Announcement PDF Sultan Resources Ltd CORPORATE DETAILS ASX Code: SLZ DIRECTORS JEREMY KING CHAIRMAN STEVEN GROVES NON-EXECUTIVE DIRECTOR ASX ANNOUNCEMENT 28th September 2023 DAVID LEES NON-EXECUTIVE DIRECTOR www.sultanresources.com.au info@sultanresources.com.au 2023 ANNUAL REPORT Sultan Resources Ltd (ASX:SLZ or the Company) is pleased to present its Annual Report for the financial year ended 30 June 2023 which is attached. Additionally, the Company confirms that its Annual General Meeting (AGM) will be held on Thursday, 23 November 2023 commencing at 10:00am (AWST) at: Suite 11, Level 2 23 Railway Road Subiaco WA 6008 The Company advises that the Closing Date for receipt of nominations is Thursday, 5 October 2023. Any nominations for the position of Director must be received in writing on or before 10:00am (AWST) on 5 October 2023 at the Company at its registered office. The Company notes that the deadline for nominations for the position of Director is separate to voting on Director elections. Shareholders will be advised of further details regarding the AGM in a separate Notice of Meeting, which will be provided to shareholders in due course. The Notice of Meeting will also be available on the ASX Company Announcements Platform and the Company’s website at https://www.sultanresources.com.au/. This announcement is authorised by the Board of Sultan Resources Ltd For further information contact: info@sultanresources.com.au About Sultan Resources Sultan Resources is an Australian exploration company with a portfolio of quality assets in emerging discovery terranes. Sultan’s tenement portfolio includes recently acquired lithium-prospective claims in NW Ontario in Canada; a tenement package in the southern terrane region of the Yilgarn Craton in the eastern wheatbelt of Western Australia with priority nickel-cobalt and gold targets, where Rio Tinto have recently formalised a farm-in JV on a central tenement; and tenements located in the highly prospective east Lachlan Fold Belt of Central NSW considered prospective for copper and gold. Sultan’s board and management is committed to the responsible discovery of metals via modern exploration techniques, and to add value to these projects for the benefit of the company and its shareholders. SULTAN RESOURCES LIMITED ABN 35 623 652 522 Annual Report for the Year Ended 30 June 2023 Annual Report | 30 June 2023 Contents Corporate Directory 3 Directors' Report 4 Auditor’s Independence Declaration 34 Consolidated Statement of Profit or Loss and Other Comprehensive Income 35 Consolidated Statement of Financial Position 36 Consolidated Statement of Changes in Equity 37 Consolidated Statement of Cash Flows 38 Notes to the Consolidated Financial Statements 39 Directors' Declaration 60 Independent Auditor’s Report 61 Corporate Governance Statement 64 ASX Additional Information 65 2|P a g e Annual Report | 30 June 2023 Corporate Directory Board of Directors Jeremy King Steven Groves David Ian Lees Non-Executive Chairman Non-Executive Director Non-Executive Director Secretary Ms Hannah Cabatit Registered Office Suite 11, Level 2 23 Railway Road Subiaco WA 6008 Telephone: 08 6559 1792 Website: www.sultanresources.com.au Securities Exchange Listing Listed on the Australian Securities Exchange (ASX Code: SLZ) Auditors RSM Australia Partners Level 32, Exchange Tower 2 The Esplanade Perth WA 6000 Solicitors Nova Legal 2/50 Kings Park Road West Perth WA 6005 Bankers Westpac Banking Corporation Level 13, 109 St Georges Terrace Perth WA 6000 Share Registry Automic Share Registry Level 5, 191 St Georges Terrace Pert WA 6000 Telephone: 1300 288 664 3|P a g e Annual Report | 30 June 2023 Directors’ Report The Directors of Sultan Resources Limited (“SLZ” or “the Company”) present their report, together with the financial statements on the consolidated entity consisting of Sultan Resources Limited and its controlled entities (“the Group”) for the year ended 30 June 2023. DIRECTORS The names and particulars of the Company’s directors in office during the financial year and at the date of this report are as follows. The Directors held office for this entire year unless otherwise stated. Jeremy King | Non-Executive Chairman Mr King is a corporate lawyer and adviser with over 20 