Greenstone Resources : Quarterly Activities/Appendix 5B Cash Flow Report

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ASX QUARTERLY REPORT

Quarter Ending 30 June 2022

JUNE 2022 QUARTER HIGHLIGHTS

Greenstone Resources Limited (ASX: GSR) ('Greenstone' or the 'Company') is pleased to provide the following report on its activities during the June 2022 quarter. The Company's primary activities during the reporting period were the continuation of exploration drilling at the Burbanks Gold Project, the continuation of the Stage I Trial Mining Joint Venture activities at the Burbanks Mining Centre, and preparations for the forthcoming drill campaign at the Mount Thirsty Joint Venture.

BURBANKS GOLD PROJECT

• During the quarter, drilling of targeted extensional and exploration targets at Burbanks North
• Recent drilling has served to extend known mineralisation at Burbanks North to over 450 metres below surface, 500 metres down plunge, and 1,300 metres along strike
• Significant intercepts from the ongoing drilling campaign at Burbanks North, include:

1. BBRC340D: 4.95 metres @ 30.46g/t Au from 292.1 metres

1. BBRC341D: 6.60 metres @ 9.85g/t Au from 395.9 metres

• 1. BBRC359D: 22.00 metres @ 3.32g/t Au from 79.0 metres
• Trial Mining activities continue at Main Lode with underground development on all known mineralised lodes within the Initial Licence Area now complete

MT THIRTY JOINT VENTURE

• During the quarter the Company provided an exploration update on Mt Thirsty (Cobalt-Nickel)o Geological review commenced following recent PGM discovery by Galileo Mining Limited o Galileo's Callisto discovery only 200 metres from tenement boundary held by the MTJV
  o Continuity of the prospective horizon onto MTJV tenure supported by lithology & geophysics o Prospective horizon remains untested with a further 1.5km extending onto MTJV tenure
  o Experienced team of independent technical experts appointed to support target generation

CORPORATE

• Completion of Tranche 1 of $4.93m placement to professional and sophisticated investors o Proceeds to expedite exploration across portfolio to guide future development decisions

1. 93,500,000 shares issued at a of $0.0425 per share for a total of $3,973,750 at a 13.7% discount to the 15-day VWAP (Tranche 1)

1. Shareholder approval received subsequent to quarter end for the issue of a further 22,500,000 shares on the same terms for an additional $956,250 (Tranche 2)

1. Cash at bank as at 30 June 2022 was $6.06 million (excluding Tranche 2)

PLANNED ACTIVITIES FOR JUNE 2022 QUARTER

• Resumption of exploration activities at the Mt Thirsty Joint Venture (the MTJV) targeting PGE's
• Interim resource updates at both the Burbanks Gold Project and Phillips Find Gold Project
• Completion of 6,500 metre drill campaign at Burbanks North and the Burbanks Mining Centre
• Resumption of exploration at Phillips Find with a 2,250 metre reverse circulation drill campaign

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Quarter Ending 30 June 2022

BURBANKS GOLD PROJECT

ABOUT BURBANKS

The Burbanks Gold Project is located 9.0 kilometres Southeast of Coolgardie, Western Australia. The Project includes the Burbanks Mining Centre and over 5.0 kilometres of the highly prospective Burbanks Shear Zone, historically the most significant gold producing structure within the Coolgardie Goldfield.

The Burbanks Mining Centre comprises the Birthday Gift and Main Lode underground gold mines. The recorded historic underground production at Burbanks (1885-1961) totalled 444,600t at 22.7 g/t Au for 324,479oz predominantly from above 140 metres below the surface. Intermittent open pit and underground mining campaigns between the early 1980's to present day has seen total production from the Burbanks Mining Centre now exceed 420,000oz. The total Indicated and Inferred Mineral Resource for the Burbanks Gold Project is 1.2Mt at 3.7 g/t Au for 145,700 ounces of gold (Table 2).

