Mr. Keith Deluce reports

MELKIOR DRILLING UPDATE

Melkior Resources Inc. has provided an update to continuing exploration in the target G area of the Carscallen project in Timmins, Ont., henceforth referred to as the Behemoth zone. Drilling is continuing, with 16 holes (approximately 3,000 metres) completed to date. The drill program has generally been implemented as described in the 2017 exploration plan available on the Melkior website.

This news release focuses on initial observations from the Behemoth zone.

CAR-17-13 (azimuth of 250 degrees/minus 45 degrees, UTM NAD83 zone 17, 451735E 5356571N) was drilled to final depth of 565 metres.

CAR-17-14 (azimuth of 250 degrees/minus 50 degrees) and CAR-17-15 (azimuth of 250 degrees/minus 70 degrees) were both drilled from the same set-up 50 metres north of CAR-17-13 to 195 metres and 164 metres, respectively.

The most recently completed drill hole, CAR-17-16, was collared 50 metres south of CAR-17-13 (azimuth of 250 degrees/minus 52 degrees) and drilled to a depth of 550 metres.

These four drill holes have collectively identified 100 metres of strike length of a north-south-trending mineralized fault zone. This mineralized structure was encountered at shallow depths (less than 100 metres) in close proximity to Melkior's eastern boundary. This structure is on strike with the Zamzam zone, located 1.8 kilometres to the north. Visual observations are encouraging; assays are expected in about one month.

The Behemoth zone, a second and larger area of interest, has been encountered by both CAR-17-13 and CAR-17-16 at depths ranging from 225 metres to 425 metres downhole. The Behemoth zone comprises multiple distinct mineralized zones in both of these drill holes. Observations indicate that the mineralization in these two drill holes is related to a broad complex (north-south-trending) structure that has experienced multiple periods of deformation. There seems to be a general commonality to the zones where the granite has been crushed; circulating hydrothermal fluids produce a pronounced silicified zone marginal and within these cataclastic zones. Multiple periods of deformation have locally produced further cataclastic deformation, brittle failure with associated quartz veining, brecciation with associated intense silicification and shearing. Pyrite is commonly associated with these cataclastic zones and later silicifying and mineralizing events. Visible gold was observed in one location in CAR-17-13 within a structural zone.

Of note is the newly documented surficial gold occurrence within the swampy area overlying the Behemoth zone that assayed 9.5 grams per tonne gold. The mineralization observed in the outcrop is within a silicified cataclastic zone in the granite that hosts a multiepisodic quartz vein (azimuth of 290 degrees, minus 70 degrees east) up to 30 centimetres wide. One of the interesting sections observed in CAR-17-13 is thought to be the 200-metre downdip extension of this new gold showing.

Of special note is that the Behemoth zone appears to be co-located with an interpreted IP (induced polarization) chargeability anomaly with a north-south trend. Historically, it has been difficult to correlate IP anomalies on the Carscallen project to gold occurrences due to the narrow width of the mineralized zones. The correlation of the Behemoth zone to an IP anomaly would be considered to be a positive development.

Also of special note is that within the central portion of the Behemoth zone is a lamprophyre dike several metres wide. Lamprophyres are indicative of deep-seated structural breaks. The magnetic signature lamprophyre indicates its trend is subparallel to the surficial gold-bearing whaleback outcrop and the adjacent regional diabase dike to the west. The co-location of these individual intrusive members with the Behemoth zone reinforces the potential for a large and complex north-south-trending structural zone.

Jim Deluce, chief executive officer of Melkior, commented: "Visible gold within the Behemoth zone is encouraging; however, its significance needs to be established through assays. I anticipate a pause in drilling to allow us to assess the assay results. We hope that the assays will support our continued drilling."

Wade Kornik, PGeo, has approved the information contained in this release. Mr. Kornik is the exploration manager of the company and is a qualified person as defined by National Instrument 43-101.