years’ experience in domestic and international legal, financial and corporate matters. Mr King is a director of a boutique corporate advisory and compliance business where he specializes in corporate and strategic advice and managing legal issues associated with clients. He spent several years in London where he worked with Allen and Overy LLP and Debevoise & Plimpton LLP and has extensive experience, particularly in relation to cross border private equity, leveraged buy-out acquisitions and acting for banks, financial institutions and corporate issuers in respect of various debt and equity capital raisings. He regularly advises ASX listed companies on corporate and commercial matters. During the past three years, Mr King held the following directorships in other ASX listed companies: • • • • • • Executive Corporate Director of C29 Metals Limited (current); Non-Executive Chairman of ECS Botanics Holdings Ltd (current); Non-Executive Director of Smart Parking Limited (current); Non-Executive Chairman of Redcastle Resources Limited (current); Non-Executive Director of Burgundy Diamond Mines Limited (resigned December 2021); and Executive Director of Red Mountain Mining Limited (resigned November 2021). Steven Groves | Non-Executive Director Mr Groves has a Bachelor of Applied Geology (Honours) and completed a Master’s of Economic Geology from CODES-SRC at the University of Tasmania. Mr Groves is currently a non-executive director of Six Sigma Metals Ltd (ASX: SI6) and brings 25 years of geological experience in the mining industry including exploration and management roles with BHP Billiton (ASX: BHP), Newmont Mining, Newcrest Mining (ASX: NCM), A-Cap Resources (ASX: ACB) and Botswana Metals. During the past three years, Mr Groves held the following directorships in other ASX listed companies: • • Non-Executive Director of Six Sigma Metals Ltd (resigned April 2023); and Resolution Minerals Limited (resigned 7 November 2022). David Ian Lees | Non-Executive Director Mr Lees has over 16 years’ experience in the Australian financial services industry starting his career as a stockbroker before moving into investment and funds management. These roles have given Mr Lees extensive experience with capital raising, business development, portfolio management, business relationships and corporate governance. Most recently, Mr Lees has worked in the private sector driving his business from product conception through to design, development, manufacturing and international retail sales. Mr Lees’s education qualifications include a Bachelor of Economics and post graduate diploma in Applied Finance and Investment. 4|P a g e Annual Report | 30 June 2023 Directors’ Report During the past three years, Mr Lees held the following directorship in another ASX listed company: • Non-Executive Chairman of C29 Metals Ltd (current). COMPANY SECRETARY | Hannah Cabatit Hannah Cabatit is an employee of Mirador Corporate where she specializes in statutory financial reporting and company secretarial services. Hannah is a Certified Practicing Accountant and has significant years of experience in senior accounting roles, company secretarial and compliance services for public listed and unlisted companies. DIRECTORS’ INTEREST IN THE COMPANY The following table sets out each current Director’s relevant interest in shares, options to acquire shares of the Company or a related body corporate as at the date of this report. Director Jeremy King Steven Groves David Ian Lees Total Ordinary Shares 700,144 150,000 956,868 1,807,012 Unlisted Share Options 2,550,000 1,000,000 3,550,000 PRINCIPAL ACTIVITIES The principal activities of the Company during the period were mineral exploration in Australia and lithium exploration in Canada. REVIEW AND RESULTS OF OPERATIONS CANADIAN LITHIUM PROJECTS During March 2023, Sultan announced it had entered into an agreement to acquire 100% interest in two highly prospective Canadian lithium projects in North Western Ontario, Canada, namely the Kember and Ruddy Project rights from XS Minerals Ltd. Subject to satisfying Conditions Precedent the Company agreed to issue: (i) XSM a total of 34,905,660 fully paid ordinary shares ("Consideration Shares”), being AUD$1,850,000 worth of fully paid ordinary shares in the capital of the Company at a deemed issue price of $0.053 of the 10-day VWAP per Consideration Share, to be issued subject to shareholder approval; (ii) XSM (and/or their nominee) AUD$185,000 and CAD$6,000 cash consideration; and (iii) the Canadian Vendors CAD$120,000 cash consideration. Additionally, the Canadian Vendors were to retain a 1.5% New Smelter Royalty (NSR) for each of the Kember Project and the Ruddy Project. The NSR will have a buyback of 0.5% for CAD$500,000 per project. A facilitation fee was payable comprised of 6% of the total value of the Consideration and a transaction management fee of AUD$60,000. 