Advance Metals : Half Yearly Accounts

ADVANCE METALS LIMITED

ABN 83 127 131 604

CONSOLIDATED INTERIM FINANCIAL REPORT FOR THE HALF YEAR ENDED 30 JUNE 2023

Advance Metals Limited and its Controlled Entities

Interim Financial Report 30 June 2023

DIRECTORS' REPORT

The Directors of Advance Metals Limited ASX code: AVM (the Company) present their report for the half-year ended 30 June 2023. The Directors report as follows:

1. Directors
   The names of the Directors of the Company during the half-year and up to the date of this report are: Geoff Hill (Chairman) Appointed 15 May 2009
   Keith Middleton (Non-Executive Director) Appointed 1 February 2022 Melissa Sanderson (Non-Executive Director) Appointed 14 April 2022
2. Review of operations
   The consolidated loss after income tax for the half-year ended 30 June 2023 was $585,739 (2022: $712,935).
   During the first half of the year the Company expanded its US footprint by adding the Augustus Polymetallic Project in Arizona. The company announced (ASX: AVM 20 April 2023) it had staked the highly prospective Augustus project staked in a historic mining district in Arizona. 85 Federal Lode Claims registered over favourable geology. Historic geochemical samples identify the presence of copper (Cu), silver (Ag), gold (Au). Existing road and highway networks in place leading into the project area. The area was drilled previously by ASARCO, Teck (Cominco), Freeports and other junior mining companies.
   The Augustus project is high grade polymetallic project in West Central Arizona, approximately 43 km Northwest of Phoenix. The Company staked an area covering approximately 704 Hectares (1,741 acres) with favourable mineralisation and geology. The staking program was delivered on time and on budget.
   The project has vast amounts of historical exploration data available from work completed by major mining companies such as Teck, Asarco and Freeports. A historical assay from a rock chip
   sample shows copper grades of +2% copper, +24 g/t gold and 7.8 g/t silver.
   Between 1933 and 1956 the Bullard Mining District produced approximately 614,000 pounds of copper, 3,600 ounces of gold, and 15,000 ounces of silver from 17,000 tons of ore (Keith and others, 1983). (ASX: AVM 20 April 2023)
   The company prepared an extensive exploration plan activity for Augustus and continued working with USFS on its drilling permits for Garnet Creek. To support these activities the Company brought on new skills at the Management level with the hiring of US based executive Frank Bennet to lead the company moving forward. The company announced (ASX: AVM 7 June 2023) the appointment of US based Frank Bennett as CEO. Frank is a seasoned mining executive with expertise in building businesses in North America for both domestic and international organisations. During the period, the Company appointed Mr Frank Bennett as Chief Executive Officer based in the USA.
   Frank is an experienced senior executive who has worked for and consulted with multiple mining firms in the metals, coal, rare earths, and aggregate industries, including Newmont and MP Materials, as well as mining suppliers in the explosives, capital equipment, chemical, automation and ground support segments, including Austin Powder Company, Normet and Yokogawa.
   Most recently Frank has been advising major mining companies (with annual spend greater than $1B) on how to improve and reorganise their international and domestic supply chains. Frank has been extensively involved in international capital markets, with firms at various stages from startups to mineral producers. Highlights include negotiating a $100M debt facility through a JP Morgan consortium, leading investor road shows with UBS and JP Morgan as book-runners and preparing pre-IPO firms for public listing.
   The Company held its annual general meeting during the period and all resolutions passed and the company released its 2022 Annual Report to shareholders.

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Advance Metals Limited and its Controlled Entities

Interim Financial Report 30 June 2023

Also during the period the company engaged with recognised geological consultants with expertise in conducting exploration in Idaho and Arizona. The outcome of these activities resulted in the commencement of exploration activity occurring prior to the end of the half year at the Company's Augustus Polymetallic Project. The objective of the exploration activity is to work towards identifying a JORC compliant Exploration Target by:

• Collecting rock chip samples,
• Developing geological model, and
• Defining drill targets for the next round of exploration activity.

During the first half of the year, the Company commenced exploration activities at the Augustus Polymetallic Project. Activity was aimed at gaining a greater understanding of both the mineralisation potential over the project area and regionally if there were opportunities to expand the footprint of the Augustus Polymetallic Project even further. The exploration activity that commenced, included:

• A large scale mapping and sampling program
• Rock Chip Sampling and Analysis
• Structural Mapping and identification of alteration zones
• Mapping of mineralised areas
• Planning for drilling program
• Road mapping and drill pad locations
• Mapping historical data on the project

The Company continues to advance its Garnet Creek project as it awaits the approval of its drilling permits and has been in constant contact with the permitting regulator. Geochemical surveys including rock chip and soil sampling, geological mapping, and ground surveys have been completed and announced to market. The Company has taken an extensive review of all the project data over the last half and will update exploration targets that will be announced to the market once finalised.

The company has engaged copper and metals experts to review the current exploration as well historic data with the goal to complete a 3D model. The 3D model is currently being finalised and the company plans to upgrade its current JORC exploration targets using the model as well as new historic data. The company will update the market on these activities once they are complete.

AVM continues to work the US Forest Service on the permits it has submitted for drilling at the Garnet Skarn deposit. The agency has made a number of requests for the information and the company has

continued to supply this information. AVM hopes to have the permits approved and will update the market once complete.

The Company also has 100% ownership over the Anderson Creek Gold Project located in eastern Idaho. The Anderson Creek Gold Project was allocated exploration spending that aligned with the timing of Garnet Creek. Additional work on Anderson Creek included desktop analysis of historical aeromagnetic surveys that could assist to better understand the potential strike distance of the project. Concepts arising from this initial work is scheduled to be tested as part of the exploration program

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