Mr. Ralph Shearing reports

TELSON RESOURCES INC. COMPLETES ACQUISITION AGREEMENT WITH NYRSTAR MINING LTD TO ACQUIRE 100% OF THE CAMPO MORADO MINE, GUERRERO STATE, MEXICO

Telson Resources Inc. has entered into a definitive share purchase agreement with Nyrstar Mining Ltd. and Nyrstar Mexico Resources Corp. (collectively, Nyrstar) to purchase all of the shares of Nyrstar's Mexican subsidiary companies that make up and own 100 per cent of the Campo Morado mine, located in Guerrero state, Mexico.

Under the terms of the agreement, Telson has agreed to pay a total purchase price of $20-million (U.S.) plus any variable purchase price, as described below, to Nyrstar under the following schedule:

• $800,000 (U.S.) at the signing of the agreement;
• $2.7-million (U.S.) on or before June 12, 2017;
• $16.5-million (U.S.) on the one-year anniversary following the closing date of the transaction.

Nyrstar shall also retain the right to receive a variable purchase price on future zinc production on the first 10 million tons of ore processed by Telson at the Campo Morado mine when the price of zinc is at or above $2,100 (U.S.) per tonne. Telson shall pay Nyrstar the greater of either of (1) or (2) below:

1. $20 (U.S.) per tonne of zinc sold if the zinc price received is over $2,100 (U.S.) per tonne;
2. Or a percentage of the net smelter revenue received from zinc from the Campo Morado mine based upon the following:
   • If the zinc price received is greater than $2,100 (U.S.) per tonne and less than or equal to $2,200 (U.S.) per tonne, then 0.5 per cent of the net smelter revenue;
   • If the zinc price received is greater than $2,200 (U.S.) per tonne and less than or equal to $2,300 per tonne (U.S.), then 1.5 per cent of the net smelter revenue;
   • If the zinc price received is greater than $2,300 (U.S.) per tonne and less than or equal to $2,400 (U.S.) per tonne, then 2.5 per cent of the net smelter revenue;
   • If the zinc price received is greater than $2,400 (U.S.) per tonne and less than or equal to $2,500 (U.S.) per tonne, then 3.5 per cent of the net smelter revenue;
   • If the zinc price received is greater than $2,500 (U.S.) per tonne, then 4.25 per cent of the net smelter revenue.

Telson maintains the right under the agreement to purchase 100 per cent of the variable purchase price at any time for $4-million (U.S.).

Nyrstar shall also have a right of first refusal, on the same commercial terms and conditions offered by an arm's-length third party, to enter into an offtake agreement for the purchase of zinc concentrates. The closing of the agreement is subject to TSX Venture Exchange approval.

The Campo Morado mine is an underground multimetal mine located in Guerrero state, Mexico, with infrastructure, installations and equipment capable of processing 2,500 metric tonnes of ore per day. The property area comprises approximately 12,045 hectares in six mining concessions that are about 160 kilometres south-southwest of Mexico City.

There are 767 exploration diamond drill holes in place (252,802.8 metres) and six mineralized bodies that have been delineated as JORC-(joint-ore-reserve-committee)-compliant resources (Reforma, El Largo, El Rey and Naranjo, where all historical resources remain in place, and two other zones, G9 and G9 Del Oro, which have seen significant production and are largely depleted).

Mineral resources as publicly disclosed by Nyrstar on April 29, 2015, are presented in the accompanying table. Telson is not treating these resources as its own current resources, but as historical resources. Telson believes them to be relevant and reliable based on the processes and practices that it understands Nyrstar followed. Please note that the mineral resources described herein were calculated in accordance with JORC. A qualified person for Telson has not conducted sufficient work to classify the historical resources as current mineral resources, and Telson is not treating the historical estimates as current mineral resources. Telson will review the historical work and undertake to make any reconciliations required between JORC categories and National Instrument 43-101 categories of mineral resources. A prior technical report dated March 31, 2010, produced for Farallon Mining Inc. is available, and includes mineral resource disclosure.

