Morella Corporation Limited provided an update on exploration activities being undertaken at both the Mallina Lithium Project (E47/2983) and Mt Edon Lithium Project (E59/2092 /E59/2055). Following the establishment of a field camp in late March, the reverse circulation (RC) drill contractor mobilised to the Mallina Project in the second week of April. After completing site and safety management protocols and inductions, drilling work commenced on 18 April 2022.

The RC program consists of three collars, each of approximately 150m, in preparation for diamond core tails to 470m. The RC program is expected to be completed within the next week. On 20 April 2022, a second drilling contractor arrived at the Mallina Project and commenced working through site safety management protocols and inductions in preparation for the commencement of diamond core drilling.

The core program consists of 1,020m of drilling, will commence 22 April 2022 and is expected to be completed in four to five weeks. As advised in ASX Announcement Heritage and approvals progress sets Mallina Lithium Project ready for drilling released 14 March 2022, Morella has commenced early-stage exploration and field work at the Mt Edon Lithium Project. Mt Edon is located approximately 2km from Paynes Find and approximately 420km north of Perth via the Great Northern Highway.

The Project overlies the southern greenstone sequences of the Paynes Find Belt, a 5km wide package of mafic, ultramafic and felsic volcanic rocks. A significant volume of pegmatite dykes/sills cut the greenstone stratigraphy and are the targets for Morella's lithium-focussed exploration activities. Field investigations took place over a five-day period in late March 2022.

A small field camp was established on the Project area, with support and logistics readily available from Paynes Find. The Project was traversed by foot and quadbike and the area covered can be seen in figure 3. The focus of the fieldwork was to map and sample pegmatite outcrops within the Project area. Morella is currently awaiting the final report and results from the field work program however it was noted that all the pegmatites observed were deeply weathered with decomposed feldspar leading to friable surface outcrop in almost all instances.

Given its physical properties and high-mobility, it is assessed that the heavy weathering may result in depleted grades for lithium at surface. Result and future work programs will be advised to the market in due course.