Hammer Metals : Yandal Exploration Update

ASX RELEASE

onlyDIRECTORS /

23 December 2021

MANAGEMENT

Russell Davis

Chairman

useDaniel Thomas Managing Director

Ziggy Lubieniecki Non-Executive Director

David Church Non-Executive Director

Mark Pitts Company Secretary

Mark Whittle

Chief Operating Officer

CAPITAL STRUCTURE

ASX Code: HMX

Sha e Price (22/12/2021) $0.048

Shares on Issue	815m
Mark t Cap	$39.1m
Options Unlisted	27m
Performance Rights	8m
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1. [phone] ABN 87 095 092 158

YANDAL EXPLORATION UPDATE

• Assays from Hammer's Bronzewing South project have now been received. 13 holes for 3,554m of reverse circulation drilling were completed
• The drilling intercepted the targeted geological horizon including several zones of intense shearing and quartz- carbonate veining. Limited low grade gold intercepts (<0.1g/t) were recorded at this target
• Multi-elementanalyses will be completed to confirm zones of alteration and potential vectors towards gold mineralisation
• The completed holes provide a platform for testing deeper targets with diamond tail extensions
• Targets to be pursued in 2022 include a drill out of potential shallow oxide gold resources at Target 1, North Orelia
• Target 1 drilling to include a follow up on the primary bedrock intercept in hole BWSRC028 of 4m at 6.3g/t Au from 77m (see ASX Announcement 9 November 2020). This mineralised zone remains open at depth and along strike to the north
• Historical data compilation of Harrier and Bower prospects has identified high priority soil anomalies which remain untested
• Former Bronzewing mine operators, View Resources and Navigator Resources recorded multiple gold soil anomalies with highs of 205ppb and 99ppb1
• These anomalies were planned to be tested with a 9km AC drilling program in 2012. Records indicate that Navigator drilled 21 holes of a 150-hole program before being placed in administration. Results from the initiation of this program (if assayed), were unable to be located

Hammer's Managing Director, Daniel Thomas said:

"Whilst no significant gold results were returned from our Bronzewing South program the drilling identified several alteration and shear zones indicating proximity to gold mineralisation. The limited dispersion of gold mineralisation is evident from the original discovery of the Bronzewing mine, with the discovery hole being a relatively low-grade intercept in air core drilling. With this evidence in mind, we are committed to pursuing the remaining targets within this corridor which could include the extension of the recently completed drill holes.

A number of other targets in our Yandal tenure continue to evolve. I look forward to the potential definition of a shallow oxide JORC resource at the Target 1 prospect at North Orelia in the new year along with other programs planned in our northern tenure and at Harrier and Bower to the east of Bronzewing mine."

1 See ASX Release: NAV: 21 April 2012 -- Navigator Resources Qtly Activities report March 2012

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P Unit 1, 28-30 Mayfair Street, West Perth, WA 6005	hammermetals.com.au

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Hammer Metals Ltd (ASX:HMX) ("Hammer" or the "Company") is pleased to provide an update on its Yandal exploration activities. The recently completed Reverse Circulation ("RC") drilling program completed 13 holes for 3,554m of reverse circulation drilling. This program focussed on the third of five modelled targets testing prospective positions south of the Bronzewing Gold Deposit (Figures 1 and 2).

Bronzewing South Target Zone

The drilling program focussed on the northernmost target position within the geological/structural corridor trending south of the Bronzewing Gold mine. Drilling confirmed the prospective rock units of the corridor between the Bapinmarra dolerite unit to the west and the eastern shear zone. Drilling intercepted the targeted units including several shear zones and zones of quartz/carbonate veining however no significant mineralisation was intercepted by the holes. 11 holes for 3,240m were completed.

To date only the gold analyses have been completed for this drilling. Multi-element analyses are awaited and will be used to better define the zones of alteration noted in the drilling and potentially act as vectors towards gold mineralisation. The completed RC holes will also provide excellent platforms for future diamond drilling tails should the targeted horizon be pursued at depth. Remaining targets (two of five) within this southern corridor remain valid and will be considered as part of future drilling programs within this target area.

Figure 1. Long section looking west through the Bronzewing South area showing the five targets identified in

the detailed gravity survey (See ASX Announcement 9 November 2020)

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Figure 2. Bronzewing South plan showing Hammer targets (See ASX Announcement 9 November 2020)

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Gummow Prospect

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The Gummow Prospect is located approximately 4.9km to the south of the Bronzewing Deposit. The prospect is located within a northwest trending shear zone traversing a tholeiitic basalt (similar to Bronzewing Basalt) between a felsic intrusive (interpreted to be a Discovery Granodiorite equivalent) and a coarse grained mafic (interpreted as the Madfish Basalt). Historic Aircore drilling, at 600m line spacing did not test the target and historic soil sampling indicates Au responses of up to 26ppb (Refer to ASX announcement dated 14 March 2019). Check soil sampling conducted by Hammer confirmed the anomalous soil response.

Drilling of this anomaly was limited to two holes(314m) with an initial intercept of:

1. 4m @ 0.18g/t Au from 40m in BWSRC048

The drilling in both holes intercepted a mafic sequence on the northern side of an interpreted felsic intrusive. Minor sulphidic veining was intersected which is associated with anomalous gold values.

Further investigation of this anomaly to be considered in a future air core program which is likely to include a program at the Harrier and Bower prospects.

North Orelia Target 1

Following a review of Hammer's 2020 Reverse Circulation program at North Orelia several opportunities for both exploration and resource definition remain outstanding.

The gold intercept in hole BWSRC028 of 4m at 6.3g/t Au from 77m (see ASX Announcement 9 November 2020 remains open at depth and along strike to the north (Figure 3). Whilst a number of other intercepts were recorded in air core and drilling within the weathered regolith, this intercept represents the most significant result in fresh rock. This intercept has not been tested to the north and remains open at depth.

Intercepts in the central zone at Target 1 and in the weathered regolith provide an opportunity for the definition of a shallow oxide gold resource (Figure 4). Historical intercepts in this zone include:

1. 8m at 4.2g/t Au from 20m in BWSRC0025 including 1m at 27.1g/t from 26m; o 5m at 3.5g/t Au from 25m in BWSRC0026 including: 1m at 16.6g/t from 25m; o 4m at 5.8g/t from 40m in BWSAC0434; and
   o 10m at 1.82g/at from 9m in BWSAC0121 including 3m at 5.8g/t from 12m

(See ASX announcement 9 November 2020)

A drilling program is currently being designed with a view to being commenced in the second quarter of 2022.

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Figure 3. Orelia Target 1 South - Primary Bedrock target

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