Acquisition of La Fortuna Gold-Copper Project Strengthens Jadar’s Latin America Precious Metals Portfolio

10 December 2020

Highlights

-          Jadar Resources has signed an option to acquire a 100% interest in the 2,707.2 hectare La Fortuna gold-copper project in Guerrero, Mexico.

-          The project is located in the prolific Guerrero Gold belt, which hosts several multi-million-ounce gold projects.

-          La Fortuna is highly complimentary to the recently acquired Tierra Blanca[i] project also located in Mexico and adds to Jadar’s growing Latin American precious metals portfolio which also includes the Yanamina Gold Project located in Peru[ii].

-          Significant exploration activity undertaken by previous owners has provided a number of potential near-term targets for drilling following exercise of the purchase option.

-          Geological mapping, rock chip sampling, IP and Magnetic Surveying have been completed with sample values of 2161ppb Au and 13000ppm Cu being recorded.[iii]

-          Magnetite-gold-copper skarn mineralisation has been identified on surface with a TMI defined magnetite zone of >300,000m2. Multiple drill-ready targets.

-          Cu & Au in-soils anomalism >2,000,000m2. High value, (>100ppb) Au in-soils anomalism >300,000m2 up to 2.16g/t Au in-soils.

-          Other prospects on the large tenement holding have had previous samples taken averaging 220g/t Ag, 5.2% Zn and 4.5%Pb from 10 old dump and rock chip samples.

-          The acquisition terms are highly attractive with predominately share based milestone payments and allowing for minimum upfront spend by Jadar.

Jadar Resources Limited (ASX:JDR) (“Jadar”, the “Company”) is pleased to announce it has reached agreement with the shareholders of Minera GS S.A de C.V (“Minera GS”), a privately owned Mexican company,  for an option to acquire 100% of the la Fortuna Property, located 270km south west of Mexico City in the Guerrero Gold Belt. The area is accessible via a network of tracks, all of which will be advantageous for Jadar both in terms of upcoming exploration and a potential future mining operation.

This transformative acquisition is highly complementary to the recently acquired Tierra Blanca project[iv]  also located within Mexico, and further strengthens the Company’s presence in country. Additionally, with the establishment of Jadar’s Latin American focused management team located in Mexico the Company is well placed to drive exploration activities and seek additional acquisition opportunities.

The la Fortuna Project held under Titulo 243345 has demonstrable potential to host a substantial gold-copper project, and a substantial body of work to date has determined at least 5 targets for near term drilling.

During the Option Period, the modelling of the extensive data on the project will be finalised, to expedite the siting and permitting of drill holes.

Jadar Resources’ Executive Director Adrian Paul commented:

“The acquisition of la Fortuna is a huge success for the Company and adds to our growing Latin Amercican portolfio. With our in country team, lead by Hugh Callaghan, on the ground in Mexico the company is perfectly positioned to begin planning exploration activities and look for further complimentary acquisitions in Latin America.

The project hosts a number of potential drill ready targets with extensive exploration work carried out to date by previous owners, and with a number of major mines and advancing projects in Guerrero Gold belt Jadar looks forward to progressing exploration activities at la Fortuna.”

Guerrero Gold Belt

The la Fortuna project lies within the prolific Guerrero gold belt where several major mines and projects have been discovered and developed (Fig. 1). The majority of the large projects demonstrate open pit projects with heap leach processing.

Figure 1 - Map Overview of the Guerrero Gold Belt

Major mines and advancing projects in this belt which illustrate the prospectivity of the area include:

Mineralisation in the Guerrero Gold Belt is related to gold-bearing iron skarn porphyries and occur within faults and as replacement deposits formed in, and around, the igneous intrusions.

The Guerrero Gold Belt contains tertiary tonalite, granodiorite and monzodiorite porphyries intruded into cretaceous limestones and sandstones. Skarn zones exist between the igneous intrusions and the carbonate-rich country rock, and within them iron minerals dominate.

