ASX ANNOUNCEMENT/MEDIA RELEASE 11 July 2023 Assays Confirm Massive Nickel Sulphides at Luhuma Central Prospect • Preliminary assay results received for massive nickel sulphides intersected in DDLUHC001 at Luhuma Central Prospect - 4.13m @ 0.99% Ni (from 223.35m) contained within a broader interval of 12.15m @ 0.46% Ni from 221.35m, as well as 2m @ 0.57% Ni (from 249m) in DDLUHC001 • DDLUHC002 returned 4m @ 0.52% Ni from 200.55m • Drilling continues at Luhuma Central and HEM 2 with two diamond drill rigs operating • DHEM survey team mobilising to site to support drilling of strike and depth extension of massive nickel sulphides Adavale Resources Limited (ASX: ADD) (“or the Company”) is pleased to advise that the Company has received preliminary assay results1 for the two recently completed diamond drillholes (DDLUHC001 and DDLUHC002) at Luhuma Central Prospect within Adavale’s Prospecting Licence PL 23980/2023. Drillholes DDLUHC001 and DDLUHC002 were designed to test the Audio-magnetotelluric (AMT) anomaly identified on Line 2 (see Figures 1 and 2). Adavale’s Executive Director, David Riekie commented: “These preliminary assay results for the initial drilling at Luhuma Central have confirmed the presence of nickel bearing sulphide intersections in our first two completed drillholes. “These results are extremely encouraging as we continue to drill and seek to unlock the strike potential of this mineralisation, based on our extensive AMT, soil and EM datasets covering this area. “We have cased the Luhuma Central diamond holes and will soon commence the Downhole Electromagnetic (DHEM) surveys on each hole to assist with this ongoing drilling program. DHEM is a critical tool to effectively drill the interpreted 1-1.5km extension.” 1 Samples to be assayed at second laboratory, ALS in South Africa for retesting using both aqua regia and (four-acid) total nickel digest and in addition PGE analyses. ASX: ADD DIRECTORS & OFFICERS GRANT PIERCE CHAIRMAN DAVID RIEKIE EXECUTIVE DIRECTOR JOHN HICKS DIRECTOR ALLAN RITCHIE CHIEF EXECUTIVE OFFICER LEONARD MATH CFO & COMPANY SECRETARY ISSUED CAPITAL Shares: ~520 million Options: 191 million Performance rights: 11.25million ABOUT ADAVALE Adavale Resources is an ASX-listed exploration company targeting projects in the 'battery materials‘ space. The company is currently focused on both its 100% owned Kabanga Jirani Nickel Project and 2 Farm-in ‘Luhuma’ licences adjacent and along strike from the world’s largest undeveloped high grade NiS resource of 58Mt @ 2.62% Ni. Adavale is also progressing exploration on its 100% owned uranium tenements in South Australia Luhuma Central Diamond Drilling Program Adavale has recently undertaken diamond drilling (DDLUHC001 and DDLUHC002) on Prospecting Licence, PL 23980/2023 (referred to as Luhuma Central), as part of a 5,000m combined DD and RC drill program to test a series of targets generated by the Company on the Luhuma Trend, a historically recognised zone of strongly elevated gravity and electromagnetic anomalism. The drillholes DDLUHC001 and DDLUHC002 intersected 4.13m of massive sulphides and 4.90m of blebby and heavily disseminated sulphides respectively. If mineralised intersections are connected between the drillholes (Figure 2) as they are interpreted to be, then these sulphide bearing intervals would approximate their true thickness (although the drillholes are not completely orthogonal to the dip). These sulphides are coincident with a strong discrete AMT anomaly that can be traced to the north and south on AMT lines L1, L2 and L3 (see Figure 1). Drilling of DDLUHC003 is in progress and is located ~60m to the north of the two assayed holes as shown on the plan view of Luhuma Central. This new hole is expected to be completed this week. Additional step-out drilling to further test the AMT anomaly to the north and south are shown as the planned holes (see Figure 1). Figure 1 Plan view of current and proposed drill hole locations (yellow dots) at Luhuma Central plus historical holes (red dot massive sulphides intercepted, black dots indicate Ultramafic rocks intercepted) together with location of the AMT lines L1 to L3 that have been surveyed by Adavale. Blue outline shows the magnetic low interpreted to be the host ultramafics and the red corridor is the AMT anomaly projected to surface and interpreted as the mineralised trend. ASX Announcement 2 All diamond drillholes either have been or will be cased for Downhole Electromagnetic (DHEM) surveys. DHEM survey teams and equipment is being prepared to be mobilised to site. DHEM surveys are an effective technique used to generate drill targets based on the “off-hole” conductive responses that are logged. This has the benefit of both increasing the effectiveness of drilling which can materially reduce the number of drilling metres required when evaluating an emerging prospect like the Luhuma Central. Drilling confirmed that the AMT