Mithril Resources Ltd (ASX: MTH) (Mithril or the Company) is pleased to provide a quarterly update on activities at its Copalquin Gold Silver Project in Mexico for the period ending 30 September 2021.

El Refugio, Copalquin District, Mexico

In mid-July, the Company announced excellent drilling results from CDH-077 and CH-075 to establish El Refugio as a significant deposit for gold and silver in the Copalquin district. (ASX Announcement 12 July 2021) Assay results for three drill holes were received, continuing to expand the El Refugio structure down dip with highgrade and bonanza grade gold-silver intercepts.

Hole CDH-077 was designed to test the depth extents of the highgrade clavo and test the zone predicted by the geologic model to be a bonanza zone at El Refugio. Drill hole CDH-077 successfully intercepted extremely high-grade gold and silver within a broad intercept of 8.26 metres at 80.3 g/t gold and 705 g/t silver from 468.34 metres down hole.

In mid-August, the Company announced that drilling on the eastern side of El Refugio was extended 80 metres east. The broad, high-grade intercepts provided a significant boost to the resource potential in this part of El Refugio. (ASX Announcement 11 August 2021). Holes CDH-079 and CDH-080 were designed to test the eastern extents of the highgrade 'clavo' with the aim of providing infill data in this area for the maiden resource estimate work. Drill hole CDH079 intercepted high-grade gold and silver with 12.4 metres at 7.60 g/t gold and 332 g/t silver from 86.6 metres down hole. Drill hole CDH-080 was drilled further down dip and intercepted 6.11 metres at 5.08 g/t gold and 197 g/t silver from 112.19 metres down hole. Two additional holes were completed further east with assays pending. Drill holes are planned up dip of these holes to further test the El Cometa structures, where drill hole CDH-072 intercepted 6.80m at 74.0 g/t gold and 841 g/t silver from 35.2 metres down hole. In early September, the Company announced that deep drilling at El Refugio had again returned an excellent goldsilver intercept with hole CDH-084 confirming the high-grade mineralisation over 100m down dip in the structure. (ASX Announcement 8 September 2021) The intercept is proximal to the bonanza grade intercept of CDH-077, which is currently interpreted as being outside of the main El Refugio structure.

Drill holes CDH-082 and CDH-083 are shallower holes drilled on the eastern side of El Refugio at El Cometa, where the mineralisation appears to be controlled by subsidiary fractures that are not parallel to the main Refugio-Cometa structure (such as in CDH-072). Both holes returned reportable intercepts, expanding the resource footprint 80m east. Drill hole CDH-081 and the previously reported CDH-080 may be re-entered and extended 50m to intercept a deeper interpreted structure. Intercepts for holes CDH-081 through CDH-083 are all in the Cometa (Refugio) vein.

In the central section of El Refugio, at least as far east as CDH-070 and CDH-071 there is a deeper vein that these holes did not reach. It is expected that there are other changes happening in the Cometa portion of the deposit - sheeted (parallel) veins of Refugio give way to or are supplemented by the N - S fractures that host the extreme high-grade in CDH-072. Further drilling on this eastern side will follow up the high-grade CDH-072 intercept later this year.

Maiden Resource Estimate Progress

The current drilling through to CDH-090 consists of holes in the western extents of the current El Refugio maiden resource estimate (MRE) area will complete the database for the initial resource modelling to be undertaken by AMC Consultants. The drilling and the assay results are expected to be available late October 2021 with the resource estimation work being completed late November 2021. The independent site visit was conducted in September 2021.

Workplan For Remainder of 2021

The primary focus of the work for the Copalquin District is the completion of a maiden JORC resource estimate for El Refugio whilst continuing the expansive drilling to further test the depth and westerly extensions at El Refugio. Further drill holes are also planned at El Cometa to follow-up the shallow bonanza grade intercept of drill hole CDH072 6.8m @ 74 g/t gold, 841 g/t silver from 35.2m (ASX Announcement 15 June 2021) and to develop the geologic interpretation of this area.

The last quarter of 2021 will see commencement of engineering study work for the development of an exploration access road into the district and an underground exploration drift at El Refugio. An underground drift at El Refugio, taking advantage of the topography, will allow more efficient exploration drilling and progress future development of the El Refugio deposit.

CORPORATE

In early September, the Company announced it had received firm commitments from sophisticated and professional investors to raise A$3.3m (before costs) through a Share Placement (Placement). The Placement was strongly supported by existing and new institutional and high net worth investors.

Capital Raising Details

Mithril completed a placement of shares to sophisticated and professional investors, comprising 220,000,000 new fully paid ordinary shares in the Company (New Shares) at an issue price of 1.5 cents to raise approximately $3.3m (before costs).

The share placement was conducted by Morgans Corporate Limited and Taylor Collison as joint lead managers and within the Company's placement capacity under ASX Listing Rule 7.1. Settlement of the share placement occurred on 7 September 2021, with placement shares allotted (pursuant to Listing Rules 7.1) and traded on 8 September 2021.

Contact:

John Skeet

Tel: +61 435 766 809

Email: jskeet@mithrilresources.com.au

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