Coaxtlahuacan Prospect

The Coaxtlahuacan prospect will be the priority for immediate focus, and can be rapidly advanced to drilling. The outcropping copper mineralisation at Coaxtlahuacan consists of chalcocite and malachite and is associated with stockworks, massive lenses and disseminations of magnetite, or sericite altered quartz felspar porphyry.

The surface geology and spatial distribution of gold and copper mineralisation at Coaxtlahuacan conforms with the well-documented geology and geochemistry, and the well understood controls on mineralisation, of numerous significant polymetallic skarn deposits within the Guerrero Belt.  Coaxtlahuacan and Guerrero Belt deposits all demonstrate intrusive-related, polymetallic mineralisation at or near the contact with limestone.

Figure 2 – La Fortuna tenement area, geology and prospects

The visible surface showings of copper and gold mineralisation occur over an area of 100m x 500m in gullies and other topographically lower extents of the large geochemical anomaly.

The copper mineralisation (>500ppm Cu) occurs in a large anomaly 300m x 500m in extent and was observed only in gullies due to pre-erosion, near-surface weathering and leaching of the copper. Several rock chip samples taken assayed in excess of 5000ppm (0.5% Cu).

Figure 3 - La Fortuna tenement area overlain with copper soil samples

A substantial gold anomaly is identified in the North and East adjacent to ground magnetic highs and within an area of saprolite cover.

Figure 4 - La Fortuna tenement area overlain with gold soil samples

The gold in soils geochemistry demonstrated significant values (>50ppb Au) over an area of 1.3km x 1.6km in extent. Within this zone, in an area of 1500m x 200m is a particularly strong anomaly demonstrating values greater than 100ppb Au and as high as 2161ppb Au. This anomaly is open to the North West and the South and suggests potential for a substantial disseminated and stockwork gold mineralisation, with the likelihood that the copper was leached out near-surface and may be encountered lower in the system.

Drilling targets will be prioritized in these areas with the intent to delineate a potential gold-copper resource.

La Fortuna Project Geology and Mineralisation

The core of the system is located north of the town of Coaxtlahuacan and is best described as a northerly plunging sediment-sill complex of Early Tertiary granitoids on the order of 1000 m thick that intrudes Middle Jurassic to Middle Cretaceous marine sediments and limestones. Copper and gold occur with magnetite in this complex as: (i) stockworks, (ii) disseminations and pods, and (iii) possibly as large scale magnetite-replaced rafts (xenoliths) of limestone (iron skarn). This area may have open-pit or underground mine potential.

Peripheral parts of the area are characterized by gold and base metal rich quartz veins and sulphide-rich carbonate-hosted replacement deposits (CRD’s) with underground mine potential.

Work to date includes extensive mapping, rock chip sampling Fire-assay and ICP multi-element geochemical data for 118 stream sediment samples, 10,649 soil samples and 520 surface rock chip samples taken from lines 100-200m by 25m apart over most of the licence area (Refer to Appendix 2 – 5). 26 line kilometres of ground magnetic and Induced Polarization surveys of the Coaxtlahuacan prospect have shown coincident magnetic highs with strong copper and gold anomalies at surface (Fig. 2).

Figure 5  - Map showing Total Magnetic Intensity (coloured contours), Induced Polarisation stations and  location of chargeability anomalies (lines of red dots), gold and copper in-rock geochemistry, and Jadar’s initial drilling plan.

Jadar’s targeted Iron-skarns are characterised by magnetite-copper, gold mineralisation. At la Fortuna the TMI magnetic anomaly maps the surface observations of magnetite, which envelopes the location of elevated gold and copper surface samples (note: the location of the rock-chip samples is mostly limited to road and creek cuts. The spatial correlation between these key geochemical and geophysical anomalies is likely to be stronger defined with more intensive sampling). Drill collars C1 to C4 into IP chargeability anomalies were targeting the silica alteration zone common on the margins of the intrusive, heat and metal source of, skarn systems. The intersected argillic-altered, minor magnetite, gold, copper, Quartz Feldspar Porphyry (QFP) is interpreted to represent the intrusive core of the la Fortuna skarn system, providing a valuable South East vector to gold, copper, magnetite-rich mineralisation.

