SOURCE ROCK ROYALTIES ANNOUNCES 2023 RESULTS INCLUDING RECORD ANNUAL & QUARTERLY FUNDS FROM OPERATIONS

SOURCE ROCK ROYALTIES ANNOUNCES 2023 RESULTS INCLUDING RECORD ANNUAL & QUARTERLY FUNDS FROM OPERATIONS

/Not for distribution to U.S. news wire services or dissemination in the U.S./

Source Rock Royalties Ltd. ("Source Rock") (TSXV: SRR), a pure-play oil and gas royalty company with an established portfolio of oil focused royalties, announces results for the three-month period and year ended December 31, 2023 .

Source Rock Logo (CNW Group/Source Rock Royalties Ltd.)

Annual Highlights:

  • Record annual royalty revenue of $6,646,326 1 , an increase of 2% over 2022.
  • Record annual funds from operations 3 of $5,653,618 ( $0.126 per share), an increase of 10% over 2022.
  • Record annual Adjusted EBITDA 3 of $5,793,204 ( $0.129 per share), an increase of 1% over 2022.
  • Record annual royalty production of 208 4 boe/d (93% oil and NGLs), an increase of 25% over 2022.
  • Declared $2,968,990 in dividends ( $0.066 per share), resulting in a payout ratio 3 of 53%.
  • Achieved an operating netback 3 of $76.30 per boe and a corporate netback 3 of $74.47 .
  • Completed $13.23 million of royalty acquisitions in central Alberta and S.E. Saskatchewan .
  • 26 gross horizontal wells drilled on royalty lands in S.E. Saskatchewan (24) and central Alberta (2).

Fourth Quarter Highlights:

  • Quarterly royalty revenue of $1,720,264 1 , an increase of 14% over Q4 2022.
  • Record quarterly funds from operations 3 of $1,663,376 ( $0.037 per share), an increase of 18% over Q4 2022.
  • Quarterly Adjusted EBITDA 3 of $1,525,386 ( $0.034 per share), an increase of 9% over Q4 2022.
  • Quarterly royalty production averaged 218 4 boe/d (94% oil and NGLs), an increase of 29% over Q4 2022.
  • Declared three monthly dividends of $0.006 per share, resulting in a payout ratio 3 of 49%.
  • Achieved an operating netback 3 of $76.06 per boe and a corporate netback 3 of $82.94 per boe.
  • Completed an $8 million royalty acquisition in the central Alberta Clearwater heavy oil fairway.

Financial and Operational Results


Three Months Ended December 31,

Year Ended December 31,

FINANCIAL ($, except as noted)

2023

2022

Change

2023

2022

Change

Royalty revenue

1,720,264 (1)

1,504,421 (2)

14 %

6,646,326 (1)

6,490,519 (2)

2 %

Adjusted EBITDA (3)

1,525,386

1,399,621

9 %

5,793,204

5,736,622

1 %

Per share (basic)

0.034

0.031

10 %

0.129

0.136

-5 %

Funds from operations (3)

1,663,376

1,411,440

18 %

5,653,618

5,128,706

10 %

Per share (basic)

0.037

0.031

19 %

0.126

0.121

4 %

Total comprehensive income (loss)

382,367

559,447

-32 %

1,566,310

2,558,054

-39 %

Per share (basic)

0.008

0.012

-33 %

0.035

0.060

-42 %

Per share (diluted)

0.008

0.012

-33 %

0.034

0.059

-42 %

Dividends declared

812,850

673,450

21 %

2,968,990

2,693,798

10 %

Per share

0.018

0.015

20 %

0.066

0.06

10 %

Payout ratio (3)

49 %

48 %

2 %

53 %

53 %

-

Cash and cash equivalents

1,462,040

13,152,502

-89 %

1,462,040

13,152,502

-89 %

Per share (basic)

0.03

0.29

-90 %

0.03

0.29

-90 %

Average shares outstanding (basic)

45,139,091

44,896,645

1 %

45,022,140

42,344,911

6 %

Shares outstanding (end of period)

45,231,645

44,896,645

1 %

45,231,645

44,896,645

1 %

OPERATING

Average daily production (boe/d)

218 (4)

169 (5)

29 %

208 (4)

166 (5)

25 %

Percentage oil & NGLs

94 %

92 %

2 %

93 %

92 %

1 %

Average price realizations ($/boe)

85.86

96.55

-11 %

87.54

107.28

-18 %

Operating netback ($/boe) (3)

76.06

90.02

-16 %

76.30

94.68

-19 %

Corporate netback ($/boe) (3)

82.94

90.78

-9 %

74.47

84.65

-12 %

(1)

Source Rock also benefited from $211,892 (Q4 2023) and $373,437 (fiscal 2023) of sales proceeds from royalty production that occurred after the effective date but prior to the closing date of acquisitions. These proceeds were accounted for as a reduction to the purchase price of the acquisitions.

