Stellar Resources : Fourth Quarter Activities and Cash Flow Reports

ASX ANOUNCEMENT l ASX: SRZ

22 July 2022

For personal use only

Report for the Quarter ended 30 June 2022

Highlights:

Heemskirk Tin Project

• Severn Phase 2A drilling program commenced in late-March progressing well with 2,514m of the planned ~3,130m (6 diamond holes) completed to 14 July 2022.
• Four of the Phase 2A holes, and the last Phase 1 hole (ZS148), are focused on expanding the Severn Indicated Mineral Resource primarily targeting areas of thicker and higher-grade tin mineralisation. Three of these holes were completed during the quarter and the fourth is underway.
• Phase 2A hole (ZS152), also underway, will test the large magnetic and approximately coincident conductive target to the south of the Severn deposit that was identified in modelling completed last November4.
• Outstanding assay results from the first Severn infill hole completed this year, ZS148, announced during the quarter7 with the second-best significant intercept ever recorded at Severn on a grade-thickness basis (Sn% * m) of:
• • 34.9m @ 1.01% Sn from 333.0m, including:
  • • 8.6m @ 1.66% Sn from 333.0m, and
    • 12.7m @ 1.19% Sn from 355.3m.
  • This intercept is significantly thicker than the currently defined Mineral Resource interpretation at this location and further delineates a northerly plunging high tin grade-thickness (Sn% * m) zone in the northern part of the Severn deposit, which is being targeted down plunge by further drilling.
• Assay results from the second Severn infill hole completed this year, ZS149 announced during the quarter7, extend the tin mineralisation down dip of the currently defined Mineral Resource near the southern margin of the deposit with significant intercepts including:
• • 5.0m @ 0.73% Sn from 372.0m, and
  • 2.1m @1.80% Sn from 391.1m.

Tin Market

• Global tin demand has been growing strongly driven by decarbonising and electrification of the world.
• Global tin supply is falling and ~75% of global tin production from non Tier-One, non OECD countries.
• Significant global tin supply deficit in 2020 and 2021 and forecast to continue.
• Global tin stockpiles remain at critically low levels (7,099t at 19 July 20229,10, ~7 days global tin supply).
• Heemskirk Tin is well positioned to meet the need for new sustainable tin supply from Tier-One OECD counties.

Stellar Resources Limited ABN: 96 108 758 961

Level 4, 96 - 100 Albert Road, South Melbourne Victoria 3205, Australia

1. [phone] F: [phone] E: [e-mail] Web: www.stellarresources.com.au Twitter: @SRZ_Tin

Report for the Quarter ended 30 June 2022

Northeast Tasmania Exploration Project

• Results announced in July8 from Stellar's first major field exploration program in Northeast Tasmania at Back Creek and Leura on EL12/2020 including:

For personal use only

Historic Leura Goldfield Soil Gold Results (EL12/2020)

• Anomalous gold soil results ranging from 0.1 to 2.4 g/t Au over a 400-500m strike length corresponding with the historic Leura Gold Mine, with likely strike extensions of the historic mine under shallow cover (>5m).
• The lack of any previous modern exploration over the Leura soil gold anomaly and the high-grade soil gold results provides an attractive drill target.

Historic Back Creek Goldfield Soil Gold Results (EL12/2020)

• • Lady Emily Reef - anomalous gold soil results ranging from 0.02 to 0.16 g/t Au over ~200m strike length over the historic Lady Emily Mine.
  • Nevermind Reefs - anomalous gold soil results ranging from 0.02 to 0.23 g/t Au over ~100m strike length over the northern reef and 0.02 to 0.05 g/t Au over ~50m strike length over the southern reef of the historic Nevermind Mine.
• EL10/2020 (Beaconsfield South) (182 km2) and EL3/2021 (Quakers Ranges) (44km2) granted during the quarter8 increasing the number of EL's in NE Tasmania held by Stellar's wholly owned subsidiary, Tarcoola Iron Pty Ltd, to a total of 12 covering a combined area of 2,559 km2.
• Second major field exploration program in Northeast Tasmania, a stream sediment sampling program of ~400 samples at Nabowla on EL11/2020, materially completed post quarter end in July. Results expected to be available by mid-September.
• Field reconnaissance visits now underway over priority targets on Stellar's other Northeast Tasmania EL's which will be used for further analysis and prioritisation of targets prior to re-commencement of high priority field work programs in 2022 Q4.
• Magnetic inversion modelling of tin and base metals targets on EL19/2020 (Scamander) completed during the quarter with planning of follow up ground geophysical surveys (IP) to identify drill targets underway.