Key Option and Acquisition Terms

Jadar has entered into a term sheet with Dr Georg H. Schnura to secure a 90 day exclusive option to acquire 100% of the shares in Minera GS S.A de C.V, the company owning the la Fortuna Project, in return for a cash payment of US$50,000 and the issuance of 6,000,000 Jadar shares.

Upon exercise of the option, Jadar will acquire 100% of the shares of the company for the following consideration:

1. US$ 100,000 in cash and 15,000,000 shares in Jadar to acquire 50% of Minera GS on the expiry date of the option.
2. US$ 100,000 in cash and 15,000,000 shares in Jadar to purchase a further 30% of Minera GS within 12 months of the date exercise of the option
3. US$ 100,000 in cash and 15,000,000 shares in Jadar for the remaining 20% of the shares in Minera GS within 12 months of purchasing the 80% shareholding.
4. Net Smelter Royalty (NSR) of 1%.

Other Targets

The Espinoza and Fortuna Silver-Lead-Zinc targets identified within the project area demonstrate historical small-scale mining and are interpreted as a possible Carbonate Replacement Style deposit. At la Fortuna the average grade of 10 old dump and rock chip samples was assayed at 220g/t silver, 5.2% Zn, 4.5% Pb. While these prospects are a secondary priority behind the gold-copper at Coaxtlahuacan, they nevertheless present an intriguing and potentially fast track exploration and development option complementary in Jadar’s portfolio to the recently acquired Tierra Blanca project in Chihuahua State[x].

Future Plans

Jadar believes this acquisition is an excellent and potentially large-scale opportunity to build on its Latin American focused portfolio, with a project that will be ready to drill in the first half of 2021. The extent and grade of the mineralised anomalies suggest a rare opportunity to acquire a shallow gold-copper project at a time of excellent gold prices, but more importantly rapidly rising copper prices at a time when the market is facing a critical shortage of copper and outstanding market fundamentals.

About Jadar Resources Limited

Jadar Resources Limited (ASX:JDR) has acquired a strategically diversified asset portfolio, across Gold/Silver and Lithium/Borate, with projects at varying stage of exploration, across Peru, Serbia and Austria. Jadar aims to generate shareholder value through targeted exploration and development of these assets.

On 2 February 2020, Jadar announced that the Company had completed the acquisition of Minera Wealth Peru S.A.C., the holder of five concessions known as the Yanamina Gold Project. Following the acquisition of Yanamina, a Maiden JORC Resource Estimate was announced of 6,742,260 tonnes @ 1.23g/t gold and 4.31 g/t silver for 265,987 ounces of contained gold, and 934,528 ounces of contained silver, confirming the Yanamina Gold Project as a significant bulk mining development opportunity with strong economic potential[xi].

On 17th November 2020, Jadar announced the acquisition of the Tierra Blanca project, a silver zinc and Lead prospect in Chihuahua State, Mexico. The district surrounding Chihuahua is a significant silver producing region with several substantial mines operated by majors and mid-tier companies, District Historical Production of 50Mt at 310 g/t Ag, 8.2% Pb and 7.1% Zn[xii].

Tierra Blanca is a drill-ready project close to infrastructure and several processing plants. Sampling in an exploration drive has revealed high-grade zinc mineralisation outcropping to surface, with structural interpretation suggesting potential for high-grade silver at deeper levels[xiii].

The Company’s also holds a number of lithium assets located within Serbia and Austria adding additional diversification to the asset portfolio. Drilling is currently uinderway at the Weinebene Project in Austria which surrounds European Lithium Limited’s Wolfsberg lithium deposit with 11MT @ 1.0%Li2O[xiv].

ENDS

For further information, please contact:

Luke Martino

Non-Executive Chairman

Tel: +61 8 6489 0600

E: [email protected]

Adrian Paul

Executive Director

Tel: +61 8 6489 0600

E: [email protected]

This ASX announcement was authorised for release by the Board of Jadar Resources Limited.

