Stavely Minerals : Regional Exploration Delivers Early Encouragement

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ASX ANNOUNCEMENT

2 December 2021

Stavely Copper-Gold Project - Exploration Update

Regional Exploration Delivers Early Encouragement as

Resource Drilling Resumes at Cayley Lode

Stavely's exploration targeting criteria proving effective in identifying 'blind' porphyry intrusions with hydrothermal alteration and sulphides/veining seen in initial drilling

• Strong early progress achieved with the recently commenced regional exploration initiative across the Stavely Copper-Gold Project - the most comprehensive regional exploration program undertaken in the Stavely area in four decades.
• The Stavely Project encompasses some 115km of strike of the Stavely, Bunnugal, Elliott, Narrapumelap and Dryden volcanic belt segments, which are highly prospective for major porphyry discoveries.
• Stavely geologists have so far identified and prioritised 19 regional targets for follow-up reconnaissance exploration.
• Current diamond drilling at the Toora West porphyry prospect has encountered porphyry intrusive phases with disseminated pyrite and quartz veins with pyrite, chalcopyrite and molybdenite mineralisation.
• Air-coredrilling at the S29, S41, Muirhead and Yarram Gap prospects has identified porphyry/intrusive phases associated with argillic/phyllic alteration, quartz veining and sulphide mineralisation. Drilling at the Yarram Gap prospect also identified chalcopyrite in silica altered gabbro.
• Soil auger sampling commenced in October with 266 samples collected over grazing paddocks at the Thursday's Gossan (SW), Mount Stavely, Mount Stavely East,
  Fairview, Pollockdale, Highway and the Southern Intrusion prospects.
• Soil auger sampling will resume in January once the crops have been harvested (~1,000 samples).
• Deep diamond drill hole SMD114 returned:

• 1. 12m at 1.43% Cu, 0.23g/t Au and 7.4g/t Ag from 830m down-hole, including
  2. • 2m at 4.98% Cu, 0.61g/t Au and 25g/t Ag from 839m
• Mineral Resource definition drilling re-commenced targeting the south-eastern extension of the Cayley Lode deposit on 1 December, with four rigs being deployed.

ASX Code: SVY	Head Office
S h a r e s o n i s s u e : 2 6 1 M	1 6 8 S t i r l i n g H w y
M a r k e t c a p i t a l i s a t i o n : $ 1 3 0 M	N e d l a n d s , W e s t e r n A u s t r a l i a 6 0 0 9
C a s h : $ 1 1 . 1 M ( 3 0 S e p t e m b e r 2 0 2 1 )	T : + 6 1 8 9 2 8 7 7 6 3 0
A B N 3 3 1 1 9 8 2 6 9 0 7	E : i n f o @s t a v e l y . c o m . a u W : s t a v e l y . c o m . a u

ASX Announcement 2 December 2021

For personal use only

Stavely Minerals Limited (ASX Code: SVY - "Stavely Minerals") is pleased to report highly encouraging initial results from the major new regional exploration initiative launched recently across its 100%- owned Stavely Copper-GoldProject in western Victoria (Figure 1).

The new multi-pronged exploration program follows the outcomes of an intensive regional prospect review which has identified 19 priority exploration targets.

The significant early progress with the regional exploration push comes as activity ramps up strongly at the Stavely Project, with resource drilling also re-commencing this week targeting the south-eastern extension of the Cayley Lode deposit.

This will allow Stavely Minerals to achieve its objective of posting a maiden Mineral Resource Estimate for the Cayley Lode in Q2 2022 as the basis for a Scoping Study.

Stavely Minerals' Chair and Managing Director, Mr Chris Cairns, said:

"The current diamond drilling at the Toora West porphyry prospect has provided excellent visual encouragement of the presence of porphyritic host-units with disseminated pyrite and porphyry-stylequartz-pyrite ± chalcopyrite and a separate phase of quartz-molybdenite veins.

"The observed alteration is not as intense as would be expected in the potassic core and would be characterised as phyllic to inner-propylitic - so we are not yet in the hotter, well-mineralised core that we are seeking, but it is very early days at this prospect.

"Importantly, we are delighted that the under-cover targeting methodology developed by our on-site team is proving to be very effective with 80% of the regional 'blind" under-cover targets tested to date being intrusions/porphyry phases with associated alteration and sulphide mineralisation - mostly pyrite but also with some chalcopyrite noted at the Yarram Gap prospect.

"We will await assay results from this early reconnaissance exploration while we now focus on completing the Cayley Lode Mineral Resource definition drilling program, paving the way for a maiden Mineral Resource Estimate in the second quarter of next year.

"Once the resource drilling is complete, we will commence the next phase of our initial regional exploration program and follow up the first-pass results.

"With a maiden Mineral Resource Estimate and Scoping Study for the Cayley Lode deposit due in Q2 next year, and results beginning to flow from our major regional exploration push, the next six months is shaping-up to be a very exciting period for the Company."

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ASX Announcement 2 December 2021

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Figure 1. Stavely Project location map.

Background

The porphyry-prospective Stavely Volcanic Arc is comprised of several volcanic arc segments that have been "structurally dislocated by overprinting deformation events, particularly Siluro-Devonian structures developed during (deformation phase) D41."

The Siluro-Devonian D4 deformation sequence is summarised in Figure 2 and explains the transposition of the various arc segments to their current-day position. Figure 3 shows the current- day distribution of the arc segments and their magnetic responses. Prospective arc segments within the Stavely Volcanic Arc include the Stavely, Narrapumelap, Dryden, Bunnugal, Elliot, and Black Range segments. Stavely Minerals has a majority holding of all of these segments with the exception of the Glenisla and Black Range segments.

Figure 4 shows the known prospects in a 30 kilometre 'window' that are largely exposed or located in areas of sub-crop that have been previously identified by either reconnaissance mapping or stream/soil geochemical sampling programs.

1 Regional geology and mineral systems of the Stavely Arc, western Victoria, Schofield A. ed., 2018. Geoscience Australia Record 2018/02.

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ASX Announcement 2 December 2021

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Figure 2. Evolution of the Stavely Volcanic Arc segmentation during the

Devonian D4 deformation (after Stavely geologist Dr Michael Agnew).

Priority Targets

In addition to the known historical prospects, the Stavely Minerals geology team has identified a large number of additional priority targets under shallow cover. A large number of these 'blind' prospects have never been previously tested. The priority target locations are shown in Figure 5.

Please refer to ASX announcement on 14 October 2021 for full descriptions of the regional targets.

Drill sections for any of the prospects discussed below will be provided upon announcement of any material assay results, with all results currently pending.

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ASX Announcement 2 December 2021

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Figure 3. Aeromagnetic image showing Stavely Volcanic Arc segments.

Toora West

The discovery of porphyry-style mineralisation and alteration in shallow air-core drilling programs at the Toora West prospect demonstrates the capacity of the Stavely Minerals geology team to target 'blind' mineralisation - in this case, located below ~30m of younger transported cover (Figures 1 and 5).

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