ACTIVITIES

Outside of the Burbanks Mining Centre, Greenstone controls over 5.0 kilometres of the highly prospective Burbanks Shear Zone which has seen limited exploration below 150 metres, despite hosting known mineralisation, including the Burbanks North Deposit of 359,998 tonnes @ 1.8g/t Au for 20,400 ounces (Inferred). This under explored horizon below 150 metres forms the basis of the ongoing drill campaign at Burbanks North, which has now served to confirm the continuity of high-grade mineralisation beyond the Northern Fault which was previously thought to terminate north of Main Lode (Figure 1).

BBRC340D, BBRC341D and BBRC359D all form part of the current 6,500 metre drill program covering both Burbanks North and the Burbanks Mining Centre (including the Birthday Gift and Main lode mines). These three holes continue to demonstrate the continuity and thickness of high-grade mineralisation at Burbanks North, and will serve to support any future resource estimate at Burbanks North, underpinning the existing JORC 2012 Resource of 1.2Mt at 3.7g/t Au for 145,700oz (Indicated & Inferred). The ongoing drill campaign at Burbanks North has served to extend known mineralisation at Burbanks North to over 450 metres below surface, 500 metres down plunge, and 1,300 metres along strike (Figure 1).

Significant intercepts include:

• BBRC340D: 4.95 metres @ 30.46g/t Au from 292.1 metres, including: o 1.30 metres @ 97.28g/t Au from 292.1 metres
• BBRC341D: 6.60 metres @ 9.85g/t Au from 395.9 metres, including: o 2.00 metres @ 29.09g/t Au from 400.5 metres; and
• BBRC359D: 22.00 metres @ 3.32g/t Au from 79.0 metres, including: o 3.00 metres @ 12.37g/t Au from 84.0 metres

TRIAL MINING

Trial Mining activities continue at Main Lode with underground development on all known mineralised lodes within the Initial Licence Area now complete (Figure 2). The recent completion of all underground development and the commissioning of a remote bogging system have subsequently allowed for the expansion of high-grade underground stoping activities, with five stoping fronts now established on the 1315, 1330 and 1345 levels.

Recent results from the underground sludge sampling and diamond drilling have subsequently identified a secondary western ore lode outside of the current mine plan which has the potential to provide additional minable ounces which are largely accessible from the current underground development. The economic viability to both mine and process this newly discovered ore lode will be assessed as part of an upcoming underground optimisation.

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The second processing campaign through the neighbouring Greenfields Mill commenced in early July 2022, and will process c.40,000 tonnes of development and stoped ore expected over a period of 2-3 weeks. Under the terms of the Joint Venture, FMR Investments Pty Ltd (FMR) carries all mining and financial risk on the agreed mining operations within the Initial License Area, with any profits after expenses to be evenly split. The Stage I Trial Mining Joint Venture is expected to materially de-risk the project through the provision of invaluable technical and financial information which will guide future production and exploration decisions.

Figure 1: Burbanks North Long section showing recently discovered high-grade mineralisation

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Figure 2: Main Lode long section showing the Initial Licence Area and active stoping areas

PHILLIPS FIND GOLD PROJECT

ABOUT PHILLIPS FIND

Greenstone's 100% owned Phillips Find Gold Project is located 50 kilometres North of Coolgardie, Western Australia.

The project covers over 10 kilometres in strike of prospective greenstone stratigraphy, and includes the Phillips Find Mining Centre (PFMC) where approximately 33,000oz of gold was produced between 1998 and 2015 from three open‐pit operations; Bacchus Gift, Newhaven and Newminster. Exploration potential within the project is excellent, with numerous targets defined by auger geochemical anomalism, mapping, and drilling.

ACTIVITIES

13 holes planned as part of an initial 2,250 metre reverse circulation drill campaign targeting near surface extensions to known orebodies and several greenfield targets. Drilling is expected to begin in early July.

MT THIRSTY COBALT-NICKEL PROJECT

ABOUT MT THIRSTY

The Mt Thirsty Joint Venture (MTJV) is located 16 kilometres North-Northwest of Norseman, Western Australia (50% Greenstone Resources, 50% Conico Limited).

