PNX Metals : Gold Mineralisation Extended at Cookies Corner

Level 1, 135 Fullarton Road Rose Park, SA 5067 Australia

ASX Announcement

29 January 2019

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Gold mineralisation extended at Cookies Corner, NT

• • New gold mineralisation intersected in follow-up RC drilling at the Cookies Corner Gold prospect with the known strike extent increased to more than 800 metres

• • Eight RC holes were drilled and three original holes extended with all holes drilled to date intersecting gold mineralisation. Results from this drilling include:

  • o 2m at 4.35 g/t Au from 61 metres in CCRC018 (new hole), and

  • o 11m at 1.13 g/t Au from 75 metres in CCRC023 (new hole),

  • o 6m at 1.82 g/t Au from 133 metres in CCRC003 (extended hole), and

  • o 4m at 2.12 g/t Au from 44 metres in CCRC004 (extended hole),

• • A further 12 holes remain to be drilled as part of this program which will be completed during the 2019 field season, expected to commence from April

PNX Metals Limited (ASX: PNX) ("PNX" or "the Company") is pleased to advise that assay results have been received from its latest program of reverse circulation (RC) drilling completed in late 2018 at its Cookies Corner prospect, located less than 30km from PNX's flagship Hayes Creek zinc-gold-silver project in the Pine Creek region of the Northern Territory.

The objective of this program was to extend gold mineralisation discovered in August 2018, and to increase confidence in the continuity of mineralisation to estimate a mineral resource to augment the Hayes Creek project.

Based on the assay results PNX has extended the near-surface gold mineralisation at Cookies Corner down-dip, along section (width) and along strike, with multiple zones intersected. Continuity along strike is excellent and mineralisation also appears to be thickening at depth (Figure 1).

As part of this program eight new holes were drilled and three previously drilled holes that ended in mineralisation were extended. A further twelve planned holes were deferred until the 2019 dry season due to wet weather access limitations (Figure 2). Drilling is expected to recommence from April when access and ground conditions should improve. On completion of the planned drilling PNX expects to be in a position to estimate a near-surface potentially open-pittable gold mineral resource.

The three extended holes, CCRC003, CCRC004 and CCRC008 highlight new areas of gold mineralisation that remain open at depth, indicating the potential for a larger gold system than originally anticipated, with better results including:

• o 6m at 1.82 g/t Au from 133 metres in CCRC003, and

• o 4m at 2.12 g/t Au from 58 metres in CCRC004

1

Drill holes CCRC017, CCRC018, CCRC019 were drilled to test for mineralised extensions 25m to the east and hole CCRC023 was drilled 25m to the west of PNX's initial drill program. All four holes intersected open gold mineralisation extending the width of the mineralised zone to at least 100m. Highlights include:

• o 4m at 2.86 g/t Au from 35 metres in CCRC017

• o 2m at 4.35 g/t Au from 61 metres in CCRC018, and

• o 11m at 1.13g/t Au from 75 metres in CCRC023

Holes CCRC020, CCRC021 and CCRC022 were designed to test the depth extent of high-grade rock chips sampled from outcrop at surface and soils anomalism along the NNW 'rabbit's ear' trend. All three holes intersected narrow lower grade gold mineralisation high up in the hole which is associated with quartz veining in the same lithology as drilled to the south. Three previously planned holes will be drilled down-dip during the 2019 dry season to extend this zone at depth.

A number of untested NE-SW trending gold bearing quartz veins associated with NE-SW trending parasitic anticlines have also been identified at surface through mapping and rock chip sampling and these will also be tested as part of the next drill campaign.

The Cookies Corner prospect is one of a cluster of gold targets located in the north-west of PNX's Burnside exploration project (Figure 2) and is situated at the convergence of two major gold-producing structural corridors, the Pine Creek Shear Zone and the Howley Anticline (host to Kirkland Lake Gold Limited's Cosmo gold mine). The associated geochemical anomaly is directly analogous to that observed over the historic Goodall Mine located 4km to the south-west. Goodall was discovered via geochemical sampling in 1981, mined from 1988-1993 and produced, on average over that time, 41,500 ounces of gold per year.

Managing Director Comment

PNX Managing Director James Fox said: "This is an exciting development with gold mineralisation now defined over an 800 metre strike extent, and 100 metre lateral extent that remains open in all directions, including at depth. It is encouraging to see the thickness of mineralisation increasing in the fresh rock and an increase in quartz veining and sulphides downhole that appears to be directly associated with the gold. New areas of gold mineralisation have been identified that remain open at depth, indicating the potential for a larger gold system than originally anticipated.

The drilling completed to date has reinforced our belief in the scale potential of Cookies Corner prospect and we look forward to re-commencing drilling.

Additionally, as we continue to develop our understanding of the controls over the gold mineralisation at Cookies Corner, we plan to apply this knowledge to a number of similar untested gold in soils anomalies in the area to continue the growth of our gold resource inventory in parallel with developing the Hayes Creek project."

Figure 1: Cross Section with interpreted zones of mineralisation (Location of this Cross section is shown in Figure 2)

Figure 2: Cookies Corner plan showing PNX completed drilling (with select holes shown and cross section (yellow line) in Figure 1), gold-in-soil anomaly and target structure on geology.

PNX holds a 90% interest (excluding uranium) in the Burnside project (16 tenements) covering ~940 km2 in the Pine Creek region of the NT, proximate to the proposed mine infrastructure at Hayes Creek1

Cookies

Corner prospect

Figure 3: NT Project locations

Competent Person's Statement

The information in this report that relates to Exploration Results is based on information compiled by Mr Bradley Ermel, a Competent Person who is a Member of the Australasian Institute of Geoscientists (AIG). Mr Ermel has sufficient experience relevant to the style of mineralisation and the type of deposits under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr Ermel is a permanent employee of PNX Metals Ltd and consents to the inclusion in this report of the matters based on his information in the form and context in which it appears.

For further information please visit the Company's websitewww.pnxmetals.com.au or contact us:

James Fox

Managing Director & CEO Telephone: [phone]

1 Refer ASX release 18 August 2014 for full terms of the farm-in, and ASX release 14 December 2018 for completion of the farm-in.