5|P a g e Annual Report | 30 June 2023 Directors’ Report Settlement of the Acquisition was subject to Sultan completing a capital raising and obtaining all necessary regulatory and shareholder approvals, and the parties entering into the applicable royalty deeds in respect of the NSR. The Company subsequently undertook a capital raising of $1,000,000 with oversubscriptions of up to $500,000 through the issue of up to 30 million fully paid ordinary to sophisticated and professional investors at an issue price of AUD$0.05 per new share. The Company satisfied the Conditions Precedent and subsequently approved the acquisition of the Ruddy and Kember lithium projects at a General Meeting on 9 May 2023. RUDDY PROJECT Following desktop studies of the available data for the Ruddy Project, the Company advised that exploration had commenced in late June 2023, with experienced Canadian geological consultants, APEX Geoscience Ltd (APEX) conducting activities at its Ruddy Project in North Western Ontario (refer Figures 1, 2). At Ruddy, the Company had established a priority exploration target from the interpreted LCT Goldilocks Zone surrounded the Allison Lake Batholith which covers approximately 3.5km of east-west strike in the centre to south of the Company’s Project. Apex utilised four helicopter-supported geologists to conduct reconnaissance over the project, sampling priority outcrop, including pegmatitic occurrences for lithium and associated elements; and veining (for gold) where appropriate. Progress has been assisted by a recent burn in the area which has increased visibility from the air, although thick deadfall (stacked fallen trees) up to 1.5m height and new growth slowed ground traverses. Apex geologists observed multiple pegmatite occurrences of up to 30m outcrop and up to 15m width within the initial area of focus. Evidence of pegmatite fractionation minerals in the form of apatite or beryl were observed in the field from limited available outcrop, which is generally heavily covered by mosses and lichen. Post-year end, the Company advised that Apex had collected a total of 157 samples over 8 days in the field, with over 35% (55 samples) taken from confirmed pegmatitic occurrences. The samples have been submitted to ALS laboratories in Canada for multi-element analysis including gold. The Company intends to use resultant lithium values and geochemical markers such as K/Rb ratios to focus additional fieldwork to discover possible covered mineralised LCT pegmatites. The Company subsequently received complete field observations from Apex geologists and continues to work through the observations. In addition, analysis and interpretation by Sultan incorporated the field work of Fingas1, whom spent 2 days ‘straight-line’ traversing a portion of the tenement in 2021 (refer Figure 4) as part of a larger pegmatite survey of the northern Allison Batholith area. Fingus noted 6 additional pegmatites outside the Apex pegmatite localities, and one coincident occurrence, highlighting the difficulty in observing outcrop at Ruddy and that more field work will be required after this first phase of reconnaissance. The combined observations support a priority zone of interest within the original LCT Goldilocks interpretation, radially distributed from the northern portion of the Allison Batholith. 