(2)

Source Rock also benefited from $85,268 (Q4 2022) and $25,268 (fiscal 2022) of sales proceeds from royalty production that occurred after the effective date but prior to the closing date of acquisitions. These proceeds were accounted for as a reduction to the purchase price of the acquisitions.

(3)

This is a non-GAAP financial measure or non-GAAP ratio. Refer to the disclosure under the heading "Non-GAAP Financial Measures & Ratios" for more information on each non-GAAP financial measure or ratio.

(4)

Source Rock also benefited from 29 boe/d (100% oil & NGLs) for Q4 2023 and 12 boe/d (100% oil & NGLs) for fiscal 2023, of royalty production that occurred after the effective date but prior to the closing date of acquisitions.

(5)

Source Rock also benefited from 9 boe/d (100% oil & NGLs) for Q4 2022 and 2 boe/d (100% oil & NGLs) for fiscal 2022, of royalty production that occurred after the effective date but prior to the closing date of acquisitions.

2023 Reserves Information

Source Rock's reserves data and other oil and natural gas information, as required under National Instrument 51-101, will be filed on SEDAR+ at www.sedarplus.ca on or before April 29, 2024 .

About Source Rock Royalties Ltd.

Source Rock is a pure-play oil and gas royalty company with an existing, oil focused portfolio of royalty interests concentrated in southeast Saskatchewan , central Alberta and west-central Saskatchewan . Source Rock targets a balanced growth and yield business model, using funds from operations to pursue accretive royalty acquisitions and to pay dividends. By leveraging its niche industry relationships, Source Rock identifies and acquires both existing royalty interests and newly created royalties through collaboration with industry partners. Source Rock's strategy is premised on maintaining a low-cost corporate structure and achieving a sustainable and scalable business, measured by growing funds from operations per share and maintaining a strong netback on its royalty production.

Forward-Looking Statements

This news release includes forward-looking statements and forward-looking information within the meaning of Canadian securities laws. Often, but not always, forward-looking information can be identified by the use of words such as "plans", "is expected", "expects", "scheduled", "intends", "contemplates", "anticipates", "believes", "proposes" or variations (including negative and grammatical variations) of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements in this news release include statements regarding Source Rock's dividend strategy and the amount and timing of future dividends (and the sustainability thereof), the potential for future drilling on Source Rock's royalty lands, expectations regarding commodity prices, Source Rock's growth strategy and expectations with respect to future royalty acquisition and partnership opportunities, and the ability to complete such acquisitions and establish such partnerships. Such statements and information are based on the current expectations of Source Rock's management and are based on assumptions and subject to risks and uncertainties. Although Source Rock's management believes that the assumptions underlying these statements and information are reasonable, they may prove to be incorrect. The forward-looking events and circumstances discussed in this news release may not occur by certain dates or at all and could differ materially as a result of known and unknown risk factors and uncertainties affecting Source Rock. Although Source Rock has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements and information, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. No forward-looking statement or information can be guaranteed. Except as required by applicable securities laws, forward-looking statements and information speak only as of the date on which they are made and Source Rock undertakes no obligation to publicly update or revise any forward-looking statement or information, whether as a result of new information, future events or otherwise.

Non-GAAP Financial Measures & Ratios

This news release uses the terms "funds from operations" and "Adjusted EBITDA" which are non-GAAP financial measures and the terms "payout ratio", "operating netback" and "corporate netback" which are non-GAAP ratios. These financial measures and ratios do not have a standardized prescribed meaning under GAAP and these measures and ratios may not be comparable with the calculation of similar measures disclosed by other entities.

"Adjusted EBITDA" is used by management to analyze the Corporation's profitability based on the Corporation's principal business activities prior to how these activities are financed, how assets are depreciated, amortized and impaired, and how the results are taxed. Additionally, amounts are removed relating to share-based compensation expense, the sale of assets, fair value adjustments on financial assets and liabilities, other non-cash items and certain non-standard expenses, as the Corporation does not deem these to relate to the performance of its principal business. Adjusted EBITDA is not intended to represent net profit (or loss) as calculated in accordance with IFRS.

