineralised intervals containing significant quantities of Ni-Cu sulphides. Given that we have drilled the VC-07 EM conductor plate over 300m of strike with 750m still to be tested, and that the mineralised body is unconstrained at depth, we are growing evermore confident that further drilling will define a major nickel-copper sulphide deposit at Andover."

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Figure 1: Andover plan view showing VC-07 conductor plate, drill holes and A-AA long section

ANDOVER - VC-07 PROSPECT

To date, Azure has completed 15 diamond drill holes for a total of 6,717.9m at VC-07 (see Figures 1) and drilling is continuing.

Importantly, drilling continues to intersect significant Ni-Cu sulphide mineralisation, extending the overall mineralised system up-dip, down-dip and along strike with mineralisation remaining open in these directions (see Figure 2). The mineralised body has now been defined over a continuous strike length exceeding 300m with mineralisation extending from near-surface to more than 400m below surface. DHTEM surveys indicate the EM conductors associated with the sulphide mineralisation continue to extend to a yet unknown depth.

Five new drill holes, ANDD0019 to ANDD0023, have been completed at VC-07 since the last market update (refer ASX: 16 February 2021). These holes targeted and successfully intersected extensions of Ni-Cu sulphide mineralisation intersected in earlier holes. Visual logging summaries are shown in Table 1.

ANDD0019 and ANDD0021 tested up-dip and closer to surface from the mineralisation intersected in hole ANDD0005 and down-dip from the mineralised intersection in ANDD0003.

ANDD0020 was drilled to test for westerly strike extensions of mineralisation intersected in holes ANDD0004 and ANDD0005.

ANDD0022 and ANDD0023 tested continuity and orientation of mineralisation down-dip beneath strongly mineralised intervals previously reported for holes ANDD0007 and AND0014 (refer ASX: 21 December 2020 and 16 February 2021).

Figure 2: VC-07 A-AA long section showing mineralised intersections

ANDD0019 and ANDD0021 both intersected significant Ni-Cu sulphide mineralisation down-dip and down-plunge from the mineralised intersection in ANDD0003. This confirms the presence of a second sulphide-rich horizon, now designated the Upper Zone, approximately 85m above the VC-07 Main Zone. The potential for extending the Upper Zone further down-plunge to the west is supported by the presence of untested DHTEM conductor plates in that direction and the mineralisation also remains open up-dip from ANDD0003.

ANDD0019 intersected significant quantities of massive, semi-massive and disseminated Ni-Cu sulphide mineralisation in the Upper Zone, as summarised below:

•  2.3m of heavily disseminated Ni-Cu sulphides from 128.1m;

•  4.1m of massive, semi-massive and heavily disseminated Ni-Cu sulphides from 133.4m; and

•  30.1m of patchy disseminated to heavily disseminated Ni-Cu sulphides from 137.5m.

Visually, the mineralisation in ANDD0019 appears similar to that in ANDD0003, which returned assay results (refer ASX: 30 November 2020) of:

• • 2.5m @ 1.1% Nickel and 0.6% Copper from 41.3m;

• • 9.9m @ 0.9% Nickel and 0.3% Copper from 62.1m; and

• • 4.6m @ 2.1% Nickel and 0.2% Copper from 78.4m.

After exiting the Upper Zone mineralisation, ANDD0019 drilled over the top of the Main Zone without intersecting significant Ni-Cu sulphide mineralisation, thereby defining the upper boundary of Main Zone mineralisation in this location.

ANDD0021 successfully drilled through both the Upper Zone and the Main Zone mineralised horizons (21u and 21m, respectively, see in Figure 2), with significant volumes of Ni-Cu sulphide mineralisation intersected in both zones.

A 15.5m-wide zone of Ni-Cu sulphide mineralisation was intersected in the Upper Zone, including:

•  5.8m of massive and semi-massive Ni-Cu sulphides from 176.1m; and

•  2.4m of massive and semi-massive Ni-Cu sulphides from 187.9m.

ANDD0021 then drilled through the Main Zone intersecting a 12.7m-wide zone of Ni-Cu sulphide mineralisation approximately 50m up-dip from mineralisation previously reported in hole ANDD0005 (refer ASX: 12 January 2021), including:

•  6.4m disseminated Ni-Cu sulphides from 266.0m; and

•  6.3m of semi-massive Ni-Cu sulphides from 272.4m.

ANDD0020 intersected a substantial mineralised zone hosting semi-massive, matrix and disseminated Ni-Cu sulphides extending 15.4m downhole from 376.1m. This intersection is approximately 50m along-strike to the west-northwest of similar sulphide mineralisation intersected in holes ANDD0004 and ANDD0005 (refer ASX: 10 December 2020 and 12 January 2021), confirming continuity and orientation of the mineralised zone.

•  1.1m of massive and matrix Ni-Cu sulphides from 377.9m;

•  3.5m of matrix and semi-massive Ni-Cu sulphides from 380.6m; and

•  1.3m of semi-massive and matrix Ni-Cu sulphides from 385.2m.