and airborne EM conductors are indeed attributable to sulphides. Drilling is ongoing to determine the extent of the sulphide mineralisation at Luhuma Central and HEM2 and will be assisted with soon to be completed DHEM survey data. Figure 2 Location of DDLUHC001 and DDLUHC002 targeting sulphides and interpreted AMT Line 1 Assay results were determined by SGS in Mwanza using an aqua regia partial digest technique to reflect nickel values in sulphide. Results, reported above a 0.4% Ni cut-off grade are summarised in Table 1. The broader interval of 12.15m includes samples with values ranging from 0.1% to 1.01% Ni. Downhole intervals are reported as orientation of sulphides, and hence true thickness, is not yet known. As part of the Company’s grade validation and internal QA/QC procedures, the samples in Table 1 will be sent to ALS in South Africa for retesting using both aqua regia and (four-acid) total nickel digest and in addition PGE analyses. ASX Announcement 3 Drillhole DDLUHC001 DDLUHC001 DDLUHC002 Depth From (m) Depth To (m) 223.35 224.35 225.35 226.35 249 250 200.55 201.55 202.55 203.55 224.35 225.35 226.35 227.48 250 251 201.55 202.55 203.55 204.55 Downhole Interval Ni % (m) 1 1 1 1.13 1 1 1 1 1 1 0.98 1.01 0.95 1.00 0.69 0.45 0.43 0.64 0.48 0.52 Total Downhole Interval Thickness (m) Ni % Weighted Average 4.13 0.99 2 0.57 4 0.52 Table 1 Summary of preliminary drill hole assay results reported above 0.4% Ni cut-off grade Drillhole collar details are summarised in Table 2. Drillhole ID DDLUHC001 DDLUHC002 DDLUHC003 Easting 261201 261264 261320 Northing 9711219 9711176 9711146 Elevation 1505 1508 1514 Azimuth 120 120 120 Dip -60 -60 -60 Length (m) 300.3 450 300* Table 2 Collar location, azimuth dip and length (m). * DDLUHC003 is planned depth Next Steps The Company currently has two drill rigs on site at Kabanga Jirani, with one rig focused on Luhuma Central and the other currently drilling high priority targets at HEM 2. With each rig drilling a hole every 7-10 days, we expect regular newsflow over the coming months. Included in the upcoming newsflow will be the following: • • • Visual interpretation of new holes, as appropriate; Aqua regia and full acid digest assay results Downhole EM results This announcement is authorised for release by the Board of Adavale Resources Limited. Further information: For broker and media enquiries: David Riekie Executive Director E: investor@adavaleresources.com Andrew Rowell White Noise Communications E: andrew@whitenoisecomms.com P: +61 400 466 226 References 1 See ASX:ADD release on 22 May 2023 titled “ Geologically Significant Nickel Sulphide Licence Granted”. 2 Evans, D. M., Hunt, J. P. P. M. and Simmonds, J. R., 2016. An overview of nickel mineralisation in Africa with emphasis on the Mesoproterozoic East African Nickel belt (EANB). Episodes, 39/2, 319-333. DOI: 10.18814/epiiugs/2016/v39i2/95780; see also ASX:ADD release 16 December 2021 “Adavale Discovers Significant Mafic-Ultramafic Intrusion”. See ASX:ADD release on 4 April 2023 titled “Nickel Sulphide Drill Targets and 15km Soil Anomaly Defined”. 3 See ASX:ADD release on 6 June 2023 titled “ Massive Nickel Sulphides Intersected at Kabanga Jirani”. 4 See ASX:ADD release on 19 June 2023 titled “ADD Continue to Intersect Zone of Strong Nickel Sulphides”. 5 ASX Announcement 4 Competent Persons Statement The information in this release that relates to “exploration results” for the Project is based on information compiled or reviewed by Mr David Dodd of MSA, South Africa. Mr Dodd is a consultant for Adavale Resources Limited and is a member of the SACNASP. Mr Dodd has sufficient experience that is relevant to the style of mineralisation and type of deposits under consideration as well as to the activity that is being undertaken to qualify as a Competent Person under the ASX Listing Rules. Mr Dodd consents to this release in the form and context in which it appears. Cautionary Statements Visual estimates of mineral abundance should never be considered a proxy or substitute for laboratory analyses where concentrations or grades are the factor of principal economic interest. Visual estimates also potentially provide no information regarding impurities or deleterious physical properties relevant to valuations. The Company regularly uses a portable hand-held XRF analyser to screen drill core for mineralisation before cutting and sampling. This allows for some understanding of the distribution of mineralisation prior to sampling to better ensure that the sampled core is representative of the type and style of mineralisation. Numerous readings are obtained and recorded for future reference. The hand-held XRF provides confirmation that mineralisation is present however it is not an accurate determination of the elemental concentration within the sample analysed. Limitations include; very small analysis window, possible inhomogeneous distribution of mineralisation, analytical