The Project contains the Mt Thirsty cobalt-nickel oxide deposit with a reported mineral resource of 26.9Mt at 0.126% cobalt, and 0.54% nickel1. A Pre-Feasibility Study (PFS) of the Project was completed

1 ASX:GSR 09/09/2019

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Quarter Ending 30 June 2022

and announced to the ASX on 20 February 2020. In addition to the Co-Ni oxide deposit, the Project also hosts nickel sulphide mineralisation potential.

ACTIVITIES

During the quarter the Company, in conjunction with its joint venture partner Conico Limited (ASX: CNJ), appointed an independent team of multidisciplinary technical experts to undertake a geological review at the MTJV following the recent palladium-platinum-gold-copper-nickel discovery by Galileo Mining Ltd (ASX:GAL) (Galileo) located only 200 metres from the northern tenement boundary held by the MTJV.

Galileo recently announced (GAL ASX Announcement, 11 May 2022) the completion of six reverse circulation drillholes at Callisto targeting a mineralised sulphide unit on the contact between an ultramafic sill and package of sedimentary rocks. An initial appraisal of the results from Callisto by Galileo indicates similarities in mineralisation style to the Platreef deposits on the northern limb of the Bushveld Complex in South Africa. The Platreef deposits are very large in nature and have combined indicated resources of >700Mt at a 1 g/t 3PE+Au cut off2. Contained metals at Platreef include palladium, platinum, gold, rhodium, copper, and nickel. Significant intercepts from the discovery hole NRC266 drilled by Galileo on their tenure, include3:

• 33 metres @ 2.00g/t 3E4 (1.64g/t Pd, 0.28g/t Pt, 0.09g/t Au), 0.32% Cu & 0.30% Ni from 144m, including;

1. 6 metres @ 2.69g/t 3E (2.21g/t Pd, 0.37g/t Pt, 0.11g/t Au), 0.41% Cu & 0.36% Ni from 159m

1. 1 metre @ 3.21g/t 3E (2.66g/t Pd, 0.41g/t Pt, 0.14g/t Au), 0.48% Cu & 0.46% Ni from 176m

Importantly for the MTJV, Galileo's recent discovery at Callisto is only 200 metres from the northern tenement boundary held by the MTJV with the extension of the prospective mineralised horizon onto MTJV tenure supported by geophysics (Figure 1) & lithology (Figure 2). Despite extensive drilling over the Mt Thirsty resource area (JORC Inferred and Indicated Resources of 26.9Mt at 0.126% cobalt, and 0.54% nickel, see Annexure A), the prospective eastern margin remains largely untested with only 3.5% of all holes drilled at Mt Thirsty penetrating deeper than 100 metres, also noting Galileo's discovery hole was from 144 metres downhole. As such, an initial review indicates that a further 1.5km of the prospective mineralised horizon may extend onto the MTJV tenure.

A Program of Work (PoW) application is currently underway with the Department of Mines, Industry Regulation and Safety (DMIRS) to support a maiden 5,000 metre reverse circulation drill campaign at Mt Thirsty testing for south-eastern extensions to the prospective geological horizon identified by Galileo.

CORPORATE

$4.93M PLACEMENT TO ACCELERATE EXPLORATION

During the quarter, the Company completed a share placement to professional and sophisticated investors raising $3,970,000 (before costs) through the issue of 93,500,000 fully paid ordinary shares (Tranche 1) at $0.0425 per share using its placement capacity under ASX Listing Rule 7.1 and 7.1A.

The placement of a further 22,500,000 shares (Tranche 2) at $0.0425 per share was subject to Shareholder approval which was granted at the Company's General Meeting held 22 July 2022.

The issue price of $0.0425 per share was a 13.7% discount to the 15-day VWAP of the trading price of the Company's shares prior to the stock being placed in a trading halt on Monday, 30 May 2022.

1. Platreef Integrated Development Plan 2020. Ivanhoe Mines Ltd.
2. ASX:GAL 12/05/2022
3. 3E = Palladium (Pd) + Platinum (Pt) + Gold (Au) in g/t

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