6|P a g e Annual Report | 30 June 2023 Directors’ Report ABOUT THE RUDDY LITHIUM PROJECT The Ruddy Project (Figures 1,2,3,4) directly abuts ground to the west held by Green Technology Metals Limited (ASX: GT1) and is located in the province of Ontario about 162km north-north-east of the town of Dryden. The Project covers around 10km2 and sits on the northern extremity of the Allison Lake Batholith, a fertile intrusive responsible for the development of proximal fractionated pegmatites with potential to host lithium, caesium and tantalum (LCT) mineralisation1,2,3. Previous study of the area by the Ontario Geological Survey (Breaks et al 20032) described the margin of the Allison Lake Batholith at the time as “…an important new exploration target for rare-element mineralization and is the largest such granite thus far documented in Ontario…”. Breaks et al 20032 considered the margin of the Batholith had high potential for further discoveries of rare element mineralization that could occur in exo-contact, metasedimentary-hosted pegmatites or as internal pegmatites within the parent granite, particularly in light of the common regional zonation sequence of rare-element pegmatites from beryl-rich into lithium-rich types. This typically includes spodumene-type pegmatites in an interpreted ‘LCT Goldilocks Zone’ of increased fractionation from the parent granite. With recent renewed interest in rare element mineralisation, the prospective Allison Batholith has emerged as a fully staked, multi-company, battery mineral exploration region. Reports by Green Technology Metals3 describe the identification of the spodumene-bearing Ouroboros Pegmatites approximately 10km southwest of the Ruddy Project (refer Figure 4) in a similar geological setting, which the Company considers highly encouraging. The Company intends to focus priority exploration at Ruddy at outcrop within the interpreted LCT Goldilocks Zone surrounding the Allison Lake Batholith, covering approximately 3.5km of east-west strike in the centre to south of the Company’s Project. Photo 1. View to Ruddy Project looking SSE, Ruddy Lake in foreground. 7|P a g e Annual Report | 30 June 2023 Directors’ Report Photo 2. Aerial view, pegmatite outcrops, Ruddy Project, Helicopter and pad visible RHS for scale. Photo 3. Aerial view, pegmatite outcrop example, Ruddy Project, visible outcrop estimate 20-30m length. 8|P a g e Annual Report | 30 June 2023 Directors’ Report Figure 1: Location of Kember and Ruddy Projects in relation to known Lithium deposits, Northwest Ontario N.B. PAK (TSXV:FL) total resource taken from NI43-101 instrument effective April 28, 2023 Mavis resource (ASX:CRR) taken from ASX release dated June 7, 2023 Root Bay, Seymour Lake and McCombe resources (ASX:GT1) taken from ASX release dated May 5, 2023 Georgia Lake (TSXV:RCK) total resource taken from Georgia Lake Project: Pre-Feasibility Study Nov 22, 2022 Separation Rapids (TSX:AVL) total resource taken from NI43-101 instrument effective Sept 26, 2018 Jackpot (Imagine Lithium- private) estimate taken from Ontario Mineral Inventory Record: MDI42E05SW00019; resource is historic and not compliant with formal resource reporting. 9|P a g e Annual Report | 30 June 2023 Directors’ Report Figure 2: Location of Ruddy Project in relation to regional geology, known pegmatite occurrences (detail sourced from ASX:GT1 Announcement on 24/01/2022), and neighbouring tenure holders 10 | P a g e Annual Report | 30 June 2023 Directors’ Report Figure 3: All sampled sites at Ruddy Project in relation to tenure at completion of June 2023 reconnaissance Figure 4: Observed Pegmatite sites at Ruddy Project; evolved pegmatites with fractionation minerals denoted by darker blue locations. Priority Zone area of focus for LCT Pegmatites in hatched area. Geology after Fingus, 2022. 11 | P a g e Annual Report | 30 June 2023 Directors’ Report KEMBER PROJECT At the Kember Project, the Company advised that a desktop review had highlighted a series of pegmatitic granite occurrences in mapping previously conducted at the Project, noted across an area around seven km in length and typically over a kilometre in width (refer Figure 5). These occurrences will form a focus of initial exploration activities at the Kember Project. Although Kember on-ground reconnaissance was originally planned as an extension to the Ruddy exploration, the Company advised it had opted to delay reconnaissance activities at Kember after one of four First Nation groups with established rights in the area requested additional time to inform its members of