2

Report for the Quarter ended 30 June 2022

Heemskirk Tin Project

Overview of Stellar's Tin Project on West Coast of Tasmania

For personal use only

Stellar's 100% owned tin projects have an enviable location within the well-established mining district on the West Coast of Tasmania with access to established infrastructure including nearby water and renewable power, access to the port of Burnie 150km to the north via sealed highway for export of concentrate, and a competitive local market for services, mining and processing inputs and labour.

Stellar's flagship Heemskirk Tin Project is just 18km to the southwest of the Renison tin mine, the largest and most productive tin mine in Australia. Including Renison, there are five major underground metal mines, three of which are operating, within 30km of the Heemskirk Tin Project.

Location of Stellar's Tin Projects - West Coast of Tasmania

The Heemskirk Tin Project includes four nearby tin deposits: Severn, Queen Hill, Montana and Oonah. Stellar holds secure Mining Leases over the Heemskirk Tin Project including the tailings pipeline route, tailings storage site and also over the St Dizier satellite tin deposit.

In addition to the Heemskirk Tin Project, Stellar owns a portfolio of nearby Exploration Licences including the Montana Flats and Mount Razorback EL's which contain a number of historic silver-lead-zinc mines with associated tin mineralisation, and the St Dizier and Mount Razorback satellite tin deposits.

3

Report for the Quarter ended 30 June 2022

For personal use only

Heemskirk Tin Project Deposits (blow up), Secure Mining Leases and a Large EL Package

Heemskirk Tin Resources

The Heemskirk Tin Project has a Total Mineral Resource of 6.6 Mt @ 1.1% Sn at a 0.6% Sn cut-off grade, of which 2.12 Mt is in the Indicated Mineral Resource Category and 4.48Mt is in the Inferred Mineral Resource Category. All deposits have higher grade zones and are amenable to mining at higher cut-off grades. All deposits open at depth1.

		Tonnes		Sn	Contained		Cassiterite	Cu		Pb	Zn
Classification	Deposit	(mt)		(%)	Sn (t)		% of Total	(%)		(%)	(%)
				Sn (%)
Indicated	Upper Queen Hill	0.32	1.0	3,230	87	0.2	2.1	1.0
	Lower Queen Hill	0.65	1.4	9,230	97	0.0	0.1	0.1
	Severn	1.15	1.0	11,500	99	0.1	0.0	0.1
Total Indicated		2.12		1.1	23,960		97	0.1		0.4	0.2
Inferred	Upper Queen Hill	0.11	1.6	1,760	94	0.2	1.9	0.7
	Lower Queen Hill	0.36	1.4	5,040	97	0.0	0.2	0.0
	Severn	2.74	0.9	24,660	99	0.0	0.0	0.0
	Montana	0.68	1.5	10,200	96	0.1	0.7	1.4

	Oonah	0.59	0.9	5,310	36	0.8	0.1	0.1
	Total Inferred		4.48		1.0	46,970		90	0.1		0.2	0.3
	Total Indicated + Inferred		6.60		1.1	70,930		92	0.1		0.3	0.3

4

Report for the Quarter ended 30 June 2022

For personal use only

In addition, the St Dizier Tin deposit has a Total Mineral Resource of 2.26Mt @ 0.61% Sn of which 1.20 Mt in the Indicated Mineral Resource Category and 1.06 Mt is in the Inferred Mineral Resource Category2.

Heemskirk is the highest-grade undeveloped tin resource in Australia and the second highest grade tin resource globally3.

Benchmarking -

World Tin Resources

Heemskirk Tin Project Scoping Study

In October 2019, Stellar announced the results of its Heemskirk Tin Project Scoping Study2 based on development of an underground mine, processing plant, tailings storage facility and surface infrastructure to mine ~ 350ktpa ore at a LOM head grade of ~ 0.95% tin from the Queen Hill and Severn tin deposits (2 of the 4 Heemskirk deposits) over a 10-year initial mine-life. The project also includes open-pit mining of the St Dizier satellite tin deposit and trucking of ore to the Heemskirk processing plant during year 11 of the mine plan.

The processing plant is expected to produce ~4,500tpa of concentrate containing ~2,200tpa of tin. Concentrate produced will be trucked 150km to the north via sealed road to the Port of Burnie for export to smelters in Asia.

The 2019 Scoping Study confirmed the Heemskirk Tin Project had attractive economics at a US$20,000/t tin price2.

5