                                                                                        Measured and
                                                      Measured         Indicated          indicated          Inferred
                                                       mineral          mineral            mineral           mineral
                                                      resources        resources          resources         resources
Name of                    Mining
operation    Ownership     method    Commodity      2014     2013     2014     2013     2014     2013     2014     2013

Campo              100%        UG          (Mt)     7.90    10.26     6.80     6.70    14.70    17.00     2.15     2.14
Morado                                   Zn (%)     4.43     4.31     2.98     3.14     3.76     3.85     2.22     2.44
                                         Cu (%)     0.87     0.73     0.89     0.71     0.88     0.72     0.92     0.71
                                         Pb (%)     0.87     0.90     0.75     0.84     0.81     0.88     0.73     0.81
                                       Ag (g/t)   122.00   114.00    98.00   110.00   106.00   113.00    89.10   105.00
                                       Au (g/t)     1.27     1.34     1.43     1.72     1.34     1.49     1.49     1.88

This table presents depleted resources and does not include the mined-out areas of the G9 and G9 Del Oro zones.

The Campo Morado mine was commissioned and commenced operations in 2009. Production was suspended in January, 2015, and the mine was placed on care and maintenance due to deteriorating industry conditions. During 2014, the mine processed 657,000 tons of ore with an average grade of 1.2 grams per tonne gold, 115.7 g/t silver, 4.6 per cent zinc, 1.2 per cent copper and 0.9 per cent lead. The concentrates produced in the same year were 48,000 tons of zinc concentrate at 47 per cent Zn and 29,000 tons of copper concentrate at 13 per cent, including 6,000 ounces of gold and 0.9 mm of silver.

In order to finance the initial closing payments under the agreement, the company arranged two financings from two corporate entities, each controlled by Estrategica Corporativa en Finanzas, a related party of the company. The related party is a significant shareholder with a control position in the company, for which the company previously received shareholder consent in late 2015, in accordance with TSX-V policy.

The initial finance was structured as a convertible debt in the face amount of $800,000 (U.S.) ($1,069,120), convertible into common shares at a price of 31 cents per common share, at any time before the maturity date of the debt, which was set at three years from the date of closing. The debt was to bear interest at a rate of 8 per cent per year (simple interest), with no interest accruing during the three-month period commencing from the closing date. These funds were deposited in trust to be held and used to either: (i) pay the initial payment to Nyrstar on signing the agreement; or (ii) be returned to the investor with no penalty to the company in the event that the parties were unable to complete the agreement. The funds have now been paid to Nyrstar and consequently the investor has agreed to convert the loan into an equity private placement based on the original conversion terms of the convertible loan. Accordingly, the company will, subject to TSX-V acceptance, issue the investor 3,448,774 common shares in the capital of the company. The company will rely on the part-and-parcel pricing exemption as defined in TSX-V Policy 4.1 in respect of this financing, as it was integral to entry into the agreement.

The second portion of the private placement financing will consist of $2.7-million (U.S.), consisting of shares only, at 55 cents per common share. When combined together, the average cost of the two placements is 50 cents per share, being a 45-per-cent premium to the closing market price of the company's shares as of April 26, 2017.

All securities issued under the private placements will be subject to a four-month hold period under applicable securities laws.

The proposed issuance of private placement securities to a non-arm's-length party also constitutes a related party transaction under Multilateral Instrument 61-101. Because the company's shares trade only on the TSX-V, the issuance of securities is exempt from the formal valuation requirements of Section 5.4 of MI 61-101 pursuant to Subsection 5.5(b) of MI 61-101 and exempt from the minority approval requirements of Section 5.6 of MI 61-101.

Qualified person

This press release was prepared under the supervision and review of Ralph Shearing, PGeol, president and director of Telson, a professional geologist registered in Alberta as a member of the professional organization APEGA (Association of Professional Engineers and Geoscientists of Alberta), and a qualified person as defined by National Instrument 43-101.

We seek Safe Harbor.