Dr. Andrew Dinning reports

SARAMA RESOURCES COMPLETES ACQUISITION OF MAJORITY INTEREST IN COSMO GOLD PROJECT

Sarama Resources Ltd. has completed the acquisition of a majority interest in the Cosmo gold project in Western Australia. This follows satisfaction of all outstanding conditions precedent and receipt of final securities exchange approval.

The 580-square-kilometre Cosmo gold project covers the entirety of the Cosmo-Newbery greenstone belt and is located approximately 85 km northeast of Laverton in a region known for its prolific gold endowment. As one of the last effectively unexplored greenstone belts in Western Australia, the project presents a unique and compelling opportunity for the company.

Highlights

Sarama's president, chief executive officer and MD, Andrew Dinning, commented: "We are very pleased to have completed the acquisition and gained control of the Cosmo gold project which we view as a compelling greenfields exploration opportunity in Western Australia's Eastern Goldfields. The project has excellent access and importantly scale, favourable lithological and structural settings, and historical high-grade workings dating back to the 1890s. Sarama has already commenced a broad-scale, systematic exploration program and looks forward to working up the project's first drill targets. We would also like to acknowledge the work done on the project by Cosmo Gold Ltd. and look forward to the ongoing support of the traditional owners for Sarama's planned endeavours."

Cosmo Newbery project

The project comprised seven contiguous exploration tenements covering approximately 580 square kilometres in the Eastern Goldfields of Western Australia, approximately 85 km northeast of Laverton and 95 km west of the world-class Gruyere gold mine. The project is readily accessible via the Great Central Road which services the Cosmo Newbery community.

The project captures one of the last unexplored greenstone belts in Western Australia and with a strike length of 50 plus km, the Cosmo Newbery belt represents a large and prospective system with gold first being discovered in the area in the 1890s. Multiple historical gold workings are documented within the project area and work undertaken to date has identified multiple exploration targets for follow-up.

Despite this significant prospectivity, the project has seen virtually no modern explorationor drilling of merit due to a lack of land access persisting over a significant period. As a result, the project has not benefited from the evolution of geochemical and geophysical techniques which now facilitate effective exploration in deeply weathered and complex regolith settings which is particularly pertinent given approximately 75 per cent of the project area is undercover.

Following the relatively recent securing of land access, the project is now available for systematic and modern-day exploration programs to be conducted on a broad scale. It is anticipated that future exploration programs will initially follow-up preliminary targets generated from regional soil sampling and limited reconnaissance drilling programs, a majority of which extended to approximately five m below surface with a small percentage extending up to 30 m below surface.

Transaction and joint venture summary

Pursuant to the binding asset sale and purchase agreement executed by Sarama and a 100-per-cent-owned subsidiary with Cosmo Gold Ltd. and Adelong Gold Ltd., Sarama has acquired an initial 80 per cent of Cosmo's interest in the project.

An unincorporated joint venture has been formed between Sarama (via its subsidiary) and Cosmo on industry-standard terms to advance exploration on the project, with the initial participating interests being 80 per cent Sarama and 20 per cent Cosmo. The joint venture structure will ensure continuity of exploration and traditional owner relationships and provide for transfer of technical knowledge for the benefit of the project. Under the terms of the joint venture, Sarama has been appointed as operator and will assume sole responsibility for funding all activities on the project up to the point of a "decision to mine" being made. Within a two-year period following completion of the transaction, Sarama has, subject to the prior approval of TSX Venture Exchange, the right to acquire the remainder of Cosmo's interest in the project for consideration of $1.25-million (Australian), payable in cash or shares at Sarama's election. In the event the right is not exercised, the parties will continue under the established joint venture relationship. Upon a decision to mine being made, the parties will be required to contribute to joint venture costs in proportion to their participating interests. In the event a party does not contribute its share of proportional joint venture costs, the participating interest of that party shall be diluted according to an industry standard formula and if a party's interest is diluted to 10 per cent or less, that party's interest shall be automatically converted to a 0.5-per-cent net smelter return royalty and the non-diluting party shall have a 100-per-cent interest.

The following information is provided for exchange compliance purposes:

• The asset sale and purchase agreement in relation to Sarama, via a 100-per-cent-owned subsidiary, acquiring an interest in the project is dated Aug. 12, 2024, was fully executed Aug. 13, 2024, and disseminated on TSX Venture Exchange newswire services on Aug. 13, 2024, and on the Australian Securities Exchange (ASX) platform on Aug. 14, 2024. The transaction is being conducted at arm's length and no finders' fees are payable.
• In consideration for Sarama, via a 100-per-cent-owned subsidiary, acquiring an initial 80-per-cent interest of Cosmo's interest in the project, Sarama has made the following payments:
  • Cash consideration payment of $100,000 (Australian) to Cosmo;
  • Issuance to Adelong, as directed by Cosmo, of 25 million Chess depository instruments (CDIs) in Sarama and 7.5 million options (exercisable at five Australian cents/option for a period of two years after issue and converting to Sarama CDIs at a rate of 1:1) to settle and fully release Cosmo from indebtedness to Adelong;
  • Cash payments for project-related expenses of: approximately $76,000 (Australian) to various governmental agencies in connection with mineral tenure fees; approximately $139,000 (Australian) to various mining services suppliers in connection with soil geochemistry works; and approximately $112,00 (Australian) to native title groups in connection with land access agreement fees.
• Sarama advises it has issued news releases in relation to the acquisition of an interest in the project on the following dates:
  • Nov. 5, 2024;
  • Oct. 14, 2024;
  • Sept. 25, 2024;
  • Aug. 13, 2024;
  • July 16, 2024;
  • June 17, 2024.

Qualified person's statement

Scientific or technical information in this disclosure that relates to exploration is based on information compiled or approved by Paul Schmiede. Mr. Schmiede is an employee of Sarama Resources and is a fellow in good standing of the Australasian Institute of Mining and Metallurgy. Mr. Schmiede has sufficient experience which is relevant to the commodity, style of mineralization under consideration and activity which he is undertaking to qualify as a qualified person under National Instrument 43-101. Mr. Schmiede consents to the inclusion in this news release of the information in the form and context in which it appears.

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