penetration depth and possible effects from irregular rock surface. The pXRF readings are subject to confirmation by chemical analysis from an independent laboratory. Forward looking statements This document contains forward-looking statements concerning Adavale. Forward-looking statements are not statements of historical fact and actual events and results may differ materially from those described in the forward-looking statements as a result of a variety of risks, uncertainties and other factors. Forward-looking statements are inherently subject to business, economic, competitive, political and social uncertainties and contingencies. Many factors could cause the Company’s actual results to differ materially from those expressed or implied in any forward-looking information provided by the Company, or on behalf of the Company. Such factors include, among other things, risks relating to additional funding requirements, metal prices, exploration, development and operating risks, competition, production risks, regulatory restrictions, including environmental regulation and liability and potential title disputes. Forward looking statements in this document are based on Adavale’s beliefs, opinions and estimates of Adavale as of the dates the forward-looking statements are made, and no obligation is assumed to update forward looking statements if these beliefs, opinions and estimates should change or to reflect other future developments. Although management believes that the assumptions made by the Company and the expectations represented by such information are reasonable, there can be no assurance that the forward-looking information will prove to be accurate. Forward-looking information involves known and unknown risks, uncertainties, and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any anticipated future results, performance or achievements expressed or implied by such forward-looking information. Such factors include, among others, the actual market price of nickel, the actual results of future exploration, changes in project parameters as plans continue to be evaluated, as well as those factors disclosed in the Company's publicly filed documents. Readers should not place undue reliance on forward-looking information. The Company does not undertake to update any forward-looking information, except in accordance with applicable securities laws. No representation, warranty or undertaking, express or implied, is given or made by the Company that the occurrence of the events expressed or implied in any forward- looking statements in this document will actually occur. ASX Announcement 5 ABOUT ADAVALE Adavale Resources Limited (ASX:ADD) is a nickel sulphide exploration company that holds 100% of the Kabanga Jirani Nickel Project, a portfolio of 12 highly prospective granted licences covering ~1,216km2 along the Karagwe-Ankolean belt in Tanzania. The six southernmost licences are proximal to the world-class Kabanga Nickel Deposit (58Mt @ 2.62% Ni). Adavale has farmed-in to two more highly prospective licences contiguous to our seven southernmost licences, adding a further 99km2 to the portfolio 1,315sq km). Adavale’s licences were selected based on their strong geochemical and geophysical signatures from the previous exploration undertaken by BHP. Adavale also holds exploration licences for their sedimentary uranium potential within the northern part of the highly prospective Lake Frome Embayment in South Australia. ASX Announcement 6 Appendix 1 Adavale Resources Limited – Reverse Circulation and Diamond Drilling Program - Kabanga Jirani Nickel Project JORC Code Edition 2012: Table 1 Section 1: Sampling Techniques and Data (Criteria in this section apply to all succeeding sections.) Criteria JORC Code Explanation Commentary Sampling techniques • RC drilling is conducted primarily to identify the presence of mafic/ultramafic intrusions or to precollar ahead of converting to diamond drilling. RC chips that are identified as mafic or ultramafic are initially analysed with a pXRF, but representative samples are also submitted to ALS (South Africa) for analyses by ICP MS. • • Nature and quality of sampling (e.g. cut channels, random chips, or specific specialised industry standard measurement tools appropriate to the minerals under investigation, such as down hole gamma sondes, or handheld XRF instruments, etc). These examples should not be taken as limiting the broad meaning of sampling. Include reference to measures taken to ensure sample representivity and the appropriate calibration of any measurement tools or systems used. Aspects of the determination of mineralisation that are Material to the Public Report. In cases where ‘industry standard’ work has been done this would be relatively simple (e.g. ‘reverse circulation drilling was used to obtain 1 m samples from which 3 kg was pulverised to produce a 30 g charge for fire assay’). In other cases