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Exterra Resources Ltd advances profit share JV for Second Fortune Gold Mine

Exterra Resources Ltd (ASX:EXC) is progressing the development of the Second Fortune Gold Mine as part of its dual focus on two demand-driven commodities, gold and lithium.

Exterra is finalising documentation with Pybar Mining Services for a joint, profit share based development of the gold mine.

The profit sharing agreement and due diligence will be finalised within two weeks and the overall agreement is to be finalised by July.

The overall agreement is in the form of a binding term sheet and was entered into with Pybar during April.

Second Fortune is the company's most developed prospect within its Western Australian gold exploration portfolio, and is located within its wholly-owned Linden Gold Project 220 kilometres NNW of Kalgoorlie.

Second Fortune PFS outcomes on higher A$1,700/oz gold price

- Net cash flow of A$34 million after capital and State Royalties
- A discounted NPV of A$28.1 million
- Mining Inventory of 61,500 ounces of gold at 9.4g/t gold (diluted)
- Production (allowing for mill recoveries) of 56,600 ounces of gold
- C1 cash operating cost of A$720 per ounce of recovered gold
- C3 total cash cost of A$1,015 per ounce of recovered gold
- Low pre-production capital expenditure of ~A$5 million
- All regulatory approvals are currently in place to commence mining

Lithium portfolio

Exterra recently commenced exploration at the 90% owned Moolyella Lithium Project located in the proven Pilbara region of Western Australia.

Moolyella is located within a historical tin and tantalum producing district and proximate to Altura Mining Ltd's (ASX:AJM) and Pilbara Minerals Ltd's (ASX:PLS) lithium projects.

Moolyella is 100 kilometres east of Pilbara Minerals' resource measuring 80.2 million tonnes of mineralised spodumene pegmatites at 1.26% lithium.

Historical rock chip sampling over 2 square kilometres recorded highly anomalous values up to 1.82% lithium in pegmatite rocks.

An exploration crew will conduct re-sampling of historic reverse circulation drill hole chips, geological mapping and rock chip sampling.

Analysis

The Pybar/Exterra joint development of the Second Fortune Gold Mine leverages Exterra to a strong AUD gold price trading near its 3 year high at A$1,750 per ounce.

The Exterra share price is up 370% year to date trading at $0.047 per share.

Exterra has a portfolio of two key demand-driven commodities in gold and lithium with projects located in proven areas.

The Moolyella Lithium Project is located within a known lithium province that hosts companies who have seen up to a 10x uplift in their share prices.

Upcoming news flow for Exterra includes:

- An update on exploration activities at Moolyella;
- Finalisation of the profit share agreement and technical and legal due diligence for the Second Fortune Gold Mine;
- Exploration drilling at the Golden Orb and Hill East gold prospects within the Linden Project;
- Finalisation of the mining services agreement and toll treating agreement for the Second Fortune Gold Mine; and
- Further updates and field work at Grass Flat gold project.

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