planned activities. The Company will deliver a revised timetable for this exploration in due course, ideally to combine with mobilisation after receipt and assessment of Ruddy assay results. ABOUT THE KEMBER LAKE LITHIUM PROJECT The Kember Project (Figures 1 and 5) is located in the province of Ontario about 180km north of the town of Red Lake, covering an area of around 30km2. Demonstrating the prospectivity of this area, the Kember Project is located about 8km from the PAK/Bolt/Spark lithium deposits of Frontier Lithium Inc. (Frontier) and is contiguous with this project tenure. Recent drilling by Frontier intersected 398.25m of pegmatite averaging 1.88% Li2O, including a 23.4m zone of 3.12% Li2O (see TSX.V Announcement 8/02/2023). Frontier have also recently announced resources totalling 58.5Mt @ 1.51% Li2O from its most recent NI43-101 instrument effective April 28th 2023, calculated from two of four known spodumene-bearing pegmatite occurrences within its PAK Project holdings. There has been no recorded exploration over the Kember Project area, however, mapping by the Geological Survey of Ontario has historically recorded the presence of pegmatitic granites over a northwest to southeast zone around seven km in length and typically over a kilometre in width, providing an initial zone of interest. Figure 5: Location of Kember Project in relation to regional geology and known spodumene-hosted Lithium deposits, Northwest Ontario 12 | P a g e Annual Report | 30 June 2023 Directors’ Report These pegmatitic granites will be the focus of initial reconnaissance of 5 to 7 days duration, with four helicopter-supported geologists from Canadian-based experienced geological consultants, APEX Geoscience conducting mapping and sampling of priority outcrop. The Company considers rare element mineralisation can occur associated with internal pegmatites within the parent granite. The Company will also conduct reconnaissance of the eastern edge of the project, closer to changes in granitic composition and contact morphologies. References 1. Fingas, J, 2022: Assessment Report on Crown Land for the Costello Lake Area – 2021 Prospecting Program, dated May 25th 2022 2. Breaks, F.W., J.B. Selway J.B and A.G. Tindle A.G. 2003, Ontario Geological Survey, Open File Report 6099, Fertile Peraluminous Granites and Related Rare-Element Mineralization in Pegmatites, Superior Province, North-West and North-East Ontario: Operation Treasure Hunt 3. Green Technology Metals (ASX:GT1) ASX Announcement: “Strategic lithium footprint substantially expanded” dated 24/01/2022 For further detail on the Kember and Ruddy Projects please refer to the following: Sultan (ASX:SLZ) ASX Announcement: 2023 “Sultan Resources enters agreement to acquire 100% interest in highly prospective Canadian lithium exploration ground in Ontario, Canada” dated 17/03/2023 Sultan (ASX:SLZ) ASX Announcement: 2023 “Sultan Completes Acquisition of Canadian Lithium Projects” dated 25/05/2023 Sultan (ASX:SLZ) ASX Announcement: 2023 “Sultan Appoints Experienced Canadian Geological Team” dated 1/06/2023 Sultan (ASX:SLZ) ASX Announcement: 2023 “Multiple mapped pegmatitic occurrences Kember Lithium Project” dated 14/06/2023 Sultan (ASX:SLZ) ASX Announcement: 2023 “Multiple Pegmatite occurrences noted as exploration commences at Ruddy Project, NorthWestern Ontario” dated 26/6/2023 Sultan (ASX:SLZ) ASX Announcement: 2023 “Priority Zone Identified at Ruddy Lithium Project, Ontario” dated 25/07/2023 WA PROJECTS LAKE GRACE PROJECT: The Lake Grace Project consists of five large tenements (E70/5081, 5082, 5085, 5095 and 5179- refer Figure 6) in the Southwest Terrane of Western Australia, containing the Kulin Hill Ni-Co Project in the North, and the Lake Grace Gold Project in the South, surrounding the Griffin’s Find Gold Mine. Rio Farm-in Tenement (E70/5082) In June 2023 the Company announced that Rio Tinto Exploration Pty Limited (RTX) and Sultan had entered into option to farm-in and joint venture agreement in respect of E70/5082, a portion of Sultan’s Lake Grace tenure (refer ASX announcement . The Agreement allows RTX to undertake preliminary exploration during an initial option period and then earn an 80% interest in E70/5082 by way of $2m of exploration spend within 5 