more explanation may be required, such as where there is coarse gold that has inherent sampling problems. Unusual commodities or mineralisation types (e.g. submarine nodules) may warrant disclosure of detailed information. For RC analyses sampling is not representative of the broader geological horizons and simply represents values derived from select points. The pXRF has been calibrated using the AMIS standards AMIS0315, AMIS0317, AMIS0319, AMIS0329, AMIS384 and AMIS0367. Standards used to verify quality of results measured include AMIS0317 and AMIS0315. If mineralisation is intercepted with RC drilling than RC material will be captured for every metre drilled. The material is put through a riffler and one third is taken for further analyses where it is sieved to remove the chips which are stored in a chip tray. Both the fines and the chips are logged and analysed using the pXRF to record Ni values. MgO values are also noted for each lithological interval. Any mineralised fines will be submitted for analyses using aqua regia digest. All sampling equipment must be cleaned between samples to prevent contamination. SG is calculated at site using a pycnometer and measurements are taken systematically down the drillhole. This is used to reconcile intercepted lithologies against the modelled gravity anomalies to verify that the causative source has been intercepted. For diamond drilling sampling takes place as follows: Core is aligned and a cutting line is drawn to prevent sampling bias. Samples are marked off in pre-defined intervals of 1 m or smaller if required to honour lithological contacts. The core is split along the china marker reference line. The sampling depth and sample ID are then transferred onto the half core remaining so that the core can be revisited and act as a reference. The remaining sampled half of the core is then submitted to an accredited laboratory (ALS South Africa) along with QAQC samples which will form ASX Announcement 7 Criteria JORC Code Explanation Commentary 15% of all samples submitted and will include certified blanks and Ni standards. Drilling techniques • Drill type (e.g. core, reverse circulation, open-hole hammer, rotary air blast, auger, Bangka, sonic, etc) and details (e.g. core diameter, triple or standard tube, depth of diamond tails, facesampling bit or other type, whether core is oriented and if so, by what method, etc). Combination of RC and diamond drilling using NQ sized core. Current depth limit of RC drilling is 150m and for diamond drilling is 600m. Drill sample recovery • Method of recording and assessing core and chip sample recoveries and results assessed. For RC Drilling Logging • Measures taken to maximise sample recovery and ensure representative nature of the samples. • Whether a relationship exists between sample recovery and grade and whether sample bias may have occurred due to preferential loss/gain of fine/coarse material. • • Sub-sampling techniques and sample preparation Whether logging is qualitative or quantitative in nature. Core (or costean, channel, etc) photography. • The total length and percentage of the relevant intersections logged. • If core, whether cut or sawn and whether quarter, half or all core taken. • If non-core, whether riffled, tube sampled, rotary split, etc and whether sampled wet or dry. • ASX Announcement Whether core and chip samples have been geologically and geotechnically logged to a level of detail to support appropriate Mineral Resource estimation, mining studies and metallurgical studies. For all sample types, the nature, quality and appropriateness of the sample preparation technique. Bulk sample retrieved from the cyclone, sample is put through the riffler and 2 to 3 kg sample retrieved for analyses (if required). Chips from this sample are extracted by washing some of the sample material – these chips are placed in a chip tray in order to keep a record of lithologies for each metre drilled. The riffler is cleaned with compressed air between sample collection to prevent contamination. For Diamond Drilling RQD measurements are taken of core to record recovery. Nature of mineralisation is not nuggety and prone to strong variations in grade that correlate to core loss or loss of fines. Sample length may be compromised when drilling through massive sulphides where core loss is often prevalent. The following is recorded for each interval in the lithology log: Borehole ID, From and to depths, lithology code, weathering, colour, grain size, rock texture and contact type and angle. The following is recorded for each mineralized interval in the mineralisation log: borehole ID, from and to depths, mineralisation type, mineralisation style and mineralisation abundance (usually as a sulphide percentage). Chips from RC drilling are stored in a chip tray with a representative sample captured for every metre. Drill core has been cut in half with half core remaining in the core tray and the other half submitted to the laboratory. Where the lithology is uniform samples are taken at 1 m intervals otherwise sample lengths are dictated by geological contacts. RC material has been captured for every metre drilled. For details of sampling technique see “Sampling techniques” section. 