The most directly comparable GAAP financial measure to funds from operations is cash flow from operating activities. "Funds from operations" is defined as cash flow from operating activities before the change in non-cash working capital. Source Rock believes the timing of collection, payment or incurrence of these non-cash items involves a high degree of discretion and as such may not be useful for evaluating Source Rock's operating performance. Source Rock considers funds from operations to be a key measure of operating performance as it demonstrates Source Rock's ability to generate funds to fund operations, acquisition opportunities, dividend payments and debt repayments, if applicable. Funds from operations should not be construed as an alternative to income or cash flow from operating activities determined in accordance with GAAP as an indication of Source Rock's performance.

"Corporate netback" is calculated as funds from operations divided by cumulative production volumes for the period. Corporate netback is used by Source Rock to better analyze the financial performance of its royalties against prior periods and to assess the cost efficiency of its overall corporate platform as it relates to production volumes. There is no standardized meaning for "corporate netback" and this metric as used by Source Rock may not be comparable with the calculation of similar metrics disclosed by other entities, and therefore should not be used to make comparisons.

"Operating netback" represents the cash margin for products sold. Operating netback is calculated as revenue minus cash administrative expenses divided by cumulative production volumes for the period. Operating netback is used by Source Rock to assess the cash generating and operating performance of its royalties against prior periods and to assess the costs efficiency of its operating platform as it relates to production volumes. There is no standardized meaning for "operating netback" and this metric as used by Source Rock may not be comparable with the calculation of similar metrics disclosed by other entities, and therefore should not be used to make comparisons.

"Payout ratio" is calculated as the aggregate of cash dividends paid in a period divided by funds from operations realized in such period. Source Rock considers payout ratio to be a key measure to assess Source Rock's ability to fund operations, acquisition opportunities, dividend payments, cash taxes and debt repayments, if applicable.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy of this release.

SOURCE Source Rock Royalties Ltd.

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Forsys Metals Corp. (TSX: FSY) (FSE: F2T) (NSX: FSY) ("Forsys" or the "Company")

Forsys is pleased to provide an update for the Company's Norasa Uranium project ("Norasa 1 ") which comprises the deposits of Valencia Main and East, ("Valencia"), under Mining Licence (ML-149) and Namibplaas ("Namibplaas") under EPL-3638, (ML-251 pending).

Highlights

Forsys has undertaken a comprehensive review and update of all of the parameters for a Mineral Resource Estimate ("MRE") for the Norasa project using recent drill results together with the 2005-2011 previous MRE data. Confirmatory and geotechnical drilling, in conjunction with new survey information, including topographic surveys, down-the-hole optical televiewer surveys, trajectory surveys, and downhole gamma probe surveys, were used as inputs for mineral resource modelling. Re-interpretation of the previous database utilising all available data and modern estimation approaches has improved the definition of the MRE to more confidently support mine planning. This study, enhanced by an integrated and expanded drill program targeting existing and new areas together with a robust work plan of optimisation process testing and modelling, will help reinforce the upside potential of the Norasa project.

  • For the overall Norasa project, a conceptual pit constrained MRE for total deposits assessed from previous (2005-2011) and 2023 drilling results is estimated to be:
    • Valencia Main Measured and Indicated Resource at 40 ppm U 3 O 8 cutoff is estimated to be 152 Mt at 136 ppm eU 3 O 8 (equivalent U 3 O 8 ). Measured and Indicated contained metal is estimated at 45 Mlbs U 3 O 8 , at 40 ppm U 3 O 8 cutoff.
    • Valencia Main and East Inferred Resources are estimated at 5.7 Mt at 120 ppm eU 3 O 8 with 1.3 Mlbs U 3 O 8 contained metal oxide, at 40 ppm U 3 O 8 cutoff.
    • Namibplaas Inferred Resources are estimated to be 218.7 Mt at 85 ppm eU 3 O 8 with 41.1 Mlbs U 3 O 8 contained metal oxide, at 40 ppm U 3 O 8 cutoff.

