Announcement PDF 7 March 2024 Companies Announcement Office ASX Limited Adavale Resources Limited (ASX: ADD) (“Adavale” or “Company’) hereby provides an updated announcement in relation to the “Electromagnetic Data Indicates Uranium Exploration Potential in South Australia” released on 28 February 2024. The additional details provided were: • • • further details on the parameters set on Figures 1 to 3; footnote 2 link has been updated; and details provided under JORC Table – Section 1. This announcement is authorised for release by the Board of Adavale Resources Limited. By order of the Board, Leonard Math CFO & Company Secretary Level 2, 49 Oxford Close, West Leederville WA 6007, Australia W: www.adavaleresources.com ABN 96 008 719 015 ASX ANNOUNCEMENT/MEDIA RELEASE 7 March 2024 Electromagnetic Data Indicates Uranium Exploration Potential in South Australia ASX: ADD DIRECTORS & OFFICERS • Large presence of prospective palaeochannel system identified from historical electromagnetic (EM) data • Data covers ~1,000 sq km of Adavale’s Mundowdna licences • Location and orientation of prospective palaeochannel system correlates well with Adavale’s upcoming low impact ground based exploration surveys of the Mundowdna licences • The processing of the historical EM dataset secured a significant time and cost saving for Adavale, obviating the need to re-fly the large licence area • Adavale is well positioned uranium price tailwind to take advantage of the Adavale Resources Limited (ASX: ADD) (“or the Company”) is pleased to advise that a significant historical electromagnetic (EM) dataset has been procured covering EL6821 and EL6957 (Mundowdna and Mundowdna South) in South Australia, where an extensive series of covered palaeochannels have been interpreted1. The EM dataset, covering most of the Mundowdna licence package, was originally flown in 2007 for the purpose of identifying palaeochannels within a large recognised alluvial fan extending north-westward out from the Flinders Ranges. Reprocessing and interpretation of the EM dataset, supported by modern satellite imagery strongly indicates the presence of an extensive palaeochannel system within the Company’s Mundowdna licence package. Adavale’s Executive Director, David Riekie commented: “The acquisition and processing of the Mundowdna historical EM data is an important step in our first phase of exploration on this ground. The data was a significant find as EM coverage was one of the techniques that Adavale would have otherwise needed to fund as part of assessing Mundowdna. It has provided a major time and significant cost saving. "The imagery from this data confirms the geological model in that there is a significant palaeochannel system within our licence package. This is timely with our upcoming works program and also means that this processed data can be used for future exploration and expansion of targets on our licence package.” 1 ASX Announcement 27 November 2023 – Satellite imagery identifies paleochannels for uranium exploration GRANT PIERCE CHAIRMAN DAVID RIEKIE EXECUTIVE DIRECTOR JOHN HICKS DIRECTOR ALLAN RITCHIE CHIEF EXECUTIVE OFFICER LEONARD MATH CFO & COMPANY SECRETARY 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 87.6Mt @ 2.63% Ni. Adavale is also progressing exploration on its 100% owned uranium tenements in South Australia Technical Data Details and Processing Outcomes The electromagnetic (EM) Method is used in several exploration settings where materials in the ground are thought to be conductive. An EM setup generally consists of a transmitter and a receiver. In palaeochannel exploration for uranium systems, saline groundwater responds in the same way as a metal would to the transmission of electromagnetic energy, creating secondary currents in the saline groundwater which are collected by the receiver on the EM array. It is because of this response to EM surveying that the original survey was undertaken in 2007 as a guide for exploraion. The historical Mundowdna EM dataset was downloaded from the South Australian Resources Information Gateway (SARIG) data portal after it was identified in an open file report by Adavale. The original report is from Eromanga Uranium. The survey was conducted by Geosolutions in 2007 using their REPTEM system. Further information on the survey can be found in Open File ENV114792. The survey, flown using a Eurocopter Squirrel BA. VH-HHJ helicopter, encompassed a 1km line spacing oriented at 045-225 degrees to true north, at a height of 30m and airspeed of 55 knots. In total, approximately 400,000 survey data points were recorded. Images produced from the processed data were then used between 2007 and 2009 to direct drilling and exploration activities over the area. At the end of 2008, Eromanga Uranium geologists specifically stated that the data needed reinterpretation. Processing software and computer limitations in the 2000s often involved processing methods that were not statistically valid for the data spacing and resulted in substandard image processing practices, especially on very