8 Criteria Quality of assay data and laboratory tests Verification of sampling and assaying Location of data points ASX Announcement JORC Code Explanation • Quality control procedures adopted for all sub-sampling stages to maximise representivity of samples. • Measures taken to ensure that the sampling is representative of the in-situ material collected, including for instance results for field duplicate/second-half sampling. • Whether sample sizes are appropriate to the grain size of the material being sampled. • The nature, quality and appropriateness of the assaying and laboratory procedures used and whether the technique is considered partial or total. • For geophysical tools, spectrometers, handheld XRF instruments, etc, the parameters used in determining the analysis including instrument make and model, reading times, calibrations factors applied and their derivation, etc. • Nature of quality control procedures adopted (e.g. standards, blanks, duplicates, external laboratory checks) and whether acceptable levels of accuracy (i.e. lack of bias) and precision have been established. • The verification of significant intersections by either independent or alternative company personnel. • The use of twinned holes. • Documentation of primary data, data entry procedures, data verification, data storage (physical and electronic) protocols. • Discuss any adjustment to assay data. • Accuracy and quality of surveys used to locate drill holes (collar and down-hole surveys), trenches, mine workings and other locations used in Mineral Resource estimation. Commentary Core samples will be analysed by SGS Tanzania and ALS laboratory in South Africa. Samples will be analysed using both an aqua regia to avoid the inclusion of silicate Ni as well as a total digest to determine total nickel. CRM’s, blanks and standard will be inserted to verify laboratory accuracy, precision or bias. QAQC samples will form 15% of all samples submitted. Chips from RC drilling are stored in a chip tray with a representative sample captured for every metre to enable check sampling to be undertaken. All logging and pXRF readings have been undertaken by a senior exploration personnel. Primary data was collected in the core shed using a set of standard logging templates and entered into a tablet with tailor made dropdown menus. The data is forwarded to their independent data management consultant (MSA) for validation and loading into the company’s drilling database The drillhole collars were surveyed with a handheld GPS unit with an accuracy of 5m which is considered sufficiently accurate for the purpose of the drillhole. All co- ordinates are expressed in Arc1960. 9 Criteria JORC Code Explanation Commentary • Specification of the grid system used. • Quality and adequacy of topographic control. • Data spacing for reporting of Exploration Results. • Whether the data spacing and distribution is sufficient to establish the degree of geological and grade continuity appropriate for the Mineral Resource and Ore Reserve estimation procedure(s) and classifications applied. • Whether sample compositing has been applied. • Whether the orientation of sampling achieves unbiased sampling of possible structures and the extent to which this is known, considering the deposit type. • If the relationship between the drilling orientation and the orientation of key mineralised structures is considered to have introduced a sampling bias, this should be assessed and reported if material. Sample security • The measures taken to ensure sample security. Samples are kept in the core shed and then delivered in person by the geologist to the courier company from where they are dispatched to the laboratory. Audits or reviews • The results of any audits or reviews of sampling techniques and data. Internal audits/reviews of procedures are ongoing, however no external reviews have been undertaken. Data spacing and distribution Orientation of data in relation to geological structure ASX Announcement No regular drill hole spacing has been set with individual holes design to intersect specific targets. Diamond drillholes were designed to test coincident gravity, Geochemical and HEM anomalies. Drillholes are designed to intercept conductors orthogonally if possible or alternatively to drill through the EM anomalies. 