Competent Person’s Statement

The information in this announcement that relates to the sampling techniques data and the reporting of exploration results is based on data compiled by Мr Howard Carr.  Mr. Howard Carr is a member of the Australian Institute of Geoscientists and has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the Joint Ore Reserves Committee (JORC) Australasian Code for Reporting of Exploration Results. Mr. Howard Carr consents to the inclusion in the report of the matters based upon the information in the form and context in which it appears.

The information in this market announcement is an accurate representation of the available data and studies. The Company confirms that it is not aware of any new information or data that materially affects the information included in those announcements.

Forward Looking Statements

Forward-looking statements are statements that are not historical facts. Words such as “expect(s)”, “feel(s)”, “believe(s)”, “will”, “may”, “anticipate(s)”, “potential(s)” and similar expressions are intended to identify forward-looking statements. These statements include, but are not limited to statements regarding future production, resources or reserves and exploration results. All of such statements are subject to certain risks and uncertainties, many of which are difficult to predict and generally beyond the control of the Company, that could cause actual results to differ materially from those expressed in,  or implied or projected by, the forward-looking information and statements. These risks and uncertainties include, but are not limited to: (i) those relating to the interpretation of drill results, the geology, grade and continuity of mineral deposits and conclusions of economic evaluations, (ii) risks relating to possible variations in reserves, grade, planned mining dilution and ore loss, or recovery rates and changes in project parameters as plans continue to be refined, (iii) the potential for delays in exploration or development activities or the completion of feasibility studies, (iv) risks related to commodity price and foreign exchange rate fluctuations, (v) risks related to failure to obtain adequate financing on a timely basis and on acceptable terms or delays in obtaining governmental approvals or in the completion of development or construction activities, and (vi) other risks and uncertainties related to the Company’s prospects, properties and business strategy.  Our audience is cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof, and we do not undertake any obligation to  revise and disseminate forward-looking statements to reflect events or circumstances after the date hereof, or to reflect the occurrence of or non-occurrence of any events.

To view entire original news in English language, please follow the link:

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[i] ASX Announcement 17 Nov 2020 - Jadar Portfolio Grows with Acquisition of Tierra Blanca Project in Prolific Mining District

[ii] ASX Announcement 2 Jan 2020 - Acquisition of Yanamina Gold Project Completed

[iii] PMY ASX Announcement 15 March 2018 – Pacifico Signs Options to Acquire Major New Gold-Copper Project in Guerrero Gold Belt of Mexico

[iv] ASX Announcement 17 Nov 2020 - Jadar Portfolio Grows with Acquisition of Tierra Blanca Project in Prolific Mining District

[v] Equinox company website - https://www.equinoxgold.com/operations/operating-mines/los-filos/

[vi] Torex Gold - Corporate Presentation - December 2020

[vii] Telson Mining company website - http://www.telsonmining.com/projects/campo-morado-mine/campo-morado-resource-summary/default.aspx

[viii] Alamos Gold Mineral Resource Statement - https://s24.q4cdn.com/779615370/files/doc_downloads/Alamos-2019-Reserve-Resource_FINAL.pdf

[ix] Argonaut Gold company website - https://www.argonautgold.com/English/assets/development/Ana-Paula/default.aspx

[x] ASX Announcement 17 Nov 2020 - Jadar Portfolio Grows with Acquisition of Tierra Blanca Project in Prolific Mining District

[xi] ASX Announcement 2 Jan 2020 - Acquisition of Yanamina Gold Project Completed, &

ASX Announcement 10 Jan 2020 Maiden JORC 2012 Resource of 265,987ozs Gold and 934,528ozs Silver at Yanamina

[xii] Ryana Silver Presentation - https://reynasilver.com/presentations/GuiguiProject.pdf

[xiii] ASX Announcement 17 Nov 2020 - Jadar Portfolio Grows with Acquisition of Tierra Blanca Project in Prolific Mining District

[xiv] ASX Announcement 17 Nov 2020 – First Explaoratory Drill Hole Underway at Weinebene Project, Austria