Pine van Wyk, Country Director for Forsys commented: "The comprehensive work done over the last twelve months on the Norasa Uranium Project has created a solid foundation to advance project development.  The revised mineral resource model will help optimise the mine economics and process parameters. Results are expected soon from a column leaching test program currently being undertaken at SGS Laboratories in South Africa, which would establish the design basis of the planned heap leaching pads.  With the existing ML149 permitted to commence mining, the large scale Norasa project is well advanced to take advantage of the strong uranium sector fundamentals."

Mineral Resources
Results are reported from recent remodelling of historical (2005-2011) drilling and recent 2023 drilling results. The Mineral Resources are reported within US$120/lb U 3 O 8 pit shells, with a cut-off grade of 40 ppm U 3 O 8 for each of the deposits at Valencia Main and East, ("Valencia"), under Mining Licence (ML-149) and US$120/lb U 3 O 8 at 40 ppm U 3 O 8 cutoff at Namibplaas ("Namibplaas") under EPL-3638. The MRE are summarised as follows:

For the overall Norasa project, a conceptual open-pit shell constrained MRE for total deposits assessed from previous (2005-2011) and recent (2023) drilling results is estimated to be Measured and Indicated of 151.9 Mt at 136 ppm eU 3 O 8 , with contained metal oxide of 45.4 Mlbs U 3 O 8 at Valencia Main. Inferred Resources for the Norasa project are estimated to be 224.5 Mt at 86 ppm eU 3 O 8 , with contained metal oxide of 42.6 Mlbs U 3 O 8 (refer to Table 1):

  • Measured and Indicated: 151.9 Mt at 136ppm eU 3 O 8 , with contained metal oxide of 45.4 Mlbs for Valencia Main.
  • Inferred Resource for Valencia Main is estimated to be 4.7 Mt at 121 ppm eU 3 O 8 and 1.3 Mlbs eU 3 O 8 contained metal oxide.
  • Inferred Resource for Valencia East is estimated to be 1.0 Mt at 114 ppm eU 3 O 8 and 0.3 Mlbs U 3 O 8 contained metal oxide; and
  • Inferred Resource for Namibplaas is estimated to be 218.7 Mt at 85 ppm eU 3 O 8 and 41.1 Mlbs U 3 O 8 contained metal oxide.

Table 1: Mineral Resource Estimate for Norasa project as at 30 April 2024 at a 40 ppm U 3 O 8 cut-off grade.

Class Deposit Mass
Mt
(metric)
Average Grade
eU 3 O 8
(ppm)
Material Content
U 3 O 8
Mlbs
Contained Metal
U
tonnes
Measured Valencia East
Valencia Main 7.6 171 2.9 1,099
Namibplaas
Norasa 7.6 171 2.9 1,099
Indicated Valencia East
Valencia Main 144.3 134 42.6 16,368
Namibplaas
Norasa 144.3 134 42.6 16,368
Measured
&
Indicated
Valencia East
Valencia Main 151.9 136 45.4 17,467
Namibplaas
Norasa 151.9 136 45.4 17,467
Inferred Valencia East 1.0 114 0.3 97
Valencia Main 4.7 121 1.3 487
Namibplaas 218.7 85 41.1 15,817
Norasa 224.5 86 42.6 16,401


Notes:
1. All tabulated data have been rounded and as a result minor computational errors may occur.
2. Mineral Resources, which are not Mineral Reserves, have no demonstrated economic viability. There is no guarantee that all or any part of the mineral resource will be converted into a mineral reserve. The estimate of mineral resources may be materially affected by geology, environment, permitting, legal, title, taxation, socio-political, marketing, or other relevant issues.
3. The Mineral Resource Statement for Norasa as at 30th April 2024 is reported at a cut-off grade of 40ppm U 3 O 8 from within a conceptual pit-shell using the following assumed parameters:
  • Base Uranium Price –USD/lb U 3 O 8 : $120
  • Average Mining Cost at reference elevation (AISC) USD/tonne: Valencia Main $2.38; Valencia East $2.13; Namibplaas $2.29"
  • Average Processing Cost USD/tonne processed: $7.55
  • Average G&A Overheads USD/tonne processed: $1.04
  • Process Overall Recovery % U 3 O 8 Recovery: 85.0 %
  • Selling Cost Transport USD/lb U 3 O 8 : $1.29
4. From the assumed parameters, a 40 ppm U 3 O 8 cut-off grade was calculated, which together with the conceptual pit shell demonstrates reasonable prospects for eventual economic extraction (RPEEE) for the Mineral Resource. The assessment to satisfy the criteria of RPEEE is a high-level estimate and is not an attempt to estimate Mineral Reserves.