years, with Sultan retaining full ownership of its principal area of focus to date (Kulin Hill tenure on E70/5095) Terms of the Option Agreement The material terms of the Option Agreement are as follows: RTX pays Sultan $25,000 and has the right to exclusively conduct a preliminary stage of exploration over the Option Tenure for 6 months (Option Period). At its election, RTX may extend the Option Period by an additional 6 months, by paying Sultan a further $25,000. At any time during the Option Period, RTX may elect to farm-in to the Option Tenure and earn an 80% joint venture interest in the Option Tenure by way of sole funding $2m of exploration activity, including a minimum of 1,000m of RC and/or diamond drilling. RTX has 5 years to meet the minimum farm-in expenditure requirement but agrees that should it not be met by 3 years and should it wish to continue in the farm-in then it shall pay Sultan $50,000 (provided that RTX has had reasonable access to the Option Tenure in order to conduct exploration activities). 13 | P a g e Annual Report | 30 June 2023 Directors’ Report On meeting the farm-in expenditure and drilling requirements, a standard 80/20 contributing joint venture (JV) is formed. Should a party’s interest in the JV dilute to below 10%, the other party may buyout the interest at fair market value or otherwise the interest shall be converted to a 1% net smelter royalty payable for the first 5 years of commercial production. For the duration of the Option Period, RTX is responsible for all rents and required expenditure on E70/5082 and is granted a right of first refusal over the sale or disposal by Sultan of the balance of its Lake Grace tenure package, namely E70/5095, E70/5085, E70/5081 and E70/5179. Figure 6: Overview Plan of Sultan’s Southwest Terrance Lake Grace Project in WA Post year-end, in August 2023, the Company announced that Sultan had contracted New Resolution Geophysics (NRG) to undertake a helicopter-borne Electromagnetic (EM) survey system to better assess a conductivity anomaly identified from existing broad- spaced EM data on E70/5082, SW of Kulin in WA. 14 | P a g e Annual Report | 30 June 2023 Directors’ Report The heli-borne EM survey was being funded by Rio Tinto Exploration (RTX) pursuant to the recent option and farm-in arrangement between Sultan and RTX and utilisd NRG’s advanced “Xcite” system and be conducted at 100m line spacing, for a total of approximately 80 line km. The Company has contracted NRG to fly a detailed (100m line-spaced) helicopter-borne time-domain electromagnetic (HTDEM) survey totalling around 80 line km over an area approximately 4km SW of the wheatbelt town of Kulin (refer Figure 3), with acquisition of data commencing and expected to be completed today. The target was initially identified by RTX geoscientists after review of existing wide-spaced (20km) airborne EM data. From modelling of the existing data, RTX identified a strong untested late time conductivity anomaly (refer Figure 7 below) in the northern part of E70/5082, coincident with a circular magnetic and radiometric anomaly (refer Figure 8 below), suggesting potential for magmatic nickel sulfide mineralisation. The new heliborne EM survey was aimed at confirming the nature and extent of the conductivity anomaly before considering the merits and nature of any on-ground exploration to further assess and test the anomaly. Figure 7: AEM conductivity response and magnetic (TMI) profile for AEM flight line over E70/5082 Figure 8: Existing AEM flight line (light blue), late time conductor (pink cross) on magnetic (RTP 1VD) image (left) and on thorium (radiometric survey) image (right) 15 | P a g e Annual Report | 30 June 2023 Directors’ Report Figure 9: Planned HTDEM flight lines at 100m spacing in relation to E70/5082 Kulin Hill Nickel-Copper-PGE Project (E70/5095) During late 2022, Sultan completed stratigraphic hole SLGDD001, a 489.4m diamond hole designed to partially test a portion of the Kulin Hill magnetic anomaly. Previous 2022 aircore drilling from available sites at the project by Sultan returned anomalous results of Ni, Cr, Mg, Fe, S and Co consistent with weathered ultramafic lithologies. The Company contends that further drilling into the ultramafic sequence will support that it is fertile and can host precipitated Ni-Co sulfides. The potential for Ni-Co sulfide mineralisation was suggested by historical drilling conducted on the edge of the sequence in 1967 and 1973, where drill core samples were observed in polished sections containing “…less than 1% of a nickel-cobalt-sulphide mineral (approximately 50% Ni, 5% Co)4”. Observations from the historical drilling also supported some fractionation of the ultramafic at depth; that is, towards the untested central portion of the sequence. 