10 Section 2: Reporting of Exploration Results Criteria JORC Code Explanation Commentary Mineral tenement and land tenure status • Type, reference name/number, location and ownership including agreements or material issues with third parties such as joint ventures, partnerships, overriding royalties, native title interests, historical sites, wilderness or national park and environmental settings. The Kabanga Jirani Nickel Project located in Tanzania covering 1,215.97km2 comprises of ten granted licences, all are 100% owned by Adavale Resources as follows: • The security of the tenure held at the time of reporting along with any known impediments to obtaining a licence to operate in the area. PL 11406 298 km2 Kabanga North East PL 11886 23 km2 Kabanga South East PL 11405 114 km2 Kabanga North PL 11538 64 km2 Burigi PL 11537 194 km2 Burigi North PL 11591 182 km2 Kabanga East PL11590 273 km2 Kabanga West PL11592 19.4 km2 Ruiza North East PL 12175 44.83 km2 Southeast Wedge PL 23980/2023 3.74 km2 Luhuma Central In addition there are two licences with farm-in agreements (65% ownership interest) PL11692 26 km2, Luhuma North PL11693 73 km2, Luhuma South Exploration done by other parties • Acknowledgment and appraisal of exploration by other parties. Not applicable, not referred to. Geology • Deposit type, geological setting and style of mineralisation. The exploration target is a magmatic Ni-Cu-PGE sulphide with the same genesis to the Kabanga N-Cu-PGE sulphide deposit that the licences are adjacent to. Drill hole Information • A summary of all information material to the understanding of the exploration results including a tabulation of the following information for all Material drill holes: DDLUHC 001 • easting and northing of the drill hole collar Elevation 1505 ASX Announcement Easting 261202 Northing 9711219 11 Criteria JORC Code Explanation Commentary • elevation or RL (Reduced Level – elevation above sea level in metres) of the drill hole collar Azimuth: 120 • dip and azimuth of the hole EOH: 300.3m Dip: 60° • down hole length and interception depth • hole length. DDLUHC 002 • If the exclusion of this information is justified on the basis that the information is not Material and this exclusion does not detract from the understanding of the report, the Competent Person should clearly explain why this is the case. Easting 261264 Northing 9711176 Elevation 1508 Azimuth: 120 Dip: 60° EOH: 450.m DDLUHC 003 Easting 261320 Northing 9711146 Elevation 1514 Azimuth: 298 Dip: 60° EOH: 300.m Data aggregation methods • • • Relationship between ASX Announcement • In reporting Exploration Results, weighting averaging techniques, maximum and/or minimum grade truncations (e.g. cutting of high grades) and cut-off grades are usually Material and should be stated. Where aggregate intercepts incorporate short lengths of high-grade results and longer lengths of low-grade results, the procedure used for such aggregation should be stated and some typical examples of such aggregations should be shown in detail. The assumptions used for any reporting of metal equivalent values should be clearly stated. Weighted averages based on length of intersections have been utilised as stated in this announcement. The true thickness of the sulphide is unknown. These relationships are particularly important in the reporting of Exploration Results. Not applicable – insufficient data available at this point to describe 12 Criteria JORC Code Explanation Commentary mineralisation widths and intercept lengths • If the geometry of the mineralisation with respect to the drill hole angle is known, its nature should be reported. If it is not known and only the down hole lengths are reported, there should be a clear statement to this effect (e.g. ‘down hole length, true width not known’). relationship between mineralisation widths and intercept length. • Appropriate maps and sections (with scales) and tabulations of intercepts should be included for any significant discovery being reported These should include, but not be limited to a plan view of drill hole collar locations and appropriate sectional views. Plan views and cross-sections have been provided. Balanced reporting • Where comprehensive reporting of all Exploration Results is not practicable, representative reporting of both low and high grades and/or widths should be practiced to avoid misleading reporting of Exploration Results. Range of assay results received has been reported. • Diagrams Other substantive exploration data • Other exploration data, if meaningful and material, should be reported including (but not limited to): geological observations; geophysical survey results; geochemical survey results; bulk samples – size and method of treatment; metallurgical test results; bulk density, groundwater, geotechnical and rock characteristics; potential deleterious or contaminating substances. No other material information that hasn’t been reported. Further work • The nature and scale of planned further work (e.g. tests for lateral extensions or depth extensions or large-scale step-out drilling). Diagrams clearly highlighting the areas of possible extensions, including the main geological interpretations and future drilling areas, provided this inf