Mineral Resource Estimation Methodology

A summary of the Mineral Resource modelling methodology is as follows:

  • The Mineral Resource was modelled using a combination of Leapfrog Geo ® and Datamine Studio RM ® software.
  • Valencia Main and East data:
    • Comprise a combined dataset of 141 diamond (DD), 148 reverse circulation (RC) and 446 percussion (PC) type drill holes (Figure 1).
    • Borehole data from Valencia Main and East with XRF assay and calculated equivalent grades (eU 3 O 8 ) from gamma-probing for each of the deposits have been used to estimate the Mineral Resource.
    • Equivalent uranium grades have been factored to correlate practically well with the XRF data, which constitutes 25 % of the grade data.
    • Where XRF data are available these supercede the corresponding probe equivalent grade in the estimation data.
  • Namibplaas data:
    • Comprise a dataset of 530 percussion holes and 40 diamond drill holes (Figure 2).
    • Borehole data from Namibplaas XRF assay and calculated equivalent grades (eU 3 O 8 ) have been used to estimate the Inferred Mineral Resource.
    • Equivalent uranium grades constitute the majority of the grade data and where XRF data are available, ~3.5 % of all grade data, these supercede the probe derived values.
  • Wireframe interpretations of the logged lithologies were used to define the various geological units.
  • Mineralisation is strongly associated with alaskite intrusions, that are in turn controlled by a structural architecture that comprises folded and planar strata surfaces, and fold-associated shears and cleavages. Importantly, the orientation of marble strata is a major control on the distribution of uranium mineralisation for REDOX chemistry reasons, at Valencia and the Erongo region alaskite deposits as whole. The alaskite orientations are therefore strataform, except where they have invaded sheared and strongly cleaved antiformal hinge zones, as at Valencia Main. In order to honour the geological controls in the estimates various surfaces were modelled:
    • String interpretations of the "stratiform" intrusions were digitised in cross-section and were used to create median surfaces for each of the intrusions.
    • The resulting mineralised zone wireframes align with the lithological strata while also cross-cutting the strata in places to accommodate axial-planar mineralisation orientations (see Figure 3).
    • The surfaces were then used to guide the orientation of the grade estimate through interpolation of individual dip and dip directions for each model block.
  • The geometry of the Namibplaas deposit comprises stratiform lithologies that dip toward the southwest. The alaskite intrusives have intruded in a strataform manner and have exploited disruptions in the overall fabric, such as local fold flexures and dilation zones associated with the NE-SW regional extensional setting. In order to honour the geological controls at Namibplaas in the estimates various surfaces were modelled with guidance from the directions of greatest structural continuity to guide implicit modelling:
    • Along the strike and dip direction of the host metasediments, and
    • Along a shallow-plunging hinge structure that is oriented to the NE, parallel to the regional extension regime.
    • Considering that mineralization at Namibplaas is strongly associated with the granitic intrusions, string interpretations of the mid-points of these "stratiform" intrusions were digitized in cross-section, thereafter linked to create median surfaces of each of the alaskite intrusions (see Figure 4).
    • The surfaces of the intrusions were then used to guide the orientation of the grade estimate through interpolation of individual dip and dip directions for each model block.
  • Grade shells using a 40 ppm U 3 O 8 threshold were constructed using Leapfrog ® implicit modelling with directional control surfaces from the geological model.
  • The model volumes were divided into four domains at Valencia Main and two domains at Namibplaas. Each domain is distinct in terms of its geographic/geometric position as well as statistical / geostatistical parameters.
  • Ordinary kriging estimation used three-dimensional directional variograms to estimate U 3 O 8 grades within the mineralised zones for Valencia Main and Namibplaas. Inverse distance squared interpolation was used for Valancia East. The models underwent validation by comparison of estimated grade values against input sample grades, both visually and statistically.
  • Volumes covered by 30 m drill-spacing were classified as Indicated Mineral Resources at Valencia. All blocks outside of these volumes within the grade shells that received a grade estimate during the interpolation runs were considered Inferred.
  • At Namibplaas, although the tight drill spacing of approximately 30 m provides dense coverage of the deposit, the predominance of probe-derived eU 3 O 8 assays warrants a confidence level for an Inferred Resource.