large datasets. Where this occurred, a significant amount of “data noise” could be observed in the resultant imagery. In Figure 1, presented below, the original imagery produced over the Mundowdna licence package is very noisy and difficult to interpret as no obvious continuous trends are evident. All processed images presented herein reflect the sixth Time Domain EM (TDEM) survey channel and have the same hillshade and colour stretch applied. The noisy nature of Figure 1 is self-evident and is due largely to the survey line spacing in relation to the much closer data spacing along each line. 2 Results List (pir.sa.gov.au) ASX Announcement 2 Figure 1: Original imagery from 2007 REPTEM survey showing the noisy nature of the data. There is limited continuity of the conductors (red and yellow colours fading into greens), and this arises from using a small search radius for the data processing in the original imagery. The blue colours are meant to represent areas that are resistive and not conductive. The significantly greater spacing between lines compared the data points along the lines means an adequate search distance needs to be used to interpolate between data points on adjoining lines. This significantly increases the computing power required to correctly interpolate between points as the spacing of points on the ground is quite close. Details of the original processing method and the data interpolation search distances it employed could not be located. However, by using a Simple Kriging algorithm in the System for Automated Geoscientific Analysis (SAGA) GIS and a 700m search distance, Adavale was able to re-create an image that closely replicated the noisy image shown in Figure 1. With this knowledge, Adavale determined that a search distance of at least 2km was required to provide meaningful correlation across survey lines. Figure 2 shows the re-processed image produced using the same simple kriging algorithm in the SAGA GIS package with the 2km search radius applied. This task was very computer intensive, taking days to produce each image, but the resulting imagery is much less noisy, providing strong indications for the presence of a palaeochannel system within the licence package. Reds and yellows represent high conductivity regions in the data. ASX Announcement 3 Figure 2: Newly processed image showing smoother, continuous data when the image is appropriately processed. Reds and yellows represent high conductivity regions in the data, while pale blues are less conductive and deeper blues are resistive. The improved processing provides continuity across lines and the imagery can be interpreted with more ease. The newly processed imagery was then compared with the interpreted palaeochannel observed in the Sentinel 2 satellite imagery1. While not exact, the interpreted palaeochannel positions within the processed TDEM and Sentinel 2 satellite imagery do closely correspond. Differences are to be expected as the TDEM data represents a depth slice of potentially deeper buried palaeochannels, while the Sentinel 2 data maps the youngest palaeochannels at surface. The high in the northwest of EL6821 is the result of groundwater related to mound springs associated with the main aquifer in the Great Artesian Basin. This is highlighted in Figure 3. ASX Announcement 4 Figure 3: Interpreted Channels from processed data showing the channels in the alluvial fan and the area of Great Artesian Basin Influence. The interpreted channels are shown in green, and the area of Great Artesian Basin influence is shown as the red polygon in the north of EL6821. Considering the newly processed imagery, the current planned exploration program will proceed as originally designed. The transects planned on the Sentinel 2 imagery interpretation test several features that are also present in the TDEM data. The ground-based exploration program is scheduled to commence in April 2024. Uranium Sector Commentary The current robustness of the uranium price is largely driven by supply and demand dynamics. On the supply side, reduced production from major producers such as Cameco and Kazatomprom in 2023 caught the market by surprise. On the demand front, an increasing number of countries are seeking uranium supplies outside of Russia, adding to an already growing demand driven by China’s burgeoning domestic nuclear power industry. China has announced expansion plans for three nuclear reactors, whilst Japan has also been restarting reactors that were closed post Fukushima. The uranium market is further complicated by the involvement of financial speculators and physical uranium Exchange-Traded Funds (ETFs). As the market gains strength, these entities are accumulating physical uranium stockpiles, thereby reducing the supply available to power users and exerting upward pressure on prices. The Sprott Physical Uranium Trust (UU.TO), established in 2021, has been purchasing uranium on the spot market, effectively removing volumes from circulation. The Trust’s current value stands at US$5.1 billion, marking a nearly 90% increase