Mr. Barry Hildred reports

AQUILA RESOURCES PROVIDES PERMITTING UPDATE

Aquila Resources Inc. has notified the Michigan Department of Environmental Quality (MDEQ) that it will be submitting a new, updated wetlands permit addressing recent comments provided by the MDEQ for its Back Forty project. On Aug. 26, Aquila received correspondence from the MDEQ that included comments from the Environmental Protection Agency and the U.S. Army Corps. of Engineers. Aquila met with all three agencies on Sept. 13 and determined that it will submit a new wetlands permit that will address the comments received from all three agencies. The wetlands protection permit is the last permit required to build and operate the Back Forty project.

Aquila has already been awarded a draft non-ferrous metallic mineral mining permit, a draft national pollutant discharge elimination system (NPDES) permit and a draft air pollution control permit. All permits are subject to a consolidated public comment period that will end on Nov. 3, 2016.

The company expects that the resubmission of the wetlands permit will not affect its target development timelines for the Back Forty.

Qualified person

This news release was reviewed and approved by Thomas O. Quigley, vice-president of exploration and senior technical adviser for the Back Forty project. By virtue of his education, experience and professional association, Mr. Quigley is considered a qualified person as defined under National Instrument 43-101. Information regarding data verification is provided in Aquila's annual information form dated March 30, 2016.

About Aquila Resources

Aquila Resources Inc. is a development-stage company with strategic assets in the Great Lakes region. The company's experienced management is currently focused on advancing permitting activities for its 100-per-cent-owned gold- and zinc-rich Back Forty project in Michigan.

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