16 | P a g e Annual Report | 30 June 2023 Directors’ Report SLGDD001 Drill Hole Details SLGDD001 was a deep (489.4m) stratigraphic diamond hole completed at Kulin Hill designed to investigate the nature of the layered ultramafic sequence beneath the weathering horizon, and to partially assess the potential for Ni-Co sulfide mineralisation associated with this type of sequence. SLGDD001 was collared in the vicinity of the 2022 drilled aircore holes and was drilled at -600 towards the southeast, targeting across a westernmost extremity of a strong magnetic body within the sequence (Figure 10). Figure 10: Plan view of 1VD magnetic signature representing the ultramafic sequence overlain by aerial photography highlighting the salt lake, with Reserve 18455 (Lot 225568) highlighted in red. Sultan’s 2022 aircore collars are marked in orange, and previous diamond drilling traces in yellow, with recent SLGDD001 named. Orange circles and traces indicate provisional drilling collar positions to test the layered intrusion correctly. 17 | P a g e Annual Report | 30 June 2023 Directors’ Report Initial observations confirmed a significant thickness of the ultramafic/mafic target sequence was intersected down to 256m down hole, with a 40m interlayer of felsic gneiss at 153.5m (refer Figure 11), before passing into a series of mostly felsic and occasionally mafic gneisses. Weathering was observed to persist to about 70m down hole. A total of 160 samples were selected for analysis. Results from the unweathered target sequence were strongly indicative of ultramafic lithologies, summarised as: Nickel (Ni) content of 0.10.29% Ni; Chrome (Cr) content of 0.1-0.65% Cr; Magnesium oxide (MgO) content of 25-41% MgO; and Silica oxide (SiO2) mostly below 35% SiO2. The drilling encountered a 6.8m (downhole length) lens of sheared mafic-ultramafic below the main ultramafic unit from 289.7m containing anomalous Pt and Pd (PGEs), Cu and S (Figure 11). In combination, these particular geochemical anomalies indicate the potential presence of sulfide in the sheared maficultramafic lens and suggest the possibility of remobilisation of sulfide from an ultramafic source. Figure 11: Cross-section of RC drill hole SLGD001 along with previous aircore drill holes SLGAC02, SLGAC03 and SLGAC04. Ni is displayed as a concentration based coloured histogram on the right-hand side of the drill string, sulphur (S) on the left-hand side of the drill string and Pt + Pd as a concentration based colour within the drill string. 18 | P a g e Annual Report | 30 June 2023 Directors’ Report Together, the thick intersection of layered ultramafic geology along with evidence for the potential remobilisation of sulfides from an ultramafic source in SLGDD001, confirm the prospectivity of the 2.2km long main target for Ni-Co mineralisation. Interpretation of the geology intersected in SLGDD001 in the context of the greater Kulin Hill Project is ongoing. Access to Reserve 18455 Negotiations to access the full extent of the target area for drilling, the majority of which extends beneath salt lake Reserve 18455 (refer Figure 10), have been ongoing since early 2022, with the Company receiving confirmation of access from DMIRS during late last year; however ground conditions for drilling activities have been unsuitable since receiving permission to drill. Recent reconnaissance over the project confirmed that the salt lake surface was currently impassable from seasonal rains and would require drying sufficiently to allow access, which the Company is currently planning for later in 2023. The Company is in communication with a suitable diamond drilling contractor with suitable depth and low angle capacity, small footprint including lightweight tracked mo