since mid-2023. ASX Announcement 5 Figure 4: 12-month uranium price chart (source: markets.businessinsider.com) Analyst commentary in 2023 highlighted that the uranium price needed to see an extended period above US$70-80/lb to provide an incentive price for new investment. The commentary also noted that with projects such as Jabiluka in Australia unlikely to restart, the focus will be on the development of new greenfields opportunities. The World Nuclear Association3 forecasts uranium demand to climb from 162 million pounds in 2021, to 206 million pounds by 2030 and 292 million pounds by 2040. This increase in demand is expected to outpace the growth in supply, leading to a potential supply-demand imbalance in the uranium market. Adavale is well positioned with its highly prospective uranium assets in South Australia to take advantage of this huge uranium tailwind. This announcement is authorised for release by the Board of Adavale Resources Limited. Acknowledgements to traditional owners Adavale acknowledges the Dieri and Adnyamathanha as Traditional Custodians of the land on which our current works are located. With respect to Elders past, present and emerging, Adavale is committed to conducting its activities with respect to the communities in which it operates. 3 World Nuclear Association - World Nuclear Association (world-nuclear.org) ASX Announcement 6 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 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 Patrick Harvey MAppSci, Australia. Mr Harvey is a consultant for Adavale Resources Limited and is a member of the AIG. Mr Harvey 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 undertaking to qualify as a Competent Person under the ASX Listing Rules. Mr Harvey consents to this release in the form and context in which it appears. 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. 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 7 ASX Announcement 8 Appendix 1 Adavale Resources Limited – Lake Surprise and Mundowdna Projects, South Australia JORC Code Edition 2012: Table 1 Section 1: Sampling Techniques and Data Criteria JORC Code Explanation Commentary Sampling techniques • Data Download Nature and quality of sampling (eg 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 (eg ‘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 (eg submarine nodules) may warrant disclosure of detailed information. The geophysical data was downloaded as several folders containing survey point data and processed imagery from the South Australian Resources Gateway. This used the spatial search tool and selected the geophysical data option. This is from the 2007 survey by Eromanga uranium. Geophysical survey The geophysical survey was run in 2007 by Eromanga Uranium. They contracted flying and initial processing and data validation to Geosolutions. The original survey report is not available in full, but a summary report is included in the information that was downloaded. This is also available in the open file envelope linked above on page 2 of the announcement. The survey summary outlines the survey parameters and the channel resampling process, along with the time domain channels, airspeed, line spacing, altitude, and datum of GDA94. Below is a reproduction from this original survey summary. Survey Equipment Helicopter: Eurocopter Squirrel BA. VH-HHJ. Towed Array: REPTEM TX / RX structure. Transmitter: Geosolutions proprietary REPTEM transmitter. Receiver: Geosolutions proprietary REPTEM receiver. 24-bit A-D sampling at 1.25 microseconds. Transmitter area: Single turn of 412 square metres. Receiver area: Single turn of 138 square metres. Coil amps nominal: 260. ASX Announcement 9 Criteria JORC Code Explanation Commentary Power system: 24 HP Honda V-twin alternator system. Survey Specifications Flying Height: 100 feet (30 metres) depending upon terrain. Line Direction: 045 – 225 degrees true. Line Spacing: 1000 metres. Survey Speed: 55 Knots - Indicated Air Speed. Sample Interval: 50 per Second. Map Datum: GDA 94. Survey Resolutions ATDEM data: Windowed to 21 channels and resampled to 10m across ground. Laser Altimeter: 10-centimetre resolution sampled 80 times per second. Data Processing Airborne TDEM Data: Geosolutions proprietary airborne geophysical survey data processing package. Navigation Data : Geosolutions proprietary airborne geophysical survey data processing package. SAMPLE TIMES IN MILLISECONDS ---------------------------C001-000.087 C002-000.112 C003-000.137 C004-000.162 C005-000.225 C006-000.325 C007-000.426 C008-000.527 C009-000.679 C010-000.932 C011-001.286 C012-001.742 C013-002.299 C014-002.957 C015-003.716 C016-004.577 C017-005.539 C018-006.602 C019-007.766 C020-009.032 C021-010.551 Drilling techniques ASX Announcement • Drill type (eg core, reverse circulation, open-hole hammer, rotary air blast, auger, Bangka, sonic, etc) and details (eg core diameter, triple or standard tube, depth of diamond tails, face- Not applicable undertaken. as no drilling 10 Criteria JORC Code Explanation Commentary sampling bit or