30 April 2024 MRE block model and US$120/lb U3O8 pit shells at Valencia Main and Valencia East, ML 149.

Figure 1: 30 April 2024 MRE block model and US$120/lb U 3 O 8 pit shells at Valencia Main and Valencia East, ML 149.

30 April 2024 MRE block model and US$120/lb U3O8 pit shells at Namibplaas, EPL 3638.

Figure 2: 30 April 2024 MRE block model and US$120/lb U 3 O 8 pit shells at Namibplaas, EPL 3638.

Figure 3 part 1.Figure 3 part 2

Figure 3:  Shows the stacked concordant surfaces generated parallel to the 3 marble bands and orientation of mineralisation aligned with the strata and axial planar cleavages in the fold hinge (guiding surfaces hidden) at Valencia.

Shows alaskite midpoint strings (yellow) linked in parallel to the the NE-SW oriented strike of the deposit.

Figure 4:  Shows alaskite midpoint strings (yellow) linked in parallel to the the NE-SW oriented strike of the deposit.

In accordance with National Instrument 43-101 ("NI 43-101") a Technical Report outlining the mineral resource estimation will be filed under Forsys' profile on SEDAR+ ( www.sedarplus.ca ) within 45 days of the date of this release.

Assaying and QAQC

  • Recent (2023) Sampling and Assays
    • Samples were taken from the diamond drill cores and RC chips for geochemical assay guided by the routine downhole radiometric probe results, and sent to Trace Elements Analysis Laboratories (Pty) Ltd ("TEA Labs") at Swakopmund for sample preparation and analyses by XRF. For internal quality control purposes TEA Labs has weekly round robins with independent laboratories at Rosh Pinah, Swakop Uranium and Langer Heinrich mines.
    • Forsys employs a QAQC programme with Certified Reference Materials (CRMs), blanks, coarse duplicates and pulp duplicates inserted into each batch of samples. The QAQC insert rate comprises 4 % CRMs using three CRM types with different grades of U 3 O 8 ; 4 % blanks and 8 % to 10 % duplicates. RC sample batches have three types of duplicates; a field duplicate split at the drill rig; a coarse duplicate split at prescribed intervals at the laboratory; and pulp duplicates, also split at the laboratory. Core samples only have coarse and pulp duplicates split at the laboratory.
    • Four-percent of the samples sent to TEA Labs are sent for check analyses at SGS Laboratories (SGS) in South Africa, which serves as the independent accredited laboratory. The sample results are further validated by comparison with the radiometric scans.
  • Previous Sampling and Assays (2005-2011 Valencia Uranium Limited (VUL)):
    • All diamond drill half core and RC samples collected by VUL were assayed at the Setpoint Technology ("Setpoint") laboratory in Johannesburg, South Africa. Setpoint was accredited with the South African Accreditation System (SANAS), accreditation number T0223, and was also an ISO17025 accredited laboratory. Setpoint crushed and pulverised the samples for analysis of U 3 O 8 using the XRF pressed pellet method.
    • The VUL protocols for the QAQC were as follows:
      • CRMs inserted at a frequency of at least one per 20 samples.
      • Blanks inserted at a frequency of at least one per 50 samples.
      • Duplicates taken at a frequency of at least one per 20 samples.
    • The Setpoint laboratory included appropriate quality assurance and quality control (QAQC) procedures during the analysis of the VUL samples by including its own certified reference standards (CRM), blanks and duplicates.
    • VUL percussion holes were not physically sampled. Datasets were derived from two downhole probes that were calibrated against the XRF sample assays.
    • Snowden reviewed the assay results from Setpoint for the Valencia deposits in 2009 2 for the purposes of resource estimation and considered the QAQC results to be of a high standard of precision, unbiased and accurate.
    • Optiro reviewed the assay results from Setpoint for the Namibplaas deposit in 2011 and considered that the results of the QAQC indicate a high level of precision with no bias, no significant contamination and a high degree of accuracy (from Snowden 2009 2 and Optiro 2011 3 )
  • Trekkopje Exploration (Goldfields 1974-1984):
    • Exploration data derived from Trekkopje Exploration era, up to and including 1984, have not been verified by the QP and therefore were not utilised in this Mineral Resource Estimate.

Workplan

Forsys is undertaking an infill and extension drilling program and optimisation work with the aim of expanding and upgrading the Mineral Resource:

  1. Resource Infill Drilling and Resource Extension Drilling
    Total of 85 percussion drill holes for 7,520 metres have been laid out on a 25 x 25 metre grid. The objective is to more than double the quantity of the Measured Mineral Resource. The holes target the 660 m elevation with drill depths up to 100 m from surface and is comparable to the previous Measured Resource grid.

