AusQuest Limited reported results from the Reverse Circulation drilling program completed towards the end of last year at its Pirata Copper Project in Southern Peru, under the Strategic Alliance Agreement (SAA) with a wholly-owned subsidiary of South32 Limited (South32). The drilling program, comprising 21 holes for a total of 6,971m, was designed to test five porphyry and/or manto copper targets located within a major east-west structural corridor which is considered to be a priority target zone within the Coastal Belt of Peru and Chile for major copper deposits. AusQuest's Managing Director, Graeme Drew, said that while the initial drilling had not intersected a mineralised porphyry, the Company was very encouraged by the results, with future work to be discussed with South32 in the coming weeks.

Results from three of the five drilled targets indicate that the basal section of the lithocap has been intersected at each location with indications that mineralised porphyry systems are located in close proximity to, but off-set from, the current drill-holes. At Target 1 (where four drill-holes were completed), anomalous pathfinder elements including molybdenum (up to 21.3ppm Mo) and tellurium (up to 10.2ppmTe), as well as the presence of high temperature clay minerals (pyrophyllite) and white mica (sericite) indicate proximity to a porphyry source to the east of drill-hole PIRRC08 and to a lesser extent drill- hole PIRRC07. Thick pyrophyllite (+100m) within hole PIRRC08 suggests it is the closest drill-hole to the causative porphyry.

Narrow zones of elevated copper (up to 0.43% Cu) within sericite alteration suggest the potential for stronger copper mineralisation within the porphyry host, once it is located. At Target 2 (five drill-holes), the three northern drill-holes (PIRRC002, 03, & 04) intersected a relatively flat northerly dipping alteration zone, sub-parallel to an underlying lithological contact between intrusive monzonites and overlying volcanics. Anomalous pathfinder elements (Mo: up to 27.5ppm, Bi: up to 12.7ppm, and Te: up to 13.8ppm) and the presence of pyrophyllite (>30m) and white mica define alteration zones which again support the presence of a relatively close causative porphyry, probably to the north-east of current drill- holes.

Broad zones of elevated gold in PIRRC01 (90m @ 0.15g/t Au from 252m, including 2m @ 2.7g/t Au), and PIRRC03 (34m @ 0.52g/t Au from 272m, including 4m @ 2.2g/t Au) plus narrow zones (2 to 4m) of anomalous copper (up to 0.59% Cu) associated with potassic alteration within the underlying intrusive rocks, provide further evidence of the potential for base and/or precious metals to be found within the porphyry systems being tested. At Target 4, seven drill-holes on widely spaced drill sections (500m to 1000m apart) were completed to drill across magnetic targets associated with sparce outcrops of advanced argillic alteration (lithocap) containing occasional anomalous copper values (>500ppmCu). This target covers a large area (approx.

2km x 1km) with poor outcrop making geological correlations difficult. Thick lithocap (60m to +160m) as defined by the presence of pyrophyllite and white micas was intersected in three of the drill-holes (PIRRC010, 012, and 015) with the highest temperature micas occurring in drill-holes PIRRC010 and PIRRC012 suggesting they are closest to the causative porphyry. Highly anomalous pathfinder elements including Mo (up to 37ppm), Bi (up to 16ppm) and Te (up to 15ppm) plus patches of copper sulphide mineralisation (narrow intercepts (2m) of up to 0.39% Cu) intersected within alteration underlying the lithocap, support the concept of a mineralised porphyry system close-by, at relatively shallow depths.

Correlation with ground magnetic data highlights the low magnetic areas (possibly due to alteration) as potential targets to be considered for future drilling at this prospect. Drill results from Target 6 (two drill-holes) and in-fill drilling at the Cerro de Fierro South prospect (two drill-holes) failed to provide significant encouragement to continue exploring in these areas. Future work (including drilling) at the Pirata prospects is being discussed with South32 and will be considered under the SAA over the coming weeks.