other type, whether core is oriented and if so, by what method, etc). Drill sample recovery Logging Sub-sampling techniques and sample preparation Quality of assay data and laboratory tests ASX Announcement • Method of recording and assessing core and chip sample recoveries and results assessed. • 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. • 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. • 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. • For all sample types, the nature, quality and appropriateness of the sample preparation technique. • Quality control procedures adopted for all subsampling 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 (eg standards, blanks, duplicates, external laboratory checks) and whether acceptable levels of Not applicable as no drilling undertaken. Not applicable undertaken. as no drilling Not applicable as no drilling undertaken. Not applicable undertaken. as no drilling 11 Criteria JORC Code Explanation Commentary accuracy (ie 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. • 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. Not applicable as no drilling undertaken. Audits or reviews • The results of any audits or reviews of sampling techniques and data. Not applicable undertaken. Verification of sampling and assaying Location of data points Data spacing and distribution Orientation of data in relation to geological structure ASX Announcement Not applicable as no drilling undertaken. GDA94 was used during the survey data collection process in 2007 Geophysical data was averaged to 10m over the ground along lines, with a spacing of 1km between lines. Geophysical data was collected on an orientation of 045/225 relative to degrees true north. There is no reason stated in the historic information as to the rationale for using this orientation. as no drilling 12 Section 2: Reporting of Exploration Results (Criteria in this section apply to all succeeding sections) Criteria 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 Lake Surprise Uranium Project covers an area of 396km2. The tenement package is located in the North-East Pastoral District of South Australia. It is 100% owned and operated by Adavale Resources. • 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. Tenement ID’s are: EL5892, EL5893 and EL6589 The Native Title holder for the area is the Dieri People. The tenements cross the boundary of Clayton Station and Murnpeowie Station. The Mundowdna Project comprises: EL6821 (682 km2) and ELA2023/00043 (591km2) These licences are centred approximately 45 km south east of Marree and are on the pastoral leases of Farina, Mundowdna, Wilpoorinna and Mount Lyndhurst. EL6821 is 100% owned and operated by Adavale Resources, While at the time of writing, ELA2023/00043 is still under consideration for grant by the department. Native Title on the licences is held by The Arabana People, The Adnyamathanha People and The Dieri People. 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 sandstone hosted palaeochannel deposit of uranium within sediment outwash from the Northern Flinders Ranges. 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: Not applicable as no drilling was conducted. ASX Announcement • easting and northing of the drill hole collar • elevation or RL (Reduced Level – elevation above sea level in metres) of the drill hole collar • dip and azimuth of the hole 13 Criteria Explanation • down hole length and interception depth • hole length. Commentary • 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. • In reporting Exploration Results, weighting averaging techniques, maximum and/or minimum grade truncations (eg 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. • These relationships are particularly important in the reporting of Exploration Results. • 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 (eg ‘down hole length, true width not known’). Diagrams • 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. Not applicable as no drilling was conducted. 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. Not applicable as no drilling was conducted. 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. An historic geophysical dataset was identified in the past company reporting from one of the companies to explore the area from 2007 to 2009. The data was downloaded by Patrick Harvey and the information was recognised as a key new dataset. Data aggregation methods Relationship between mineralisation widths and intercept lengths ASX Announcement Not applicable as no such information was referred to. Not applicable as no drilling was conducted. 14 Criteria Explanation Commentary Reprocessing of the information took place as the original imagery from the data appeared noisy in nature and there are some significant anomalies and aliasing of data related to the original processing. The data was reprocessed into images on System for Automated Geoscientific Analysis (SAGA) using the simple kriging algorithm. The search radius was set at a distance that allowed processing over 2 lines from ea