    A subsequent program for potential resource extension is planned for the areas adjacent to the Valencia Main deposit; along strike to the west, on the hinge zone to the south, and north of the Main deposit at the Jolie Zone.
  2. Pit Design Modeling
    The updated resource block model is used to assess open pit economic models. Pit slope design parameters are being reviewed to include lithological logging and geomechanical test work from additional drilling.
  3. Column Leaching Process Optimization Work
    Column Leach tests are presently underway at SGS in South Africa where the columns have been emptied and final analyses and data is pending. The next phase of testing will assess systematic processes to enhance the efficiency and effectiveness of extracting the uranium mineralisation from the ore using sulphuric acid solutions.
  4. Process Design
    DRA Global were appointed as the study contractor to deliver engineering to support preliminary cost estimates for a heap leach process. Ongoing engineering and optimisation continues.
  5. Bulk Sampling
    After site assessment and selection, a detailed plan is being drawn up to develop a box cut with the objective of retrieving approximately 20,000 tonnes of typical run-of-mine, fresh and representative sample material from the deposit.

Qualified Persons Statement for Metallurgy
Mr Aveshan Naidoo is a Specialist Engineer: Hydromet and Economics, for DRA South Africa Projects (Pty) Ltd of Building 33, Woodlands Office Park, 20 Woodlands Drive, Woodlands, Sandton, 2080. He holds a Bachelor of Science in Chemical Engineering and a Master of Business Administration at the University of Witwatersrand. He is a registered Professional Engineer with the Engineering Council of South Africa (Registration No. 20130523). Mr Naidoo has been practising his profession continuously since 2008 and has 16 years of experience across a range of African projects. He is familiar with NI 43-101 and, by reason of his education, experience, and professional registrations, he fulfils the requirements of an independent Qualified Person as defined in NI 43-101.

Qualified Persons Statement for Mineral Resource
The information in this release that relates to the updated Mineral Resource Estimate for the Norasa Project is based on information compiled or reviewed by Dr Guy Freemantle of The MSA Group (Pty) Ltd., Johannesburg, South Africa. The MSA Group are independent consultants to the Norasa Project, Namibia.  Dr Freemantle holds a Bachelor of Science in Geology and a PhD in Geology, both at the University of the Witwatersrand. He is a member of the Society of Economic Geologists (892905); a Fellow of the Geological Society of South Africa (965392); and is registered with SACNASP (Registration 117527). Dr Freemantle has practiced his profession continuously for 14 years and has sufficient experience and knowledge that is relevant to the style of mineralisation and type of deposits under consideration as well as to the activity that is being undertaken to fulfil requirements of a Qualified Person as per NI 43-101. Dr Freemantle consents to this release in the form and context in which it appears.

About Forsys Metals Corp.

Forsys Metals Corp. (TSX: FSY, FSE: F2T, NSX: FSY) is an emerging uranium developer focused on advancing its wholly-owned Norasa Uranium Project, located in the politically friendly jurisdiction of Namibia, Africa. The Norasa Uranium Project is comprised of the Valencia Uranium deposit (ML-149) and the nearby Namibplaas Uranium deposit (EPL-3638). Further information is available at the Company website www.forsysmetals.com

On behalf of the Board of Directors of Forsys Metals Corp. Richard Parkhouse, Director, Investor Relations.  For additional information please contact:

Pine van Wyk, Country Director, Forsys
email: pine@forsysmetals.com

Richard Parkhouse, Director, Investor Relations
email: rparkhouse@forsysmetals.com email: info@forsysmetals.com
phone : +44 7730493432

Nikolas Matysek,  Communications Manager (Canada)
email: nmatysek@forsysmetals.com

Forward Looking Statement

Certain information contained in this press release constitutes "forward-looking information" , within the meaning of Canadian legislation. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur", "be achieved" or "has the potential to". Forward looking statements contained in this press release are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations. Among those factors which could cause actual results to differ materially are the following: market conditions and other risk factors listed from time to time in our reports filed with Canadian securities regulators on SEDAR at www.sedar+.com. The forward-looking statements included in this press release are made as of the date of this press release and Forsys Metals Corp disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by applicable securities legislation.

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