Commencement of Ore Stacking & Production Schedule

13 May 2021

GOLDSTONE RESOURCES LIMITED

("GoldStone" or the "Company")

Commencement of Ore Stacking and

Increased Production Schedule

GoldStone Resources Limited (AIM: GRL), is pleased to announce that mining and ore stacking at the Homase Mine within its Akrokeri-Homase Gold Project ("AKHM") in Ghana has commenced with the first mined ore having been successfully stacked onto the heap leach pad.

Homase Mining Highlights 

·    First ore stacked on leach pad on 6 May 2021

·    The first two cells of the heap leach pad have been commissioned, enabling stacking to commence at a rate of 100 tonnes per hour, which is currently ramping up to a target of 200 tonnes per hour

·    80,000 tonnes of ore have been stockpiled, equating to around one month of mine production at full 3,000 tonne per day heap leach capacity

·    All crushing plant and stacking equipment has been tested and commissioned, and the dry plant is now operating on day shift

Mining and Production Schedule

Further to the increased mineable resource announced, 3 December 2020, and the Company's optimization review of the Homase Mine, GoldStone is also pleased to provide its planned mining schedule for the year ending 31 December 2021. 

The first eight months production of the Homase Mine is forecast to produce some 25,000 ounces of gold, at a total cash cost, pre-tax, of under US$600per ounce.  These figures have been derived by the Company, which believes the cash cost lies within the lower quartile of industry cost standards.

Table 1: 2021 Planned Mining Schedule

Planned gold production for the first eight months from commencement of mining now exceeds the Company's original guidance of 14,400 ounces per annum, stated in the Definitive Economic Plan ("DEP") announced on 19 June 2019. Accordingly, the Company expects to increase the planned production rate to around 50,000 ounces of gold per annum, which would represent an increase of more than 300% from the original production schedule. 

The Company is continuing to review the options available for extracting saleable gold from the loaded carbon it is producing, including toll treatment or expanding its own processing facility to include an elution plant and gold room. In this regard, Goldstone expects to make a decision shortly depending on the terms offered by existing third party processing facilities and any financing options that may be available, however notes that additional funding may be required in the coming months depending on the timing and cost associated with such arrangements.

The Company can confirm that mining operations, which began in April 2021, following the pre-stripping and clearing of the Homase mine site, continue to perform well. The daily mining rate and the growth in the primary and secondary run-of-mine stockpiles are performing at or above the targeted levels.

Following the increase in mineable resource and the optimization review, the Company is in the process of updating the DEP and we will update the market in Q3 2021.

Heap Leach Processing Plant

All of the mechanical and electrical components, associated with the dry plant, for the agglomerated ore transport and stacking has been assembled, it includes screening plant, grasshopper conveyors and an extendable stacker, which has been positioned and ore stacking has commenced.

The first two cells (combined area 13,000m²) of the heap leach pad, which will comprise a total of seven cells, for approximately 73,000m², have been commissioned, enabling stacking at an initial rate of 100 tonnes per hour to commence, which is ramping up to a target of 200 tonnes per hour / c.2,500 tonnes per day.

Cyanide has been delivered and other reagents are on site, with piping expected to be completed within the next two weeks followed by irrigation. 

Emma Priestley, Chief Executive Officer, commented: 

"After a tremendous amount of hard work by the entire GoldStone Team, invariably affected by Covid pandemic-related delays, we are pleased to inform our shareholders that we are now stacking ore onto the heap leach pads. This is a pivotal step in the evolution of the Company as we start production of the Homase Mine.  Commencement of operations will lead to an ongoing revenue stream and will also establish a base for unlocking value in our AKHM project.  I would like to thank the staff in Ghana for the successful start-up of the Homase Mine.

"Having already increased our gold resources, announced 3 December 2020, as a result of our exploration programme, we are now able to increase our planned production rate to around 50,000 ounces of gold per annum, including 25,000 ounces in calendar year 2021. This represents an increase of more than 300% from the original production schedule.

"A further benefit from the commencement of production at Homase is that exploration team will now be able to proceed with drilling the Homase Mineralised Trend that lies below and along strike of the current 602,000 ounce JORC resource, with a view to extending the mine's original 5 year life. The exploration team has previously limited its work on this initiative, as the production start-up at Homase has been the Company's priority".

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About GoldStone Resources Limited

GoldStone Resources Limited (AIM: GRL) is an AIM quoted exploration and development company with projects in Ghana that range from grassroots exploration to development.

The Company is focused on developing the Akrokeri-Homase project in south-western Ghana, which hosts a JORC Code compliant 602,000 oz gold resource at an average grade of 1.77 g/t.  The existing resource is confined to a 4km zone of the Homase Trend, including Homase North, Homase Pit and Homase South.

The project hosts two former mines, the Akrokerri Ashanti Mine Ltd, which produced 75,000 oz gold at 24 g/t recovered grade in the early 1900s, and the Homase Pit which AngloGold Ashanti developed in 2002/03 producing 52,000 oz gold at 2.5 g/t recovered.  It is the Company's intention to build a portfolio of high-quality gold projects in Ghana, with a particular focus on the highly prospective Ashanti Gold Belt.

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.