4 January 2022

GOLDSTONE RESOURCES LIMITED

("GoldStone" or the "Company")

Update re Gold Loan and Operations

GoldStone Resources Limited (AIM: GRL) is pleased to provide an update regarding operations and the shipment of its Gold Loan payments.

Despite various setbacks which delayed our targeted production timetable, 2021 was an extraordinary year in GoldStone's development, with the Company achieving a number of key milestones, culminating in its transformation from a developer into a producer.  

As previously announced, in order to commence production of gold doré, the Company was required to build an elution and smelt house earlier in the production process than originally envisaged, however, the Board is pleased to have maintained its key objective, for Goldstone to be a low-cost developer.   Having achieved the key milestone of gold production, the Company's objective for the year ahead will be to ramp up operations to a steady state and achieve consistent production.

Gold Production and Loan Repayments

The gold pour announced 30 November 2021, to the amount of 14.46kg of gold doré, has been held in stock to accommodate the October and November 2021 Gold Loan payments to Asia Investments Management Services Limited ("AIMS"), which totalled 11 kilogrammes of gold bullion, as announced on 20 September 2021.

A further gold pour is targeted for early January 2022, and it has been agreed with AIMS that, in order to minimise shipment costs, the October and November 2021 payments will be shipped in January 2022, with no additional interest incurred.  The December 2021 Gold Loan Payment, 8kg of gold bullion, due to AIMS will accrue interest until shipment.

Production in 2022

The Company has, to date, recovered approximately 37kg of gold, of which 14.46kg are held as gold doré and the remainder in concentrate, with a second pour is anticipated in early January 2022.

The Company has stacked 108,000 tonnes of ore onto the heap leach pads which, at the grade of approximately 1.7g/t, equates to approximately 184kg of contained gold.   The Company has recovered approximately 20 per cent. of the contained gold, which was less than the expected recovery rate due to agglomeration issues. The Company is in the process of carrying out detailed test work and cost analysis to understand the leach kinetics within the heap so as to optimise the recovery the remaining contained gold.

The final engineering stages for Cell 3 of the heap leach pad, approximately 7,000m², is being completed, and the geofabric and geomembrane will be laid. The test work being undertaken on the existing leach pads, including our understanding of the previously encountered agglomeration issues, will feed into the stacking process design for Cell 3, so as to optimise recovery and ensure the cell is ready for stacking late in January 2022.

The initial planned mining rate for the first six months of 2022 is expected to be approximately 60,000 tonnes per month, which the Company then expects to increase in H2 2022. 

As with 2021, the Board expects this year to be very busy for GoldStone, as the Company progresses the development of the Homase Mine by optimising the heap leach process and ramping up production to achieve the previously planned production rate of 25,000 ounces of gold doré per annum. 

Exploration

The Company undertook a further geochemical soil sampling programme within the Homase and Akrokeri Licence areas (the "Licences"), as infill and seeking parallel zones of mineralisation, following the programme carried out in 2018.  In addition, soil sampling was undertaken at a former artisanal mining area in the far north of the Homase licence area.

At the former Akrokeri underground mine, a drilling programme has been set out and, subject to availability of a rig, exploration drilling is expected to start as soon as practicable.

Emma Priestley, CEO of Goldstone, commented:

"Whilst 2021 was a difficult year in a number of respects, it was also a year of change, as the Company transformed into a gold producer in challenging circumstances.  The Company nevertheless made good progress and has maintained its low cost base strategy, and the Board is grateful for the support of the Company's existing shareholders and new investors."

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About GoldStone Resources Limited

GoldStone Resources Limited (AIM: GRL) is an AIM quoted low debt, emerging gold producer via its 100% owned Homase Mine, which started production in 2021. GRL has one of the lowest debt to equity ratios of any emerging gold producer and when at full planned production of 2000oz pcm GRL expects an AISC of <USD600/oz.  Target for full production is mid-2022.

Located ~15km north-west of AngloGold Ashanti's Obuasi mine, in the mineral-rich and highly prospective Ashanti Goldbelt.  Homase Mine is a series of shallow open pits producing approximately 25,000oz pa of gold, with a recently commissioned CIC treatment plant, for the Heap Leach operation.  First gold was poured in November 2021, and the Company will be ramping up production during the first quarter 2022. 

The Homase Mine, hosts a JORC Code compliant 602,000 oz gold resource at an average grade of 1.77 g/t. This is confined to a 4km strike length, which the Company plans to explore, along strike and down dip, in order to expand on the known resource.  The mine was formerly operated by AngloGold Ashanti in 2002/03 producing 52,000 oz gold at 2.5 g/t recovered. 

The Company also hosts the former underground Akrokerri Ashanti Mine, which produced 75,000 oz gold at 24 g/t recovered grade in the early 1900s.  It is the Company's intention to commence exploration of this former mine in the near future.

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014 as it forms part of United Kingdom domestic law by virtue of the European Union (Withdrawal) Act 2018.